Why xxx doesn't cash out his coins has become the standard Q&A  Why don't central banks cash out their gold? They bought it at $35 per ounce and now it is $1200! Because they got those gold so cheap, they don't have the urge to cash out extra reserves when they have enough money to spend |
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Is it really difficult to handling a string of two-hundred-fifty-six 0 and 1s? Cast 3 dices 33 times then you have the most secure private key in the world
Currently the address calculation part is still tricky (without address you can not send bitcoin into that perfect key) , once there is a simple way to do that part, average people should be able to understand the whole process without rely on any third party services
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You could just say that the money has no value by itself, and the money an individual has represents the amount of goods that he can have. Thereby you can exclude money out of the equation completely and would lose almost nothing from the picture. If we consider value as utility, then money has some utility to us by and of itself, since it gives us the possibility to choose what to buy (and what not) as well as postpone buying altogether. Whether this utility abides by the law of diminishing marginal utility (i.e. diminishes with the amount of money an individual has) remains to be seen...
Personally, I don't think that it does, therefore there is room for doubt about the nature of this utility
I think it does, but since money can purchase almost everything, and human's demand are so many, you are actually asking wether diminishing marginal utility applies to all the human's demand added together. That is much more complicated than asking the same question for a single utility like bread or milk In fact, even with 100 utilities, you might run into a problem that the demand appears to be unlimited due to you have less time to consume: Even if you spend all day playing games and watching new movies, you might end up with missing out more and more games and films, not because you don't like them, just because you don't have time (And generally economy theories are not working any more in an environment that has abundant supply) And you can not exclude the money out of the equation. Without money, you will lose the means to access any other utilities. This transaction demand is also what gives fiat money value, and it enabled most of the commercial activities Without merchant acceptance, the money is like you described, has no value, but the universal acceptance itself, although does not generate any utility, injected value for currency temporarily until the next trade happens A good example: In 2009 North Korean suddenly announced that the old currency will not be allowed in circulation, thus anyone holding the old currency immediately lost most of the purchasing power of those currency. The value of those currency suddenly disappeared because the acceptance is removed nation wide One bitcoin private key without blockchain is totally useless, but once it is in the network, can be transferred between people, some people will start to accept it as a payment method, then it start to have its monetary value. Similarly, fiat money without merchant acceptance is also useless |
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Money isnt really a imaginary concept.
If it wasnt for a fiat system in place, what you expect people to barter and be okay with it? The only reason why the system is in place is to avoid the nonsense of bartering, but it just happens that the banks also have the ability to cash out as well since they offered it.
It is imaginary, first comes the concept, then the realization in the physical world. The concept of ideal money is: There is something special that is accepted by EVERYONE in commercial activities and have relatively stable purchasing power over a period of time. As long as these 2 conditions can be met, it is money So, first came cows and wheat, which was needed by almost everyone when food supply was still not sufficient. Then came gold. The strange thing is that gold is not needed by everyone but still became money thousands of years ago. I think this has something to do with Sovereign power. In old Egypt, wheat is the money, while gold were largely used for decoration. If many people don't feel gold is any more meaningful than some shinny stones they occasionally find in the rocks, then the gold usage as money is very likely to be a decision from the top |
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By this interpretation (which I don't disagree with), cash is effectively representative money with the caveat that cash is not guaranteed to be redeemable for any arbitrary amount, instead relying on market functions. Cash itself is worthless, but it represents X units of "anything and everything" (at least within the issuing country, dependent on their legal tender laws, if any!). Since "whatever we want" is basically the most maximally valuable commodity in the Universe, cash is maximally valuable to everyone (unlike, say, camels or silver nuggets), but only while it represents "whatever we want."
The real issue with the traditional definition of representative currency is that it MUST be legal tender for it to be maximally valuable -- I really don't give half a shit about being able to redeem it for a silver nugget because
1) I have no direct use for silver nuggets and don't want the clutter (there's no single item on Earth I want in such quantity that I'd want to be able to spend my net worth on owning... except maybe Tesla Powerwalls - those things are fucking amazing).
