Bitcoin Forum

Economy => Speculation => Topic started by: BrBoy on January 05, 2012, 11:37:29 AM



Title: $7 today?!!
Post by: BrBoy on January 05, 2012, 11:37:29 AM
Hey it was not $5 yesterday?


Title: Re: $7 today?!!
Post by: Nesetalis on January 05, 2012, 11:40:58 AM
it was 4.8


Title: Re: $7 today?!!
Post by: bulanula on January 05, 2012, 11:43:58 AM
Yet another one of these threads. LOL

$9 tomorrow for sure.


Title: Re: $7 today?!!
Post by: ArsenShnurkov on January 05, 2012, 02:05:46 PM
$9 tomorrow for sure.

Absolutely no way. I think it will stagnate at the current price for 2-3 days, then fall to 5.5


Title: Re: $7 today?!!
Post by: SpontaneousDisorder on January 05, 2012, 02:21:22 PM
I bought some so it must crash. :)


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 02:26:21 PM
100 by the end of week? )




Title: Re: $7 today?!!
Post by: teflone on January 05, 2012, 02:45:43 PM
I bought some so it must crash. :)


Hahahaha, thats how I feel, except I sold, so its going up.. it ALWAYS does..


Title: Re: $7 today?!!
Post by: Ean on January 05, 2012, 02:49:35 PM
I bought some so it must crash. :)


Hahahaha, thats how I feel, except I sold, so its going up.. it ALWAYS does..
You should make your trades public so the rest of us know what to do.


Title: Re: $7 today?!!
Post by: BadBear on January 05, 2012, 03:01:39 PM
I bought some so it must crash. :)


Hahahaha, thats how I feel, except I sold, so its going up.. it ALWAYS does..

Whats happening lately is good enough for me to hold for a while.  I think we'll see a rise to 10-15 before the next major correction.   


Title: Re: $7 today?!!
Post by: cypherdoc on January 05, 2012, 03:08:11 PM
$9 tomorrow for sure.

Absolutely no way. I think it will stagnate at the current price for 2-3 days, then fall to 5.5

boy, you sure missed out.


Title: Re: $7 today?!!
Post by: zby on January 05, 2012, 03:28:25 PM
Hmm - the number of threads like this is growing.  Maybe people are now fully in BTC?


Title: Re: $7 today?!!
Post by: kjlimo on January 05, 2012, 04:03:26 PM
100 by the end of week? )




+1

I bought some so it must crash. :)


Hahahaha, thats how I feel, except I sold, so its going up.. it ALWAYS does..

+1

I'm rooting for continued volatility, and can it hold out one week for my paycheck to get  in there!?!?!?!


Title: Re: $7 today?!!
Post by: wndrbr3d on January 05, 2012, 04:06:59 PM
Hoarders gonna hoard.

I'm waiting for the first BIG hoarder to take a fat dump on this rally.


Title: Re: $7 today?!!
Post by: proudhon on January 05, 2012, 04:30:10 PM
Quote
$7 today?!!
6.25 is the wall now

What?  There's only 2500BTC between the current price and > $6.25.


Title: Re: $7 today?!!
Post by: proudhon on January 05, 2012, 04:44:16 PM
Quote
$7 today?!!
6.25 is the wall now

What?  There's only 2500BTC between the current price and > $6.25.
about 15 000 bitcoin traded and none got over 6.25

I see.


Title: Re: $7 today?!!
Post by: ArsenShnurkov on January 05, 2012, 04:59:02 PM
about 15 000 bitcoin traded and none got over 6.25

Every true bear should defend his position by both words and deeds :)


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 05:03:35 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week

prepare for lift off

$10 is easy on the horizon


Title: Re: $7 today?!!
Post by: Mushoz on January 05, 2012, 05:08:22 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week

prepare for lift off

$10 is easy on the horizon

Seriously?! Wow, that's one of the best spots I can image to bring this technology to the media and to more people. Loads of smart and technically inclined people, who will definitely understand this much faster and see the benefits it can bring. Kudos to Bit-Pay! Let's hope the media coverage will be good :)


Title: Re: $7 today?!!
Post by: ineededausername on January 05, 2012, 05:09:30 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week

prepare for lift off

$10 is easy on the horizon

Seriously?! Wow, that's one of the best spots I can image to bring this technology to the media and to more people. Loads of smart and technically inclined people, who will definitely understand this much faster and see the benefits it can bring. Kudos to Bit-Pay! Let's hope the media coverage will be good :)

+1... that's amazing :O


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 05:12:02 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week

prepare for lift off

$10 is easy on the horizon

Seriously?! Wow, that's one of the best spots I can image to bring this technology to the media and to more people. Loads of smart and technically inclined people, who will definitely understand this much faster and see the benefits it can bring. Kudos to Bit-Pay! Let's hope the media coverage will be good :)

+1... that's amazing :O

this is as early and best signal as anyone could have - get on board now till it's too late

current exchange rates will look ridiculously low in a few months


Title: Re: $7 today?!!
Post by: Litt on January 05, 2012, 05:15:47 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week

prepare for lift off

$10 is easy on the horizon

hmm Bit-pay girls at CES promoting bitcoin POS system. Now that is some real bitcoin marketing right there. It's a pretty big news.


Title: Re: $7 today?!!
Post by: ineededausername on January 05, 2012, 05:16:11 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week

prepare for lift off

$10 is easy on the horizon

Seriously?! Wow, that's one of the best spots I can image to bring this technology to the media and to more people. Loads of smart and technically inclined people, who will definitely understand this much faster and see the benefits it can bring. Kudos to Bit-Pay! Let's hope the media coverage will be good :)

+1... that's amazing :O

this is as early and best signal as anyone could have - get on board now till it's too late

current exchange rates will look ridiculously low in a few months

With the TV show and the CES booth, I think we are heading in the direction of new highs. ($50, anyone?)


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 05:18:27 PM
....
With the TV show and the CES booth, I think we are heading in the direction of new highs. ($50, anyone?)

just don't look like :o when it reaches it, you have been warned


Title: Re: $7 today?!!
Post by: miscreanity on January 05, 2012, 07:12:38 PM
Already breached $7 on Intersango (https://intersango.com/) & BTCex (https://btcex.com/).


Title: Re: $7 today?!!
Post by: NamelessOne on January 05, 2012, 07:14:49 PM
Already breached $7 on Intersango (https://intersango.com/) & BTCex (https://btcex.com/).

Most excellent!  ;D


Title: Re: $7 today?!!
Post by: StewartJ on January 05, 2012, 07:19:09 PM
$9 tomorrow for sure.

Absolutely no way. I think it will stagnate at the current price for 2-3 days, then fall to 5.5

I agree it will "stagnate"  for a day or two (I like the term "stabilize" myself), then continue on its merry way
upwards, probably close to $7.00, if not $7.25.  I am ascertaining this from past trends, and we are speculating
on the upside, the sentiment has been bullish for some time.


Title: Re: $7 today?!!
Post by: GeniuSxBoY on January 05, 2012, 07:21:17 PM
Thread only works when ineededausername creates it  :D


Title: Re: $7 today?!!
Post by: bulanula on January 05, 2012, 07:28:33 PM
Thread only works when ineededausername creates it  :D

Ehm, I think you meant "The manipulator" ;D


Title: Re: $7 today?!!
Post by: StewartJ on January 05, 2012, 07:30:24 PM
Quote
$7 today?!!
6.25 is the wall now

What?  There's only 2500BTC between the current price and > $6.25.
about 15 000 bitcoin traded and none got over 6.25

We are going to be trading at S6.xx for a while.


