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The shift is because of Namecoins value beyond being a currency. Doubt there will be a third, or rather I doubt there will be a 10th...
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Hi guys, Breaking news (using old media timings  ) Namecoin has come of age it seems, it is currently trading at 10 NMC to 1 BTC. It is arguably more useful than BTC in that it provides a secure platform for domain name ownership that cannot have domain names reassigned by anyone except the original owner. The dept. of Homeland Security ICE is going to just be in love with it. Miners are already shifting en-mass to namecoin (I have) and exploiting the 37 fold easier difficulty level and 10 to 1 exchange rate. It's like mining 10BTC/day where you normally only had 2. It was actually better a few days ago. Soon we will see major pools operating both systems. Once the prices adjust and the difficulty normalizes for both systems we will have 2 crypto currencies trading at approximately the same rate to the USD. Black Swan squawks here! |
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Maybe its just you and me  |
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Soloing is viable, you should get 2 hits per day at 1550 MHashes. That pool is VERY UNSTABLE! Can't believe I'm only doing this now, had the idea a while back, should have just mined a few thousand! BTW Who in this thread thinks it's ethical to delete the thread so we can mine on our lonesome?? |
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Fiat money is, itself, debt. The framers of the US Constitution referred to them as 'debt instruments' and banned their issuance in the Coinage Act. They are obligations of the bank itself, backed up by the "Full Faith & Credit of the United States". When you go work for a wage, the first thing that happens is that the employer is endebted to the employee. The employer then pays the debt by transfering that obligation to the government, via the Federal Reserve bank. They are not called "notes" without reason, just like a mortgage is a "note".
Fiat money does not have to be debt based, our current fiat money system however IS debt based because every dollar that exists came out of the federal reserve at interest. If the government simply issued the money itself without the federal reserve middle man, they could just print it without having to pay interest on it. We basically rent our money supply from the fed. The government doesn't need to do this, it could just print the money instead of printing the damn bonds. Bitcoin itself is a fiat currency (as it is backed by absolutely nothing except trust in the system), it is also not debt based. Two very important attributes. The only thing bitcoin is missing in my opinion, is that the money supply should expand infinitely at around a fixed 2-3% rate a year as Milton Friedman suggested. Since banks will not be able to engage in such heavy fractional reserve banking with bitcoins (because it will be impossible to bailout a 10:1 ratio of loans), the interest rates for depositors in banks will be higher than the inflation rate, protecting the purchasing power. Money printing is only bad when they start to exceed the amount of products and services in the economy, and the newly printed money chases after the existing products and services in the market, instead of going to create new things such as useful infrastructure. Printing money to create infrastructure that will be useful (NO BRIDGES TO NOWHERE): Good. Printing money to recipients that will just use it to buy goods and services with the newly created money: Bad. Bitcoin is an excellent project, it's not perfect, but it's far better than what we currently have. Aaah, fix the system thinking, I remember it fondly Have you ever wondered about prices, what they are and how on earth we come up with them. Prices are subjective human beings' way of determining how much effort something is worth to them. If you have to pay $100 for an item slightly better than a similar $90 item then you will be free to decide if the additional features are worth the effort you personally have in generating $10. Governments spend money from people who worked for it without having had to work for it. This one simple fact makes building a bridge to somewhere completely impossible to them. I've worked for government and I can tell you now, the problem is not corruption, it is thinking that more controls, better controls, controls from smarter people, and controls control controls will ultimately fix a fundamental underlying flaw; government does not respond to the price mechanism, if they are ineffective, they can still fund themselves tomorrow at gunpoint. Ludwig von Mises predicted the collapse of the Soviet Union on exactly this basis. Since they don't know what people are willing to work for, what people want on an individual level (which is what the price mechanism does) then they are doomed to misspend funds to the point of collapse. Another problem is, who has the right to purchase assets with money injected via money creation, even if exactly 0% inflation (non-flation  ) is possible? Our elected officials? Bankers? And if we allow this privilege for someone how do we know they won't simply start buying up all manner of assets for themselves? A better solution would be to let the benefits accrue to the existing market participants through price deflation. |
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I do accept your point that it is not all our debt directly and some of it is allowed to be rolled over forever.
I live in South Africa and our previous reserve bank governor now works for Goldman Sachs. He and a whole bunch of others (one of whom is the current deputy governor of the reserve bank) were sent on free "economic training" by Goldman in the early 90s.
When Greece was about to default they turned their energies against everything except their debt. This is not the actions of a sovereign nation, this is the actions of an underling bowing to his betters. (No offence meant to Greece or Greeks, they are simply some of the first to be hit by the system's ultimate implications)
So with Goldman being able to issue South African currency (among many, many others) and buy up US debt and "sterilize" US currency, but the government of the US only being able to issue US debt and maybe US currency, who is at who's mercy?
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You can easily liken this to the gold rush in the late 1800's. Everyone believed they had a shot to get rich. As excitement built up, people flooded into the regions, some with a simple gold pan, others with all sorts of equipment. But the point was that they all thought they had a chance to end up rich. Why not? 'There's gold in them thar hills' and it's up for grabs. While most people probably never found a speck of gold, the point was they all believed they could find it.
