Bitcoin Forum

In 2013 bitcoin has more mainstream attention than ever before. With good and bad sides. Cyprus crisis had a major role in the price change. Cyprus being just a small island. What can happen if Greece has the same issues?

Also, what will happen this year with all the exposure? People do forget fast, but that's why we have internet. Bitcoin will sooner or later reappear on their screens. And then what?

It seems we are in the very beginning and people think it's already over. One single major exchange, one major btc-only business, a few people controlling large amounts of coins.

Just wait for the next little economic shock. People will run away from banks and fiat. Now they have options.

Cyprus hadn't had and effect except that existing Bitcoiners saw a reason to buy in more.


If you are looking for fundamentals look for websites accepting BTC directly as a donation to pay for hosting costs.

+1

I can bet "99,999% cyprus people never heard what is Bitcoin(word bitcoin WTF?) ?"

ElectricMucus - what is your opinion on BTC and it's price in general. I'm asking because you're the most efervescent here and I really want to know.

It changed very much over the time.
Initially I was your run-of the mill bull, hoping that bitcoin will change the world. Then after witnessing the whole drama surrounding Bruce Wagner, the advent of Bitcoinica I became very bearish. That attitude hasn't changed since. Still I kind of anticipated this bubble, although I didn't really capitalize as much on it ("only" 10x before the pop, which I have increased some since). You guessed it I think we are still in Bubble territory.
I became largely annoyed by the thing we call the cargo cult: Guys playing financial experts, playing monopoly man and chanting the gospel of Bitcoin to be the biggest best thing ever.

I don't really believe in things like Bitpay, other payment processing, Bitcoin ATMs, Bitcoin "Supernodes" or Bitcoin stock exchanges. I think Bitcoin is an incredible useful tool as a financing model for non-profit websites, small webhosts, oh and of course Silk Road and the rest of the online black market. I also like Satoshi Dice and Seals with Clubs, great. Bitcoin has already found it's niche. It can be incredibly successful in it, possibly it can even sustain prices like we have seen this month in a few years.
But the gold-rush mentality has to stop. Bitcoin currently doesn't work as a currency not because it has insufficient market cap but because the crazy price swings make it unsuited to use it as such unless absolutely necessary.

That is as I would like Bitcoin to be, idealistically. For me personally the more dumb money there is in it the better. The volatility is incredibly predictable which is great for my way of trading, I kind of expect it to last as long as the current paradigm of the hype way of doing things holds.

So what happened with Bruce and his whole Bitcoin show? I heard he scammed people or something?

That wasn't really certain, he said to be connected to mybitcoin and them running away with half the funds but that wasn't that of a concern, at least for me.

I was the kind of back ground he came from, what a kind of person he was and such. For me he became a symbol for a certain kind of person present in our community.
People who aren't really into the technology, aren't into e-commerce or aren't into trading as such, which is all great.

These people remind me of used car salesmen, if you understand what I mean... Generating a hype as a means end, making up stuff selling cool-aid, shilling for the press, etc..

Scammer will always be in every community. Bitcoin is the best thing for paying (anonymously) over the web. This is fundamental fact #1

Why do people always ask about fundamentals. There are NO fundamentals. Bitcoin is pure bubble, it is pure speculation. You can not apply the typical currency or security fundamentals to bitcoin! There is no country behind it, no GDP, no interests rates, no revenue, no liabilities, no assets. no nothing.

Throw all of that out the window. You can't "predict" the appropriate price of bitcoin using it. Everyone here is speculating based on how successful they feel bitcoin will be in the future. And no one knows for sure at all.

Finally, a sensible, even-keeled understanding of Bitcoin.

Bitcoin is not going to bring a new world order.

Bitcoin is not going to bring down the Federal Reserve.

Bitcoin, or more likely a successor (which isn't so limited in available coins), will provide utility in allowing for pseudonymity with online transactions - a true equivalent of cash-in-envelopes transactions for the internet. And for this reason will hold some value.