Title: Re: $7 today?!!
Post by: ineededausername on January 05, 2012, 07:31:29 PM
Thread only works when ineededausername creates it  :D

Ehm, I think you meant "The manipulator" ;D

lol, we aren't going to see $7 because I didn't make the Official Manipulator's Announcement ;D


Title: Re: $7 today?!!
Post by: StewartJ on January 05, 2012, 07:33:23 PM
Thread only works when ineededausername creates it  :D

Ehm, I think you meant "The manipulator" ;D

lol, we aren't going to see $7 because I didn't make the Official Manipulator's Announcement ;D

If you will just give me a minute to load up on some BTC...  OK ready when you are


Title: Re: $7 today?!!
Post by: SgtSpike on January 05, 2012, 07:40:59 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week

prepare for lift off

$10 is easy on the horizon
Now, I wonder how many people are holding off on selling their earnings knowing that information?  And how well it will supply those new demands when they do decide to dump their holdings?

I'm definitely holding off on selling my most recently mined BTC though until some point after the conference.  Don't worry, I'll only have 15 or so by then, haha.


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 07:43:01 PM
sorry guys, i didn't mean to kill today's sell-off dump )


Title: Re: $7 today?!!
Post by: ineededausername on January 05, 2012, 07:54:48 PM
Go to mtgoxlive and compare the depth there with this one:
http://farm8.staticflickr.com/7167/6526007815_5387586a46_b_d.jpg

They look awfully similar.  Last time this happened, the price shot up by around 40%.


Title: Re: $7 today?!!
Post by: BadBear on January 05, 2012, 08:01:32 PM
Indeed.  Of course seems like every time the market gets predictable it changes it up.   


Title: Re: $7 today?!!
Post by: Litt on January 05, 2012, 09:18:29 PM
Indeed.  Of course seems like every time the market gets predictable it changes it up.   

Market may be unpredictable, but human psychology is rather predictable in comparison.

I'm not sure if people want to miss out on buying btc at $6 like they did at $5, $4, $3, and so on.

Btc won't be staying at $6 for long.


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 09:20:50 PM
quick! some one dump whole bunch of bitcoins!  :D


Title: Re: $7 today?!!
Post by: casascius on January 05, 2012, 09:24:35 PM
I'm going to CES for a day next week.

I understand Roger Ver (MemoryDealers) is going to be there selling physical bitcoins for cash.  Since I had to drop $600 a night just to get a hotel room there - nothing on the LV strip decent available for under $400 - it's not like people there are going to be poor, nor few in numbers, nor (it being CES) will they be techno noobs.

I anticipate bringing tons of them to keep them stocked up just in case.  I will probably bring several dozen 1000 BTC bars, and numerous 25 and 100 BTC items.  Who knows what'll sell, but everything that sells is going to see an offsetting transaction on MtGox.


Title: Re: $7 today?!!
Post by: ineededausername on January 05, 2012, 09:28:04 PM
I anticipate bringing tons of them to keep them stocked up just in case.  I will probably bring several dozen 1000 BTC bars, and numerous 25 and 100 BTC items.  Who knows what'll sell, but everything that sells is going to see an offsetting transaction on MtGox.

:o

GUARANTEED SPIKES BUY BUY BUY.

Spike up to $7: large short squeeze.  <20k BTC needed for this one.
Beyond $7, no asks.


Title: Re: $7 today?!!
Post by: Crypt_Current on January 05, 2012, 09:35:54 PM
I just spammed my FB hard about BTC -- 300 of the people I know best are either going to lose or win here


Title: Re: $7 today?!!
Post by: SgtSpike on January 05, 2012, 09:43:50 PM
I'm going to CES for a day next week.

I understand Roger Ver (MemoryDealers) is going to be there selling physical bitcoins for cash.  Since I had to drop $600 a night just to get a hotel room there - nothing on the LV strip decent available for under $400 - it's not like people there are going to be poor, nor few in numbers, nor (it being CES) will they be techno noobs.

I anticipate bringing tons of them to keep them stocked up just in case.  I will probably bring several dozen 1000 BTC bars, and numerous 25 and 100 BTC items.  Who knows what'll sell, but everything that sells is going to see an offsetting transaction on MtGox.
You're going to wait to fill the bars and coins until they are sold, I presume?  And you don't have that much BTC, so you'll buy BTC for each one that sells?

EDIT:  Just bought back in with the proceeds from my last month and a half of mining that I had been selling.  Sucks to effectively get half of the Bitcoins I sold, but I am very bearish at the moment.  We'll see...


Title: Re: $7 today?!!
Post by: Litt on January 05, 2012, 09:53:06 PM
I just spammed my FB hard about BTC -- 300 of the people I know best are either going to lose or win here

A few friends of mine are getting anxiously waiting right now for the dwolla deposit to show up. They have been complaining how the price have gone up so much since they decided to buy. And no I didn't let them buy my coins.  ;D

Not my problem! I've been telling them to buy since last year to take advantage of this rally in progress. Better late than never though..


Title: Re: $7 today?!!
Post by: casascius on January 05, 2012, 09:56:16 PM
I'm going to CES for a day next week.

I understand Roger Ver (MemoryDealers) is going to be there selling physical bitcoins for cash.  Since I had to drop $600 a night just to get a hotel room there - nothing on the LV strip decent available for under $400 - it's not like people there are going to be poor, nor few in numbers, nor (it being CES) will they be techno noobs.

I anticipate bringing tons of them to keep them stocked up just in case.  I will probably bring several dozen 1000 BTC bars, and numerous 25 and 100 BTC items.  Who knows what'll sell, but everything that sells is going to see an offsetting transaction on MtGox.
You're going to wait to fill the bars and coins until they are sold, I presume?  And you don't have that much BTC, so you'll buy BTC for each one that sells?

EDIT:  Just bought back in with the proceeds from my last month and a half of mining that I had been selling.  Sucks to effectively get half of the Bitcoins I sold, but I am very bearish at the moment.  We'll see...

I have 50k of mtgox USD locked and loaded, not on the order book anywhere, so I can dispense BTC based on market rates without worrying about my personal BTC or whether the rates will go up or down until then.


Title: Re: $7 today?!!
Post by: Mushoz on January 05, 2012, 09:57:52 PM
I'm going to CES for a day next week.

I understand Roger Ver (MemoryDealers) is going to be there selling physical bitcoins for cash.  Since I had to drop $600 a night just to get a hotel room there - nothing on the LV strip decent available for under $400 - it's not like people there are going to be poor, nor few in numbers, nor (it being CES) will they be techno noobs.

I anticipate bringing tons of them to keep them stocked up just in case.  I will probably bring several dozen 1000 BTC bars, and numerous 25 and 100 BTC items.  Who knows what'll sell, but everything that sells is going to see an offsetting transaction on MtGox.
You're going to wait to fill the bars and coins until they are sold, I presume?  And you don't have that much BTC, so you'll buy BTC for each one that sells?

EDIT:  Just bought back in with the proceeds from my last month and a half of mining that I had been selling.  Sucks to effectively get half of the Bitcoins I sold, but I am very bearish at the moment.  We'll see...

I have 50k of mtgox USD locked and loaded, not on the order book anywhere, so I can dispense BTC without worrying about my personal BTC.

Quick! You can still catch the rally with your 50k ;D


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 09:59:11 PM
I have 50k of mtgox USD locked and loaded, not on the order book anywhere, so I can dispense BTC based on market rates without worrying about my personal BTC or whether the rates will go up or down until then.

chain that ubikey


Title: Re: $7 today?!!
Post by: DeathAndTaxes on January 05, 2012, 10:00:08 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week


Wow is there a there a thread on that.  Pretty big news.


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 10:00:53 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week


Wow is there a there a thread on that.  Pretty big news.

https://bitcointalk.org/index.php?topic=56706.0


Title: Re: $7 today?!!
Post by: SgtSpike on January 05, 2012, 10:05:22 PM
I'm going to CES for a day next week.

I understand Roger Ver (MemoryDealers) is going to be there selling physical bitcoins for cash.  Since I had to drop $600 a night just to get a hotel room there - nothing on the LV strip decent available for under $400 - it's not like people there are going to be poor, nor few in numbers, nor (it being CES) will they be techno noobs.

