When everyone has a robot and can produce everything he basically needs, so he don't need money to survive

True, trading profit both party, as long as there is division of work and unfulfilled demand

In modern society, very often majority of the demand is fulfilled, each producer are dumping excessive goods in an attempt to get most liquid assets (usually money) from the other, then it does not benefit anyone

Profit is an accounting term after the arrival of money, and it is based on an assumption that money have constant value, which is not true, it is not necessary to support economy activities. Economy is driven by demand, and its root is desire

Of course, if you use time as a unit of value, then your statement is almost true. Exchange happens because each participants could save more time from it. But not everyone is profit-seeking and I guess majority of people are not

Regarding "All money is a scam" claim, it does not necessary to be so

If Alice works 8 hours and exchange her products with Bob's products, which also cost 8 hours to produce, there is no scam involved, just fair trade. Similarly, if the cost to produce certain amount of money is similar to the value of the product those money can purchase, then it is also fair trade. This means, if the amount of goods that need money to trade increases, the cost of producing money should also increase. Bitcoin is a perfect example of the fair trade principle

In fact it is that fork made me believe that core devs are worth trusting. It is very critical to take a conservative approach when it comes to change management for financial systems, they made the correct choice.

If the fork went to 0.8 chain and all the other miners are forced to switch version, then they will feel that they are kidnapped by the core devs, then the trust for bitcoin will dramatically drop, since the main principle of free will participation is broken, can't imagine what kind of damage that can do

I think wallet services like blockchain.info will be the major trend in bitcoin banking: A bitcoin bank can store your private key but you or a third party security firm will hold the encryption password, thus the bank can not use your coin without your authorization, they become some kind of storage solution provider

Holding the private key by yourself has many issues: It can be forgotten, lost, hacked, or even robbed. It will be much safer to let a security firm to protect the key, while you hold the access code

FRB works because previously people have no idea about how money works, but now when everyone are more enlightened by internet, the way they handle money will be different


Banks usually have a function of utilizing the excessive capital: They pool unused money together and make loan to enterprises to drive projects and economy activities. With bitcoin, lending is not possible without the consent of the depositor, but I guess some depositor, being fully aware of the nature of FRB, would still give up the control of their bitcoin in exchange of some interest, because those bitcoin is just pocket change that they don't care at all

Bad money drives out good but that does not mean good money becomes less valuable, they just get hoarded and will be used at a later time with much higher purchasing power

Don't remember exactly, but somewhere I read that pilgrims went to Jerusalem with their own type of money and they have to find exchangers to exchange to local money to spend, those exchangers became the center of capital flow. And because Catholic church prevent people from charging interest, Jews became specialized in the banking service later

If GCB could print euro then their problem will disappear, just like FED printed 5x USD and most of the problem in US after financial crisis are solved (at least for 10 years)

Money printing works because most of the people do not understand how money works. When FED print 5x more money and buy lots of things, companies around the country will just see lots of incoming orders from large state organizations and they can immediately produce more, hire more, and make more money. Their sight is just limited on the available money to earn, they are seldom interested in the things happening beyond that scope

From an individual point of view, fiat money has relative stable value, this is their belief, so this belief gives central banks power to stimulate the economy, more money means more purchasing power, and a large amount of purchasing power will create boom. Since the production will always increase when more money arrives, there is almost no inflation as long as the money are not created at a speed of one fold a month

This can only happen if people do not store bitcoin at their own wallet. And there are reasons they don't want to do that: They are either handicapped in IT or prefer to rely on a third party to take care of their money

Exchanges typically practice FRB, all the bitcoins on exchanges are just numbers, the real amount of bitcoins at an exchange is unknown unless there is a transparent audit. In fact, the earliest bank in human history evolved from exchangers

Investment decision making is the most difficult work in the world, thus the reward is become richer, but definitely not just sitting there doing nothing. At any moment, you can become an early adopter of any new things, but your chance of hitting a home run is very low. And to maintain your position is not an easy task

It is a common phenomenon in financial world, scarce and valuable resource will all lead to this result: Many people are sitting on their early investments that grows and grows in value over generations: Land, gold, forest, large enterprise, even Google and Apple stocks ...