People have forgotten the drama surrounding Bruce Wagner and Bitcoinica. The vast majority of investors today have never heard of either. The bubble was not a surprise. I was a little surprised on how and why it popped but in retrospect I shouldn't have been.

Yes. bitcoin is volatile. It is volatile because it has insufficient market cap. And it is volatile because there isn't a robust trading platform for it. For example. it is too hard to short it. I personally believe that coinlab can save bitcoin if they do it right. If they make it easier for the average (Amercian, at least) investor to buy and sell bitcoins and also provide a way to short bitcoins, we'll be much better off. Shorting will help make bitcoin much less volatile and easier trading will let more people get involved and raise the market cap. And as bitcoin finds it's niche. it will become less volatile as there will be less pure speculation. And right now it is almost all speculation.

I personally believe that bitcoin has a good future as an inflation-proof store of value once it gets less volatile.

Volatility can not be fixed with a technical solution imo. Only when the social structure of it's userbase transforms into it's final state it can happen.

What that is I already enumerated above. One Bitcoin can be worth tens of thousands of dollars and still jump up and down in orders of magnitude over the course of a year.

I've never gotten a satisfactory response as to whatever happened to that guy. Last I remember he was trying to get some sort of Bitcoin Conference in Pattaya, largely because he'd have open access to backdooring young Thai ladyboys.

The best part of Bruce Wagner was the "conference" he held in New York. It was billed as this super-organized, polished event (you know,  the same overselling of nearly everything Bitcoin-related) and the few pictures and "live feed" from the "event" showed it to be a room with a few chairs and tables and was filled with a smattering of people who looked like this was the first thing to break them away from the computer in their mom's basement for the past 10 years. Think LukeJr. An overpromoted dissappointment (much like every star-studded Bitcoin venture since).

But at the same time, I can't fault the optimism - it was new, Wagner was a dedicated con-artist and it seemed as if things were progressing.

It's hard to buy in to the optimism here now, and I'm willing to bet that many of the folks that populate this board, and lauding it as the next coming of Christ, are new to BTC.

You guys are the new Proudhon?
The future never looked so bright for Bitcoin! (Please note I didn't talk about price here.)

ElectricMucus, I'm wondering...
What's your opinion of the alt-coins, if you're so... let's say "dull" about Bitcoin.

No I'm not the new Proudhon. I will not make any promises regarding the price within any significant timeframe. You won't have me "calling the top" or such silly things.

Alt-coins are great for speculative gains. I'd say they have the potential to reach the same market cap as bitcoin if you add them all together. As for now there isn't really any coin which I would consider an innovation.
But the concept of crypto-currencies has a great potential, and if it does release that potential I think that during this decade some concept which is not in itself based on Bitcoin will surpass it, if even consume it.
I wouldn't bet on it though.

Extremely interesting read (your long answer to wobber). Thanks. And if you ever turn bull again, let us know.

That said, I find the statement below unlikely. A bigger market cap probably doesn't entirely suppress volatility, but it's quite unintuitive to think the two would be completely unrelated: two big factors in today's violent price swings are, in my opinion, individual traders with large amounts of fiat and btc playing the market, and fresh-faced newbies, trying to get in at all costs. Both factors will have less impact on the price if large, institutional investors would enter the market.

Bitcoin isn't something like the Internet. It is something like cern httpd. A proof of concept of something which can potentially change the world.
The www has changed the world, but if we were to use httpd in our current time that would be silly.

I am agnostic on the long term prospects of Bitcoin itself.
That means I think it isn't possible to tell because the amount of chaos influencing it exceeds the amount if certainty by such an amount.

Here is the thing: I don't view the way Bitcoin itself is implemented as particularly liberating for the whole world economy.

I always like to tell the hypothetical anecdote of the 100BTC hard-drive in some land-fill in 2050 when one BTC is supposed to be more than the annual earning of a middle class family. If that hard-drive isn't found and it surface in 2100 it might turn the economy into turmoil.
Freedom fighters in the past didn't have vouchers to inherit their decedents, and with good reason.

