Even CEX's OWN WEBSITE tells you that you'll lose money by buying their product

https://cex.io/calc

Punch in the #s representing the current market stats

100 GH
16% maintenance fee
0% pool fee

Current difficulty: 5006
Difficulty increase: 50

Conversion rate: 460
Conversion rate increase/decrease: 0

So for 100 GH at their current prices, you'd pay 1.1 BTC
Their calculators show that you'll get a .62 BTC return before maintenance fees > return, at which point your GH are worthless.

Even the default values that are in the page when you go to it show a net loss if you buy their GH, so it's not like people are getting deceived by false marketing.

It's true, buyers aren't protected with bitcoin purchases.

They have zero recourse if you scam them, and as far as proving you own an address, that's very difficult if you use an address once.

Bitcoin has 0 intrinsic value and 0 utility.

It's worth what someone's willing to pay for it.

The true value is thus the current market price. Right now that's about $460

Having an equal way for people to earn coins is indeed crazy.

It's either one of the 2 following situations:

1) Cost to mine coins > value. This is a bit tricky. If total cost > value, but marginal cost (electricity) < value, people who already own hardware will continue to mine, but no new investment will occur. If marginal cost > value, then the network will die because only stupid people will continue to mine.
2) Total cost to mine coins < value. People/institutions will make ASIC farms to mine and cash in on the profit potential.

So unless you manage to control the value so that it's always in a state where total cost > value && marginal cost < value (even then, there's plenty of institutions that have idle hardware they could put to use), it'll either die or people will buy tons of specialized hardware to control a big part of the network.

And bitcoin isn't revolutionizing anything.

And bitcoin has already failed at what it was supposedly supposed to accomplish.

A handful of organizations control all the hash power of the network already, and big companies (eg, google) and govt agencies aren't even involved yet.

Could you imagine if the real players of the world got involved? Eg, if intel + google partnered up. Intel made ASIC chips for google to run. Nobody else's hardware would be relevant anymore.

Yep. Humans have never ever revolutionized money before.

Hell, I still barter with clamshells.

This is like exchanging all your USD For GBP and saying you want a fixed amount of USD back when you turn in your GBP a year later.

Not possible.

Or if it was done in some way, you're not really holding GBP, you're holding USD and calling it GBP.

Like, if miners that control > 50% of the hash power come together and decide they want to increase the reward per block mined to 100 BTC, couldn't they do that?

Since it's all peer to peer they could just change the software to accept that.

US Federal/state governments.

Rest of the world doesn't mean shit.

Simple.

The disney dollar is basically a multiple use gift card. Also, Disney corporation doesn't spew a bunch of anti-government crap when selling these store credits.

The liberty dollar had all kinds of anti-government propaganda on their website. It was also very scammy. They were basically selling people gold/silver bullion at a HUGE markup with deceptive marketing. IMO, good riddance. If someone tried to pay me with a liberty dollar I'd call the cops on them. Basically every "liberty dollar" would be backed by like 50 cents worth of gold. Total scam.

Even their website, had that shit where it's like "Special offer, expires in <a date 5 days from now>", but every day the "expiration" date on the "special" offer moved back a day. Sold exactly the way a scam would be sold.

You might be willing to do that, but the mainstream public follows banking laws for the most part.

And yes, major businesses are set up for accounting, but more complex accounting systems DO cost money to set up. And since bitcoin is, for now, officially property, it's fairly trivial for the IRS to impose a transfer tax on it. Which again, YOU might snub and send/receive bitcoin to whoever you want and ignore the tax, but a company like amazon can't do that.

Remember, you're not spending a currency, you're transferring property every time you "spend" bitcoin.

And there's plenty of precedent for taxes/fees on transferring property. Transferring (non-publicly listed) company stock often has fees/taxes associated with it. Transferring real estate has fees/taxes with it. Buying shares of a public company has regulatory fees associated with it.

By ruling bitcoin as a property, not a currency, it opens to door on all kinds of taxes on it. If someone opens up a store where you can physically buy bitcoin with cash, states could easily say that you have to pay sales tax on those purchases now.


There's definitely doors to kick in. There's datacenters with petahashes of equipment, and mining pools that control petahashes of power.

Those entities can be forced to to adhere to regulations or risk getting seized.

Well, the ability to force registration would only apply to US businesses/residents. So it'd still be very hard to trace coins in the overall system.

And the point of seizure is the same as being able to seize someone's bank account. It'd likely need a court order to do so.

The US Govt and the US banking system is incredibly unpopular. Look at the crappy congress approval ratings, and how many people are angry about what wall street and the big banks did. But they're very successful. The US Govt is still in power, and the US Banking system still has control over the economy.

Big institutions are already in the bitcoin sphere. What do you call CEX.io who has 1/4 of the network hash power? What do you call bitstamp and the other big exchanges that handle the bulk of trading volume? They have huge influence over the bitcoin economy.


That's not what I was getting at though. Forcing people to register/provide access to their wallets to a govt agency makes it possible for the govt to seize your coins.

Drugs, alcohol, etc.. people get high or get some kind of pleasure out of it. Again, you can't grind up a bitcoin and snort it to get high. Heroin addicts have a desperate need to inject more heroin into their veins.

