there's even more madness to the story if one is willing to hear it all. once they get the numbers on their screen, they sell those numbers to someone else. so they can get real money... so as soon as they get it they want to get rid of it, many of them do. how does that make any sense?

yes I believe a little honesty is called for on behalf of people "evangelizing" bitcoin. one argument that I hate hearing is "bitcoin is valuable because it cost $XXXX to mine".

because they are all too busy trying to make money off of bitcoin.   That's literally what some people think bitcoin is for so they can make money. they understand that there's really nothing backing up bitcoin, no physical asset. just a group faith that they keep "believing"...

maybe they should have called it something else other than "mining". because i agree that is a stupid name for doing a bunch of mathematical computations faster than anyone else. maybe they should have just called it "hashing" because when they say "mining" it makes it sound like they are doing something really important. when in reality, they are just trying to pad their own wallet. and run up a big electric bill that raises other peoples' rates. unless they are using solar or something but from what i have seen, many cryptocurrency "miners" don't seem to give a rats ass if their electricity consumption raises normal peoples' rates. and yes in case people wondered why electric utilities keep raising everyone's rates, its because of them.

yes i do tend to agree that the term "mining" is a bit misleading to what people are actually doing. they're not really doing anything except wasting electricity so they can get more bitcoin. they're not really miners in a traditional sense like a gold miner. gold miners actually find something in the ground. bitcoin "miners" aren't finding bitcoin.

to an extent what you say is true. bitcoin only has value because everyone agrees it has value. or enough people agree. unlike something like gold that has intrinsic value because it has physical uses.

Ok I give up. You're not here to learn anything, you're here to parade your Dunning-Kruger level of ignorance for us all to gawp at.
Congrats, it is impressively confident.

HFSP

Is it perhaps the conditioning children receive to believe that being wrong is a bad thing which is responsible for your inabilty to consider that your understanding of the topic is erroneous?

Let me break it down into the simplest terms I can:

The 'token' we use to represent money is currency. But we absolutely do not need to have a 'thing' at all. We could simply keep a record of debits and credits in a central database, agreed?

Money evolved out of the very first debit and credit ledgers we created and it was simply recorded as a number in a ledger. So if you as the farmer dropped off your grain at the local temple you would be assigned a certain number of credits for it and some of those credits would then be deducted against the debits you had previously run up earlier in the year when needing to buy your farming supplies etc. So you, like every other farmer and producer of goods for the community's economy would all have your debits and credits recorded in thie ledger.

If you were to look at a page of that ledger you would only see numbers being assigned to names as a result of whatever basis they had warranted a credit for. So you'd have no idea whether one unit was for grain, or grapes, or timber, as this wasn't necessary to know.

Do you know why it wasn't necessary to know? Because each unit recorded represented only one thing. The value introduced into the economic system as a result of time and energy expended creating it. Work.


That we then decided to create a token system which would then allow people to hold their own representation of that monetary unit, and then buy goods and services from other people who would accept it in exchange, is what saw the creation of a currency unit representing that monetary unit previously recorded in the ledger.

That is the difference between money and currency. Currency is just the token 'thing' we created to be able to move those written monetary unit records from the central ledger into the hands of the people so they could trade freely without it having to go through the central record for every transaction.

I don't think you're that stupid you don't know the difference. You're just choosing to act ignorant.

He has every right to prefer a specific system or medium of exchange for the transaction. All financial transactions generally follow established protocols. There's some flexibility in choosing a method the recipient accepts as valid, but still within the parameters set by the recipient. For example, you can enter a store and choose to pay by cash or card, but you cannot take the goods and tell the cashier "I will send you units of money via carrier pigeon" and expect him to accept such a transaction. But, if you persist in using a carrier pigeon instead of the preferred method, it raises concerns. It could be that you don't have the units readily available, or maybe you're simply trying to scam.

So, why do you keep insisting on your own "system" for the transaction instead of a method the recipient is comfortable with?

If they are "units of nothing", then it takes nothing for you to send them to me, right?  So do it.  


It is highly relevant to our discussion.  I'm trying to demonstrate that Bitcoin has value as a form of currency, even though it's not backed by a specific asset or commodity like debt or gold.  You've argued that it's essentially worthless, created out of thin air.  If that's the case, then I challenge you to send me 1 million Bitcoins.  If you're unable to do so, it would contradict your claim that Bitcoin is just like monopoly paper which can be printed out of nothing.  

Yeah I'm getting the feeling that you *really* don't understand a word of what is being said to you.

'Money' is a representation of work done. Time and Energy.

An issued unit of Bitcoin is the result of Time and Energy, ergo, it is not 'nothing'.


If you are incapable of grasping this premise then you have no hope at all of understanding the topic of money. Stop confusing it for currency, that is merely its representative token.

Oh I see what the problem is. You're struggling to understand what a unit of work is in an economic sense and you're conflating money with currency.

Your trite 'payment in dust' analogy shows this misunderstanding. The 'dust' as a means of payment would be considered currency in that case because you are declaring it to be 'your money', but it fails as money because there is no scarcity and no value can be ascribed to it because no work is needed to be done to create it.

