One small thing that could be done right now by everyone is:

Install this Facebook game http://www.facebook.com/#!/apps/application.php?id=157118501301&ref=ts which is also listed in the bitcoin.org trade directory http://www.bitcoin.org/trade.
The game accepts bitcoins in payment.
Invite 10 different Facebook friends to install the game everyday for a week.

Its free, fast and takes almost no effort.  And who knows, it may go viral and all of a sudden everyone will be asking 'what are these bitcoins?'

Just be warned, I found the game addictive.

Well, I mean store that sell physical items, not brick and mortar businesses. In my sleep deprivation  I slipped up.

It could be considered as such for some purposes because it is a store of value. In strict financial terms, it is not one. Regardless, it doesn't (In my understanding) invalidate its use as game "currency."

I think bitcoin poker will really establish the BTC.

I specifically used the example of Freenet, which does have problems in terms of trying to sell its use outside of the guerrilla applications like child pornography and Chinese dissidents.  This isn't saying that "the sky is blue", but pointing out a major and significant problem in most peer to peer network.  There have been numerous other articles in mainstream press articles about peer to peer networks that continually criticize the subversive nature of those network and dismiss the inherent benefits from such networks.  This has become so large of a problem that at least proposed legislation has come in some areas to simply ban the concept of peer to peer networking altogether.... and that is something formally being pushed by groups like the RIAA and MPAA.

It is for this reason that I'm suggesting that Bitcoins try to at least philosophically distance itself from such subversive activities and try to stick with "legal" approaches and applications of this kind of currency and keep those kind of subversive activities more on the fringes of the group rather than a part of the mainstream of applications.  Besides, there is no way to really know what kinds of activities have been done with Bitcoins, and certainly no statistical data to show there hasn't been "any sort of porn or drug transactions using BTC".

What I am saying is that shouldn't be the first kind of thing for somebody visiting this website.  If I load up Freenet and give the mouse to a boss or CEO in a presentation about the technology, I certainly would be afraid of having something come on the screen when random links are pressed that would kill the presentation and make certain that its adoption would never happen.... even if I was not fired immediately for the presentation.  It isn't simply saying "the sky is blue" but to me a very real concern.

Dollars are currency, not money.  Money can be a currency and vice versa, but they are not quite the same thing and not entirely interchangable.  And fiat currencies are, by thier very definition, not money.  Gold, in our modern world, is still money even though it's no longer a currency.

Well you cant really use btc as a virtual currency because it is a cash equivalent. You can sell tokens for btc though. As long as you cant cash the tokens out for any cash equivalents immediately you wont face any repercussions. Once you have the tokens you can  use them like any other virtual currency. This is the same reason you cant just use cash and claim it is a virtual currency. Tokens that you can earn however could be cashed out once your users got to an agreed amount.

Bitcoin needs its own virtual currency fork to be used as an in game system and not break the terms of service of zynga,super rewards and other virtual currency products.

If btc had been setup as virtual currency from the beginning it would be different,so now it has to be done differently.

Business beget business. Before you can have physical stores, you must do it with cheaper capital business.

What kind of a nut would want a computer in their home in 1985?
What did people think of a network of computers communicating with each other in 1995?

I don't know what will catch-on and what will fail. Bitcoins seem to solve current problems, and are worth investigation.

If prices are remaining steady then there is no inflation.    In the case of bitcoins, there will have to be high deflation if bitcoins are widely adopted.

The rate at which bitcoins are generated is fixed over the long term.  If you increase the demand for bitcoins at a rate faster than they are being generated, then they will become more valuable compared to other currencies.  That is deflation.  We have seen deflation in the bitcoin and we will continue to see deflation if bitcoins are successful.  If people do not value and demand bitcoins, then you will see inflation.

What bitcoin needs to take off, is a killer app.

The only people who are motivated to use bitcoin at the moment are cyphergeeks, who are attracted the beauty of its internal mechanics, and rabid libertarians, who see it as a tool to spread their ideology. The vast majority of internet users are neither of those. Paypal fulfils their needs just as well as bitcoin, so why would they be motivated to switch?

The killer app, IMO, would be a system for trading bandwidth on anonymity networks such as Tor and i2p. The problem with these networks at the moment is that they are slow and inconvenient as they rely on volunteers to provide bandwith and suffer from congestion.

If Tor users had a way of paying for node providers anonymously, the size and speed of the network would explode.  Anonymous bittorrent would become viable, and judging from the amount of bittorrent traffic on the net, there is no shortage of demand. Increasingly draconian copyright laws, and their increasingly heavy handed enforcement, will motivate even the most lazy bittorrent users to switch.

That is one application where bitcoin has a big competitive advantage. There are few, if any, other currencies suitable for anonymous bandwidth trading.

You can have a fixed exchange system because the two systems would talk to each other to ensure that any new coin minted in one system results in a coin being destroyed in the other.  Because the transaction is always reversible for free at any time on demand by the user a user would not care which design is on the gold coin they were paid in.

You need not track both systems if you are only doing exchanges in the one system.

The *key* is convertibility between the systems.

If there was no "demand" for bytecoins then every bytecoin would be melted down and reformed as a bitcoin.

However, if the system was set up such that re-minting was always possible at any time then the coins would have equal value.   

Thus each country could have their own "gold coins" but even though they have different names and denominations they all ultimately have equal purchasing power. 

If for some reason people just perfer the look of the US gold coin vs the canadian one and melting/recasting was free then the canadian coin would go out of style. 

So you have your two independent block lists representing bit and byte coins.  Some nodes would have to track both block lists.  A transaction would be entered at the same time in both lists to destroy one coin and create another.   


Put yet another way.  If I take one gold coin out and divide it up into 1000 pieces called gold bbs.  I only need to ensure that the bbs are not "double spent" and I could care less about the other gold coins in circulation.  At any time I could convert my gold bb back into .001 gold coins.  It is only when I decide to "hop boundaries" that I need to ensure that there is no "double conversion".