Sure, it can be used as money (proven fact), similar to the way gold coins can and have been used as money in the past.

But it is not terribly practical to do so.

Especially, if having to fight with the common, government issued money (legal tender), I think Bitcoin will loose this battle.

What I believe Bitcoin community should do is to re-define Bitcoin, more precisely align it with the reality and give it a new name.

With all respect to Satoshi Nakamoto, I think he chose the name Bitcoin poorly. It implies that it is a coin, version of money, yet there are minor similarities between Bitcoin and the legal tender coins.

Instead, IMHO, he should have chosen a name that reflects the nature of the Bitcoin, much more similar to the precious metals and other resources, store of value and incidentally similar to currency, but definitely not the virtual electronic currency it is portrayed as now.

I've studied all bitcoin.org documents as well as what the Bitcoin Foundation has produced, yet I have only seen the same original motion being repeated endlessly, regrettably the Bitcoin community being left wheel-spinning to deal with the practical challenges.

Let me give few examples:

1. Dealing with the regional law and tax regimes - defining Bitcoin as asset instead of money will allow more efficient tax management.

2. Financial regulations - the status quo inevitably antagonises the current financial regulatory regimes, implying that there is a new kind of currency they cannot and will never be able to regulate - if defined as a resource, mined like any other finite resource, and sold and bought on the markets like any other resource (unregulated), the financial institutions may well accept it as something they can trade and not something that threatens their (in many cases self perceived) authority.

3. Common man on the street - the first though that comes when exposed to the idea of Bitcoin is "is it legal, will I get into trouble by using it?", instead one could simply relate to the current legal status of any precious metal, it is just a commodity (albeit of different, digital nature) that can be traded for any legal tender on the one of the many unregulated exchanges.

4. Bank - if the bank cannot use Bitcoins (not legal tender in any country), then they would not support it, they may as well make its use and adoption more difficult. But if it is just a legal commodity, then they would not see reason to oppose it or obstruct its adoption.

5. Terrorists - no one is objecting the terrorists using cash to fund their ventures, but suddenly, the anonymous use of the Bitcoin currency makes it an evil tool - removing the "currency" and "coin" from the definition of Bitcoin would allow for more objective view on the properties of Bitcoin, disassociation from the "evil" anonymous nature of the cash.

6. And so on...

MY QUESTIONS TO THE BROADER BITCOIN COMMUNITY:

Do you agree or disagree with me, please argue you point here - serious discussions only, please.

Do you think the time is right, it is realistic to get the majority of the Bitcoin community to come to a consensus with regards to more precisely defining and naming Bitcoin? If yes, what do you think will be the right process to follow - centralised, decentralised, combination of the two? If no, please argue you reasons here.

[anonymity]

I've been working on a white paper with regard to using Bitcoin in non-trivial ways, and one of the issues that came up again and again was the concept of anonymity.

I've tried to determine the value that the anonymity brings to Bitcoin, and repeatedly failed.

I understand how important the anonymity in our society is, especially from the government+financial conglomerate perspective (and the reasons they fight it with all they have).

But what is the value that it brings to Bitcoin?

I would like to hear from the broader user base.

I am calling all willing developpers to bid for the following work:

1. Develop a script that I can run privately to automate the selling of my BTCs
2. Needs to work through Mt/Gox API only
3. No complex UI required - I will be the only person ruining the script, but it must be able to perform at least the following functionality:

3.1 Compulsory
a. Should be able to enter and store my Mt/Gox user account credentials securely
b. Create BTC sell order at the highest "ask" value at the moment (instant selling of BTC)
c. Set the USD level above which to enable the automatic creation of the withdraw request
d. Set a day(s) of the month on which to initiate the automatic withdraw request (subject to reaching the level at rule "c")
e. Specify fixed USD amount to withdraw
f. Keep running as long as there are BTC in the Mt.Gox wallet
g. Send me a message if something happens out of ordinary (i.e. notify me only if there is something wrong)

3.2 Optional
a. Include market analysis routine that will allow to maximise the exchange rate, set higher sell-order level if there is time before the next auto-withdrawal date

4. PHP preferred, but can be anything really, as long us I can set and run the script on my PHP/SQL shared hosted web-site and run it from there.

Also, willing to buy a ready-made script, if it does most of the functionality I need

Please respond with your price offer and time-frame, either here or via PM.

[If you find this advice useful, don't just enjoy it, say thank you by throwing some bone in my direction: 1M8wpSfQSVPeXbizWAqQBkBxDYzicEKqMt]

There are two fundamental requirements for the value/behaviour of the BTC - from two virtually opposing groups of users - and they clearly contradict to each other.

1. The miners would like to see the value of the BTC to be continuously and steadily rising, ideally without any fluctuations - the greater the gain in value over certain period, the higher the profits the miners can realise when they sell their Bitcoins.

2. The speculators, on the other hand, would like to see the value of the BTC be as low as possible (but still be just above the cost of mining), but what excites them most is the trend, which should fluctuate as wildly as possible - the greater the fluctuation, the higher the profits the speculators can make when they trade many times over the shortest period of time.

I started as miner at the time the difficulty was not that great. At the time I've looked at speculating, but did not trust my understanding of this market - I thought it was not safe for me to invest cash into it, as everyone was telling me how difficult and dangerous the speculation is, especially if you don't know what you are doing.

Hence I've started building my BTC wealth by mining for them in a pool.

While mining I've joined many others in their frustrations, i.e. looking the value of BTC raise steadily over a year or so, then violently jump up and down (eventually mostly down) until that made me dizzy and even more frustrated.