2) in the event of some monetary disaster where I'd actually consider redeeming cash for nuggets, I presume the chance of the nuggets actually being there is very low.
Combined, this makes representative currency (by traditional definition) a giant waste of resources. If the best use we can find for gold, silver, rhodium, and whatever is storing them in a warehouse, aliens should kill us all right now. Similarly, using useful items as a medium of exchange is terrible. -So we use relatively useless items. Cash is fantastic with regards to work efficiency because the paper, fabrics, and polymers we use to make fiat in the world has negligible value (not completely the case with all the semi-effective anti-counterfeiting shit built in these days, but the value's still very low). Who really gives a shit if a bank is storing $10,000,000,000 in nominal value using $291.50 in actual material costs (the actual cost of manufacturing the bills) -- I mean, that's pretty cool that we've been able to add what we were using as money back into the productive economy - but it left us open to policy abuse by the issuers, which turned out to be governments (which is probably far better than banks, at least), so I see bitcoin as the final evolution here and putting the final nail in the coffin of using otherwise-useful resources as something to keep in your pocket or a warehouse. "Redeemable" (if you trust the issuer... a LOT) crypto put a bit of a twist on that, but I don't honestly believe it has any place in the mainstream.
The problem is not about the cost, it is about the arbitraging behavior related to the money. This has already been observed on many alt-coins, especially POS coins If a money unit cost $291.5 to make, but command a market price at 10 billion dollars, thus become a presentation of value, then what will happen? Everyone will try to produce this money and use its market value to purchase other things, because they can make a quick profit right away. This will raise the competition in money creation and raise its cost, at mean time anyone accepting this money will only be willing to exchange similar value of $291.5, no more People will be forced to accept a market price of $10B if they are not allowed to produce this money, that's how fiat works today. And that's the reason it is called monopole money: Only banks allowed to make money at a cost of $291.5 and spend it like 10 billion. But for a money that everyone can make like bitcoin, its production cost will always be close to its market value, due to arbitraging |
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There is a common misconception that money is not value, because it can not be eaten etc. But, all value is one individual's preference for one thing over another, which includes money. Therefore, money is value just like other things. I agree that value is subjective, means utility and can be compared on the basis of an individual's preference of one thing over another. But I don't agree that money can be judged that simple. One of the fundamentals of the subjective value theory that you make reference to here is the notion of diminishing marginal utility. Money apparently doesn't conform to this notion, which can be explained only by the assumption that money doesn't possess value per se. It is just an intermediary for (or, rather, into) things that can be bought with it... That's a good question The diminishing marginal utility still applies to fiat money, but because fiat money have universal acceptance (In fact only domestically), can buy you anything, then the diminishing marginal utility will apply to all the things combined together, thus very difficult to observe for average household. You need much larger amount to see the effect Imagine that you have 100 trillion dollar, adding another 100 trillion dollar is almost useless to you, because it does not buy you any more things than 100 trillion dollar can do. In fact for 50 trillion dollars you might already run out of the things that you can buy in the whole world (Many things are not for sale), this is the problem that central banks are facing right now This is similar to: When you are very hungry, the first potato will worth almost the same as the second potato to you, and the third... only after eating 5 potatoes, the extra potato will show the effect of diminishing marginal utility You have also mentioned that when the money does not grant you more ability to buy, it will have diminishing marginal utility. The fiat money's value is very tightly related to the acceptance |
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Difficulty will rise to compensate for the drop in electricity price
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Another question: How long has the wallet been used? When is the last time you receive coins with this wallet?
