Bitcoin Forum

I have to admit that I'm sceptical about Bitcoin. I'll give you my reasons, then please convince me!

Bitcoin is not backed by anything. It would probably not exist in a free market. Money in a free market has always been some kind of commodity. Something that has value beyond its use as a currency. The problem with Bitcoin is that it has no value beyond its use as a currency. Why should it then be regarded as money? Money came into being as a medium of exchange, so that if you got stuck with it it was useful in some way. It wasn't just a piece of paper. It was something that was useful in and of itself. Like gold. Like silver. Bitcoin has none of that. It's just a string of 0s and 1s. Where does it get its value from? I don't think in a free market it would be valued.

Something like Bitcoin could be used as a currency if it was backed by some commodity to do anonymous/quick transactions, but there would be a standard, ultimately, for exchange. It would always be exchangeable into e.g. gold. So that the banks who issued the Bitcoins were contractually obligated to redeem them into gold. Then Bitcoin would serve as a currency, but the money would be the gold.  

There's also the problem with Bitcoin of inflation. Yes, there's a fixed amount of Bitcoins qua Bitcoin, but anyone can create alternative cryptocurrencies. I don't see why Bitcoin has any unique features that cannot be replicated by others, and therefore you will create massive inflation in a digital coin space.

So why do I think Bitcoin is still valued today? I think it is because people are fearful of the dollar. They think it's gonna get useless, and they're looking for alternatives. Bitcoin is a product of this fear. Also, I think people are worrying about their privacy. And with good reason, given the growing government intrusion in our lives. People are looking for ways in which to remain private. In which to remain outside the government's abitily to monitor them. Bitcoin provides that. So right now it's providing a value. The value as privacy. The value that it's not paper money. But in a fre market, which we are all working to realize, I do not believe Bitcoin would exist.

Bitcoin is backed by the laws of Nature:

http://miguelmoreno.net/wp-content/uploads/2013/05/fYFBsqp.jpg

What is the US dollar backed by? and don't say gold because it hasn't been for a long long time. Like the US dollar, Bitcoin is backed by the people who use it. You can take your Bitcoin and you can exchange it for goods at Dell etc, this is what gives it value.


Not entirely true. Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts in a particular country or socio-economic context. The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, perhaps, a standard of deferred payment. Any item or verifiable record that fulfills these functions can be considered money. (pasted from wikipedia)

One of the first types of money used by ancient humans was sea shells. Properties of a good money are something easily transferred, divisible, durable, scarce and fungible, and widely accepted as a means of exchange,.


Inflation caused by other cryptocurrencies do not have a significant effect on Bitcoin, much in the same way inflation caused by Bitcoin doesn't really have a significant impact on USD.

I don't doubt the technology. It's genius. I just doubt that it would be valued as a currency in a free market when it's not backed by a commodity.

It's backed by our trust on sound math.

What backs banks ledgers?

Pure force only. But I'm not here to defend the dollar. Paper money wouldn't exist in a free market either. Only paper currency, backed by gold (or other commodities).



Nobody would use paper money in a free market. The dollar is backed by force. Bitcoin is backed by fear. That's my view until I'm convinced otherwise.


But WHY can you exchange paper money for goods at Dell? Because the store is forced to accept it! No way they would accept worthless paper notes backed by nothing in a free market.


If everybody started using Bitcoin, it would have a huge impact on the dollar.

In this particular case, not being backed by something physical is an advantage, and a big one, check E-gold (https://en.wikipedia.org/wiki/E-gold).

The only reason to back paper currency with gold is to enforce scarcity and this method failed over and over again through history because it is too easy to cheat and manipulate. Bitcoin solves that.

I assume you mean a free market doesn't exist today.  I would agree although
a quasi-free market does exist, and Bitcoin exists in it.

But I need no reason to assume that the more free the market gets, the less people would use Bitcoin.  Just the opposite. 

