First of, Happy Birthday! Second, what an elaborate piece of work you've concocted.

I remember reading about your idea way back when BTC was trading above $14. However, I never understood why the need for such complex system when the bitcoin network already provides everything that you would need to assign a different value to each bitcoin mined (or just to a tiny fraction of each bitcoin). Unfortunately, I still haven't figured out how to put my vision into words that would crush the dreams of even the most audacious of BTC speculators. Perhaps you wouldn't mind helping me solidify that vision in what can be called "The Third Bitcoin Whitepaper" one day?

Basically, I don't see raw bitcoins (those traded on Mt.Gox, etc) to be worth more than the cost of their production + maybe some profit margin that reflects a level of competition among the miners. But once those raw bitcoins are used in transactions for something of value (e.g. an hour of someone's service, an ounce of gold, a product, etc), their value can grow or shrink from the value of those transactions. So, if you are up for a simpler way to build "new currency layers" within the bitcoin network (rather than on top of it, as proposed in your paper), then we should talk.

True, the value must first be assigned in order for something 'with no inherent value' to be called an asset.

In the case of bitcoins supported by the actual transactions, that value is assigned by the value of those transactions.

However, in the case of raw bitcoins (those traded on MtGox, etc), that value is merely proposed (not assigned).

A raw bitcoin (freshly mined) is not an asset per se, but a set of empty rows in the General Ledger.
By selling your bitcoins to others you're selling them an exclusive right to use those rows to record various transactions.
Only bitcoins that are supported by the actual transactions can be called an asset (the value of which is the value of transactions).

Recent hikes in the price of raw bitcoins are merely the Smart Money attempt to once again capitalize on the unsuspecting bitcoin fans.

Please understand that I'm in no way trying to imply that the forum's current format/version can successfully serve the growing needs of bitcoin community. I simply do not agree with the decision to take all bitcoin-related discussions outside the bitcoin.org domain in order to dissociate bitcoin from conversations that are deemed inappropriate for the general public or physical-world merchants.

I believe that the focus should be on redirecting, not escaping those types of conversations, as their occurrence is an indication that bitcoin does not yet have a solid value proposition. Decentralizing all communication may hinder bitcoin's growth potential.

Thanks for bringing that up!
I was trying to draw the following distinction:

Ledger > Bitcoin, Dollar (Fiat money)... http://en.wikipedia.org/wiki/Money

Commodity > Gold Coins... http://en.wikipedia.org/wiki/Commodity_money

As you can see, since bitcoin is a general (accounting) ledger, there's no reason to treat it as a commodity?

Let’s forger about the physical world for a moment, and how it will be awesome to shop/party/gamble in that world with bitcoin. Instead, let’s take a good look around and recognize that internet is this new digital world, with a multitude of valuable things to offer, but without the official currency to assign and track the value that went into producing and distributing/marketing all of those things. Now, this is bitcoin’s real opportunity: to become the internet’s official currency. Let’s not waste it on a wild-goose chase.

From my perspective as a marketing/economics geek, bitcoin doesn’t yet need any particular image to maintain in the physical world; what it needs is to be viewed/accepted as a currency of the digital world that is full of open-source projects, freelancers, cypherpunks, hacktivists, gamblers, trolls, porn, you name it. If bitcoin cannot make it in its own world, what makes you think that it can make it in the physical world where it has to compete with well-rooted fiat currencies? USD became an accepted currency around the world because it had the backing of its home economy. Let's give bitcoin its own economy first, and everything else will follow.

Keeping that in mind, whatever you see happening in this forum today is nothing more but a reflection of what’s happening all over the internet, and what also happens when a new nation/community is being born/formed. Trying to escape all of that is like trying to give up on the future potential of internet. My vote is to make this forum the go-to place for ALL bitcoiners.

In order for bitcoin to catch on as a currency, the general public needs to see value in the communities/businesses build around bitcoin, not in the bitcoin itself. Essentially, bitcoin must first become the de facto currency within its own economy before it can be considered a viable competitor to the fiat currencies, which today support the activities of numerous multimillion-dollar businesses.

Unfortunately, the developer/miner crowd does not seem to be realizing that just yet, otherwise they'd be spending bitcoin.

In addition to being in it for a long haul, I have big plans for bitcoin. Problem is that most don't see it as just a currency.

When I was referring to bitcoin possibly not having a clear vision I meant something along the lines of its application to the real world (or maybe just the internet) problems/issues: i.e. what problems is it trying to solve and how will it help to solve them?

From the marketing perspective, bitcoin's current fans are its biggest asset in fulfilling that vision. They are the ones who didn't need fancy language to see potential in bitcoin. Essentially, they are its energizer bunnies that just keep going and going. All that's missing is a clear sense of direction: i.e. what exactly they should be communicating to the rest of the world about bitcoin.

