Paying the lawyers in Bitcoins is exactly the whole point here and yes that is not the problem. But the lawyers themselves also have expenses and may need sell part of those funds quickly. Also consider a scenario where bail needs to be posted quickly for example. Liquidity can be a real issue here. Just give it some time and Bitcoin will be there but not right now.
That's just it though. If Megaupload accepts BTC and offers a better deal than paying via Paypal, the liquidity problem will solve itself. Yes it will but only as a result of a significant rise in the BTC price. In fact any significant increase in the use of Bitcoin as a payment method will result, by itself, in a substantial increase in the BTC price with no speculation involved. One needs to consider the size of the float in BTC needed between the customers of the business, the suppliers of the business and the business it self. We are not even considering that any of the players involved will keep some funds in BTC simply for convenience to avoid exchange fees and spreads. |
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I bet 1 BTC its an Iphone
I would not put it past Apple to delete the app and the corresponding wallet.dat. They can do this under their TOS you know. Opps I forgot Apple has already censored Bitcoin wallet applications. |
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Wow..major price spike across almost all the major exchanges - that doesn't happen often. That's probably the fastest I've seen the weighted average move up in a year.
Virtex is lagging behind a good buying opportunity for us Canadians With an ask wall at 7.05 CAD or 6.91 USD. |
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This can get real interesting real fast if pirateat40 in indeed in caught in such a trap.
Why would this affect pirateat40? Supposedly, in his own words, he is using other people's BTCs instead of pocketing the entire lavish profits himself as a hedge against the exchange rate fluctuation for when he converts his BTC into fiat. Obviously if he is telling the truth then a huge rise in the exchange rate is the event he's hedging against and his clients should bare the losses. Perhaps people should withdraw their BTC from Pirate's "program"? Before its too late? The whole point of borrowing BTC is to hedge against a fall not a rise in the BTC price. The "pet rock" scenario. The risk is that if the BTC price rises fast enough one can get caught in a short squeeze. Now if piratat40 is in fact in this situation and people start withdrawing from his program then this would force piratat40 to use his USD reserves to buy the BTC at market in order to meet redemptions further driving up the price. This is a classic short squeeze. Furthermore setting up an ask wall here can be very dangerous here if there is a buyer waiting in the wings that simply buys the ask wall at market. Now all of this assumes of course that pirateat40 is in fact caught in a short squeeze which may not be the case. |
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Paying the lawyers in Bitcoins is exactly the whole point here and yes that is not the problem. But the lawyers themselves also have expenses and may need sell part of those funds quickly. Also consider a scenario where bail needs to be posted quickly for example. Liquidity can be a real issue here. Just give it some time and Bitcoin will be there but not right now.
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All one needs to look at is what is happening in the bitcoin market right now with amounts that are way less than 1% of USD 67 million to see that the required liquidity is simply not there. A simple market buy for even 0.1% of USD 67 million will have a significant impact on the market right now. Furthermore the time is simply not there to wait for "the manipulator" to accommodate you with an ask or bid wall for example.
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This can get real interesting real fast if pirateat40 in indeed in caught in such a trap.
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I wonder how much more of this pirateat40 can take before going bust  Assuming of course pirateat40 is caught in a BTC short squeeze at 7% per week. |
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There is one small detail. The article mentions: ... The U.S. Department of Justice has already seized $67 million. ... and the market cap of bitcoin is just under $70 million. For bitcoin to work in Kim Dotcom's case one needs a bitcoin market cap more in the range of say USD 70 billion and a corresponding price for 1 BTC of say USD 7200 at least. |
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A simple strategy depending on the market conditions on the small exchange is:
1) Determine the corresponding USD price if applicable using the corresponding FOREX rate
2) Buy at market as much as possible at any price below the MtGox USD market price
3) Place a bid wall at the MTGox USD price price with the balance and move this wall with changes in the MtGox USD market price
A similar strategy can be used by a seller.
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It's also useful for instantly screening an incoming unconfirmed transaction as being "good pending confirmation" versus "totally bogus and no chance of confirmation" without needing a block chain at all.
It's also useful not just for physical bitcoins, but if people start printing disposable bitcoin cash from their printer. (example: user clicks File -> Print Money to "be their own bank" instead of driving to an ATM and paying an ATM fee - something I see as wildly compatible with the average joe. such self-printed bills would have the same requirements as physical bitcoins).