You do have a point that something like Gold is more attractive because it has uses other than a medium of exchange.  However, it not not easily divisible, transferable, or portable like Bitcoin.

Good point about confiscation (e-gold). What about stability? Without being backed by a commodity, how do we keep the value of Bitcoin stable? Under a gold standard, the stability of the money is pegged to the value of gold.


Of course it doesn't. Central banks and fiat money have nothing to do with a free market. In a free market there's a complete separation between state and economics.

Since the number of Bitcoins is constant, the value will be determined by the demand. But the demand can change, and then there are no mechanisms to correct it.

Stability is relative.

http://goldprice.org/charts/history/gold_30_year_k_hkd.png

Bitcoin is now unstable (short term) because it has low liquidity and is used primarily as a speculative asset. I expect it will stabilize with broader usage and better liquidity over time as it becomes more and more useful.  

Anyone that uses the "bitcoin is not backed by anything" argument is truly ignorant. Nothing will convince you because you wish to remain ignorant. Your skepticism has already been addressed hundreds of times over the last 6 years. Learn to read.

I think nobody but you should convince yourself about this.


Bitcoin has a network behind that performs a really huge number of operations to keep itself secure. This is value.
Bitcoin can be used without registering/opening an account somewhere. It means ANYONE can use it. Even if there is not banking infrastructure like in Africa. This is value.
Bitcoin allows quick and cheap transactions anytime anywhere without needing third party consensus. This is freedom and this is value.
Bitcoin opens the doors for new hardly-imaginable technologies (like automated-open-source-companies owned by nobody, but it's too early to talk about this). Innovation is value.


It would be a huge error. Imagine that one day someone finds a chemical way to turn matter into gold. Everything would lose value instantly.


It's not enough to create a new cryptocurrency: something like bitcoin miners are needed to make it safe. Up to date no altcoin is safe as bitcoin is, so I wouldn't say that inflation is unlimited. Bitcoin has a planned inflation and it's well known in advance. You can create your funkycoin, but the day it may become interesting, only one small bitcoin miner is enough to turn your crypto upside down.


I don't agree. Bitcoin's value is like a rollercoaster, I am not sure people could trust it more than the USD yet. However people can trust it for what it is: something complete new that has so many innovative features that it can change and improve the world.

The fact that I don't accept your arguments doesn't make me "wish to remain ignorant".

bitcoin is backed by

1. the stable mathematical laws behind it

2. the believers use it

3. bitcoin's own economic eco system (global anonymous market )

4. its unique features ( anonymous , can't be frozen by third party Or Gov , almost no transaction fee )

That's like saying "Imagine that one day someone finds a way to make Bitcoin insecure?" This is highly speculative. No reason to believe that it's even possible.

No need to convince you... this train is rolling with or without skeptics... fortunately enough folks have done the research to see the opportunities... slow adapters will simply kick their own ass.

Actually, transmuting material to gold is already possible.  You need to remember, even the gold we have today was not originally gold.

It is not very economical at the moment but billions are being spent on cold fusion research that has the potential to poop gold bricks out as a waste material.

The technology is rock solid, but the value is not backed by other commodities. One must compare Bitcoin to something, otherwise prices will be arbitrary.

If one wants to have a stable currency and thereby avoid inflation and deflation, it must be stable in value against something else. Value is always relational.

That being said, you guys have made some valid points, and I'll actually buy 10 Bitcoin today. Hope they will increase in value. What do you think?

The fact that people believe in it doesn't make it true. Most Bitcoin buyers have little knowledge of economics.

That's what most people here think but there is no guarantees. Bitcoin is still experimental and you should only put money you are comfortable to lose at this point.

None of the currencies are, unless trust in the central banks can count as a form of backing.


Well, if money is a medium of exchange in the strict sense, gold and silver can't be considered money. I can't go to the supermarket and pay with gold or silver. They only accept notes and coins of the Central Bank and credit/debit cards. Following the same path, a national currency isn't money outside the country.