I anticipate bringing tons of them to keep them stocked up just in case.  I will probably bring several dozen 1000 BTC bars, and numerous 25 and 100 BTC items.  Who knows what'll sell, but everything that sells is going to see an offsetting transaction on MtGox.
You're going to wait to fill the bars and coins until they are sold, I presume?  And you don't have that much BTC, so you'll buy BTC for each one that sells?

EDIT:  Just bought back in with the proceeds from my last month and a half of mining that I had been selling.  Sucks to effectively get half of the Bitcoins I sold, but I am very bearish at the moment.  We'll see...

I have 50k of mtgox USD locked and loaded, not on the order book anywhere, so I can dispense BTC based on market rates without worrying about my personal BTC or whether the rates will go up or down until then.
That's good!  That'll buy a decent amount of BTC... at least for now.  :P


Title: Re: $7 today?!!
Post by: simonk83 on January 05, 2012, 10:52:34 PM
$7 is actually looking possible today..... crazy


Title: Re: $7 today?!!
Post by: istar on January 05, 2012, 10:57:21 PM
Bit-pay is going to have a booth at CES (consumer electronic show) in Vegas next week

prepare for lift off

$10 is easy on the horizon

Seriously?! Wow, that's one of the best spots I can image to bring this technology to the media and to more people. Loads of smart and technically inclined people, who will definitely understand this much faster and see the benefits it can bring. Kudos to Bit-Pay! Let's hope the media coverage will be good :)

Not sure people will care that much.


Title: Re: $7 today?!!
Post by: BrBoy on January 05, 2012, 11:22:04 PM
$7 is actually looking possible today..... crazy
In the point we are now $7 is possible today.

intersango.com and btcex.com already touched $7.


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 11:35:11 PM
6.5 - bold move


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 11:37:38 PM
TOUCHDOWN! 7!


Title: Re: $7 today?!!
Post by: freshzive on January 05, 2012, 11:37:54 PM
Wow.


Title: Re: $7 today?!!
Post by: jothan on January 05, 2012, 11:39:56 PM
TOUCHDOWN! 7!

Holy mother of elliptic cryptography !

I pussied out at 5.60 yesterday, hoping to buy back at 5.40.

Sheesh, 7.1 ATM.


Title: Re: $7 today?!!
Post by: druid on January 05, 2012, 11:41:06 PM

Holy mother of elliptic cryptography !

I pussied out at 5.60 yesterday, hoping to buy back at 5.40.

Sheesh, 7.1 ATM.
same, Im such a noob :/


Title: Re: $7 today?!!
Post by: Serge on January 05, 2012, 11:45:57 PM
it's going to be crazy ups and downs from now on

rebuy and hold 'em tight, else sharks will get all your cheap coins


Title: Re: $7 today?!!
Post by: BrBoy on January 05, 2012, 11:53:02 PM
That was faster!

MTGOX:   Last    7.1200
BTCEX:   Last   7.3999


Title: Re: $7 today?!!
Post by: the joint on January 05, 2012, 11:53:47 PM
Haha man oh man, this shit is like christmas!


Title: Re: $7 today?!!
Post by: SgtSpike on January 05, 2012, 11:54:26 PM
Glad I bought back in then.  :)

The question remains, how much of this rally is simply anticipation of the CES?  How much will the price fall again after said conference is over?


Title: Re: $7 today?!!
Post by: the joint on January 05, 2012, 11:58:15 PM
I've already reaped my profits.  Waitin' for a dip to re-buy.  Nice to know I have my profits locked in at 7.  Lookin' to pull the trigger again...


Title: Re: $7 today?!!
Post by: jothan on January 06, 2012, 12:07:08 AM
Haha man oh man, this shit is like christmas!

I zhouthonged myself a sell at 7.00, hoping its gonna be like christmas !


Title: Re: $7 today?!!
Post by: Mark Oates on January 06, 2012, 12:14:17 AM
someone's making a ton of bucks on the 7.07-7.20 bouncy bounce!  ;D

Glad I bought back in then.  :)

The question remains, how much of this rally is simply anticipation of the CES?  How much will the price fall again after said conference is over?
Mmmneyah... I'm not so sure people are that concerned about CES.


Title: Re: $7 today?!!
Post by: casascius on January 06, 2012, 12:21:37 AM
I think at CES, a few people will buy a few bitcoins.  That's about it.  CES is about too many other things than Bitcoin for it to be that big of a deal.  Of course, right now, when $30k or $50k gets dumped into bitcoin by people who have no plans to flip it back as fast as they can, that pushes the price up some and keeps it there.  But we won't know until we get there.

The real reason I believe the price is rising fast, is because the media has finally stopped parroting each another about how "Bitcoin is dead and done", and has moved on to writing about the "bitcoin collapse that never happened".

If you think about it, the only reason we really crashed is because people got (understandably) spooked at large thefts and panicked - a self-sustaining reaction.

Now that we all know not to keep our bitcoins on anonymous websites and hopefully not on our computers either, the whole reason we ever went from $30 to $2 in the first place no longer exists.  And the news headline "new virus mines bitcoins" or "new trojan steals wallets" doesn't phase us anymore.

On top of that, you have people issuing investment advice that people should be keeping a small chunk of their net worth in bitcoins.  A small chunk of even a fraction of the world's investors who'd take advice like that is massively greater than a few hundred grand or a few million sitting between the current price and $30 again.

I would say the train has left.  Good luck waiting around for that deal.  The next big predictable shocker that I believe will stun the value of the Bitcoin again is when the transaction demand overwhelms the P2P network and makes it prohibitive for all but the most valuable transactions, and people will then realize "ok, Bitcoin block chain is not useful for free everyday payments anymore, but now is the backing currency for a bunch of independent banks".  A negative paradigm shift people will have to get over, and maybe it will drop a BTC worth $500 back to one worth $50.


Title: Re: $7 today?!!
Post by: miscreanity on January 06, 2012, 12:29:39 AM
Now it's getting uncomfortable. If I weren't using weighted prices for analysis, I'd be ready to sell a good amount of my holdings. Instead, there's still plenty of room for a correction into stability by the end of the week. There's also a lot of air above us now; $30 seems to be beckoning.

Bitcoin may be exhibiting early signs of a giffen good (http://www.investopedia.com/terms/g/giffen-good.asp). If so, it'll make gold's rise seem quaint by comparison (as if it hasn't already).

Major points to watch:

  • Bit-pay showcasing at the CES
  • Federal Reserve QE3 or "inflation targeting"
  • Rapid succession of capital control implementation

There are others, but those could cause a magnitude 9.2 in the Bitcoin world - to the upside. A number of articles in major media (http://lovebitcoins.org/media.html) hit during the last few months, which may be sparking another round of public interest. That would explain what seems to be continuing fresh capital inflow.

The CES spot isn't about merely buying Bitcoins, but about their potential benefits over existing payment methods. That speaks to businesses' bottom line in an environment where margins are being squeezed ever tighter. It will raise eyebrows for newcomers, particularly with the ease of use compared to acquiring a smartphone credit card reader and dealing with all the other hoops required for other methods.

It's time for amateurs to lock in stop-losses and halt further trading, and pros to get some hedging in place. The greater the flow, the wider the swings. Prepare your emesis bags: things are about to get bloody.


Title: Re: $7 today?!!
Post by: Litt on January 06, 2012, 12:46:27 AM
Haha man oh man, this shit is like christmas!

I zhouthonged myself a sell at 7.00, hoping its gonna be like christmas !

You are doing it wrong.


Title: Re: $7 today?!!
Post by: tvbcof on January 06, 2012, 12:48:51 AM

...