And a lot of what the government does is indeed a scare tactic. But it does work. How many people file their taxes honestly because they're afraid of an audit? And legitimate businesses like amazon have to comply with the law. If the government passes a regulation saying that they need to have access to everyone's bitcoin wallets (just like they have access to everyone's bank accounts, and have the ability to seize/freeze assets), individuals who don't comply likely won't have anything happen, but you can bet that major businesses will be complying. Without major businesses accepting it, it can't go mainstream and it'll just be a drug trader currency.

Look at what happened with online poker a decade ago. Government got involved, seized bank accounts, forbid banks from doing business with online gambling sites, etc etc.

They didn't have to go after individuals to cripple something, they go after the big institutions.

So for bitcoin, if they want individuals to comply with laws, they could set up an agency where you have to register your bitcoin addresses with (and possibly give them access to freeze/seize your funds if they deem necessary). If you don't have a valid registration with that agency, banks will not allow you to do any transactions related to bitcoin (eg, wire transfer to an exchange). The government would use the banking system to enforce their laws.

Again, this applies to legitimate business, and people who don't want problems with the law, which are the majority.

Obviously criminals don't give a shit about following regulations.

What I'm saying is, the government can easily block it from becoming mainstream. Some people here have this idea that bitcoin can compete with the central banking system. The reality of it is, the major governments of the world won't let that happen.

Sure they can. They can't get rid of the protocol, but they can make it useless.

Let's say for you have a totalitarian country.

They can make a law saying that they'll execute anyone who uses bitcoin. Nobody would dare touch it anymore. That's an extreme, but it's still possible in some countries (more realistically they'd seize your assets).

For a country like the US. The government probably can't make it illegal to possess or use bitcoin, but they can do the following to effectively kill it:
- Give it unfavorable tax treatment
- Force merchants who accept it to adhere to complex and expensive accounting rules, so that it's not economical to accept it as payment for any legitimate business
- Call it a counterfeit currency and prosecute people who try to use it. (2 words: Liberty Dollar). I don't care if you want to believe it or not, but if you print up your own money (even if it doesn't resemble US dollars at all, eg. Bitcoin bills), go to a store, and try to pay with it you CAN get in trouble.
- Make a few high profile examples. Find a company doing bitcoin mining who's books aren't correct to the letter, seize their assets. Find a bitcoin user who didn't report capital gains on their coins and throw them in jail for tax evasion.
- Use the fact that bitcoin is commonly used for criminal purposes to have law enforcement harass bitcoin users. Government can seize coins that are traced to have been used in illegal activity (or if the government SUSPECTS they were used in illegal activity). This can easily be done to merchants by mandating they report transactions and wallet addresses. The govt could even go a step further and mandate that merchants give access (private key) to those wallets to a govt agency.

Sure, things like drugs are illegal and are a thriving economy, but that's different. You can't grind up a bitcoin, snort it, and get high, so if the government hassles people who use it, and no legitimate business will accept it because it's too much of a pain in the ass, nobody is going to bother using it unless they want to use it to buy drugs online or something.

LOL @ bitcoin as a store of value.

It's one of the most speculative and risky things available right now.

It's the equivalent of investing in a startup tech company that you think is promising and are hoping is going to become the next google.

No, I'm not confusing anything. This is exactly what I'm saying. There has to be a platform on top of bitcoin, that includes things like security, chargebacks, etc in order for it to appeal to the common person.

Escrow = Trusted 3rd party.

With cash, it must be protected against theft, but that's the bank's responsibility, not the end user's.


Someone hacking into a merchant database does NOT get info in the credit system, like SSN. All they can get is the info you provide to the merchant. Name, Address, information about that specific card (which can be cancelled and reissued). Chargebacks are for more then reversing unauthorized transactions. I've done chargebacks because I was unhappy with the way a merchant handled something, and no longer wanted to deal with the merchant. And if a merchant doesn't deliver, with bitcoin you have to go to court to sue them to get your money back. With a credit card or bank payment, it's a 5 minute phone call to get your money back. Good luck suing someone for a few hundred bucks.


Ok...

Name and billing address (assuming you live at your billing address, most people do) you have to give the merchant regardless if you want to receive what you paid for. The card information has zero security implications. If that gets stolen you have exactly zero liability as a result. (The time I lost my card -- totally my fault btw, I didn't bother to report it stolen until a week later -- it took me 5 minutes on the phone before all the txes were reversed and a new card was on it's way).

Merchants can offer a discount. True, but currently the big ones that I'm aware of charge the same amount in btc. Also, offering different prices for credit card users vs other payment method users often violates the terms of the merchant account with the credit card company, and they're subject to have that terminated. Merchants giving up all their credit card business to give btc users a discount? Doubtful. I don't know if you remembered, but gas stations had to go through a huge fight to be able to charge cash and credit users different prices.

Credit check. Valid point. Not everyone can get a credit card. Debit cards offer the same protection as credit cards though and only the lowliest of the low can't get a bank account.

Credit card companies CAN indeed block payments at their discretion. But the majority of those cases are when something illegal is involved. In this case, I would agree, bitcoin is a great currency when dealing with anything illegal, and is far superior to anything cash based in any way. But for legitimate uses? I don't see the incentive for the consumer to choose bitcoin.

Bitcoin is great for online gambling, buying drugs, laundering money, or payment for other illegal products/services.