I have promised to keep my negative views to myself in this forum, but you insist asking for them...
All I hope for is honesty. Thanks for that.
Is what I wrote on twitter and put on my homepage any different from what I already wrote here?
I believe your tone has been different. I haven't seen you here call anyone a scammer, fool or sucker yet but maybe I missed it. I haven't seen you gloat over an investor's loss here yet but maybe I missed it. I do however see consistency in your pointing out the negative aspects.
(You missed my last tweet, "One day bitcoins will be worth their weight in gold".)
Saw it but others have posted before. It is clever until one quickly realizes that USD, Rubles, Yuan, etc. will all also be worth zero one day.
The UK used to use sticks as money. Native American Indians used shells. Just as oddly "pre-Information Age" currencies use paper and bits of near-worthless metals. The Information Age uses encrypted bytes and they'll, just as strangely, be worth as much as sticks, shells, and paper were. Today those bytes are worth @624 times USD.
Even if bitcoin ultmately succeeds (which I wish it will, but doubt it) and bitcoins becomes extremely valuable (which I very much doubt they will)
They're extremely valuable *now* so you've lost that bit of your argument already. I sometimes wonder if Bitcoin has staying power myself but I believe that code changes can be made to it as necessitated to keep it healthy, as have already been done. I watch as more tech gets added on top of it. Though the heart of it solves and old problem with virtual currencies, it does seem a bit creaky to base a worldwide currency on. I wonder if something more solid (seemingly, to me) will come along but in any case I am aware the project is in Beta and as Gavin has claimed many times, it's an experiment.
From my point of view a part of it has already succeeded. I bought some. Not only did I make some money (investment paid off) but I was lucky enough to purchase many gifts last year for the holidays with it (using as a currency). With new developments I wonder if I will write my Final Will with it (using it as legal documentation) or vote for a President of my country with it (using as voting mechanism).
Can you see you need to separate your views about Bitcoin's "fiat worth" from its "technology worth" -- the potential to drastically change things worlwide?
However, this particular game will be profitable for its current players only if the price goes up; and that is not likely to happen if the "market" consists of the same guys trading the same bitcoins and the same dollars back and forth among themselves. In order for the price to go up, and the old players to make substantial profits, new players must come in and bring new money.
I imagine other forces are at work on the price aside from the back and forth of current investors. That is the economy growing up around Bitcoin.
Anyway even if Bitcoin exchange speculation is nothing but pure gambling you said you weren't against folks gambling so why do you complain about it? because you think the house is rigged? You know the house always wins, right, even in Vegas? This is why it's called gambling. Sounds like gambling is OK with you as long as it doesn't happen in your backyard. NIMBY?
So, in that aspect bitcoin trading is indeed a classical Ponzi schema: the money invested by new members is used to pay the large profits of the early joiners -- if these are smart enough cash out while the price is higher than what they paid for their coins. The net effect of the game is to shift money from the late entrant' pockets to those of the early entrants.
Honestly, I think many of us go through this phase because in the beginning we do not see how bytes can be worth money. But then if we come back and do some research we learn about money. We learn about the Two Generals. We test the currency and it works. It's cool and fun and easy to use (not necessarily to obtain but that will improve). It's a bit rickety around the edges; it has its flaws but it is new. The internet was rickety in the beginning. We see potential.
Bitcoin isn't a project which concerns itself only with exchange rate. It is being used for currency, store of value, legal contracts, voting mechanisms; the potential is a bit mind boggling.
A ponzi is created from the beginning with intent to fraud investors. Bitcoin is an innovation that solved a very real problem in the crypto community and an exchange price arose from that, along with more innovation on top of the protocol.
And that is when the game stops being OK. That is because in order to lure new players, some of the bitcoin "evangelists" are resorting to plain lies, painting bitcoin as a "good investment", an hedge against "rampaging inflation", etc. They keep showing that false arithmetic of total e-commerce divided by 21 million.
What you call "luring new players" I personally think of as excitement to share this awesome new technology, with an added bonus of potential monetary gain. I tried to get a brother of mine interested around $140 because it looked pretty certain to go up and he could use the help. But he was afraid and I didn't badger him. I did give some to my family last Xmas and told them to just hold it, but that if they got interested in Bitcoin to talk to me first because there is quite a bit of shadiness in the culture at the moment.
I do have my concerns that if Bitcoin is infinitely divisible why would it be worth anything? I feel it has to do with the psychology of someone wanting to own a whole coin, or really, "more" of anything. Some people always want more. They can pay and so they do. When the UK used sticks for currency I'm sure there was always some fellow who wanted one more notch on his stick than anyone else. In other words, most volume knobs only go to 10 but some folks will eventually get amplifiers that go to 11... because more is better.
Some still claim that bitcoin payments are untraceable and un-seizeable. (You may have seen my tweets a couple of weeks ago where I argue with someone who claimed just that.)
Funny thing is it is pretty good at being anonymous until one begins using 3rd parties, or until law enforcement gets access to someone's records/diary, or decides they have the budget to prosecute and issue search warrants to providers for IPs, etc. Once they correlate a name with a BTC address, and have access to records where one has recorded a payment to another's address (tied to a name), then they can easily unravel all the addresses in that chain of transactions. So it is basically near useless at anonymity for the people who'd need it most.
Now if criminals were to encrypt their data and stay vigilant with PGP communications.... but most people in this world are too lazy or complacent for all that.
And the bitcoin salesmen conveniently forget to mention the growing legal barriers, the dozens of exchange failures that ate millions from their clients, and the many other things that would turn sensible people, even uneducated ones, away from the bitcoin game.
You see growing legal barriers, I see growing legal acceptance. There has been fraud, surely, as in any currency. You've likely heard of Wall Street in the U.S. (also known as "business Harlem")? This clip is funny because it's true.
http://www.thedailyshow.com/watch/tue-august-13-2013/frisky-business---jessica-williamsOne feature of Ponzi schemes is that most people who join feel the urge to become salesmen and convince others to join too.
You mean proselytizing, like a religion? Or do you mean it's like telling one's friends about the Walking Dead on AMC because it is a frigging awesome TV show? Or perhaps telling friends to go to Disney World if they've never been because it is a wonderful experience? Or "try the Grape Meatballs, they're delicious!" We enjoy something, we share it.
It was the opening of the Chinese market that lifted the bitcoin price from the low tens to 1200, and it is the Chinese who are holding it at the present levels. But that market is no longer growing. So, where will the necessary new suckers come from?
I don't see suckers. I see people continuing to come into the market from all over the world as they go through the learning process and begin to see why Bitcoin is more than the sum of its parts, mostly because the parts are so exciting and we can't see them all even now.
None of us knows if China was the reason for the lift, or which exchanges may use fraudulent transaction/price data. I personally assume most of Gox and Huobi transactions are internal bot price fixing. Plan accordingly.
I have seen people here and elsewhere saying that the only hope left now is Latin America. Well, I cannot sit and watch fellow countrymen being conned, can I?
Haven't heard this but I better understand your sentiment. "Gambling is OK with me except NIMBY. And even as a computer scientist I'm too short-sighted to see the massive digital potential, which grows as we speak, aside from price gambling."
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