The receiving address has never been used, it seems the key for that specific address was already compromised before the transaction happened. Since all the addresses in an Electrum wallet are generated by the same seed, it is very likely that the seed was compromised
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Windows 7 and VMware from encrypted container running Ubuntu
Likely the problem is here, how good is the entropy of this encryption? I'm also wondering if the randomness of the key generation on a VM can be as good as physical machine |
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Well it is somewhat unusual to have exactly zero bitcoin in your wallet IMO. Generally speaking when you buy something you are not going to be spending exactly all of what you have
OP claims that he was transferring the funds from his bitcoin exchange into his brand new electrum wallet (that was my interpretation anyway) and that the funds were immediately sweeped into the hackers address. I have no idea if he is lying or not, unless you trust the OP a lot you shouldn't donate as there is no way we can know if OP is telling the truth. That's not a brand new wallet: I've had much more btc in that wallet in the past. And I only fire up my VM to check my electrum which isn't that often. WHY ME AND why now. This is bullshit!
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The rate on the btcjam site is really strange:
They give you 19.3 % return for borrowing your money, while lend your money to others for 6.7% income. So for each bitcoin they lose 12.6% per year, how is this business profitable? The only way to make profit is to short the market with borrowed coins and buy back the coins at a price that is 12.6% lower of the current price
And since we all know that shorting the bitcoin is a sure way to die long term wise, sooner or later they will go belly up
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A fake Electrum server  Is that possible? and is elctrum responsible for that at all? If it is indeed an Electrum bug, then they will compensate you for sure. But I'm not sure what kind of harm a fake server can do, since the signing of the transaction happens locally and no one should have the knowledge of your seed If your VM machine was not running when the theft happens, then the weakness should be in the seed or private key |
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A fake Electrum server Was your VM machine running when the theft happened? |
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OP, was your VM machine running when the theft happened?
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That isn't the worst. I lived for a couple of years in a squatter area (squalor) in between the level you see above and the more compacted level seen in the worst in the following video: https://www.youtube.com/watch?v=OIGA0xDDagQThere are lot of filipinos living in the scenenic and wild open spaces of the farms and nature, but believe it or not the filipinos will actually prefer to congregate into a squatter like closeness of houses even if they have wide open spaces around them. You can go out to the farms and find that the neighbors build their houses very close together on a small area of the available wide open space. This isn't entirely economics of land ownership. The filipinos culturally prefer to live that way. Even when they are rich and live in subdivisions they still prefer to have a zillion people, chickens, dogs, and everything else running about and freely in/out of the abodes which are built as closely together as possible. It looks horrible to you because you are a Westerner. For the filipinos, they are most happy like that. Put them in our wide open spaces and serene, antiseptic environs and they get miserable and lonely. I know. I tried. The worst thing you as a Westerner can do is go try to change them. You will create Frankenstein results. I know. I tried. Let them be. Fix their roofs when the typhoons blows it away. Give them jobs. Let them decide how they want to progress. They do like to sample our luxurious environs (i.e. trade with them, but don't try to change them on your own terms), but emotionally they always return to that simple closeness. That is where their heart is. Please don't open your big Western heart that wants to "fix" everything. You break everything when you do that. Note the Philippines has a lot of very modern facilities now. Asia is modernizing very rapidly. They really don't need us. Exactly, those kids are equally happy like those kids in western, children never care about the environment around them, they take it as granted |
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There can not be deflation when the money supply increases. However people's income is different: Those in the bottom of the food chain are still suffering from a lower demand and lower income, while those at the top of the food chain are getting higher income and higher demand for those things that are not included in inflation/deflation statistics (capital goods and assets)