I would say the train has left.  Good luck waiting around for that deal.  The next big predictable shocker that I believe will stun the value of the Bitcoin again is when the transaction demand overwhelms the P2P network and makes it prohibitive for all but the most valuable transactions, and people will then realize "ok, Bitcoin block chain is not useful for free everyday payments anymore, but now is the backing currency for a bunch of independent banks".  A negative paradigm shift people will have to get over, and maybe it will drop a BTC worth $500 back to one worth $50.

Or by that point we'll have a situation where organizations will be saying "Hey, use PeepCoin because we have a whole day's worth of Bitcoin production (1800 BTC) backing it's value among a bunch of other usability bells and whistles."

Maybe that is effectively what you are saying, but in that scenario I would see Bitcoin values mostly just continue to rise until the demand for crypto-currencies was saturated.  The main Bitcoin transactions would be relatively large transfers swapping backing value between competing crypto-currencies.



Title: Re: $7 today?!!
Post by: casascius on January 06, 2012, 12:54:36 AM
Maybe that is effectively what you are saying, but in that scenario I would see Bitcoin values mostly just continue to rise until the demand for crypto-currencies was saturated.  The main Bitcoin transactions would be relatively large transfers swapping backing value between competing crypto-currencies.

Quite possibly.  When that problem approaches, some time will be bought, I think, by big players running the only functioning instances of bitcoind (which will all have to be on highly connected servers), and most users of bitcoin will be using it through electrum-like clients and wallet services.  People will have to pay a meaningful fee to create a real block chain transaction, which would be today's equivalent of a bank wire.  Everyday people will conduct business through bitcoin "banks", today's equivalent of someone sending BTC from their MtGox account to another MtGox account.  (Such a transfer settles privately and never appears on the block chain.)

The presentation by Dan Kaminsky pretty much predicts this same thing, though Kaminsky frames it as us having to go back to the same "banks" Bitcoin was created to free us from.  I don't see it so harshly though - because these banks will be propped up by the free market and backed by free market currency, not propped up by the government and backed by a promise that the government will print more money and/or confiscate more wealth from the people to make up for anything that goes wrong.


Title: Re: $7 today?!!
Post by: SgtSpike on January 06, 2012, 01:15:51 AM
Maybe that is effectively what you are saying, but in that scenario I would see Bitcoin values mostly just continue to rise until the demand for crypto-currencies was saturated.  The main Bitcoin transactions would be relatively large transfers swapping backing value between competing crypto-currencies.

Quite possibly.  When that problem approaches, some time will be bought, I think, by big players running the only functioning instances of bitcoind (which will all have to be on highly connected servers), and most users of bitcoin will be using it through electrum-like clients and wallet services.  People will have to pay a meaningful fee to create a real block chain transaction, which would be today's equivalent of a bank wire.  Everyday people will conduct business through bitcoin "banks", today's equivalent of someone sending BTC from their MtGox account to another MtGox account.  (Such a transfer settles privately and never appears on the block chain.)

The presentation by Dan Kaminsky pretty much predicts this same thing, though Kaminsky frames it as us having to go back to the same "banks" Bitcoin was created to free us from.  I don't see it so harshly though - because these banks will be propped up by the free market and backed by free market currency, not propped up by the government and backed by a promise that the government will print more money and/or confiscate more wealth from the people to make up for anything that goes wrong.
...and then, a government who likes Bitcoin will decide to print notes of exchange for them!  They will keep 100% reserves of Bitcoins to match the notes printed, so each person can be certain that each 1 Bitcoin note will be worth exactly 1 Bitcoin, and can exchange them with the government at any time.  But then, the government changes the name to "Notes", and doesn't keep a 100% reserve anymore.  They continue printing the notes, despite the lack of Bitcoins backing them.  Finally, said government withdraws the ability for people to exchange their notes for Bitcoins.

I would hope that this wouldn't happen, but would almost laugh if it did.  Fortunately, those of us holding BTC from the start would be the ones in a good place when/if something like that ever went down.


Title: Re: $7 today?!!
Post by: paraipan on January 06, 2012, 01:26:48 AM
Maybe that is effectively what you are saying, but in that scenario I would see Bitcoin values mostly just continue to rise until the demand for crypto-currencies was saturated.  The main Bitcoin transactions would be relatively large transfers swapping backing value between competing crypto-currencies.

Quite possibly.  When that problem approaches, some time will be bought, I think, by big players running the only functioning instances of bitcoind (which will all have to be on highly connected servers), and most users of bitcoin will be using it through electrum-like clients and wallet services.  People will have to pay a meaningful fee to create a real block chain transaction, which would be today's equivalent of a bank wire.  Everyday people will conduct business through bitcoin "banks", today's equivalent of someone sending BTC from their MtGox account to another MtGox account.  (Such a transfer settles privately and never appears on the block chain.)

The presentation by Dan Kaminsky pretty much predicts this same thing, though Kaminsky frames it as us having to go back to the same "banks" Bitcoin was created to free us from.  I don't see it so harshly though - because these banks will be propped up by the free market and backed by free market currency, not propped up by the government and backed by a promise that the government will print more money and/or confiscate more wealth from the people to make up for anything that goes wrong.
...and then, a government who likes Bitcoin will decide to print notes of exchange for them!  They will keep 100% reserves of Bitcoins to match the notes printed, so each person can be certain that each 1 Bitcoin note will be worth exactly 1 Bitcoin, and can exchange them with the government at any time.  But then, the government changes the name to "Notes", and doesn't keep a 100% reserve anymore.  They continue printing the notes, despite the lack of Bitcoins backing them.  Finally, said government withdraws the ability for people to exchange their notes for Bitcoins.

I would hope that this wouldn't happen, but would almost laugh if it did.  Fortunately, those of us holding BTC from the start would be the ones in a good place when/if something like that ever went down.

amen. I'd put those it in my testament along with a nice qr where my wallet was stored


Title: Re: $7 today?!!
Post by: tvbcof on January 06, 2012, 01:28:04 AM
Maybe that is effectively what you are saying, but in that scenario I would see Bitcoin values mostly just continue to rise until the demand for crypto-currencies was saturated.  The main Bitcoin transactions would be relatively large transfers swapping backing value between competing crypto-currencies.

Quite possibly.  When that problem approaches, some time will be bought, I think, by big players running the only functioning instances of bitcoind (which will all have to be on highly connected servers)

I'm suspecting that I'll be operating a few in one cloud or another or some corner of a datacenter.  It would be most distasteful to me if/when it comes to this however.  I very much like the fact that almost anyone can run the full block-chain almost anywhere, and Bitcoin will be a much less compelling proposition to me when this is no longer the case.

, and most users of bitcoin will be using it through electrum-like clients and wallet services.  People will have to pay a meaningful fee to create a real block chain transaction, which would be today's equivalent of a bank wire.  Everyday people will conduct business through bitcoin "banks", today's equivalent of someone sending BTC from their MtGox account to another MtGox account.  (Such a transfer settles privately and never appears on the block chain.)

The presentation by Dan Kaminsky pretty much predicts this same thing, though Kaminsky frames it as us having to go back to the same "banks" Bitcoin was created to free us from.  I don't see it so harshly though - because these banks will be propped up by the free market and backed by free market currency, not propped up by the government and backed by a promise that the government will print more money and/or confiscate more wealth from the people to make up for anything that goes wrong.

I don't really see the necessity for banks (though I've got nothing against them as an option and recognize some of the nicities in terms of efficiency and speed.)

With a myriad of different kinds of crypto-currencies distributed the load of a fraction of a global economy, it seems to me that people could opt to use crypto-currencies independently of banks as an option.  I might choose to run (and possibly mine) PeepCoin and NewNameCoin because they cover my needs, but neglect SilkCoin because drugs are not an interest of mine these days (and if I get an urge to toke out again after 20 years, it's easy to trade some PeepCoin for some SilkCoin on an exchange.)  I might also be forced to mine Bitcoin because that is one of the requirements of mining (or just using) PeepCoin.

Or I may choose to avoid the hassles and just use a bank.



