How do you ensure that each bitbuck on the chain is actually backed by a dollar?
You would need a large centralized source, like a big bank, that simply buys and sells them for $1 no matter what other markets are doing. Then nobody has any incentive to change the price. NO you wouldn't - you would just need an understanding that these vouchers are worth a fixed amount and there is no point trying to sell them for any more because nobody is going to pay you any more - the value in holding them is the fee for transferring them to and from fiat. Its just like the fact that bitcoin has a market driven price based on its perceived value - if there were 200 Bn bitcoins, the price would be easy to keep to a fraction of a penny without any kind of centralisation - same deal here. This is why I would have thought using Devcoins might be a nice twist. There is an incentive in using them for a related purpose, and they already have a plan to mine millions of them, so its a kind of short cut! In fact, the use of a parity with a fiat would be of benefit to Devcoin too! |
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The history of technical development goes totally against the grain of the hollywood storyboard way of inventing things!
People don't wake up one day and say, the world needs one of these, spend a few days working on the idea and release it on a grateful public.
Ideas come in waves and one layers a development on to something else. Eventually all the ideas come together, and someone invents something useful, which is made better by a bunch of other people. IF enough other people grab on to the idea, it takes off, and everyone remembers the person who did it.
Of course, there are plenty of great ideas out there, which are being used by millions of people, but the core person who developed it, gets nothing. That happens a lot too - but again, Hollywood covers that bit up.
As for bitcoin, its a great idea which took a lot of people a lot of development time to bring to a working model, and Satoshi is just the name everyone remembers.
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Why worry about food?
In the west, its practically impossible to die of hunger - of course, you can still be homeless, but is that a different question?
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This second part is what makes it all work. The issue is gaining enough ground to get local IOU sellers in every corner of the world. Then what happens if everyone wants to cash out in only one currency? There won't be enough of that type of fiat to redeem all of the IOUs!
Not to mention it will be difficult to control the issuing of IOUs. Mining them for cheap won't help if the value is pegged to the USD, it means the miners will be making value off nothing.
The key word here is local fiat - it doesn't have to be USD or anything, it just needs to be fixed to the value of a single currency, so you know that 150 fiat vouchers is worth .01 US Cent - for at least 12 months. What its worth in exchange for a Euro is dependant on what the dollar is worth compared to Euros and is a world standard rate. The local Joe Bankers just need to know their local exchange rate to be able to be a money changer. |
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Wow, I really like this idea!
Having a cryptocurrency pegged to the USD or something will allow anyone to convert it to BTC easily.
The only problem is adoption. This new cryptocurrency (say, BitBucks) will actually solve the problem, but only if everyone accepts it. If everyone in the world accepted BitBucks, then it would be easy to convert between fiat and BTC! If no one accepts it, then no one will want to convert to BitBucks because its useless.
So you have the same problem as Bitcoin where the market is determining its value, yet we want to peg the value of BitBucks to the USD.
Just thinking out aloud here...
How do you ensure that each bitbuck on the chain is actually backed by a dollar? Its backed by the fiat of the person who converts the voucher to fiat! So, its just like the voucher system currently used by the exchanges, except its going to be your local joe banker who is converting your voucher to dollars, or euros or whatever. The other side of this is that it might be useful if these virtual bankers were to mine their own voucher coins, so there was no need to create a market for these pegged coins. If the coins are extra low value, and can easily be mined on a CPU, The actual value per coin can be worked out as being 1% more than the electric needed to mine them. So, we would say something like 10 digital fiat vouchers is worth 0.1c and will be for the next 12 months when the formula between coins produced, electricity used and the value of fiat can be reassessed by a mining committee of some kind! These are all ideas that need your interaction to make them work - does this sounds doable in your part of the world? |
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This is the best thread so far - and it does highlight the big problem is how to marry fiat with crypto.
I wonder if the answer is to have a p2p version of localbitcoins?
At the moment, I am sending my fiat, from my bank account to another bank to an exchange which creates a voucher, which I can use to buy crypto. Anyone else can sell their crypto for a voucher which the exchange can send to their bank, who send it to your bank and then you can spend it as fiat.
We need a p2p exchange, where a fiat voucher can be converted into local fiat.
Bitcoin already has miners, is it time it also had bankers?
What if there was a local Jane or Harry who would convert digital coins (and we know how to create digital coins by today!) into a fixed rate of fiat and the other way around for a fixed fee?
Lets say an alt coin was created that could be mined and had a value of 0.1c and couldn't be worth any more. Lets assume 200 bn were mined! Actually - why not use DEVCOINS? They would finally have a real use! If these were used as a direct replacement for fiat, in a localbitcoin model, with a charge of .01% per transaction, you would then have a digital fiat voucher that could be used on the exchange, as described above.
You would also have got around the problems currently caused by the regulations of bank transfers etc because the sums would be small and local and no change in value means no speculation is possible. Might still have a problem with money laundering laws, but that's something that could be dealt with on a local basis.
Any feedback to that?
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Since when does the success of Bitcoin depend on being able to speculate on its value? Bitcoin as a p2p payment system doesn't depend on that and neither should Bitcoin as a currency. It's success shouldn't depend on being able to trade it like a commodity.
Movements of conventional currencies are already regulated and its those regulations which are affecting Bitcoin exchanges - they're not new regulations. Exchanges know those regulations exist and know they'll be affected by them. If they don't have the capacity to do that, then perhaps they shouldn't operate a financial service.