National currencies aren't backed by commodities, but they still are useful as currencies. Anyway, there are some places where you exchange bitcoins for gold, so I don't get the point.


For this purpose, there are gold certificates. Anyway, Bitcoin isn't issued by banks. It's generated by miners. Also, the banks aren't obligated to redeem a national currency in gold.



The creation of alternative cryptocurrencies has nothing to do with Bitcoin inflation. They are created to offering features which doesn't exist in Bitcoin, or to just try a different approach. Sometimes they are created just to do a pump-and-dump.



If you want privacy, I think cash is still better than Bitcoin.

Regarding the question of free market, I strongly disagree with you. In a free market, we have the freedom to create our own currency without ask to the government.


The answer is simple. Bitcoin doesn't have a stable value. There isn't any mention to "stable value" in the Bitcoin's whitepaper. Gold also doesn't have a stable value. But you still trust in gold.

But after all, why Bitcoin? In my opinion, because it's a honest and secure way to pay someone for goods and services.

Paper money is created according to the desire of the governments and central banks.

Credit and debit cards are just numbers typed in computers. They aren't secure, they can be easily cloned, so you have to trust the merchant won't try to scam you.

Banks work with fractional reserve. So, when you tranfer the fund from your bank account for another bank account, they are just tranfering numbers or a "eletronic promise to pay in paper money, even without sufficient paper money for this" from your accountto another. In case of a bank run, the banks go to bankruptcy. With Bitcoin, you don't have this, nobody will give to you a "promise to pay in Bitcoins", they'll pay with the Bitcoins like the same way with paying in cash. In other words, with Bitcoin, you can have more control over your money than in a traditional bank,.

Note: it's still posible to have fractional reserve with Bitcoin. Mt. Gox is a example of this. But in the Bitcoin you can avoid this. In banks, no way.

Also, gold and silver are complicated to send over the world. With Bitcoin, you can send any amount, paying a low fee, to any place of the Earth.  ;)

Why does there need to be?  If demand increases or decreases, price will follow.

If your concern is fluctuation, well.... Everything fluctuates.  there is no currency, commodity, asset, or anything else on the planet whose value doesn't fluctuate relative to other things.

You seem smart enough that you already understand the pros and cons of Bitcoin.

Not sure what exactly you wish to be convinced of or what your point is with this thread.

I'm not out to defend fiat currencies.


Because it's not allowed. But in a free market you would be able to pay with gold and silver. Maybe not physical gold and silver, but with redeemable paper notes.


Because the government forces people to accept them. If the government forced you to accept squirrel snot, that would be useful too. But it doesn't mean it would survive as money in a free market.


But the point is, when people start accepting other cryptocurrencies, the value of the existing ones will drop.


There are degrees of fluctuation. It's a big problem if I save bitcoins over several years, and then it's value is decreases by maybe 90 percent because it's not backed by physical commodities.

Let's turn this around a bit.

I am skeptical about gold. It's not backed by anything. It's a fairly useless metal, especially to the everyday person. It fluctuates in price. Why are people so interested in it? Convince me.

Gold is to the Earth as Bitcoin is to the Internet. Perception is reality.

Gold does not have to be backed by a commodity, because it is a commodity.

I don't agree that it's useless.

I don't agree that perception is reality. Reality is what is is. regardless of what people believe it is.

Adam’s Smith’s greatest student, J. B. Say, wrote two centuries ago: “money is indebted for its currency . . . to its being a commodity bearing a peculiar and intrinsic value.”

Every form of money is a human abstraction. In that sense, reality is pretty subjective.

Currency is only a way to measure exchangeable value. Nothing more.

Each person on this planet gets to use their measurement (or currency) of choice. Most people select the currency of their nation to measure the value or purchasing power in their pocket. This is all we've known for the last few thousands years, and replacing this concept with something new may or may not be quick. You're healthy skepticism is shared by many.