Title: Re: $7 today?!!
Post by: kjj on January 06, 2012, 01:35:45 AM
...and then, a government who likes Bitcoin will decide to print notes of exchange for them!  They will keep 100% reserves of Bitcoins to match the notes printed, so each person can be certain that each 1 Bitcoin note will be worth exactly 1 Bitcoin, and can exchange them with the government at any time.  But then, the government changes the name to "Notes", and doesn't keep a 100% reserve anymore.  They continue printing the notes, despite the lack of Bitcoins backing them.  Finally, said government withdraws the ability for people to exchange their notes for Bitcoins.

I would hope that this wouldn't happen, but would almost laugh if it did.  Fortunately, those of us holding BTC from the start would be the ones in a good place when/if something like that ever went down.

This cycle takes decades.  Essentially, they can't start the next round of bait-and-switch until most of the people that lived through the end of the last round are dead.


Title: Re: $7 today?!!
Post by: SgtSpike on January 06, 2012, 01:55:04 AM
Maybe that is effectively what you are saying, but in that scenario I would see Bitcoin values mostly just continue to rise until the demand for crypto-currencies was saturated.  The main Bitcoin transactions would be relatively large transfers swapping backing value between competing crypto-currencies.

Quite possibly.  When that problem approaches, some time will be bought, I think, by big players running the only functioning instances of bitcoind (which will all have to be on highly connected servers)

I'm suspecting that I'll be operating a few in one cloud or another or some corner of a datacenter.  It would be most distasteful to me if/when it comes to this however.  I very much like the fact that almost anyone can run the full block-chain almost anywhere, and Bitcoin will be a much less compelling proposition to me when this is no longer the case.

, and most users of bitcoin will be using it through electrum-like clients and wallet services.  People will have to pay a meaningful fee to create a real block chain transaction, which would be today's equivalent of a bank wire.  Everyday people will conduct business through bitcoin "banks", today's equivalent of someone sending BTC from their MtGox account to another MtGox account.  (Such a transfer settles privately and never appears on the block chain.)

The presentation by Dan Kaminsky pretty much predicts this same thing, though Kaminsky frames it as us having to go back to the same "banks" Bitcoin was created to free us from.  I don't see it so harshly though - because these banks will be propped up by the free market and backed by free market currency, not propped up by the government and backed by a promise that the government will print more money and/or confiscate more wealth from the people to make up for anything that goes wrong.

I don't really see the necessity for banks (though I've got nothing against them as an option and recognize some of the nicities in terms of efficiency and speed.)

With a myriad of different kinds of crypto-currencies distributed the load of a fraction of a global economy, it seems to me that people could opt to use crypto-currencies independently of banks as an option.  I might choose to run (and possibly mine) PeepCoin and NewNameCoin because they cover my needs, but neglect SilkCoin because drugs are not an interest of mine these days (and if I get an urge to toke out again after 20 years, it's easy to trade some PeepCoin for some SilkCoin on an exchange.)  I might also be forced to mine Bitcoin because that is one of the requirements of mining (or just using) PeepCoin.

Or I may choose to avoid the hassles and just use a bank.
I think using banks is going to become unavoidable, if for no reason other than the confirmations issue.  If you have a bank account with Bitcoins in it, and a trusted entity (a bank) promises to pay a merchant on your behalf for goods you want to buy, then there is no need for said merchant to wait for confirmations to process a transaction.  All they need to do is receive confirmation from the bank that the bank promises to pay.

A debit card for Bitcoins, if you will.

A merchant could accept 0-conf transactions as "good enough", which would work for a while, but it wouldn't be long before people came up with all sorts of schemes and softwares to help them rip off the retail stores (i.e. make a transaction appear on the retailer's system, then withdraw it or create another transaction using the same funds).  And judging by the number of people who have no ethical problem with pirating copyrighted content, I have no doubt that this sort of activity would be rampant if retailers accepted 0-conf transactions.

Anywho, that's my tangent on this thread for the day.


...and then, a government who likes Bitcoin will decide to print notes of exchange for them!  They will keep 100% reserves of Bitcoins to match the notes printed, so each person can be certain that each 1 Bitcoin note will be worth exactly 1 Bitcoin, and can exchange them with the government at any time.  But then, the government changes the name to "Notes", and doesn't keep a 100% reserve anymore.  They continue printing the notes, despite the lack of Bitcoins backing them.  Finally, said government withdraws the ability for people to exchange their notes for Bitcoins.

I would hope that this wouldn't happen, but would almost laugh if it did.  Fortunately, those of us holding BTC from the start would be the ones in a good place when/if something like that ever went down.

This cycle takes decades.  Essentially, they can't start the next round of bait-and-switch until most of the people that lived through the end of the last round are dead.
And until they swap some words around in the published and taught history textbooks.  ;)


Title: Re: $7 today?!!
Post by: BrBoy on January 06, 2012, 09:15:52 AM
Top was $7.22... Volume is also high 211,995.46


Title: Re: $7 today?!!
Post by: waspoza on January 06, 2012, 05:04:31 PM
I think using banks is going to become unavoidable, if for no reason other than the confirmations issue.  If you have a bank account with Bitcoins in it, and a trusted entity (a bank) promises to pay a merchant on your behalf for goods you want to buy, then there is no need for said merchant to wait for confirmations to process a transaction.  All they need to do is receive confirmation from the bank that the bank promises to pay.

A debit card for Bitcoins, if you will.

A merchant could accept 0-conf transactions as "good enough", which would work for a while, but it wouldn't be long before people came up with all sorts of schemes and softwares to help them rip off the retail stores (i.e. make a transaction appear on the retailer's system, then withdraw it or create another transaction using the same funds).  And judging by the number of people who have no ethical problem with pirating copyrighted content, I have no doubt that this sort of activity would be rampant if retailers accepted 0-conf transactions.

Banks could use green adresses (https://en.bitcoin.it/wiki/Green_address) to 0 conf transactions. It should be safe i think.


Title: Re: $7 today?!!
Post by: GeniuSxBoY on January 06, 2012, 05:16:56 PM
wwhhhyyy iissssnn'''ttt cllllaaaarrrkkkk mmmooooooddddddyyyyyy wwwwooorrrrkkkiiiiinnnnnggg pppprrrrrooooppppeeerrrrllllyyyy


Title: Re: $7 today?!!
Post by: Serge on January 06, 2012, 05:17:57 PM
wwhhhyyy iissssnn'''ttt cllllaaaarrrkkkk mmmooooooddddddyyyyyy wwwwooorrrrkkkiiiiinnnnnggg pppprrrrrooooppppeeerrrrllllyyyy

is there anything that works at all atm ???



Title: Re: $7 today?!!
Post by: SgtSpike on January 06, 2012, 05:24:45 PM
Yeah, exactly waspoza.  A merchant would be much more likely to trust a transaction coming directly from a bank than from a consumer standing there with a handheld Bitcoin client in their hand.

The next step, of course, would be bank-to-bank transfers used as payments.  So basically, you and the merchant both have a bank account, and you issue a payment from your account to theirs.  You and the merchant never actually touch the Bitcoin ledger (and the bank(s) may not have to either), but it's just a balance transfer on paper.  It wouldn't be much different than the current credit card/debit card system.

We moved to using credit/debit cards for convenience.  Given how inconvenient it is to utilize a Bitcoin client in-person, I can imagine we would move to a similar system with Bitcoins.  It's kind of depressing because Bitcoins were made to move away from all of that stuff, but it's reality.  If Bitcoin usage became widespread, more convenient methods of making payments cropping up would be inevitable.


Title: Re: $7 today?!!
Post by: Technomage on January 06, 2012, 06:07:23 PM
The next step, of course, would be bank-to-bank transfers used as payments.  So basically, you and the merchant both have a bank account, and you issue a payment from your account to theirs.  You and the merchant never actually touch the Bitcoin ledger (and the bank(s) may not have to either), but it's just a balance transfer on paper.  It wouldn't be much different than the current credit card/debit card system.

