Then use the standard bitcoin denominations, 100 miliBitcoins = 0.10 BTC or 10 miliBitcoins = 0.01 BTC, hence 500 miliBitcoins = 0.50 BTC
FTFY |
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Looks like you didn't read my post. I am not saying everyone basically gets the same, like in socialism. I ask about people receiving an addition to whatever they earn anyways. Things would not change other than that. Please, either learn about what socialism is or read my post. Looks like you didn't understand my post. If you do not understand that your proposal is wealth redistribution, and that this could have reduced incentive to work as an effect, well... Only for a while though, if your 1000$ bonus is fixed and not adjusted for inflation, it would soon be pretty worthless... By the way, the reduced incentive thingie is still somewhat debatable, whereas claiming this proposal wouldn't result in inflation is downright laughable... Please, either think some more about what you are proposing or stop giving arrogant answers. EDIT: Afterwards I realised this wasn't a very mature reply, I know you mean no harm, I was just quite pissed at the time :-) |
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The value I have provided is just $1,000 in efficiency over the existing system as an innovator/ early adopter. But I get to exchange as if I have provided 5,000 times that value.
My conclusion is 50 years of slavery to realise $1000 in value, (no way) the distribution of BTC is problematic. A disproportionate amount of wealth goes to too few for providing only marginal benefit. (a stable exchange rate only guarantees a disproportionate amount of wealth goes a few, while a crash with exstended periods of dispair may better distribute the BTC)
As long as late adopters see benefits in adopting bitcoin use (and like I said before, I think spreads and fees will drop with increased usage), why shouldn't they do it? If their transaction fees are lower, and there is no reason why the exchange rate should drop, what is the rationale for not adopting it? Who will give a rats ass about transfering wealth to early adopters as long as there is personal gain in it for them? And even if a subset of these are very ideological people , are they that much happier continually transfering wealth to traditional banks or central banks? |
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This essentially requires some kind of resolution between the two partners. However
- a seller could be a scammer just looking to grief "buyers".
- a buyer, once receiving the item, could random the locked up coins for a discount. The seller has no leverage here.
I'm not too keen on this and doubt I would agree to it. 2-of-3 transactions are where it's at.
What are 2-of-3 transactions? Is it a system in which the buyer and/or seller have to deposit some money that will be transferred back to them upon completion of a mutually satisfied transaction? Because such a system would make sense to me. I have seen the term "m-of-n transactions" before on this forum, is this a more generalised term? Although I am not yet technically literate enough, do-it-yourself escrow seems like an awesome idea. Thanks Casascius! |
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In a grocery store I pay with dollars coz noone accepts bitcoins. In 20 years the situation will be the same. Because some guys made a bridge between dollars and bitcoins. Because they hid a wallet with coins in a bank vault and gave ppl paper money. Because they made Bitcoin an instrument to store wealth.
Baby steps. First the merchant accepts a card that converts BTC into dollars. From there it's just a tiny stem for the merchant to use his own service that accepts BTC and converts it into dollars (like BitPay). This would be good for the merchant, because instead of being locked into VISA or MasterCard, the merchant can accept almost-fee-free BTC transactions, and chose from a very large selection of competing exchange services to convert the money for him. After that it's just another tiny step to simple keep BTC. I largely agree, except that the final step isn't tiny and in my opinion won't happen on a global scale until exchange rates stabilize (which will take a long time). Of course there will be more enthusiastic merchants and people that value and keep the BTC, but I think most merchants will not risk the exchange rate volatility. |
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OK, but we are not dealing with the regression money theorem here. So we are not evolving an economy backed by barter.
Like I said in another post, I don't think the lack of regression theorem applicability is a problem. https://bitcointalk.org/index.php?topic=118230.msg1357230#msg1357230'Not backed by barter' this depends a bit on what you mean. No, bitcoins indeed do not have an intrinsic non-monetary use like commodities do. But they are exchangeable for other goods (depending on perceived value). Here is an example: lets agree to trade in BTC the exchange to Fiat is $10 to BTC1.
Now I give you 30 days to pay, and 30 days from now Fiat is $20 to BTC1.