Rulers measure distances. Thermometers measure temperature. Scales measure weight. Currency measures value.

Each one of these are flexible enough that anyone can make their own language. For example thermometers use Fahrenheit or Celsius, scales measure pounds or kilograms, currency measures dollars or euros. Another similarity is that all of these measurement tools have exact ratios or formulas that never change and make it easy to convert and communicate from one to the other. One kilo equals 2.20462 pounds, one inch equals 2.54 centimeters, even F to C has a formula.

Now think about your dollars to euros. The formulas to convert one to another constantly change, and they change by the hands of only a few people. Every time this changes, the tool that you are using to measure value changes. WHO GETS TO DECIDE? Do you? Do you influence this decision at all? Do you get to vote on it or vote for people that make this decision for you? No, no, no and no.

You may or may not have noticed it, but your entire life someone has been sneaking into your toolbox and switching the tape measure you've been using to measure your wealth and purchasing power.

This is why cryptocurrency is revolutionizing the world.

"I then submit to you that Bitcoin is a commodity as well." As written by me, the greatest me there will ever be.

And well surely you agree that many other metals are much more useful than gold though, why aren't they more valuable?

Then the reality of the matter is any of the money you have in your wallet is just paper, regardless of what you or anyone else believes it to be worth. The idea of worth and value is defined purely by perception, the only other option being perhaps God.

Too much subjectivism and religion for me

Well, it depends of the country. I think it will be good to do a search about the legal status of this type of transaction.


A currency board with gold standard? Unlikely, governments don't want this. And I don't think this would solve the problems with the soreveign currencies. In some countries, commercial banks are creating 97% of the money. A currency board (independently if it's pegged to gold or to another currency) won't stop this.


Yeah, I agree.



Cryptocurrencies are an experimental technology. I think those alternative cryptocurrencies are necessary, because innovation is necessary. Also, in a free market, the people have the rights to accept other cryptocurrencies. So, in this case, let the free market do the choices.

That was the experiment with Bitcoin. Can something not backed by anything but agreed upon by a group can have value? So far Bitcoin has shown the answer to be a big yes.

no offense but if you are skeptical and are here for us the bitcoin community to change your mind,I only have one thing to say to you.

You are a big boy,you can do your own research,we have the same internet. Their are countless people like you asking the same questions in those same exact words. So instead of answering your questions the exact same way I normally do I rather just tell you this.

THIS.. first sentence.. it is is not backed by anything, yes.  second sentence.. it currently exists in the FREE MARKET.  i didn't bother to read OP's post past that.

I agree, your "Gold is superior"-argument sounds a lot like religion. So far, you didn't tell us, what makes gold so superior.
So, please tell us.

*s(k)eptic is the correct spelling ... your spelling sceptic is closer to septic ... a human body affliction referring to severe infection ... or in reference to a septic sewage system handling human waste ... either of which is an accurate adjective to describe the functioning of bitcoin ...

The U.S. dollar is backed by the world's most powerful military pumped by $7xx billion dollars annually.  So yes, it IS backed by something.  Something very large and unfathomably destructive.


Bitcoin is not a currency.  A 'virtual currency,' perhaps...but not a currency.  It's simply a medium of exchange.  Just like credit cards, money orders, paypal, and the likes.  IT IS NOT A CURRENCY, no matter what a neckbeard or tinfoil hatter will tell you.

Yes, I know the hardcoin bitcoiners will preach to the choir about their grandeur plot to overthrow the government and have their hipster technology take over as the world's accepted money medium...but that's why the sane general public is laughing and pointing from the outside at their detachment from reality.

Now could it thrive and continue to grow as a medium of exchange? Perhaps.  My money isn't betting on that horse, though.  Its worth will forever be tied to the dollar, and there will be a better technology released by the government that is an OFFICIAL "currency" that will render bitcoin and all other alts worthless.  Yes, I know this saddens everyone.  But that's how the world works...the government with the nukes will control the money flow by any means necessary.

inb4 that's fud bro
inb4 troll bear
inb4 quit rekking my bitcoin get rich quick dreamz brah
inb4 u dont know sh-t im already 48% finished drawing up my blueprint to take down the military n congress

Back to reading more anarchist literature.

the internet is backed by ? so it should be worthless.