We moved to using credit/debit cards for convenience.  Given how inconvenient it is to utilize a Bitcoin client in-person, I can imagine we would move to a similar system with Bitcoins.  It's kind of depressing because Bitcoins were made to move away from all of that stuff, but it's reality.  If Bitcoin usage became widespread, more convenient methods of making payments cropping up would be inevitable.
This is true. I also see it as very likely that certain bank services will continue to be in high demand even in a Bitcoin-economy. There is however, a big difference to how it is now. It's not forced, it's done by choice. Banks essentially have a monopoly on money in our current system which would be removed with Bitcoin. Simply because it is possible for anyone to store and send bitcoins in a very secure and fairly convenient way without relying on any 3rd party.

Using banks for convenience is a matter of choice. Even if most merchants started demanding a green address for instant transactions, I would still be able to store my savings independently and only channel the funds needed for my immediate needs through a third party such as a "bank". Banks of some sort are needed but the system would not be as reliant on them as we are now and banking would also be a significantly smaller business sector because many bank services would see much lower demand than they do now.


Title: Re: $7 today?!!
Post by: miscreanity on January 06, 2012, 06:26:39 PM
There is nothing preventing green address functionality from being implemented in clients, putting bank-style services in the hands of anyone using it. It's no different from allowing popups or saving known passwords for trusted sites using your browser.

A client used in a business setting can easily build a green/trusted list based off repeat transactions. For a franchise, this may include verification against all of the other locations' lists.

There remains room here for traditional 3rd-party banking services, but it is still a matter of choice rather than force as SgtSpike pointed out.


Title: Re: $7 today?!!
Post by: SgtSpike on January 06, 2012, 06:49:25 PM
But see, as long as banks are used, they can manipulate the money supply.  Fractional reserve, and all of that.  If people accept a bank balance as good as coins themselves, then banks can lend out more BTC than they actually have, effectively inflating the BTC supply.  And just as easily, they can withdraw their lending to shore up their reserves and deflate the BTC supply.

If you don't believe banking will be forced, but rather optional, then face-to-face transactioning needs to be solved before we get to that level of Bitcoin usage.  As it is now, you can use a mobile phone to send payments, but again, it can't be trusted at 0-conf, or people will find ways to easily trick the retailers.  Aside from green addresses, which would be controlled by banks or bank-like institutions, or bank-account-to-bank-account balance transfers, I just don't see a way to make point of sale payments with Bitcoins.  Please do prove me wrong on that front though.

IMO, any transaction for a retailer could be trusted at 1-conf, but no one is going to wait 10 minutes for their payment to go through, which makes it just as useless for POS as 6-conf.


Title: Re: $7 today?!!
Post by: tvbcof on January 06, 2012, 07:44:12 PM
...
There remains room here for traditional 3rd-party banking services, but it is still a matter of choice rather than force as SgtSpike pointed out.

I run a full client, but also use Instawallet.org for times when it makes sense and keep some spending money there.

A Bitcoin banking service which allows me alone to control my private keys is a giant step ahead of traditional banks as we know them, but...

The real magic of Bitcoin that attracted me in the first place is that the entire economy can be operated independently and autonomously 'normal' people with very little organisation.  When operation of the network requires specialized connectivity available mainly within datecenters or large private organizations, this will spell to me a very significant weakness against attack in the system and thus a much less interesting solution.



Title: Re: $7 today?!!
Post by: casascius on January 06, 2012, 07:55:11 PM
But see, as long as banks are used, they can manipulate the money supply.  Fractional reserve, and all of that.  If people accept a bank balance as good as coins themselves, then banks can lend out more BTC than they actually have, effectively inflating the BTC supply.  And just as easily, they can withdraw their lending to shore up their reserves and deflate the BTC supply.

I think Bitcoin banks could very easily and credibly prove they have the BTC they say they have via the digital signature function.

The only slightly more difficult part would be them credibly proving that the amount they have on deposit is accurate.  Not impossible though.  I propose a simple straightforward way.

One way they could do this is to create an anonymous list of all their depositors and put them in some sequence.

Example, MtGox could say and sign, "we have 1000000 BTC on deposit", and create an ordered list of balances.  Each entry on the list would have a start and end range, for example, the first entry for example 25 BTC would "start" at 0 and "end" at 25, and the second entry for example 100 BTC would "start" at 25 and "end" at 125.  Each entry would have a public key published with it, and the entire list would be signed by MtGox.  The last item on the list would "end" at 1000000 BTC.

Then MtGox would give each depositor a signed statement that "your deposit, acct xyxy is on our list at <start> and <end>", along with the matching private key for that entry.

Two depositors who could produce messages both claiming the same entry as their deposit could publicly prove that the bank misrepresented its liabilities.

The private and public key scheme included with each line would simply allow the individual depositors to collaborate via some independent registry, so they could anonymously claim ownership of their funds in an effort to look for double allocations without sharing their account numbers or identities at large.  (e.g. they would each sign messages saying "These funds are mine, contact me <how> if you think they're yours", where <how> is generally going to be "publish your contact details encrypted with <public key> and proof that the bank signed a message saying these are yours, and I'll find you.")  While not every depositor would participate, it would only take one collision to discredit the bank - which would be a strong incentive to keep the bank honest.


Title: Re: $7 today?!!
Post by: mb300sd on January 06, 2012, 08:00:49 PM
Multisig transactions should solve all the banking problems. Your deposits are with them, but they cannot move them unless you provide the other signature. Double spends can be prevented because the bank will not sign a double spend. The "bank" is basically reduced to a trusted third party that prevents double spends, allowing merchants to trust 0-conf transactions.


Title: Re: $7 today?!!
Post by: DeathAndTaxes on January 06, 2012, 08:15:51 PM
Yeah, exactly waspoza.  A merchant would be much more likely to trust a transaction coming directly from a bank than from a consumer standing there with a handheld Bitcoin client in their hand.

The next step, of course, would be bank-to-bank transfers used as payments.  So basically, you and the merchant both have a bank account, and you issue a payment from your account to theirs.  You and the merchant never actually touch the Bitcoin ledger (and the bank(s) may not have to either), but it's just a balance transfer on paper.  It wouldn't be much different than the current credit card/debit card system.

We moved to using credit/debit cards for convenience.  Given how inconvenient it is to utilize a Bitcoin client in-person, I can imagine we would move to a similar system with Bitcoins.  It's kind of depressing because Bitcoins were made to move away from all of that stuff, but it's reality.  If Bitcoin usage became widespread, more convenient methods of making payments cropping up would be inevitable.

The convenience of credit cards comes from the inability to use cash online or by mail and the general dangers/issues of purchasing everything w/ cash.

Bitcoin "lack of convenience" is more a technical not fundamental issue.

Imagine something like this:
1) you go shopping and cashier rings up the goods.
2) the little checkout display has a button Bitcoin.
3) you click on it and it displays a QR code.
4) you scan the QR code w/ mobile phone and (based upon an agreed upon format) it has the payment address, amount, and a note for your wallet.
5) you hit send.  3-5 seconds later the cashier gets a payment confirmation, prints the receipt and you walk out of the store.


Title: Re: $7 today?!!
Post by: SgtSpike on January 06, 2012, 09:44:48 PM
But see, as long as banks are used, they can manipulate the money supply.  Fractional reserve, and all of that.  If people accept a bank balance as good as coins themselves, then banks can lend out more BTC than they actually have, effectively inflating the BTC supply.  And just as easily, they can withdraw their lending to shore up their reserves and deflate the BTC supply.

I think Bitcoin banks could very easily and credibly prove they have the BTC they say they have via the digital signature function.

The only slightly more difficult part would be them credibly proving that the amount they have on deposit is accurate.  Not impossible though.  I propose a simple straightforward way.

One way they could do this is to create an anonymous list of all their depositors and put them in some sequence.

