Bitcoin Forum

we konw that gold price is historycally stable, now we hope bitcoin's price can be more stable in the long for its widly accepted in busisness.

i think we have fath for gold because it is unique on this planet,different from any other metal.
is bitcoin unique forever as crypto tech develop ?

"Almost all the gold ever mined is stored in the form of bullion and jewelry."
is quick circulation good for bitcoin's price or value?

any thoughts? thanks.

People trust on gold as it is time tested. Those who have faith in BTC are the ones who understands the protocol and hence know it's value in long term. I wont tell u why as that would unnecessarily lead to sudden price rise. It is buy time ;)

people konwn nothing about BTC would not be here, i think.
i've bought twice, both at the time before its price drops.

i want to hear some enconomic explanation on BTC's superiority in the long run.
personaly, i doubt whether bitcoin's quick circulation in the future and it's value is a contradiction.

another question:
as BTC's price gorws up and circulation speed up, will transaction confirm time of small amounts and big amounts be differ greatly?

No it's not. Platinum is close in value and usage to gold.

Gold is just used as currency because it's shiny, hard to mine, and easy to verify that it's actually pure. Sounds like something you know?


PS: Gold is not even the most expensive metal. That honor goes to platinum-190, at around $1 billion per ounce.

It's a question of acceptance.  The only thing fiat has going for it is wide acceptance.  We each decide what we want to accept in exchange for the goods and services that we provide.  Today, most people let the bankers and politicians make that decision for them.  The bankers and politicians are very grateful for that, but in the future I think most people are going to prefer a medium of exchange that has a fixed, finite, inelastic total supply that isn't centrally controlled and manipulated by bankers, politicians, or anyone else.

Precious metals were the best alternative before Bitcoin came along, but now the market has to choose between not just fiat and precious metals, but cryptocurrencies as well.  When it comes to precious metals vs cryptocurrencies they each have their own pros and cons which I think will lead to both of them increasingly being used as money for the foreseeable future.  Fiat currencies, on the other hand, offer tremendous advantages to some, but tremendous disadvantages to everyone else, which will make them unsustainable over the long term.

big thanks to you.
it seems that there will be a slow BTC circulation.
but it looks like BTC can be manipulated by the big ones in this community,too.
what about the confirm time, will there be a significane difference between big amount and samll amount transfer in the long run?

i take your quote and rebuttle with: (30 year gold history resembles 3 year btc history)
http://goldprice.org/images/monthly_dollar.gif


i take your quote and rebuttle with:
1) fools gold
2) cheap copper bars/ingots coated in thin layer of gold
3) if the words 'precious metal' was the same as the words 'crypto currency'.. then i guess your ignoring white gold, platinum, silver which are all in the same category.

circulation is good whether quick or slow movements. the more important part though is the supply or demand. having more demand does make the price rise, but there is a critical point where demand is so high due to hoarding(not circulating) and prices are high due to supplies being small. that people start moving over to something new. this is why gold hoarders want to slate bitcoin so much, because less and less people are buying their hoards of gold. so the demand for gold is decreasing causing a value drop. this causes either the gold hoarder to sell at a loss or hold on even stronger for a possible price rise.. and i hope you can now see their hate for bitcoin.

even jewelers use to love gold, but now they are making jewelery out of platinum and silver more so then 30 years ago.

its all supply and demand. too much supply (circulation) can cause a dip in prices. to much hoarding (not circulating) can cause people to not buy, and find something different to use which also causes a price dip.. there is a narrow area in the middle that supply and demand has to be in for it to satisfy both buyers and sellers

maybe i should say during every two or three years gold's price do not change a lot

Gold is over-hyped by the bitcoin community. Good stocks outperform gold, although in the next 2 years it is not a good time to hold stocks but in general they do outperform gold.

Yes, it will take time for BTC to be adopted by the masses.  There are still technological and security barriers that need to be overcome.  When Bitcoin is as easy to use as sending or receiving a text message or e-mail then you'll see wider adoption and circulation.  No new technology becomes widely adopted overnight.