Basically any situation where one needs to prove what the balance is in a particular bitcoin address without actually spending the coins in that address. |
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One possibility to consider is that our "manipulator" is in fact buying and selling Bitcoins on behalf of clients in a parallel market and the appearance and disappearance of walls is driven to some degree by what is going on in this parallel market.
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Yes but under (1) what happens when you actually try to double spend the funds to me? I can still verify the double spend is in fact a double spend because I have the subsequent block hashes so what is the incentive to convey the block with the previous spend information removed?
The subsequent block hashes don't tell you whether or not the funds are spent. The only way you know funds are spent is that you know of a transaction that spends it. There is no present way to know that certain funds are NOT spent unless you have the whole block chain coming after that transaction. Remember, the goal is to eliminate a boundless multi-gigabyte download for new users. The only way to solve that is to remove some information from that data set so it is smaller. The party receiving the reduced data set can be assured that the data that's there actually belongs there, but he has no way to know whether the missing (pruned) data was actually supposed to be pruned. This proposal addresses that. The fact that the correct data is pruned is secured on a second blockchain with merged mining. I can see the point of this for certain applications such as verifying the integrity of a physical Bitcoin without actually opening it up and spending the funds. So there is an advantage in that respect over the proposal in Bitcoin: A Peer-to-Peer Electronic Cash System. |
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Before commenting on this thread I reviewed Satoshi Nakamoto's original paper: Bitcoin: A Peer-to-Peer Electronic Cash System, bitcoin.org/bitcoin.pdf, and I am left with two questions: 1) How is this proposal better or worse than 7. Reclaiming Disk Space in "Bitcoin: A Peer-to-Peer Electronic Cash System" with respect to overall blockchain size management? This works as a way to reclaim disk space provided you are starting with the whole block chain, but as presented, there is no way for one node to convey that stubbed tree to another node along with the assurance that only spent transactions have been removed. If I run a node that prunes and stubs off a transaction showing I spent some coins, and then send you that pruned block, my spent coins look unspent to you. Since it's a solution that's only useful to a node with the full block chain, and the real problem we face is more the downloading of the block chain rather than storing it, a solution that requires a full block chain download before anything can be safely pruned doesn't address the problem. 2) How is this proposal better or worse than 8. Simplified Payment Verification in "Bitcoin: A Peer-to-Peer Electronic Cash System" with respect to verifying payments?
That proposal suggests spending the funds and then watching to see if the rest of the network confirms the spend into a block before any useful verification is possible, or freshly receiving the funds while watching new blocks. The idea discussed in this thread would allow instant verification of the existence of pre-existing funds without having to spend them first or downloading any blocks at all - and is actually not a different proposal, but the same proposal with significant improvements. Yes but under (1) what happens when you actually try to double spend the funds to me? I can still verify the double spend is in fact a double spend because I have the subsequent block hashes so what is the incentive to convey the block with the previous spend information removed? |
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Before commenting on this thread I reviewed Satoshi Nakamoto's original paper: Bitcoin: A Peer-to-Peer Electronic Cash System, bitcoin.org/bitcoin.pdf, and I am left with two questions: 1) How is this proposal better or worse than 7. Reclaiming Disk Space in "Bitcoin: A Peer-to-Peer Electronic Cash System" with respect to overall blockchain size management? 2) How is this proposal better or worse than 8. Simplified Payment Verification in "Bitcoin: A Peer-to-Peer Electronic Cash System" with respect to verifying payments? |
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Based on the trading activity in January of this year I see 7.2 USD as a resistance point.
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None of the above. Systematic buying of a fixed amount government fiat worth of Bitcoin on a weekly or bi-weekly basis's regardless of the Bitcoin price. A monthly frequency for a cost averaging strategy is too long because of the historical volatility of Bitcoin.
Here is my favorite: In honour of Apple banning Bitcoin wallet applications from their app store:
1) Price an iPad
2) Buy half the value of said iPad worth of Bitcoin every two weeks.
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I would agree with them if they'd recognize that limited liability and IP laws are types of subsidies that should be abolished along with the other forms that they normally oppose.
But they don't. The want to protect "private property" on the Internet. That means patents, trademarks and copyrights. Lets see SOPA 2.0? Allow the existing carriers who obtained their "private property" more often than not as a result of government monopolies in the past to give priority to "their" partners and again stifle real competition in the marketplace. AT&T will just love this. Then there is the opposition to anti-trust laws that can be used to break up monopolies that stifle real competition. |
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