If I perform some work, say, building a house for you, my time and energy introduces additional value to the communal economy as that house will have value for many years to come. This would warrant the issuing of additional units of money to the community's collective money supply so that it is accounted for (if no new money is issued then the net effect of the value I have added to the economy is deflationary) If I want to pay my utility bills, buy a car, go on holiday, I need to offer the utility company, the car salesman, the travel company, sufficient proof of having done the equivalent value of work that equates to the price of the goods/services I am purchasing. So you need to give me a number of units of something which will maintain the same economic value as every single other unit of currency our communal economy uses (which denotes it as fungible money, one of the essential qualities of what makes something 'money')

Now, if you replace 'dust' with 'fiat currency' in your analogy, you could perhaps be a skilled forger and simply create units of currency in your back room and hand them to me, but in most fiat transactions the person paying has done some work for somebody else who, likewise, did work for others, and you all received various amounts of units of money which represented that. If no new value was added to the economy then the same monetary units all move around between people and there is no inflation or deflation.

Ideally, because I have created new value in the economy, our community central bank would print X number of new units of our money and that would be introduced into the economy, ensuring that additional value is accounted for and no deflation (and no inflation through excessive printing) occurs.

But, say central banks (and forgery) do introduce excessive amounts of new money into our communiity's economic system. Let's imagine they introduce a whole YEAR's worth of additional money into the system. Each unit of that money represents work that will have to be done to produce the equivalent value. Otherwise we're all going to see prices rise as there is more money in the system than there are things of value being created it equates to. Suddenly everything costs more but we still have exactly the same amount of value in the community's economy.

We have debased our money until we are able to balance the scales by producing more things of value into the system.

Each unit of money in an economic system represents a unit of time and energy spent (work), regardless of the token we adopt as its national currency (dollar, yen, pound, euro etc). It is how that money is created and the abuse of that process which results in the mess we see nations in these days.

This is what Bitcoin solves. It can only be produced through work which has been done, not work which is yet to be done.

Do you understand?

That's because it is, James. Like ALL money, each issued unit of Bitcoin represents actual work done.

Fiat currency (another form of money), however, can be issued in advance of the work actually being done, thereby resulting in there being an over-supply of units to the economy, causing inflation and saddling every participant and even future, yet-to-be-born, participant with the debt of needing to do the work it represents as a result.

Does that clarify things for you?

Money doesn't need to be backed by a tangible asset or commodity.  Bitcoin is a prime example of this concept, as it has established itself as a form of currency despite not being pegged to gold, debt, or any other physical equivalent.  Its value lies in its digital existence and the trust people have in it as a medium of exchange, even though there is nothing behind "1 BTC", just as there is nothing behind one monopoly note.


Go ahead and send me 1 million "empty digital boxes" if that's how you think.  I want you to transmit them to me using the Bitcoin protocol.  I'm curious to see how this plays out, so keep me updated on the process.


I want the Bitcoin protocol, not other protocols.  


I don't want you to send me any "empty digital box" that goes against the Bitcoin protocol.  


That's false.  If you do not meet satoshi's rules, then any transaction you make will be invalid by the nodes of the network.  

Bitcoin = converting electricity into store of value

Using poker chips as an analogy for Bitcoin was a bad idea, because poker chips are liabilities, not assets.  They derive their value from the casino's promise to redeem them for currency.  Bitcoin is an asset.  It is not backed by anything other than itself, just as every asset.  Its value comes from the trust and confidence that people have in it as a decentralized currency.  You're just incapable of acknowledging that Bitcoin possesses these qualities.  

You haven't answered my question:

I've illustrated the essence of a Bitcoin unit.  It signifies a numerical value within a distributed, resilient, and incorruptible database.  It doesn't denote the quantity of a tangible asset, much like electronic poker chips don't signify any physical object, yet they possess specific characteristics that make them valuable.


If I create an online game and grant you 10 "e-diamonds", there's no physical item I can present to depict these diamonds.  They exist solely within the confines of my game's rules.  Should you trust me, these e-diamonds can attain value and serve as a form of currency.  


If that were the case, then send 1 million bitcoins to this address: bc1q0u2tencdlkzeungrj7zsswl62nlxgucghhanwe.  Since they're merely abstract figures in a database, it shouldn't pose much difficulty for you to generate them out of nothing, correct?  

Correct.


If you asked me "unit of what" is Bitcoin, I would explain that it stands as a unit unto itself, not tied to anything.  For those lacking creativity, it might be thought as a number in a database.


Your ABC number would hold no value, and furthermore, it couldn't have any real worth due to its absence of essential monetary attributes.  It lacks durability and a stable monetary policy.  You could generate infinite ABC coins by merely altering your spreadsheet.  If your ABC number possessed durability and a verifiably fixed supply, it might begin to be regarded as a form of money.

What appears to me, is that you fail to understand that money doesn't necessarily require backing by a physical asset.  In ancient times, when tobacco served as currency, its value didn't stem from its tangible real-world worth per se.  It was accepted as money because it fulfilled the essential characteristics of currency.  Same for gold.  

It has to do with your denial to acknowledge that money units can detach from any backing by debt and essentially represent nothing, relying solely on the faith that the government will be responsible the monetary policy.    


Money doesn't require being backed by debt.  When you make a purchase from a vendor, you're not considering whether your banknotes represent any debt.  Money functions primarily as a medium of exchange, contingent upon mutual agreement on its value.  Monopoly money fails as money because it can be printed arbitrarily.  Bitcoin can function as money, even though not backed by an asset, because it is the asset.  It possesses the characteristics of money, like portability, durability, divisibility, and easy verifiability.  

It is very relevant, because you're under the delusion that every dollar bill represents a portion of debt, which is not true if the government issues money that isn't owed to anyone.  Your argument suggesting that the current monetary system isn't based on faith is simply incorrect.  It functions as long as there's trust that the government acts responsibly.  

In Bitcoin there is nothing that can be corrupted, that's why it has captured widespread interest.  It represents a wholly novel and innovative monetary system.  Your difficulty in grasping it comes from denying money existing without debt.