Try walking into a cafe and paying for your lunch with '3 internets.'  I tried.  But the damn workers are so stubborn.

If you hold the value of 3 internets you are the richest person in the world.

So what will happen to gold price when suddenly everyone stop perceiving it as valuable? What if no one buys it as an investment or store of value and the price is solely dictated only by its practical usage (such as electronic and aerospace components)? Will it remain 10% of its current value?

The fact is that most of the gold's price is created by the general agreement that it is precious and valuable, so the 90% (out of the ass estimate) is backed only by perception.

Fiat isn't backed by anything either. Bitcoin is an revolutionary economic experiument in my opinion.


It's already being used as a currency so you're wrong, though it's not ideal currently with price fluctuations but this could change in the future.

You should risk some small affordable amount and hodl in a secure offline wallet. In 10 years you will either badly regret for not doing it or you will have lost some small affordable amount of money. Its a good time to buy in.

This.
If you invest affordable amount the potential loss is capped at 100%, while potential profits are un-capped.

Although, for the first-time buyers, I'd recommend to buy some small amount first to 'play' with (send/receive, import/export wallet etc) to get the basic knowledge of how it works, rather than to buy large amount straight away.

This is actually pretty good advice. If you're skeptical buy a coin or two and hold it as an investment and see where it goes. If bitcoin goes tits up you've lost $200 or so. If it goes the other way you've made a nice little investment. You don't even need to purchase any coins either as there are plenty of ways to earn them from this forum.

takes a lot of faith and sentiment to make the economy and markets run the way they do; beliefs drive our economies as much as anything else. perceptions of what is good / bad, high / low, what is valuable etc etc.
the laws of economics are largely dependent on humans propping them up, unlike natural laws from which facts come from, so dont doubt the power of belief!
not exactly the point you were making I know but couldnt resist mentioning it (for a general note) anyway :p

the general public sentiment is of bitcoin being a ponzi pump dump scam and simultaneously capable of supporting terrorism hardcore drug trafficking and pedophilia ... is the reality of the people existing outside of the trollboxes and btcforum ... sorry to break the bad news to you ...

It has the backing of the community, people like you, me who believes in the future of bitcoin and are willing to pay a certain price to acquire a bitcoin unit. For me, that is good enough.

Why is that bad news? If Bitcoin got that far with such shitty general public's perception, then what will happen when people slowly start realising that it's actually not that scary.

It would be more disturbing to discover that 99% of population have a positive sentiment, that would mean it will be very hard to grow/expand from where we are right now.

What interest do I have in convincing you?

The reality is that the longer it takes for the rest of humanity to recognize the true value of this asset, the more I personally benefit.

By all means, continue your skepticism indefinitely, I'm enjoying access to these $200 coins. I can only earn fiat to melt so quickly, you know.

Look at the marketcaps of other decentralizing services such as Uber and compare it to Bitcoin, then see the potential for growth.

yeaaaahhh bullshit ... and i do btw hold bitcoin simply for the sake of an apocalyptic scenario of global economic collapse of all governmental currencies while the internet *somehow* still exists ... i also hold raw gold raw silver guns and loose cut diamonds ... take my evaluation with as much salt as suits you ...

I'm optimistic about Bitcoin, but not fanatically so.  I'll try to give you some additional considerations.


Whether a currency is "backed" by anything is of little importance, at least inasmuch as all money is backed by a mere belief in its value. In other words, money -- no matter what form -- ultimately has value because people believe it has value.  This holds true whether we're talking about fiat, gold, oil, whatever, etc.