No one in the bitcoin community can manipulate the total supply of bitcoins.  Those who constantly expand the supply of fiat money do so arbitrarily and issue that new money in the form of debt.  Unlike fiat, the inflation of the bitcoin supply is controlled and predetermined and is not a debt.  That's a huge difference and there is nothing anyone can do to change that.  Those who find that inelastic supply unacceptable can choose to use a different currency, but they can't choose to change Bitcoin's parameters.

If slow confirmation times for small transactions become an issue then someone in the market will come up with a solution.  Off-the-blockchain transactions performed by a mutually trusted third party could be one possible solution.  Or, using an alternate cryptocurrency like Litecoin for smaller transactions could be another option.  You gotta have faith in the free market.

lets say 50 years of gold history is the equivelent to 5 years of bitcoin.. two or three years of gold is 2-3 months of bitcoin.. so the steady $600-$700 price range of bitcoin these last couple months, is again what i refer to as stable. roughly 10-15% variation

EG 2012-2013 dollar to euro (using just 2 years of fiat history)
http://www.fx-exchange.com/currencyimages/2012/eur/the-year-of-2012-eur-usd-exchange-rates-history-graph.png
http://www.fx-exchange.com/currencyimages/2013/eur/the-year-of-2013-eur-usd-exchange-rates-history-graph.png

low of 121 to high of 135 = over 10% price variation.

so if the dollar is stable for having just a 10% variation over 2 years of the many decades it has been around. then so is bitcoin for having a same 10% variation for the couple months of just 5 years being around

Platinum looks like silver and we want use silver as a currency so we don't choose platinum because its color  :D
so gold is still unique.

On the condition of mass delusion. Value is in the eye of the beholder. There was time when there were no humans on earth and no one to value gold. There will be a time when gold will no longer be valued. The 5000 years history of gold is a blink of the eye compared to the age of the earth. So it is with bitcoin. It was once worthless and will be so again. Only the mass delusion of some humans gives it value.

Gold is not similar to bitcoin. Bitcoin is much more flexible. Payments with gold are much more difficult and require actual movement of metal .

Did somebody say gold?  :-*


This is a great explanation.  :D

that exactly why i have choose BTC in dec 2013 ... instead of gold.
i can't buy something on Internet with gold metal ... but with an exchange, BTC and paypal and 1 hour, i can.

that is money fo me : buy what i want.
and trust me, local market don't accept gold ...  ::)

Agreed.  Only humans have a use for money.  Take humans out of the picture and there is no need for money.

Also, Bitcoin is instantly divisible. Gold is not.

Cypherdoc hasn't posted here yet? He'll smell the word gold and be here shortly.

How has the price of gold been historically stable. Just the opposite. Bitcoin doesn't have the ability to be stable yet and won't for a very long time.

Only idiots have faith in gold over time. You can lose as much money speculating on gold as you can on Bitcoin. Bitcoin is unique only as it's the first one and started the craze. I don't think it will be the last iteration of crypto coin or eventually even the most popular.

How a commodity is stored is immaterial to its value. Value isn't derived from storage method.
The amount of money in a nation's money supply is crucial to the health of its economy. If there is not enough money in circulation, the economy cannot grow. This basic premise should hold true for Bitcoin if Bitcoin is currency but you are comparing it to a commodity. So basically you're saying it's not money.

If you want to compare Bitcoin price to a commodity you should look up price charts for the now defunct pork bellies market. The charts look real similar.

thank you very much for your good presentation.
during the last three month bitcoin's price volatility is low, but we see chinese policy December last year and MT.Gox caused price breakdown.  All of this attributes to goverment regulation, at these situition, its price is not stable at all. it will happen again.

if the bitcoin market keeps the pace of recent two month, BTC will make a big step to be a stable currency.
another hand, lots people suggest there will not be this kind of stable, and they have reasons because the limited bitcoin supply, they(include me) think the price will rise steadily in the long term.

expectation of steady rise and stable in price is a contradiction?

The issues with BTC equaling gold as of now:

1. Length of trust.  Gold's been around for millennia.  BTC hasn't.  BTC needs to survive for another decade before it can be trusted.

2. Complexity.  Gold is simple to understand.  BTC isn't.  Even the vast majority of people that are technologically savvy either have no clue what BTC is, or barely understand it.