The seller will have lost 50% on the deal and the buyer up 50%. (As btc increase in value relative to Fiat a buyer - people with btc - will have an advantage. This advantage will be expressed as a reluctance to sell goods and services in btc.
As long as the value is increasing there is no insensitive for the economy to develop.
I do think there is a rational incentive to use BTCs currently if the fees are smaller than using traditional systems (especially in international transactions, or if you are unable to pay in another way due to circumstances, like an underdeveloped banking system in your home land or something similar). If everybody thinks BTCs will increase in value, then they will trade all their fiat money for BTCs and buy their required goods with BTCs. They won't keep a portion of their savings in BTC and spend dollars and euros for goods, I mean, what is the use of holding spare fiat money in this case? Bitcoin currently has a problem for merchants in that its exchange rate is still extremely volatile (due to the small market cap), so this is a problem to price their goods in BTC, and to keep BTCs for expenses. The logical intermediary step towards broader adoption is pricing in USD or euro or..., converting that to BTC values, transfer in BTC and use services like bitpay to immediately convert back to conventional currencies. As this practice grows, fees should drop (and exchange rate spreads should drop too). When BTCs eventually reach a more stable exchange rate, people can just trade in BTCs and keep them without needing to convert. Without an economy - trading of goods and services - there is nothing backing up the value of btc.
Agreed, but I think the development of the economy is possible (and happening). |
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But with regards to adoption and value there is a problem of supply and demand.
When something is in limited supply the price will increase, and likewise as the price increases the demand will drop. So demand for Bitcoin will decrease as the value transfers to the early adopters.
I don't agree with you here. A rise in price will generally be accompanied by an increased amount of people believing bitcoin has value. The more people use bitcoins for commerce or consider it to be a good store of value, the more truly valuable bitcoins become, as they can now be used as a medium of exchange between more individuals. It's a positive feedback loop. |
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I don't think it'll go beyond $20 again, at least until the next reward halving. It hit $31 because of a whole lot of hype and attention out of nowhere, then it quickly went back down as the difficulty did. I actually expect its price to go down because of how affordable and efficient ASICs are in comparison to GPUs.
Do I assume correctly that your underlying premise is therefore that that price follows cost of production - or more indirectly that price follows difficulty which follows cost of production? Many would argue with you that it works the other way round. I get the impression it is more generally believed that price is determined by the balance between supply and demand and that when the price goes up difficulty goes up as more hashing power comes on line until cost of production is near BTC price. You'll also find some technical analysis on this I have found to be persuasive. The efficiency of miners determining the prices makes no sense to me whatsoever. "Oh, they just invented a superefficient miner, now I don't want my bitcoins anymore" .... wut? If mining is profitable because of increased efficiency, then the result will be that more people will start mining, not that people will sell off their btcs... |
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shortages + money printing = inflation (when money velocity and lending is constant, which usually isn't the case after a boom period).
agreed. so tell me, where is MV going?  I know it is going down, which is typical for a recession. And this can last for a very long period, just look at Japan. Only, it won't last forever. |
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Think of a runner on a treadmill. The runner is inflation, the treadmill is deflation. Until the runner's body gives out from dehydration or exhaustion, things continue as normal - at least in appearance.
No reason why inflation can't last forever. It's easier (less short-term negative consequences) to grow the monetary base than to shrink it. Without monetary base reduction, deflation cannot go on forever. Until real assets are completely exhausted and actual shortages cause widespread disruption (including starvation & death), monetary inflation can mask deflation.
shortages + money printing = inflation (when money velocity and lending is constant, which usually isn't the case after a boom period). |
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I am not looking at the Technology adoption lifecycle as causal but rather a correlation in an attempt to predict adoption. If there are going to be 1,000 players in the Bitcoin community the first 150 are the early adopters who benefit by receiving huge wealth, if there are going to be a 100,000 players in the Bitcoin community first 15,000 are the early adopters. But examining statistics it looks like there are about 2-3000 active members in the Bitcoin Economy, and looking at the wealth distribution it looks like mega wealth is concentrated in less than 100 members. I would expect 80% of the wealth to be distributed among 4-500 members if we were in the early adopter's stage. But as about 2/3 of Bitcoin's are distributed in a small minority, I believe we are in the later stages of distribution, and would consider that some new comers to the Bitcoin party are early majority participants.