Example, MtGox could say and sign, "we have 1000000 BTC on deposit", and create an ordered list of balances.  Each entry on the list would have a start and end range, for example, the first entry for example 25 BTC would "start" at 0 and "end" at 25, and the second entry for example 100 BTC would "start" at 25 and "end" at 125.  Each entry would have a public key published with it, and the entire list would be signed by MtGox.  The last item on the list would "end" at 1000000 BTC.

Then MtGox would give each depositor a signed statement that "your deposit, acct xyxy is on our list at <start> and <end>", along with the matching private key for that entry.

Two depositors who could produce messages both claiming the same entry as their deposit could publicly prove that the bank misrepresented its liabilities.

The private and public key scheme included with each line would simply allow the individual depositors to collaborate via some independent registry, so they could anonymously claim ownership of their funds in an effort to look for double allocations without sharing their account numbers or identities at large.  (e.g. they would each sign messages saying "These funds are mine, contact me <how> if you think they're yours", where <how> is generally going to be "publish your contact details encrypted with <public key> and proof that the bank signed a message saying these are yours, and I'll find you.")  While not every depositor would participate, it would only take one collision to discredit the bank - which would be a strong incentive to keep the bank honest.
Makes sense, though it is a rather complex solution to the problem, and I'm not sure many people would understand.  I wonder how many people would actually participate in verifying such a list, or how many companies could be forced into releasing one?  I mean, look at how many people use MtGox already, despite not knowing whether they actually have enough Bitcoins to cover all of their balances?

It might be one of those domino-effect things, where the first company to start regularly releasing such a list might be favored enough by consumers to force other companies to follow suit.  But, I have a feeling not enough people would be concerned about the fractional reserve problem to spend any of their own time on ensuring companies are kept accountable.

Multisig transactions should solve all the banking problems. Your deposits are with them, but they cannot move them unless you provide the other signature. Double spends can be prevented because the bank will not sign a double spend. The "bank" is basically reduced to a trusted third party that prevents double spends, allowing merchants to trust 0-conf transactions.
Seems reasonable.  I have a feeling that banks wouldn't like that much, and many wouldn't use multisigs.  Smart people would, of course, use this method, but we all know how smart the general populace can be...

Some people might not even want to deal with multisigs either.  They like just swiping a card and entering a pin, and unless/until Bitcoin is just as easy (i.e., doesn't require a mobile phone to provide your piece of the multisig), I think many people would be fine with just letting the bank handle the transactions entirely.

But, hopefully you're right, and multisigs would keep fractional banking to a minimum.

Yeah, exactly waspoza.  A merchant would be much more likely to trust a transaction coming directly from a bank than from a consumer standing there with a handheld Bitcoin client in their hand.

The next step, of course, would be bank-to-bank transfers used as payments.  So basically, you and the merchant both have a bank account, and you issue a payment from your account to theirs.  You and the merchant never actually touch the Bitcoin ledger (and the bank(s) may not have to either), but it's just a balance transfer on paper.  It wouldn't be much different than the current credit card/debit card system.

We moved to using credit/debit cards for convenience.  Given how inconvenient it is to utilize a Bitcoin client in-person, I can imagine we would move to a similar system with Bitcoins.  It's kind of depressing because Bitcoins were made to move away from all of that stuff, but it's reality.  If Bitcoin usage became widespread, more convenient methods of making payments cropping up would be inevitable.

The convenience of credit cards comes from the inability to use cash online or by mail and the general dangers/issues of purchasing everything w/ cash.

Bitcoin "lack of convenience" is more a technical not fundamental issue.

Imagine something like this:
1) you go shopping and cashier rings up the goods.
2) the little checkout display has a button Bitcoin.
3) you click on it and it displays a QR code.
4) you scan the QR code w/ mobile phone and (based upon an agreed upon format) it has the payment address, amount, and a note for your wallet.
5) you hit send.  3-5 seconds later the cashier gets a payment confirmation, prints the receipt and you walk out of the store.
But what if you have a custom client on your mobile phone?  Your custom client could do mischevious things such as:
- Create another transaction right after the first one from the same address to one of your own addresses.  It's a crap shoot as to which transaction gets into the block chain at that point.
- Ensure that it is a transaction that would require a fee.  Then, create the transaction without a fee.  It will never go through (or at least, take a long time to go through), but the cashier will see 0-conf.  In the meantime, you can send those coins to a different address to ensure that transaction never happens.
- Etc, etc, etc.  More loopholes will be found, I am certain.

It's no worse than the type of fraud that people can commit with written checks, but you can see how most stores view those these days...


Title: Re: $7 today?!!
Post by: casascius on January 06, 2012, 09:56:27 PM
We all hopefully realize that the block chain infrastructure is non-scalable to the level of mass retail adoption and that this discussion is academic at best. By the time retail adoption of bitcoin is commonplace, space on the blockchain will have a price, retail purchases will never hit the blockchain, and you will be dealing with a bank that is simply backed in bitcoins and who settles your purchase off the block chain, who will solve this problem the same way Visa debit works.

Watch Dan Kaminsky's presentation. He agrees.


Title: Re: $7 today?!!
Post by: SgtSpike on January 06, 2012, 09:58:44 PM
We all hopefully realize that the block chain infrastructure is non-scalable to the level of mass retail adoption and that this discussion is academic at best. By the time retail adoption of bitcoin is commonplace, space on the blockchain will have a price, retail purchases will never hit the blockchain, and you will be dealing with a bank that is simply backed in bitcoins and who settles your purchase off the block chain, who will solve this problem the same way Visa debit works.
Yeah, exactly, that's what I was initially writing about.


Title: Re: $7 today?!!
Post by: tvbcof on January 06, 2012, 10:36:10 PM
We all hopefully realize that the block chain infrastructure is non-scalable to the level of mass retail adoption and that this discussion is academic at best. By the time retail adoption of bitcoin is commonplace, space on the blockchain will have a price, retail purchases will never hit the blockchain, and you will be dealing with a bank that is simply backed in bitcoins and who settles your purchase off the block chain, who will solve this problem the same way Visa debit works.

The most important thing to me is that a system remains firmly within the grasp of the all classes of user-base and can be operated successfully in the face of a dedicated attack by parties who control global network infrastructure.

A solution which I would be OK with would be to pay whatever fee is necessary to keep the block-chain spam-free enough to achieve the objective that I would like to see.

A better solution which I have elaborated on earlier is to simply break the problem into multiple block-chains thus distributing the load and providing better tuned currency solutions in the process (while paying particular attention to protect the 'satoshi block-chain'.)

Watch Dan Kaminsky's presentation. He agrees.

I'll dig it up this weekend.  I've at least read some of his stuff, possibly a slide-show from the presentations you mention, but don't know that I've watched such a thing.

But from your description and my other observations within the community, it strikes me that there is some room for more creative thinking.  I get the strong sense that exceptional computer resources considered a given for problem solving (very common in this space), and also that what I consider a 'problem' is not considered as such by very many people.



Title: Re: $7 today?!!
Post by: evoorhees on January 06, 2012, 11:18:36 PM
We all hopefully realize that the block chain infrastructure is non-scalable to the level of mass retail adoption and that this discussion is academic at best. By the time retail adoption of bitcoin is commonplace, space on the blockchain will have a price, retail purchases will never hit the blockchain, and you will be dealing with a bank that is simply backed in bitcoins and who settles your purchase off the block chain, who will solve this problem the same way Visa debit works.

Watch Dan Kaminsky's presentation. He agrees.

+1

In the future, most transactions won't "hit the blockchain" at all. Already today, many don't. Anyone sending money to someone else of the same ewallet may not ever hit the blockchain. Same with transactions occurring within an exchange. Handing a persona  Casascius coin doesn't hit the blockchain either. (Sidenote: this is also why Bitcoin can be untraceable - the blockchain doesn't record every transaction, contrary to popular belief)

The blockchain will always be the ultimate arbiter. When one needs -absolute- confidence in a transaction, one would rely on the blockchain. However, 99% of real-world transactions don't require absolute confidence, they just require -reasonable- confidence, and within that realm we'll see lots of interesting market-based systems to quickly process payments.