3. Copycats.  Right now there's plenty of altcoins out there, with groups swearing up and down that their coin is the best and will become the currency of the future.  BTC is the strongest, but as long as there are multiple competitors, it will never be taken as seriously as gold.

4. Reason for holding it.  People hold gold as a safe hedge.  Most people hold BTC because they're speculating about the future value.

3. Gold has other competitors too, including Platinum.

This is what we often hear from the privileged few that are allowed to create money, then loan it out and charge interest on those loans.  Of course if adding more money to the total money supply were such a good idea then allowing each of us to have our very own printing press to print out as much money as we need and just skip the loan part would be an even better idea.  I'm sure we'd have the world's economy firing on all cylinders in no time.   :)

That's just a part of Econ101. It's one of many basic economic principles that very few people here seem to understand.

There's a balance.  Too much and it's worthless.  Too little and money turns into a commodity rather than a medium of exchange.

Hahahaha quoted for the MF'in truth. People either understand this technology, or they don't.

The ones who do have been - and will continue to be - richly rewarded for however long it takes fiat to finally die.

This is not true, regardless of whether you're a Keynesian or an Austrian economist.  The quantity theory of money states that

   M V = P Q,         (1)

where M = money supply, V = money velocity, P = price level, Q = real output (goods, service, etc).  I think the vast majority of economists agree with this equation, although their opinion may differ on how it should be used.

It is common to associate a growing economy with growing real output, Q (i.e., more goods being produced, more services being used, etc.).  If you re-arrange Eq. (1) to solve for real output, Q, you get

   Q = M V / P .

So real output, Q, can grow three different ways (or more properly, it has 3 degrees of freedom):

   1.  Money supply, M,  can increase (what you said).
   2.  Money velocity, V, can increase (e.g., an increase in the rate that bitcoin-days are destroyed)
   3.  Price level, P, can decrease (the feared deflationary spiral).

Yes, it's definitely taught in economics classes, but does it stand up to logic and reason or is it just propaganda?  I believe Bitcoin will eventually force the ECON 101 textbooks to be rewritten with less propaganda and more facts.  We'll have to wait and see how things shake out.

Let's assume you're right, and that fiat dies to a technology currency.  Who's to say BTC takes over?

What I wrote above can be understood as fact.  Now let's talk mythology.  (Myths can be useful as they align peoples' views, permitting communication from a common frame of reference.  However, it is important to question from time-to-time whether our shared myths are still useful).  

Presently, we operate under a myth that "deflation is bad."  This means that if we want to increase real output, Q, we must rule out Option #3:

   1.  Money supply, M,  can increase.
   2.  Money velocity, V, can increase.
   3.  Price level, P, can decrease. NOT ALLOWED DUE TO OUR SHARED MYTHS

According to our mythology, we must choose #1 or #2.  So the Fed lowers interest rates to encourage spending (increase V) and buys assets to increase its balance sheet (increase M).

I would argue that focusing on #1 and #2 tend to increase output, but the increase is mostly garbage output, not real and useful output.  Manipulating #1 and #2 cause us to exploit our natural resources at a faster rate but provides less real and useful output than if the economy was left to its own devices, also leaving less resources available for our children.  But this is a subject for another longer post….

People hang on tightly to our shared mythology--even very intelligent people.  Letting go is frightening because it requires a reshaping of our interpretation of reality.  

I'd like to present my Theory of Dinosaurism:

One becomes a dinosaur when their hard-wired brain no longer sees it as possible for the status quo to ever *really* change.

When Einstein published his ‘theory of relativity’ as a young man, it was met with doubt and criticism by his seniors. But it wasn’t that these more experienced physicists eventually came to realize that he was right. No, these older physicists died off leaving behind the younger generation that was less blind to the truth.

Einstein became a dinosaur too in his old age, doubting modern theories in quantum mechanics.

We all eventually become dinosaurs, as the leadership in thought falls upon the younger generation who continue to fight for truth and progress.

That's all correct if you can identify what's really true and what really constitutes progress. If you followed the truth of this forum starting two short years ago you would have already lost all of your money to MyBitcoin or Bitcoinica or GLBSE or Pirate@40 or on and on and on. If any other investment vehicle had this many problems so soon after introduction it would already be ancient history. Fanatical idealism is keeping Bitcoin alive.