Possibly the most important characteristic of money is that people can agree that it holds a common value.  In a bartering economy, this does not hold true.  For example, a gold coin considered outside the context of price consensus (i.e. outside gold's purported value depicted in the gold markets) may be much more valuable to one person than another, such as when one person needs a good electrical conductor and the other person doesn't, etc.

To this extent, a digital currency is arguably superior to gold.  You can argue that it is precisely because 1's and 0's are arbitrary and intangible that consensus of value can be achieved.  For example, sugar might be considered an "intrinsically valuable currency" since it has nutritional value outside of social consensus.  But, do you think that sugar is more valuable to a normal person or to a diabetic?  The arbitrariness of pure math can avoid this issue.

Also consider that the Blockchain is valuable in a way that Bitcoin as a currency is not.  Bitcoins derive their value in part by their integration with their own Blockchain.  Bitcoins would lose their value consensus if, say, only the Litecoin Blockchain existed.  So, as it turns out you can make an argument that bitcoins have some intrinsic value, but in the sense that useful bitcoins are inherently tied to the Blockchain (which is why testnet bitcoins on the testnet blockchain are worth jack).  The most profitable BTC companies to date are typically those that facilitate transactions on the Blockchain (and thereby increase its value and utility) such as payment processors, exchanges, and casinos.  The more the Blockchain is used and develops in the complexity of its inter-connectivity, the more socially valuable it becomes.


The value of something is always related to something else.   Let's imagine, per your example, that BTC is backed by gold.  So, you can take 1 BTC and sell it anywhere in the world at market value and receive predictable sum of gold.  Okay, great.

Now you have gold.  Now suppose that after some time passes you want to sell your gold.  How valuable is that gold?  How did it get its value?

The point is that there are two (2) things that can always be stated about value: 1) Value is always relative and is thus subject to change, and 2) Intrinsic value does not necessarily equate to consensus value.  Because consensus value is required for a good form of money, and because value is always subject to change, the natural conclusion is that intrinsic value of money really doesn't matter at all.


There are two things I want to say, here.  First, inflation in and of itself is not bad, but actually can be very good for tempering certain market conditions; the only real problem is irresponsible inflation.  Second, alternative cryptocurrencies don't work with the Bitcoin Blockchain.  Sure, if new alt-coins emerge and people decide to move BTC holdings into those alts, then you can imagine it as though Bitcoin is being inflated (even though it isn't) because the sum of all cryptocurrencies in total will have inflated. But...

...I actually wonder if this is precisely why Satoshi didn't allow any room for inflation whatsoever (except by way of a hard fork).  In other words, I wonder if foreknowledge of alt-coin development led to the decision to make BTC completely deflationary, as a naturally-evolving inflation mechanism to help temper cryptocurrency markets in general would arise from the alt-coins themselves.


I think it's a little fanciful to think BTC is valued today because people are fearful of the dollar.  I can't imagine that very many people use BTC primarily for ideological reasons, and if they do then I'm guessing money isn't especially tight for them right now (else it would be insane to speculate on this market).  I simply think BTC is valued today because its unique features allow it to be a preferable form of money transmission with specific regard to certain types of transactions.  Someone may use BTC for online gambling while using fiat for every other transaction in their lives, for example.  In my case, I prefer to sell things for BTC rather than fiat because I can avoid chargebacks and the enormous fees of eBay et. al., and because of the ease and timeliness of international transactions.

If people are really worrying about their privacy, they're probably doing something illegal or are irrationally paranoid (if you're instead talking about things like the seizure and confiscation of banking accounts, then I can concede the point, especially if you're a Cypriot).  Collecting all data everywhere is certainly unsettling, but filtering through that data is completely different.  If you aren't doing anything illegal or suspicious, there's simply no good reason to waste time and resources to parse through all that extraneous data.  I admit, though, that I'm not a fan of this kind of data collection.  It is unsettling.

I don't think the primary value is privacy.  I think the primary value is its integration with the valuable technology of the Blockchain, compounded by its growing use.

