So if I may sound like a newbie for a moment...
"How will I get my coins from Mt Gox -> BitInstant -> Paypal?"
If you have bitcoins in Mt Gox and want to cash out to Paypal use https://fastcash4bitcoins.com/ |
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Mt Gox is not a good choice for processing BTC payments into dollar accounts. Use BitPay, Coinbase, or BIPS. Any of them will send the received funds directly to your bank account and you won't have to mess with Dwolla.
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Based on the way their buying limit works I think they are buying their bitcoins from Mt Gox, withdrawing them to their own addresses, and selling them to users who are mostly holding on to them. I think the 24 hour limit is based on them sending a new wire transfer to Mt Gox every day they use to buy Bitcoins with to sell to their customers. They are slowly trying to increase their volume but are limited by the ACH delay in terms of getting more money into their own accounts, and send most of their operating capital over to Mt Gox every day. When they stop accepting new orders it's because they are out of dollars to buy with until the banking system finishes processing another batch of ACH pulls and another wire.
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Denninger can be a douche when it comes to some issues, but this is not one of them: http://www.market-ticker.org/akcs-www?post=219136Ok folks, if you live in Cyprus and are one of the common people there, perhaps a "wealthy" person such as a businessowner but not one of the "connected few", now it has come out how you were screwed. Laiki Bank customers in the UK face no restrictions on access to their cash and have been told it is "business as usual" at the firm's four British branches, despite an overnight decision to close its Cyprus parent.
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Ruth Harvey of Laiki Bank in the UK said that although not all of the details of the impact of the agreement were known, there was no need for the 13,000 UK customers to panic. "We are open, it's business as usual, and there are no restrictions on our client's accounts," she said. "The message we want to get over to our customers is to keep calm and carry on." So if you knew this and had the capability, you apparently could have moved all your money out of this Cyprus bank during the freeze. I am willing to bet that if you are a Russian oligarch with a lot of money (formerly) in Cyprus you did exactly that. I'm also willing to bet that if you're a Cypriot citizen you probably didn't know this and as a result you got screwed since you could only get a couple hundred -- or even €100 -- at a time from an ATM. And before you scream "but those rich people deserved it!" let me point out that business people with payroll accounts in these banks are utterly screwed and so are their workers, who worked in good faith and now there is no money to pay them with.
The details of this "program" are as yet not entirely certain, but history is that there is always a way by which the common man gets rooked and the privileged few do not. This time it was blatantly "in your face"; along with the ECB and TARGET2 pledges of which there is no evidence that they will be zeroed along with common holders of bonds or stock it also appears that if you happened to be one of the "privileged few" you were also able to escape being "bailed in." |
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Considering how many Russian mafia fortunes were stolen, I wonder how long it will take before EU ministers are found dead in an alley with needles in their arms; or their grandkids are taken in retribution. Really, Russian mobsters are the last group that I'd think that a bunch of socialist leaning politicos in Brussels would want to upset.
You didn't hear? They all got out. The banks involved all had branches in London and elsewhere and "accidentally" forgot to notify those branches about the freeze until all the Russian oligarchs finished cashing out. |
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The rough calculation I use is to estimate what the exchange rate should be based on the quantity theory of money and assume everything beyond that is speculative premium.
If all world commerce was conducted in BTC, the exchange rate should be $1 million. This would mean about $5 trillion in commerce per month. The best guess I can come up with based on the available data is that the bitcoin economy sees on the order of $10 million - $100 million in commerce per month, so by a simple ratio the exchange rate should be $2-$20 if it was entirely driven by commerce. Everything else is speculative premium.
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The users that cash out with them I would assume.