I have no background in this knowledge, but aren't you reading too much in these numbers? On what are you basing these statements, isn't there a lot of variability between different technologies? (just curious to know) While I am heavily invested and love to hear people tell me this is going to be big, I have seen a problem in the system design in relation to propagation and adoption, and am trying to understand how I can help propagate the technology, so I can cash out on my investment or help catalyze in a new age of sustainable prosperity.
What problem are you refering to? Blockchain size and synchronisation speed? |
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a consolidation could land us around 13.20 ( 12.6 + (13.5-12.6)*0.66 = 13.194 )
my guess is we'll be trading sideways in a range between 13.1 and 13.3 for a while now.
FTFY |
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What exactly would be the problem with a government or a lot of people "snatching up bitcoins"?
I'll have a crack at answering this one but I'll ask readers to bear in mind my limited understanding of the bigger picture. If what you're referring to is what the OP is about then what they'd be buying it for is to put into cold storage as a reserve fro the Indian Rupee. As I see it this is not an increase in distribution nor use for commerce. In order to buy a proportion that would make any kind of impact on the overall value of their reserves they'd need to buy well more than is currently available at Mt Gox. All I can see the impact being therefore is a massive inflation of the bitcoin price over a sustained period with an accompanying reduction in bitcoin available for everyone else. Of course the divisibility means in one sense it doesn't matter but without being able to justify my feeling about it I would be a lot more comfortable if the cause of such an increase in price and reduction of Bitcoin available to purchase were to happen in conjunction with wider dispersal, more and more geographically distributed nodes and minig outfits and more time for the software and Bitcoin economy to become more robust. I would also be more comfortable for me, should central banks eventually decide to use Bitcoin as a reserve, if it were much more highly valued and distributed first. It just wouldn't feel right for me for a single fiat-issuing entity to be the primary beneficiary of all subsequent growth in Bitcoin value. Agreed (for some reason i thought rchapoteau had mentioned their use as a normal currency in india, instead of just a reserve asset) |
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What exactly would be the problem with a government or a lot of people "snatching up bitcoins"? As long as the fundamental ideas behind it don't get changed, that would be brilliant in my mind (unless it is a somewhat smallish country with a lot of political enemies, who could view destroying bitcoin as a valid move to hurt the other), greater network power, much greater userbase and legitimate businesses that would use it (and as a bonus higher BTC prices for early investors)... I don't see the problem.
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Wow all 2 of you are hoarding. Good job that will keep the price up.
Love the flawed logic around here. When you said "investorS" you meant 2, not like 20,000. LOL!
So you want him to have a sample size of 20,000 people in his personal environment who are starting to use bitcoin? In contrast, your statements are the absolute truth, no evidence required. Enlighten me, where do you get your ideas? |
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Probably just the lack of mining competition there, which ensures more LTCs to be mined.
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Maybe they are already looking at it  . I think you are being a bit optimistic here . Bitcoin is an experiment, central banks want certainty. Who wants to be the guy who brought up the idea to buy all these 'bitcoins' as a reserve, if bitcoin should fail? If bitcoin grows and matures over the next couple of years, hopefully some people will be willing to stick out their neck. Right now, I think it is very unlikely... |
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No government that owes debt in its own currency has ever hyper-inflated, either....because they can always keep rates down; eg, no exponential feedback loop.
Bernanke also said that US housing never went down on a nation-wide basis, look how that turned out... Your argument is more rational however, as it excludes a mechanism (and relies on the history of all countries, instead of one), but I still do not see it as a foolproof protection against hyperinflation. If enough people lose confidence, money velocity will keep accelerating, and you'll have hyperinflation. Consider it a hedge against the Yen depreciation trade.
That wouldn't be a hedge; I think you meant something along the lines of "Consider it another way to get profitable exposure to a collapse in Japan". In that case, perhaps...
Yes, that was what I meant. |
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