I have a similar standpoint towards my Bitcoin holdings. You never know what can happen and what can be used in such scenareo.

Ok. Now that is a very good point I've read thus far. Sometimes I also kept telling myself whether seeing the price going up is a good thing or bad thing because I might miss the opportunity to buy the coin at such low price ever again.

I feel the same, its a bad thing for us. Let us amass as much BTC as possible now and be rewarded for being believers.

Bitcoin has value because it has the following properties:

- Finite supply. Only 21 million coins will ever exist and politicians cannot create more on a whim, which gives it some of the properties of a commodity.
- It's secure and has never been hacked. Poorly run third party companies and individuals have been hacked, but the Bitcoin protocol has not been hacked.
- It's global and could be the first true global currency. It's easy to use Bitcoin for cross border, foreign transactions.
- It removes the third party intermediary, like a bank, and for allows for individual to individual, cash like transactions over the internet.
- It has low transaction costs. Micro transactions are now viable with Bitcoin.
- It can be anonymous depending on how it is used, but the blockchain also provides a treasure trove of information once an individual is associated with a Bitcoin address.
- The Bitcoin mining infrastructure is significant and provides network security. A 51% attack is not financially viable.
- Bitcoin could experience exponential growth due to the network effect.
- It's an open source protocol. It's not owned by any individual or government with an agenda. Anyone can look at the source code behind it.

On the surface, Bitcoin has many properties that are far superior to fiat currencies. I don't know if Bitcoin will succeed or fail, but it does have a tremendous amount of potential. If Bitcoin fails, I have no doubt that something similar will replace it and help reshape global finance as we currently know it.

I would not invest more than I could afford to lose in Bitcoin, but do believe that it's worth a small investment due to the amazing potential.

Or maybe :



https://i.imgur.com/IL6PV5E.jpg

You should buy Bitcoin because if humanity decides to rise above the state it is in now, blockchain technology will be one of the tools used to get it there.

Despite my annoyance at ignorant people demanding that we spend our time to cure their ignorance, I would like to address this point.

My response is simply that every kind of money can be replicated by another kind of money. This issue should be not considered a problem for Bitcoin for the same reasons it is not considered a problem for other currencies. Any fiat currency can be replicated by creating another fiat currency, and anybody can create a fiat currency. The dollar can be replicated by anyone simply by issuing their own fiat currency and changing the name, yet this problem with the dollar and every other currency is conveniently overlooked when it is applied to Bitcoin. Mr. Pot, I would like to introduce you to Mr. Kettle.

The claim is that because anyone can make an exact replica of Bitcoin, the thousands of replicas will make the original worthless. However, the flaw in this argument is that you cannot make an exact replica of Bitcoin. Each form of money has its own characteristics whether they are imbued by its creators or they arise out of its usage. There are characteristics of Bitcoin that cannot easily be replicated, including the infrastructure that has been built around it, the name, the public perception, and even the people that use it.

The final proof against this claim is simply in the hundreds of Bitcoin clones that already exist. If the weakness of Bitcoin's reproducibility were true, then Bitcoin should be worthless by now. In fact, Bitcoin is unaffected and remains king while the rest are insignificant in comparison.

FTFY

http://www.scientificamerican.com/sciam/cache/file/1541A804-A801-4698-B75079B5681213FB.jpg

Bitcoin is backed by orgasms. That's all you need to know. Cum join us.

Go to a society where people doesn't know anything about gold. They have an open market, they trade goods between them, but they don't know about gold. So, where's the value? What you can do with your gold in that society? So, your gold piece in that society still have an instrisic value. But you can't do anything with that, it's useless.


But US dollar is not redeemable. This is an interesting point, although of not being the case of US dollar. So, for example, the pound sterling notes have this sentece: "I promise to pay the the bearer on demand the sum of X pounds". But this is just bullshit.

Also, the US dollar is useful only as a medium of exchange only in the countries which use the US dollar as currency.