This phenomenon doesn't detract from the strengths of Bitcoin. Rather, it's simply the evolving scaffolding which surrounds it.


Title: Re: $7 today?!!
Post by: evoorhees on January 06, 2012, 11:22:12 PM
But see, as long as banks are used, they can manipulate the money supply.

How?  Anything a bank/ewallet can do with bitcoin, so can I. We are all, already, banks.

As a bank, I could extend credit to my friends right now, this instant. It could be in the form of an IOU, redeemable in Bitcoin. IOU's for Bitcoin can always be made, copied, and passed around the economy. If there is trust among the market players, then this effectively increases the money supply - but it's not necessarily harmful.

"Fractional reserve banking" is not the enemy. The enemy is fractional reserve banking that is subsidized by the government - for without the subsidization market forces are able to work and fractional banks that act imprudently will be destroyed.


Title: Re: $7 today?!!
Post by: casascius on January 06, 2012, 11:31:46 PM
Makes sense, though it is a rather complex solution to the problem, and I'm not sure many people would understand.  I wonder how many people would actually participate in verifying such a list, or how many companies could be forced into releasing one?  I mean, look at how many people use MtGox already, despite not knowing whether they actually have enough Bitcoins to cover all of their balances?

It might be one of those domino-effect things, where the first company to start regularly releasing such a list might be favored enough by consumers to force other companies to follow suit.  But, I have a feeling not enough people would be concerned about the fractional reserve problem to spend any of their own time on ensuring companies are kept accountable.

Not many people would need to participate for it to be effective.  Lots of people already wonder if MtGox has reserves to cover their deposits.  Imagine TradeHill started doing this today.  That would be HUGE news, a major leap in trustability.

Sure, the bank could pull a fast one on some people assuming they won't all check.  But the more a bank overextends itself, the greater the likelihood they are going to get caught with this scheme.  The signature scheme would guarantee that even a single detected instance of double-allocation of funds would be provable.  It would be enough to impeach the bank as dishonest, even if it were for a trivial amount.


Title: Re: $7 today?!!
Post by: bitcoinbetas on January 06, 2012, 11:34:21 PM
$10 by this time next week  ;D  wanna bet? ;)


Title: Re: $7 today?!!
Post by: SgtSpike on January 06, 2012, 11:41:40 PM
But see, as long as banks are used, they can manipulate the money supply.

How?  Anything a bank/ewallet can do with bitcoin, so can I. We are all, already, banks.

As a bank, I could extend credit to my friends right now, this instant. It could be in the form of an IOU, redeemable in Bitcoin. IOU's for Bitcoin can always be made, copied, and passed around the economy. If there is trust among the market players, then this effectively increases the money supply - but it's not necessarily harmful.

"Fractional reserve banking" is not the enemy. The enemy is fractional reserve banking that is subsidized by the government - for without the subsidization market forces are able to work and fractional banks that act imprudently will be destroyed.
I think the level of lending achievable on a personal basis vs the level of lending achievable by a bank are two completely different things though.  A bank could probably fairly easily leverage itself to lend 5x or 10x as much money as it actually has in deposits.  I can't see very many people doing the same thing on a "friend level" basis.

Regardless, I got a bit sidetracked.  I do agree that fractional reserve banking itself isn't the enemy.

Makes sense, though it is a rather complex solution to the problem, and I'm not sure many people would understand.  I wonder how many people would actually participate in verifying such a list, or how many companies could be forced into releasing one?  I mean, look at how many people use MtGox already, despite not knowing whether they actually have enough Bitcoins to cover all of their balances?

It might be one of those domino-effect things, where the first company to start regularly releasing such a list might be favored enough by consumers to force other companies to follow suit.  But, I have a feeling not enough people would be concerned about the fractional reserve problem to spend any of their own time on ensuring companies are kept accountable.

Not many people would need to participate for it to be effective.  Lots of people already wonder if MtGox has reserves to cover their deposits.  Imagine TradeHill started doing this today.  That would be HUGE news, a major leap in trustability.

Sure, the bank could pull a fast one on some people assuming they won't all check.  But the more a bank overextends itself, the greater the likelihood they are going to get caught with this scheme.  The signature scheme would guarantee that even a single detected instance of double-allocation of funds would be provable.  It would be enough to impeach the bank as dishonest, even if it were for a trivial amount.
Agreed.


Title: Re: $7 today?!!
Post by: tvbcof on January 07, 2012, 12:39:04 AM

I think the level of lending achievable on a personal basis vs the level of lending achievable by a bank are two completely different things though.  A bank could probably fairly easily leverage itself to lend 5x or 10x as much money as it actually has in deposits.  I can't see very many people doing the same thing on a "friend level" basis.

Regardless, I got a bit sidetracked.  I do agree that fractional reserve banking itself isn't the enemy.

There is a good reason why fractional reserve banking has been ubiquitous for eons.  It has the potential to be very sound given good management, and provides the flexibility to dampen features inherent in an economy.

The key is 'good management'.  As long as there is money to be made by neglecting 'good management', it is unlikely to occur on an ongoing basis.

I believe that management of a monetary system should be devoid of a profit motive and that all of the benefits of having one and using it should accrue to the citizens who use it.  In short, a monetary system should be a public utility.

What we in the USA have with private ownership of the monetary system with state enforced 'tender' laws is the worst of both worlds, and is fascism by my definition.  The construct always had a built in life expectancy due to it's reliance on inflation (which the owners can scrape), and I suspect that we are likely near the it's end-of-life.  The replacement will be as much like what we have now as possible, or even better from the standpoint of those who have been milking the current system.

The success of Bitcoin is important to me in large part because this could provide tangible evidence of the possibility for alternative monetary solutions when they are needed.  If Bitcoin (or something like it) could be chosen against the will of 'the 1%' (for lack of a better description) that would be a great thing, and this is why it is some important to me that the network itself retains it's ability to operate against the types of concerted attacks which seem improbably to most people.

---

Oh ya, I would happily patronize a 'fractional reserve Bitcoin bank' if there were a reason to do so.  My criteria would be that 1) I get a fair cut of the proceeds, 2) I hold the power to get out imediately and autonomously if I choose, and 3) that I can verify their books to my satisfaction.



Title: Re: $7 today?!!
Post by: FreeMoney on January 07, 2012, 01:45:08 AM
Oh ya, I would happily patronize a 'fractional reserve Bitcoin bank' if there were a reason to do so.  My criteria would be that 1) I get a fair cut of the proceeds, 2) I hold the power to get out imediately and autonomously if I choose, and 3) that I can verify their books to my satisfaction.



By #2 do you mean that people can get out in order of asking and you'll only be left holding the bag if you are late? Because not everyone can get out, that's the downside.


Title: Re: $7 today?!!
Post by: tvbcof on January 07, 2012, 02:00:37 AM
Oh ya, I would happily patronize a 'fractional reserve Bitcoin bank' if there were a reason to do so.  My criteria would be that 1) I get a fair cut of the proceeds, 2) I hold the power to get out imediately and autonomously if I choose, and 3) that I can verify their books to my satisfaction.


By #2 do you mean that people can get out in order of asking and you'll only be left holding the bag if you are late? Because not everyone can get out, that's the downside.

No reward (#1) is without risk (#you).  I would want the tools to protect myself (#3 & #2) before I would risk my assets.  I'm not planning to be MF-Global'd/MyBitcoin'd with Bitcoin or any other asset I hold.

And I'm very unlikely to loan my BTC to a bank/exchange/whatever for a paltry sub-inflation % as I am forced to with the USD I hold (and mostly dump as quickly as I get them.)