I did two things:

A.  I showed that according to the Quantity Theory of Money, real output (Q) can increase without an increase in the money supply (it requires falling price levels instead).

B.  I discussed the idea of myth vs reality and presented my Theory of Dinosaurism.  

You seem to agree that this is all true.  

But I think you are also suggesting that "falling prices are bad" is some sort of truth, and that if we question this it represents "fanatical idealism."  Is this correct?


All groups have shared myths including bitcointalk--you call this groupthink in your signature.  Myths are part of being human and shape our society--they can help us or hinder us.  For example, the "HODL" myth helps us overcome fear during outbreaks of FUD.  So far this myth has been beneficial to its subscribers.  "Deflation is bad" is another myth that was helpful in growing the economy after the Great Depression and World War II.  I no longer subscribe to this myth, however.  

We actually released an awesome podcast about almost this exact question just today! It's Episode 12 (http://youmeandbtc.com/podcasts/ymb-podcast-episode-12-gold-silver-rob-michael-coinstax/) over at YouMeAndBTC.com (http://YouMeAndBTC.com). We're joined by a special guest host, Robert Michael from CoinStax.com (http://CoinStax.com), a new bullion dealer that exclusively accepts Bitcoin. We talk about a lot of these ideas because we're responding to a 14-point criticism of Bitcoin by a well-known gold bug, Franklin Sanders. I think it should interest all of you. Let us know what you think in the comments or here, thanks!

Bitcoin shares some qualities with gold such as being scarce, fungible,etc. 
it also has advantages over gold that should be obvious.

Lets say you're 100% correct.  

People realize they want control / crypto > fiat.

Who's to say the answer is BitCoin?  Society could easily realize "Hey, that other currency is much more innovative and superior, that will really be the future!", and rapidly turn Bitcoin from $600 to a memory.

It is interesting to analyze this sentence in the context of myth vs reality.  The reality is that control of a private key permits spending of the coins in the corresponding bitcoin address.   But the rule says more than that.  I think it forces a re-thinking of our definition of the word "have."  Right now I think I have money in the bank.  But really all I have is a promise.  


Bring on the Bill Clinton "is" jokes...

Well...

Put a 20mm cannon to their head and ask them : "Trust Bitcoin like gold or the gun will fire. You got 15 seconds.
Short of that - simply won't happen, unless you find "believers" who do so anyway (there are a number of these in the forum) because it's new and sounds shiny.

Also, replace things like "faith" with knowledge. We know gold is a physically unique and physically rare material, non-reproducable and defined by the table of elements, created by forces of nature eons ago. Resilient and it depends on absolutely nothing.
Bitcoin is just an experimental invention by humans (who exactly, we don't even know for sure), a virtual computer code producing virtual output heaviliy depending on human-made infrastructure and many high-tech requirements that didn't even exist 30 years ago.

Regardless of design, it simply has nothing in common with physical gold - so one is best off not to compare them, they're entirely different leagues.
There is no such thing as "as good as gold". Once you realize that, you know the drill. Either it's gold or not. If not, it may have its uses and associated value - but it'll never compete with the qualities of gold.

Gold is a Great conductor and will become more and more useful and rare into the future,..

Not to mention Gold is rare throughout the universe created when Stars Super Nova,..

Imo, Gold and Btc cannot be compared other than their Price,..

So, maybe if there was a practical use for Btc such as conducting, then we would be talking,..

Bitcoin is Valuable to me because its the Original CryptoCurrency, we have to think about thousands of years into the future and Make a Place for BTC there.

There is a chance greater than zero that each of us's DNA sequence is mined somewhere up there, and somebody up there had collected their 25 "up-there-conis" for finding a "block".. There are about 6 Billion blocks found so far and lets say maximum 21 Billion blocks could exists at the same time, so some of them will disappear over time (i.e. "death"), more will be mined (i.e. "birth")..