Credit card, money orders and PayPal are not a medium of exchange. They are a medium of payment.

Anyway, it seems you just did a copy and paste of  this, these sentences sound familiar to me... Bitcoin is a currency. It is a unity of account. It has intrisic value. It is a store of value. But, of course, without acceptance your bitcoins are not money.

Then don't invest if its too speculative for you, or only invest a small amount.   
No one is going to tell you to invest more than you're comfortable with.

What a pointless thread.

This, decentralization is the future, anything else is death.

Fair enough on credit card and paypal being a medium of payment.  But it's no different than bitcoin...since ultimately bitcoin is nothing more than a means to ultimately convert to fiat somewhere along the chain.


And show me any country that official defines bitcoin as a 'currency' and not loosely as a 'virtual currency.'  There's a fine difference.  One is backed by governments and power...the other are not.

So everyone over night stops seeing a pretty thing as pretty? That would need a cultural revolution the world over   Few substances have the color of gold with tarnish-resistence.
https://www.fourmilab.ch/documents/golden_glow/

Gold's inate properties make it desirable amongst a periodic table of silvery and dull metal colored elements.   That perception of worth is very difficult to remove, unlike the perceived value of e.g. Tulip bulbs, where many people in the day were commenting "but why does it carry such worth when the Rose has much more beauty and variety?"

If I use all the governement-backed paper money which I receive to convert to silver, will the paper money which I receive just be a medium of payment?



In Bitcoin, people doesn't care or doesn't want to have it backed by the government.

Also, gold and  silver still remain as currencies, even without government backing. The same applies with Bitcoin.

Even more, soreiveign currencies out of circulation still remains as currencies. They just loose the legal tender status, but all ther other properties of a currency are here.

lol
So Gold is valuable because it is pretty? That is it's intrinsic value?
There are a lot of people, who don't think, that gold is pretty. Who wouldn't wear golden jewelry.
You make it sound like seeing gold as pretty is hardwired into our DNA. It is simply not.

Essentially, nothing is backed. Certainly not the Dollar and Euro.


Some people seem to think that gold is some legit kind of backing in and by itself. But gold being intrinsically valuable "because it's a commodity" is circular reasoning. Look up the dictionary meaning of 'commodity' (http://www.merriam-webster.com/dictionary/commodity): something that is bought and sold, something or someone that is useful or valued. So this actually boils down to: "gold is valuable, because.. it's valuable".

So, again, what backs gold?


Sure, it's nice for jewelry and shit.

But then Bitcoin certainly isn't useless either: in today's global, 24 hour online economy, a frictionless, virtually free, worldwide, digital, instant, 100% secure, transparent, flexible, decentralized payment system is extremely useful.

There's a lot going for both gold and Bitcoin, that can't be said about euros and dollars: they're scarce, they can't be created at whim out of thin air, they're not controlled or issued by some authority, they don't require a 3rd party payment infrastructure (especially one that is fully owned by a handful of private commercial organizations) so they're independent, they can't be counterfeited, and so on. And in terms of ease and costs of transport, security, storage, validation, supply predictability, divisibility, and scalability, Bitcoin does way better than gold.

There's your intrinsic value right there!


Value is 100% subjective, so if (and only if) enough people think a bitcoin, or a brick of gold, or a piece of paper with "€100" written on it has value, it has value.
.

You missed my point. No, gold won't lose 90% overnight for no reason. Point was that huge part of its high value is created by perception, and that part of value is backed by nothing else but that perception.

As for the 'beauty' part: I honestly find a bitcoin more beautiful than gold. Sure, I'm a math geek and all, but still, I honestly do. There's such an intrinsic beauty in its ingenious cryptographic design and mathematical soundness.. it just keeps astonishing me. Gold certainly doesn't have that.

There's nothing more beautiful since I first read the bitcoin white paper 8 months ago. And I am not even maths or computer geek!