I suspect, but can not prove, that Coinbase is selling far more bitcoins than it is cashing out for users because I never see threads posted where people are complaining about not being able to sell on Coinbase. It's always the other way around. Tangible Cryptography is another good indicator. On the Bitcoins Direct side they are barely able to keep bitcoins in stock to sell, and frequently have to freeze orders and are rarely open to new clients. The FastCash4Bitcoins side keeps offering more ways to cash out and increasingly favourable rates but still can't find enough BTC sellers to keep up with demand on the other side of the business. |
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I have to admit that was one hell of an hour though... never want to see that again. You'll get used to it. Undoubtedly it will happen again. |
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My theory: when the actual buyers come in the price drops. In the meantime, few groups with huge number of BTCs buy and sell to each other, artificially increasing the price. Those groups can't have an infinite amount of bitcoins. Where are all the bitcoins that Coinbase is consistently selling out of coming from? |
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why do they hate men? Because they had abusive or absent fathers and haven't dealt with that so they generalize their legitimate anger at the specific men who harmed them into a general dislike of all men, most of whom don't deserve it. It's the exact same principle that creates misogynists, just for the other gender. |
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It would be counter-productive and absurd to even come up with an example since your rhetorical question is a straw-man which does not map to the reality of the situation.
The block size is not a 'quota' but simply a number chosen to effect a design goal or the Bitcoin system. Namely, provoking miners to mine for a reward. I don't think there is much dispute about that, at least in a qualitative sense...notwithstanding thoughts on how to subsidize the world's masses and assertions that Bitcoin could function just fine if the full block-chain was held by just six corporations/governments. Although I don't claim to be a historian or have been involved from the early days, these philosophies strike me as afterthoughts and I didn't spot them in the whitepaper. (It's still on my todo list to read the historic mailing list archives though.) Transaction processing is a service. It has a supply curve, and a demand curve, and an equilibrium price. A cap on the block size is a production quota that will have deleterious effects that we haven't seen yet only because the equilibrium demand is below the current cap. When Bitcoin was first released it had no specific limit on the block size. This was only added on later as a means of preventing an attacker from sabotaging the network before the infrastructure was ready to handle high transaction rates. That's the reason it was set so high above the typical block size of the time. Now that block size is approaching the limit it's time to take the training wheels off and implement the technical measures needed to support the next phase of growth. It needs to be started early because it will take time and the adoption rate is exponential. |
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Bitfloor back over 90 already.
...or was for a moment anyway.
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Alright, lets hear your list of such industries.
Not until I see some reciprocity in the form of answering the question I already posed. please show me a historical example where imposing a production quota results in decentralization. |
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I used the MSB example as simply an illustration of something which is, for whatever reason, difficult and expensive. Politics can be left out unless your goal is to muddy the waters. This is not a valid approach because reasons make all the difference. Bringing a new smartphone to market is difficult and expensive because the high demand requires significant resources to supply. It works though because since the demand is driven by the customers there is enough profit available to pay for that infrastructure. We see healthy variety and competition in the smartphone market. Banking is a difficult and expensive market to enter because of artificially imposed barriers to entry. Those extra costs do not pay for services that the customers want - in fact they are used to provide the exact opposite of what customers want. Because of all this we see stagnation and cartels. I could go on all day citing examples of industries that are difficult and expensive to enter but remain decentralized and competitive because there is little-to-no intervention. Every one of your examples of a market with centralized cartel will have the smoking gun of government intervention in the middle of it. The intervention is and always will be the problem, not voluntary trade. |
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Your argument would result a very significant and very real 'quota' enforced on the number and flavor of 'peers' in the p2p solution. That would indeed provoke the 'centralization' that you (maybe) disfavor and the associated ills that I describe. You described the situation of MSBs wherein the costs to start a business in this industry is artificially high because an external agent has created artificial barriers to entry. Because of this excessive cost, competition is limited and the relatively few companies in this space are easily controlled by that agent. You then go on to imply the solution for this lack of competition is for that same agent to intervene again and impose supply quotas in order to correct the problem it caused when it intervened by imposing barriers to entry. Typical government apologist "logic", swapping cause and effect by pretending that the effect of bad policy was actually the reason the policy was enacted in the first place. |
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The problem is the network cost is tiny, yet has nothing to do with the long-term cost of storing the UTXO set, and also is fixed so that profitability for larger, more centralized, pools is always higher than smaller pools. There is a marginal cost to the miner for increasing the UTXO set in the form of capital investment of memory and fast storage to store it in. When the UTXO set gets large enough to be a problem miners will have an economic incentive to reduce their hardware costs by favouring transactions that shrink the set over those that grow the set. Even the miners with lower capital costs will have an incentive to limit the size of the set because it affects the speed at which other nodes can validate their blocks and thus their orphan rate. |
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