I'm happy that you kept all of your Bitcoins. You know I've been ripped off several times. I'm not discounting the value of holding on to your Bitcoins at all costs. You should protect that key like it was your house key. The problem is that a lot of us need cash to give Bitcoin value. Just holding on to it doesn't really create any value for us. When I was mining with video cards I needed to cash in some Bitcoins to pay the high electric bill and buy supplies to keep mining. Exchanges are necessary for that to happen. I'm sure I don't need to tell you how many exchanges have ripped people (including me) off. The very last exchange to screw me was CryptoXchange and I almost quit Bitcoin because of it. You'll get a laugh out of this: PatrickHarnett, MnW and Yankee convinced me it was a great trustworthy exchange because I was fed up with Trade Hill. lol

Bitcoin most certainly is an investment vehicle. I would go so far as to say, at this point it is mostly an investment vehicle. If I want to shop at that overpriced overstock.com I can simply use a credit card. I don't need to first exchange my cash for Bitcoins to do it. If I'm buying Bitcoins it's to hold and wait for them to appreciate not because I want to buy some junk online. I could do that before Bitcoin ever existed. If I mine Bitcoins then I want to hold them for sure because I want as large a return on my equipment investment as possible. If I bought my mining equipment from a scam artist like BFL then I really need to hold my coins or I may never ROI. Many people choose to use the numerous opportunities that are available on this forum to attempt to increase their small holdings of coin into a larger holding. They are promised a greater return and that's why they are here - profit. Let's face it, no one is using Bitcoin because their doctor said their health would improve if they got themselves a few Bitcoin. They want a fucking profit! Well guess what, they just made Bitcoin an investment vehicle.

I don't agree that falling prices are bad. I have always believed that Bitcoin should not be pegged to the USD because that creates most of its problems. People should barter Bitcoin like any other commodity. Bitcoin could then be pegged in exchangeable value for product instead of being reliant on the US government to set its value (how many Bitcoins does that cost). There's a little of that going on but not nearly enough. Bitcoin business can't even operate without BitPay type business because someone needs to seamlessly exchange the spent Bitcoins for fiat because Bitcoin can't pay the bills. Everyone here preaches how fucked up the American Dollar is and how they can't wait until Bitcoin replaces that nasty old fiat and in the same breath they ask how many American Dollars Bitcoin is worth today: "Have you seen the price of Bitcoin today? It almost at $1000. Wow!" What a load of crap. You can't have your cake and eat it too. If the dollar crashes Bitcoin goes with it because Bitcoin is pegged to the dollar.

should there be "known something about..." not "known nothing about..."?

yes, you are right. bitcoins = its private keys.
1  as assets,we need the community to keep bitcoin's advantage over its competitors all the time.
    while we can not promise it.
2  if we regard bitcoin as medium of exchange more then assets, it will have both fiat and gold's pros.

I don't want Bitcoin to be priced in anything (even though I like BigMacs). I want it to have its own value if it is going to be used as a currency. Do you see any of these BigMacs priced in dollars? http://www.burgerkingjapan.co.jp/campaign/cp111.html
No, they price them in their currency. I know its not priced in Dollars because there is no fucking way that I would pay $7.50 for a BigMac. Bitcoins need to have intrinsic value for trade just as a national currency does. It can be exchanged for any currency but it should have its own value first. Unfortunately it can't because people don't trade Bitcoin for something and then spend the Bitcoin they received on something else. There is always an exchange for fiat in the chain. If people want Bitcoin to replace fiat then stop using fiat and start using Bitcoin.

this is very thinking.
high speed fait circulation bring problems, because commodities are at certain produce period, the period can not be shorten unlimited.
the same for bitcoin.

As long as we believe in BTC the value will be there  :)

There isn't much of similarities between gold and bitcoin. Bitcoin will get stable enough to become new gold when almost all of it would be dig up. So in year.... 2100

If people had a sure way to protect their bitcoins the price would by up *5 by now, maybe we should look at the idea of hardware wallets.

Yeah, I think hardware wallets will be a big step in the right direction.  Desktops, laptops, tablets, and smartphones aren't designed to protect private keys.

Isn't that one of the beauties of bitcoin? That stupid, lazy people will be the last people to catch on?

Condition? It's not about conditions, it's about IQ, and ability to learn - and more importantly - unlearn.

this is a good idea on btc wallet security , and security bring public confidence on btc.

People will trust btc as gold when the gov and banks start accepting and supporting btc as a currency!!!

as long as people are accustomed to the way.

i think mostly like this :
much more safe for individual and enterprise<------------|------------> easy to understand for public