This has been the case in Japan for nearly two decades by now. Deflation there started in the early 1990s, and despite the efforts by the Bank of Japan and the government through the reduction of interest rates and quantitative easing (money printing), it nevertheless persisted... As I said, for some people it is inflation, for some others it is deflation, depends on where you are in the central bank's food chain. In an expansionary monetary policy, those who first get central bank money will always get rich regardless of inflation/deflation. And these rich guys might not be interested in spending money to stimulate the economy (which is the most inefficient use of money during a recession), they just send their money oversea and hunt for other assets Inflation (and deflation, for that matter) is not defined on a personal basis, as you might have known. It is a general price increase or decline. Furthermore, whether or not the rich guys might be interested in spending money to stimulate the economy is not directly relevant to the point you first made, that deflation cannot exist in an expansionary monetary environment (actually, it works against your point). In fact, an expansionary monetary policy is used to fight deflation, but its mileage, as it were, may vary, and they have to coexist, at least for some time (by definition)... The whole picture is more complex than some single formula. After 2008, added money supply just flew out and pumped up the commodity and oil price around the world, and to china, to raise the housing price in china. So the inflation can be exported, no current economy theory discuss this in detail. Even in home country, new money are mostly used to buy more and more bond, thus drive the bond inflation, but bond is not included in the CPI/PCE, the whole nation would still be dragged into deflation (Due to more debt, and less consumption as a result) Of course those money will eventually "trickle down", but since majority of those money flowed to some other area, the effect of an expansionary monetary policy might not be felt in 5-10 years, makes the operation itself very inefficient and a waste of resource, the only thing it achieves is moving wealth to the money creator and their friends |
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We need the economic theories. The money supply must grow and shrink with economic activity, allowing stable prices. The question is: How can we do that in cryptos?
Money supply does not need to change, the price will change, people will adapt to changing prices with their own strategy |
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Economy theory is always politically related, so the first question is to answer if government allow the mass circulation of alternative currency? So far, most of the countries only allow their domestic currency to circulate, that also has something to do with tax collection
From this perspective, I think bitcoin will only work as a digital asset, serving specific purposes like saving and international transaction, so the demand is not driven by GDP or something in mainstream economics
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Deflation is painful for those who print money. Deflation is good, in absolute terms, for everyone else,, even those in debt. Debt means temporary boost in funds & lower prices means more purchasing power.
Actually for indebted persons its not, because their wages could go up, but the nominal value of the debt goes up aswell, along with the interest rates, and that can hurt them. You got a 30.000 yen debt, which is like 150$, suddently the yen gets stronger now you got a 150.000$ debt referenced in 30.000 yen. Which one is better? However in a deflationary economy people would not be indebted so hard. Credit cards would not exist, and only business loans would be made, as cars and houses could be bought from 1-2 year salaries. People should not get into debt in the first place. Every logic that applies to healthy person might not be suitable for a sick person Debt always involves some future uncertainty, thus incur some kind of risk, there is no systematic way to remove that risk. The most risk-free way is to use saved money, then there will be no loan, no interest, perfectly stable finance But people are greedy, they want something that they don't have today and they hope that they can pay it back tomorrow, so they take loans. IMO loan is some kind of gambling, you bet your future for something that you want today, and if that future does not hold, you will lose much more than the occasion when you don't gamble If a society is full of gamblers, then the normal logic does not work any more, there will be strange theory and logic developed to specifically serve this kind of society |
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There can not be deflation when the money supply increases. However people's income is different: Those in the bottom of the food chain are still suffering from a lower demand and lower income, while those at the top of the food chain are getting higher income and higher demand for those things that are not included in inflation/deflation statistics (capital goods and assets)
This has been the case in Japan for nearly two decades by now. Deflation there started in the early 1990s, and despite the efforts by the Bank of Japan and the government through the reduction of interest rates and quantitative easing (money printing), it nevertheless persisted... As I said, for some people it is inflation, for some others it is deflation, depends on where you are in the central bank's food chain. In an expansionary monetary policy, those who first get central bank money will always get rich regardless of inflation/deflation. And these rich guys might not be interested in spending money to stimulate the economy (which is the most inefficient use of money during a recession), they just send their money oversea and hunt for other assets Because JPY had experienced strong appreciation even after the finish of plaza accord, most likely their money supply increase were not fast enough because of the fear from the housing market collapse |
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