Then it suddenly occurred to me - I don't need to get mad - just change and adapt the requirements I have from the BTC and it's market.

As a miner I was glued on the value line and I was expecting it to grow, as I could not see how could I possibly make money from the BTC reducing it's value or the value fluctuating so wildly that one could not use it as a medium of exchange.

I thought that I must change my perspective and understand all aspects of BTC value - before declaring that mining BTC's is not as clever idea as I thought it was when I started.

Realising that mining is only one side of the Bitcoin, I rushed to read as much as possible on investing in currency markets, particularly finding the most basic strategies, the idiot-proof-models to start speculating without loosing my precious stash in this.

From there on it was quite easy for me - I waited for a steady period in the BTC trend and sold small number of BTCs (not affecting the market), set number of reasonable orders (both buy and sell, staggered symmetrically around the value I sold my BTCs at) and wait until it start swinging again.

The first time I waited for the roller-coaster only 4-5 days (the average waiting time later was about a week or two, but you can see the history of the value of BTC yourself, and build your own understanding of what will be ahead), but the volatility lasted about same length before it stabilised - and for that short period I've made speculating more BTCs as profit than when I mined for the whole past month!

So, here is my advise - don't get stuck with one way of extracting the utility value out of Bitcoin - set yourself to explore ALL opportunities the young BTC market has presented to you.

1. When the market is steady and above your cost of mining, mine, as there is nothing else you can do to extract value out of BTC.

2. When the market goes crazy, start speculating - the more violent the value of the Bitcoin is, the higher the profits you will realise - if you don't do something extremely stupid like buying high and selling low (it has happened times and times again)

3. When the market calms, sit back, count the new chickens, and go and check that the mining rig has not hanged or something, as now will be the time to live (go and get laid, check if there are new gadgets you can consider buying, or check e-bay for any loosers selling their rigs out of despair)

4. So here is my advice - don't be a MINER or a SPECULATOR - be BOTH, at the right time!

5. Eventually, very soon, you will find yourself in BTC nirvana!

If you find this advice useful, don't just enjoy it, say thank you by throwing some bone in my direction: 1M8wpSfQSVPeXbizWAqQBkBxDYzicEKqMt

[Hey people, this is gopher, please note that someone hijacked my user-name to create this post - I am not saying that if this post had value for you then you should not send BTCs to that address, but please make note that it is the hijacker who will get the appreciation, not me.]

http://www.newegg.com/Product/Product.aspx?Item=N82E16814105001&Tpk=hd5970

If you like this send me donations

1PBH2vtLWpJ6KucFzUdjapdxnhKSrmCHhw

NOTE:

Hey people, this is gopher, please note that someone hijacked my user-name to create this post - I am not saying that if this post had value for you then you should not send BTCs to that address, but please make note that it is the hijacker who will get the appreciation, not me.

Just picked up a used 5850 for 70 $ .. Should I mine, or put on ebay and more than double my money, and purchase the bitcoins with the profit? I want to mine, but I would be stupid not to sell this

Hello everyone, this is my first post out of the newbies section!

I have been wondering, why do people expect that the bitcoin system will miraculously solve all social and political issues the human kind has created over the centuries?

Surely the conservative will react sceptically or even pessimistically to any new economic development - but why do they expect that unless Bitcoin present answer to all these challenges the traditional money system failed to solve, then they must fail in the long term!

Some examples:

1. Anonymity - no one criticises the use of cash in illicit transactions like drug and weapons trade, but suddenly, because the Bitcoins can be used in similar manner (anonymously) it is the issue that Bitcoin brings to the society

2. Derivative from 1 - ability to steal someone else's Bitcoins and that transaction is irreversibly - no trail - but one can steal someone's wallet easily, we see this happen every day by pick-pockets, but no one blames it on the money - they blame it on the pick-pockets!

3. Lack of utility value - sure, I can not buy many things with bitcoins right now, but same applies to the non-convertible currency and the Internet - I can not buy anything with say Ghana Cedis on the Internet, but no one shoots down the Cedi economy as lacking utility or claiming that their currency does not have future.

4. Derivative from 3 - there is quite an utility value of bitcoin - it looks like the speculation are thriving on the Bitcoin value growth like there is no tomorrow (no pun intended) and thanks to them, there is a lively US$ 80-90M market cap growing exponentially - I am sure some of the non-convertible currencies present bleaker investment prospect to the money market traders than Bitcoin, but they still get traded.

and I can go on and on

So, which is the particular characteristic of Bitcoin, so different from the current physical moneys the society uses will make it fail in the long term?

Failing to solve all social and political problems and provide enduring world peace?

How?

I remember reading somewhere that back in late 80's, one of the largest consulting firms (do I dare saying Anderson) advised some large European telcos that the potential market size for GSM is around 100,000 users, and those will be mostly the upper earners. 20+ years later, everyone will laugh at such wrong prediction, yet at the time, that consulting firm was the authority to listen to and take advise from and no one would be blamed for doing so - they would say, "he/she was prudent to listen to an established specialist and not go with the profane amateur sentiment".

I see the history repeating itself - many self-proclaimed in economics and general money matters authorities have their fingers waving and warning us that the potential for Bitcoins is imaginary and not at all big and only the established money traders should speculate in these as the Bitcoins mechanism is so complex, that only few, very experienced in money economics traders can understand it and trade successfully..

Do we see Bitcoin becoming the phenomena the GSM made it two decades ago?

methinks so!