However, you can almost never foresee the future. Many people just ignored bitcoin when they saw it crashed from $30 to $3 during 2011 bubble, and there will also be many people ignore it when it crashed from $1200 to $200 during 2013 bubble

This is another strange thing: It seems Greek government have no control over what their own bank is doing, they can not stop their own bank from carrying out capital control, thus banks using capital control to threaten Greek parliament to give in to more austerity measure

So it seems these governments and parliaments in western countries are just a show, they don't have any real meaningful power, they can not decide on their own fate, it is banks who have the real control over the country

If everyone start to buy bitcoin each month and accumulate enough bitcoins, then capital control will lose its effect, since then people would be trading things with bitcoin when fiat money is not available

However income is more problematic, if your income is received in form of fiat money, then you are essentially controlled by the fiat money system, there is no escape, since that will remove your income

It is always a very interesting thing to discuss the interaction between mining cost and market price

Labor theory of value is true when demand > supply. This theory worked many centuries when most of the products are insufficient

Because mining is the lowest possible cost to get coins, smart buyers will first seek to mine bitcoin if they want serious amount of bitcoin. Only when mining production can not keep up with the demand, the price will surge, otherwise the miners will quietly accumulate coins at a price close to mining cost

If demand << supply, then the first thing we will notice is that the mining difficulty will drop, means investors are scaling back of their mining operations due to less demand in bitcoin. So far this has not happened, means the demand is still strong

If demand >> supply, then we can expect that the mining difficulty will rise quickly. It does not matter it is caused by technology shift or more people joining mining, as long as difficulty is rising, we will know for sure that the competition is getting tougher. As a result, cost will rise, market price will also rise

If demand = supply, then the price will stay flat, most of the demand is satisfied by mining

A very fast price rally is caused by an anticipation of dramatically increased demand. Because the daily supply is fixed, those demands can only be satisfied by market order, which will drive up the price

Currently about half of the daily coin supply are generated through mining, after next reward halving, the mining will get less coins, so the serious demand can only turn to market and purchase, which will raise the price

The sun's influence to the earth is many many magnitudes larger than humanity. Human have no way to affect the earth temperature's long term trend, only adopt to it

We are entering the new ice age soon, it is extremely cold this year

Just bought some computer memory with bitcoin last week

Only those with a continuous income stream as bitcoin will spend it frequently, others will just hold it as an investment, spend it after some years when it has been appreciated greatly. I guess that there will be more people spending coins after another 2-3 years, especially after another wave of bubble

Currently the biggest spenders are those who accumulated coins before the first reward halving

They will not know for sure if price would go up, maybe most of the people who want to buy before the reward halving have already bought long ago and after reward halving no one will buy  


The demand can be very high or very low, but I guess it is on the higher end of the spectrum. This is very easy to tell due to asymmetric options in bitcoin investing: When you want to get large amount of bitcoins, you can mine; but when you want to get rid of large amount of coins, you can only sell

Mining is the lowest cost and have many other privacy benefits, serious demand will first seek their way into industry mining operation. This will have least impact on market,  give them chance to accumulate large amount of bitcoin without raise the exchange rate

If the serious demand start to shrink, then the first thing we'll observe is that the difficulty will drop significantly. In fact, the difficulty has never dropped too much recent years, means the demand is still very strong: The hash rate keeps expanding means that investors not only invest in bitcoin, but also invest in infrastructure, have long term plan. Bitcoin is a virtual world's currency, in order to grow bitcoin, people have to grow this virtual world too, and mining is one of the important infrastructure

And after reward halving, when mining could not bring enough coins, hash rate might drop temporarily, and those investors will turn to market to purchase, and raise the price to a level that mining is profitable again

Even if you anticipated it, there are some hard facts that will have a deep impact for the supply

For example, currently lots of mining farms sell part of their coin to deal with the mining cost, I guess at least 1000 coin daily are dumped on exchanges. When reward is cut by half, they will have significant less coin to mine, and also much less coin to sell. So the daily coin sell pressure from miners will be cut by half. On the other hand, since they are paying the same cost but mine only 1/2 of the coin as before, all of their coins will be deeply underwater, thus they can not liquidate those coins at a loss, but only hold on to them, and scale down the mining operation. So the overall impact on daily coin supply will be significant

People can become richer when their income is larger than expense, that has nothing to do with money. But become richer by printing money out of thin air is totally another thing, it is robbery

Money is just an imaginary concept, but everyone need it: They need something that can be used as a standard unit of value, so that they can easily measure the value of everything else in the world, that is money in their eyes. People produce rulers to measure length, they also produce money to measure value

If there is no such kind of standard unit, for example everything's bitcoin price fluctuates day to day, then everyone will lose their mind, since they feel unsafe, and can not predict the future and make economy plan accordingly

So because people have such kind of accounting demand, it gives banks a mission to create fiat currency that give people an impression of constant value

In reality, different currency's value always fluctuate against each other, but people take it as granted that their domestic currency is the standard unit of value. So the stability of fiat money's value is automatically maintained by people's consensus domestically, not supply and demand (or to say, the demand for money is infinite thus the supply is always limited, does not affect its value)