Bitcoin Forum

I figure this is probably a great place to ask this question.

So I'm in the shower this morning, and it hits me: Bitcoin is just ones and zeroes. Sure it has lots of the features and benefits traditional currency can provide (and a whole lot more), but it's just code, right? So how come (besides the fact government just loves to steal) bitcoin is being treated like it's money and not software? Having someone sign an End User License Agreement would be a hell of a lot simpler than having to gather tons of information on them.

Then maybe I wouldn't have to drive to Canada to see a Robocoin kiosk in action.

(Yes I'm in NH, yes I know the Lamassu guys, but I still haven't seen one of their machines)

Bank accounts are just 1s and 0s as well.  If bitcoin was treated as software, then bank accounts would have to be treated as software too.

The comparison is not bitcoin and bank accounts, its bitcoin and the USD.

Bank accounts are just a bank's way of accounting and displaying transaction information, etc.

USD are just some pieces of paper with ink on it.
Money is defined by the way you use it, not by the stuff it's made of.

We as individuals can treat bitcoin as software, code, anything we please.

But what really counts is the consensus view. For example, gold is not good for much other than filling teeth or making jewelry yet it's one of the most sought after materials in the world. Why not just treat gold like an ordinary mineral?


I like this explanation.

The point is that "money" that you have in a bank is just 0s and 1s in a computer database maintained by software, "bitcoins" is just 0s and 1s in a computer database maintained by software.  To say that "bitcoins" is software because it is "just 0s and 1s" is to say that the transfer of value can't be represented as a transaction entry in a computer based transaction ledger.


And bitcoins are just the bitcoin protocol's way of accounting and displaying transaction information, etc.

Except that there isn't any such thing as a "coin" in bitcoins.  Only transactions on a payment network that transfer control of value by way of a mutually accepted protocol.


Or if you want to be technically correct:

"I have discovered an accounting ledger entry in the publicly shared ledger database known as 'the blockchain' which encumbers value with a requirement to provide a digital signature from a private key that I happen to have access to before I can re-encumber any of that value with a similar requirement."


Or perhaps:

"My account over at the BTC-e exchange has been credited with a promise from BTC-e to transfer some value upon a request from me."


True, that is a "commonly used term".  I prefer to think of it as an uninsured, unregulated, un-audited "bank account" with a small foreign company.

+1
OP, have you seen the new 100 dollar bills?  They look like monopoly money.  ::)  But yes, life would be simpler without the governement breathing down our necks, but redefining bitcoin as software won't change that.

I agree that that ship has sailed. There were so many people who were thrilled when the government said bitcoin is money, either forgetting or ignorant of the fact that the US government does not tolerate competing currencies that have a farts chance of threatening the dollar.

Federal Reserve has expressed some interest in it's member banks creating crypto currencies.  

http://www.chicagofed.org/digital_assets/publications/chicago_fed_letter/2013/cfldecember2013_317.pdf

It's more likely they go the co-opt route than try to ban btc outright.

+1, bitcoin is just a software, nothing more.

All this regulation bullshit is just that, bullshit, why should we need license to install a software?

Online banking is NOT just showing your how much you have in your account...  ::)

I'm not going to go into great detail here, but look up fractional reserve banking...

Basically, every time a bank makes a loan, they create money out of thin air! Crazy!

Even crazier when you think how much the federal reserve is "printing"....

Moneymasters covers history of money and what it is.  Watch it on Youtube.

I've seen it. He does a great job reviewing the history, then goes on to say the answer is to cut out the Federal Reserve and allow the Treasury to inflate the money supply, instead...

Bitcoin is just a decentralized public ledger that records transactions to and from address's. Those transactions could represent anything, and in this case, currency. But imagine. It could be votes.

Or exchanges of ownership of code? That's what I'm saying. It's just information/data. Sure information/data has value, just like anything else, and in this case it's features and benefits make it great for trading basic units of value, but it's still just ones and zeroes.

Both bitcoin and dollar are created out of thin air, so basically its all about what people trust more.

But bitcoin can't be created at will

Yes it cant, but still it holds no real value its all about accepting and trusting.

What is Money? What we mostly have is Debt, that is why bitcoin is increasing in value, it is not Debt! bitcoin is stable, the fiat currencies are not and that is why bitcoins value fluctuates (alright there is more to it)

Go to your local library (if you still have one) and go to the Law section and grab a Blacks Law Dictionary and look up Money, heck look up a lot of words you thought you knew!

Now then, just what does professor farnsworth think the future of bitcoin really is? Is it going to usurp our current method of labour trade for real Freedom?

As another poster stated bitcoin is not just money, it is so much more!

8 )

And every time a miner solves and broadcasts a block, they create money out of thin air!  So What?

It can be. Anything can be a currency as long as it meets these criteria:

1. People believe it to have value.
2. It is easy to trade.
3. It's hard to counterfeit.

I think software only meets No. 2..

I'd say 1 and 2, but yea, not 3

Huge difference! There is a limited number of blocks, there is an unlimited supply of US dollars.  ::)

I suggest everyone head over to: http://www.zerohedge.com/

Why not treat money as paper?

I think you need to change that question... Why treat paper as money?  :)

No, there is a limited number of bitcoins.  There is NOT a limited number of blocks.

So, the crazy thing isn't that money is "created out of thin air!", it's just that there isn't a limit on how much of it can be created that way?

Bitcoin is software and money also.

By buying a bitcoin you buy a mean of exchange but also one of the only 21 millions coins that will ever exist and thus you "own" part of the bitcoin payment system.

See it as a currency, yes, but see it also as a share of a financial platform.

The owners of this platform will own 21 million coins. How much these coins are worth will depend on how useful the platform is to people and not just coin/share owners.

Bitcoin is not about investing, it's about facilitating transactions.

But if you want to have a share in that investment platform, you invest in a BC and hold it and thus hold a share of the platform.

It is not needed to own BC to use BC as a payment system. Transactions can be made from currency through exchange rate, these services already exist.

People who only want to use BC for transactions purposes will not buy and hold bitcoins but only convert in and from bitcoins.