I think the analogy is apt- but I think history will repeat itself. There were people who made a lot of money during the Gold Rush and went back to their countries and build mansions with the proceeds- but few were miners. Most in the Gold Rush were so busy mining, speculating, trading and in general trying to get "rich" that they could not be bothered with things like cooking, doing laundry and selling basic goods. The merchants and service providers- those that sold to the miners and the speculators were the ones that fared best overall. Spot on |
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The constant increases in the base money supply is simply to allow the constant growth of the fractional reserve banking system under current rules. It would collapse if it could not issue more debt continuously.
When the debt matures the government pays it back with interest, even if it was issued by the central bank. If the bank rolls it over, they simply extend the loan, but cause constant inflation. The banking industry permits this since the government is their collections agency. The government is however indebted to the banking industry and at its mercy, squandering the opportunities to break free.
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How do I trade NMC for BTC and how hard is it?
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Sadly they are all debt. The government does not loan from itself. It loans from the home market, the main participants of which are a cartel of banks with the lethal right to issue money from debt. There have already been calls to remove reserve requirements and allow the system to work legally as it does already practically. There are already countries where the reserve ratio is zero, I believe Australia is one.
As for collapsing, in the past 3 decades there have been 3 events so costly it has wiped out al profit from the banking industry for its entire history. Each time the government bailed it out at the expense of the people. You are 100% correct the system will collapse if it is all debt based. The model is very unstable.
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The price is no where near it's eventual value if bitcoin is not replaced by something better or shut down. Just like land was nowhere near it's eventual value when you could get it in land grabs in the old west.
If prices rise, miners follow and then difficulty. What you get out in USD remains remarkably stable. If price falls, miners leave and difficulty drops. What you get out in USD remains remarkably stable. The only scenario that forces great specializations in mining is where price stabilizes, hashes increase, difficulty follows and ASICs take over due to low power consumption. What are the chances of price staying stable honestly?
Bitcoin is highly divisible, if 80 % concentrates in a few pockets ( which normal money also does ) and demand stays high the price wil rise and there will still be enough BTC to drive the world economy. And if prices rise the hoarders will eventually feel rich enough to spend and push those coins back into circulation.
Keep mining till you are only making 100% over power then switch to Namecoin. Then switch back as the price difficulty allows.
Why does everyone come up with these negative dynamics all the time?
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What on earth are you guys on about!? Mining is getting more rewarding in purchasing power, not less. Mining, if the proceeds are sold (dumped) drive down price, not up. The community is not growing because of miners, miners are increasing because the community is growing and pulling the price up with it. I run www.bitcoin.co.za and the first questions we get are "how can I buy bitcoins?" followed by "how can I help?" not "how can I make a killing mining?" There are not remotely enough miners at the moment, you could replace all the capacity with less than $10 million in hardware. That is totally doable if a large financial house figures out we intend to take their printing press from them. We need about a hundred fold more miners to be safe, remember we are our own army. |
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Russians are extremely interested:
I think most of what you just said can be boiled down to the "store-of-value" function of money. Fiat money is busy dying and taking everybody's hard earned value with it. Governments simply cannot be trusted around money. That's why they so tenaciously try to ensure that anything to do with money flows through their system. Commodities can serve as a store of value, but their physical presence attracts predators. Plus, they are hard to preserve, appraise, and move around. Bitcoins so neatly solves all these problems and I predict its greatest use, or at least its initial "killer app" is going to be as a store of value. Anybody who buys into this is going to _expect_ that their stash retains at least the purchasing power of the fiat they traded. Maybe that's wishful thinking, but that's common psychology nonetheless. No matter what happens to the BTC ecosystem, unless it's 100% eradicated, the holders of the BTC will bring the system back to life, in order to recover their value. You'd need a world-wide prison planet to snuff this. Sure, that's the ambition of many politicos, but that's not going to happen. And with BTC in our arsenals it's now a bit less likely than before. I couldn't agree more. There is no chance of international outlawing. Local outlawing will be met with distant jurisdiction cash outs. Bitcoin's biggest threat is a better bitcoin. |
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With the price collapse I think it's going to go the other direction, like earlier this year.
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I can't wait for the exodus and then the drop in difficulty and/or the increase in shares. I really like mining  |
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Namecoin is theoretically domain name backed.
If bitcoin takes a knock in the short run, namecoin could succeed by proxy on it's behalf for a while.
IE exchanges set up to buy domain names (50 namecoins a shot) proxied through exchanges that can clear namecoins for bitcoins without bank verifications. Or just keep trading the namecoins if people will accept them.
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THE GOVERNMENT WILL CRUSH THIS.
Which one? The one that's bankrupt and only influences 6% of the Earth's population? Do you know about some places on your planet called "Europe" and "Russia"? A combination of governments or whatever. As soon as their is a soapbox to standon (silkroad) the politicians will get involved. Sex trafficking, drugs, weapons. its a politicians wet dream. One successful exchange on the planet could bring the debt based money monopoly to its knees. If only one government allows it or simply fails to contain it their fiat money will be rejected by the market. The overwhelming evidence of stability and growth will flock investment to that region and the idea will be verified. Governments will also not be able to successfully outlaw all trade with that country simply on the basis of its citizens having the freedom to transact in bitcoin. If there is not complete co-ordination, everyone from Venezuela to North Korea to Washington to Vienna to Mauritius to the Isle of Man to Chile to Zimbabwe to Somalia there will be no way of "crushing" it with legislation. |
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Sometimes people do what they do until they know better. Hopefully you also see yourself as doing things today that tomorrow you will know better about and not as a completely all wise being.
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