No to really change the world we need something better, humbler, deeper. I only wish everybody here had read Neil Stephenson's Novels...

100 is neglijable. Also 1000. Not all the people in the world would use BTC, as not all would use gold.

Also, the lost BTC will be felt, as in not being traded, not having any value

That isn't what this is about, it is the uncertainly of supposedly lost coins which is the issue. Remember the 78% of all coins ever never moved paper?
Now we could say that some fraction of these coins are most likely lost, but how large is it?

We have no way of knowing. Infinitely deflating currency can only work for either:
a limited time period and/or a limited economy
or if there is a mechanism of ensuring that some previously assumed "lost" substantial value doesn't suddenly resurface.

There may be some mechanism which could be implemented like a maximum transaction amount but I doubt this would be very well received by most.

78% of coins not moved paper? I don't know about that.

I was big news, I can vividly remember the reactions, mostly scepticism at first and then denial.
http://arstechnica.com/tech-policy/2012/10/78-percent-of-bitcoin-currency-stashed-under-digital-mattress-study-finds/

How is that a surprise? Most of my coins are in cold storage.

Most of my dollars also.  :D

Being one of the maybe first 10,000 btc users, I am also assuming that many, MANY btc are lost forever. How? Deleted, when people got bored with mining. My assumption? somewhere from 2 to 4 mil coins

People deal with far greater uncertainties in fiat currency.

I think you need to separate your concerns: A great currency and a fair world.

As they say: There should be a way to have our cake and eat it.

I am a big Stephenson fan, and I am re-reading Cryptonomicon right now to give me a different frame for looking at Bitcoin. In your mind, what makes the fictional e-banking system they plan on running through the Crypt 'better & deeper' than the possibilities of Bitcoin?

Well there should be at least one possibility to narrow that down somewhat: The coins generated before the advent of mining pools. Because once you bother with pooled mining you are most likely in it to stay,

You know what would be cool: To give everybody an incentive to move their coins at least once a year or so, whatever that may be.

Some way to form a social structure around it, in Diamond Age banking was tied to being a member of a phyle, It should encourage more cooperation in contrast to competition, IDK, but if I knew exactly I would probably be busy trying to code it,

In an ideal world yes.

But don't become anorexic while trying.

Seriously -- I believe that the world's problems can't be solved through economics. In my mind, the USA is kindof a case in point. Equal rights and assured access to basics (e.g. education & healthcare) should be higher priorities than the success or failure of any economic model. Maybe I am just naiive, but I don't like seeing the tail wagging the dog.

Yes!

I was saying this yesterday. Eventually too many coins will be "lost" but we will never know exactly how many. The risk will become greater and greater as there is a chance that those coins could become "unlost" and crash the bitcoin economy.

Perhaps a solution is to require that coins move wallets every set amount of time, to prove that someone still has the private key to the wallet that holds them. If they aren't moved in some amount of time (like five years or something) they get deactivated by the system. Anyone wishing to save bitcoins could simply pass them back and forth between two wallets they own every once in a while. Or maybe sign a document with the wallet keys that hold the coins. It's too late to add this feature to bitcoin but maybe some future crypto currency will have it.

This would be unpopular - especially for those who hold physical coins such as Casascius or Bitbills.
It would be much less drastic to adjust the fee mechanism to take into account coin age - and  restrict the rate at which old lost coins come back into circulation by making it most cost effective to trickle them in.
It wouldn't stop someone who had a vast fortune spread across many separate private keys, flooding them back in - but it may stop sudden liquidity shocks, whilst not actually 'taking' money from people who have old coins but are patient.
This would probably be tricky to implement - and if not easily understood - may also be unpopular. You're right that this sort of thing would probably first appear on some other blockchain, and I suspect only if it's demonstrated to be a problem for the Bitcoin economy.