Use them, don't loose them! Developers used this forum to figure out how to get bitcoin to its current state. Now let its biggest fans to use this forum to figure out how to put together bitcoin's most relevant value proposition(s) for the general public. Maybe this is that time when developers start observing how the first way of bitcoin users is interacting with bitcoin.

What is it? Because, everywhere you look (not just this forum), most consider bitcoin either as an investment or as speculative asset.

BTW, who's to say that the topics discussed throughout this forum today is simply the result of NO CLEAR VISION for bitcoin? If it is true, then perhaps the priority should be to establish a clear vision, rather than trying to convince merchants to embrace bitcoin.

And this is another reason why bitcoin is not yet ready for merchants and the general public.

Let's work out the kinks first, you know, the kinks that began surfacing as the non-developer crowd entered this forum. Does anyone (among developers) even recognize that this issue could (read: will) be the deal breaker for most merchants?

What do you think I meant? Seriously, stop and think for a minute or two before replying with statements like that.

Perhaps this could be that reason to come up with something original, something that could leave even Quora (another rapidly-growing groupthink site) in the dust. This could also be an opportunity for the miners to seed the initially created bitcoins to those who choose to put their skills to the test. Think about it, what would bitcoin's value be if it was used to pay for the creation of something like Quora, Facebook, and the likes? This is how you build bitcoin's value up... not through marketing gimmicks.

Is it because those whose thoughts had mattered suddenly decided not to engage the new comers for the sake of not having to repeat themselves? Start engaging the new comers, instead of referring to them as kids/trolls, and the problems will go away.

Interest/curiosity does not imply approval/acceptance.

In marketing, it's all about positioning. You can't go after different market segments all at once, because to do so would require different value propositions of the same or maybe even different versions of bitcoin (or even a completely different currency).

Hence, in its current raw form, bitcoin has a much better chance of being successfully positioned for "libertarian/anarchist/conspiracy theorist/right-winger" crowds that may not be as "normal" as the general public, but nonetheless represent its best first-time customers, whose approval/acceptance of bitcoin as a medium of exchange will drive the creation of bitcoin economy. And once bitcoin has an economy to call "Home", it will be possible to position it for the general public's approval/acceptance.

Now, what everyone (starting with the bitcoin developers) needs to worry about is exchanges like Mt.Gox properly reporting their customers' profits to the authorities, because any foolishness in that aspect could leave bitcoin without any customers.



I wasn't talking about paying in $ or other fiat currencies. I was talking about paying in bitcoins only... It is a currency, right?

And don't forget the most effective/realistic approach: spend bitcoin to save/grow bitcoin. Basically, pay someone (e.g. bitcoin fans, etc) to come up with a better forum (in terms of usability/accessibility/whatever) or something completely new. That's what will give bitcoin its value, not some cheap marketing tactics that have no chance in hell to go against even the smallest of fiat currency establishments. Own your creation (bitcoin)... Show it can be used as a currency, or shut the rigs down!

That's my 2 marketing/economics BTCents.

Example of communities centered around bitcoin: MtGox

Although I don't like its practice of bypassing the bitcoin block chain when trading BTC for fiat currencies, nevertheless it makes for an interesting environment, capable of giving one an adrenaline rush like no other (just ask GeniuSxBoY; also see here & here).

I doubt that one can move bitcoin into the mainstream just like that: i.e. by setting up a "proper" communication channel. It's best to focus on moving the mainstream into bitcoin, and by that I mean developing communities that the general public cannot have access to unless they have bitcoins in their hands. The general public has no desire to replace fiat currency establishments (e.g. PayPal, MasterCard, etc.) with an establishment run and maintained by the geeks, especially when that establishment has nothing to show for itself other than doing things for the lulz (nothing against LulzSec). The ultraright-wing, libertarian, anarchist conspiracy theorists are the only ones interested in that kind of stuff, so I'd say direct your focus at them to see bitcoin grow in strength (you'll need it to withstand the attacks from its most ferocious competitors). Does it make sense?

By leaving it alone, some groups will eventually dissociate themselves from this forum by establishing their own gatherings elsewhere. But by not letting newcomers to see the true face of an already established bitcoin community, you will be risking to alienate those who by accident stumble on a group they have nothing in common, thus making them draw wrong conclusions about bitcoin's future. So, instead of cleaning up the forum from certain groups but not others, why not just setup http://blog.bitcoin.org, and then allow only select individuals (perhaps one from each group) to seed topics for all to discuss?

It's Twitter that one should be worried about: IRC for the general public.

Here are a few possibilities:
- BitcoinMG (for MtGox crowd)
- BitcoinTH (for TradeHill crowd)
- ... (fill in the blank)

The best part is that Bitcoin will power them all.