This is a theory and practice type of statement. If I want to use bitcoin as a p2p payment system, I need to turn what value I have, which is in fiat, into bitcoin before I do anything. The exchange rate that I get for my fiat is what puts an exchange value on the goods I want to buy. So if I am spending an extra $8 on every bitcoin, then my goods are going to cost an extra $8 per bitcoin - compared to buying them with fiat in the first place! Its the whole concept of financial regulations which created a need for bitcoin in the first place. If I have to tell a regulator who I am, what I am going to use my money on, and produce an audit trail to prove it, its going to take time. The only advantage left for bitcoin is the speed of making a purchase, and if the exchange transfer is taking forever, then I might be better off using fiat. And, in the political paper shufflers world, that is exactly how you kill a competitor. Not through outright banning legislation, but through using paperwork treacle. It means they can always hold their hands up to any accusations of killing off with a simple it wasn't us, it was the free market that didn't want it. |
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I live in Euro-land and I've had exactly ZERO problems with decent exchanges like bitstamp.net and bitcoin.de. (and I used to trade on intersango.com as well but they're too small now, no significant volume going on anymore) So yeah mate, I think you're looking in the wrong place  Why the hell would you go for a Russian exchange, having to deal with utter crap like OKPay, if there are plenty alternatives. Well? Where would you suggest? Both bitstamp.net and bitcoin.de have their fair share of critics, and their prices do seem very high. I also still need to transfer my sterling into something else before I can use them, so I am no better off! Besides, I trust BTC-e far more than I do any of the other names in the exchange universe at the moment. |
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I used to like RT but after watching it for a while, you notice its just as biased as every other station - it just happens to be biased in an Alex Jones kind of way!  Just use it on rotate between all the main TV news channels, and eventually, you will work out the truth is a mix of all of them! |
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BTC-e have just switched on their OKPAY service again for a few days, to allow people to move their cash into their exchange, before they switch off the service for another 2 months.
We are seeing all the various financial services throughout the world getting their cogs spun up to make the movement of fiat to a bitcoin exchange so difficult that without already having your cash in the exchange, you can't take advantage of any movements in value. If you do want to move your fiat into bitcoins the whole process is taking longer and longer - last time it took me 2 weeks.
I don't expect US users to note how difficult it is for the rest of the world, but at this rate its going to be impossible to get enough bitcoins / altcoins into the mainstream to gain enough traction to make any success happen.
Anyone else having this problem, or am I just looking in the wrong place? - BTW, I really don't like MTGox, I don't trust them, and to only use that service to get your bitcoins seems to defeat to object of having them!
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Nice Story, and as believable as many I've read.
The only flaw seems to be a lack of connections to Cypherpunks - and his Google work is more about breaking cyphers than it is about financial transactions.
However, the reality is it isn't important!
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We've got way too many coins that have been totally abandoned by their "developers" as is, shouldn't we leave this stuff to the people who are actually interested enough in it to take initiative and learn the right way? It's like handing someone a paint-by-numbers kit and telling them you're teaching them to be an artist.
This is exactly how innovation happens - its not clean and tidy, and ordered - that happens when someone writes the timeline history for crypto currency in 20 years time. By creating this easy to do kit, everyone can learn the basics, and we move on to the next problem. The next problem is how do you encourage people to have enough trust in your coin to give it real value? You have already answered a part of that question - by not abandoning it unpatched after a few weeks! Think of this development as the difference between Hollywood and YouTube. Cryptocoins are Youtube, and once in a blue moon, something makes it out of the site, and onto the big screen, or the Hollywood mainstream - but its rare. In the history of the Internet, who remembers every development that lead to the next innovation? Nobody. Its only the big fish that make it, and that is why we should consider this altcoin making kit the best idea to come out of cryptocoins for at least 3 weeks! |
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Have we stopped calling users stupid yet? If we seriously want this to move on, we need to start thinking like real users, not like techies. Remember that techies are the ones who invent multi million dollar anti gravity ball point pens, where users just use pencils! |
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Its a good analogy, and one I've used myself, but so far, we, as in crypto currency adopters, are not learning any lessons. Its quite obvious that to make something popular with the mainstream, it needs to be similar enough to something that already exists. Once, that has been done, then you need to make sure that the public have a quick and easy help path to ensure that they never gets spooked. Make sure there is plenty of big companies taking the reigns, and before you know it, bitcoin will be everywhere, even if it does have a different name! The problem though is that Linux had an easy way to sell itself - its free, as in Beer! Now that is a problem worthy of a mystery developer .. |
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I guess it depends on your viewpoint! The chances that anyone can correctly predict the future of bitcoins in 20 years, at this time, is practically nil. As an experiment, imagine its 1975, and someone asks you to predict how these computers are going to impact our lives - could you do it will any accuracy, besides talking about job losses and change? |
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Have you checked out BTC-e?
They are $10 cheaper for BTC!
The market is being played because its a nightmare to actually move coins around these exchanges! ;/
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This is a nice idea that will possibly serve better as a suggestion that bitcoin is regulated against fraud, rather than be a tool to prevent it. There are far too many ways that fraud can take place, that I can't see this project being much more than the equivalent to Spamhaus for the Bitcoin community. However, if it wasn't for the likes of Spamhaus, would email be used as much as it is today? Would email be subject to far more regulation? I like the Red List project, but please try to explain to some of the hard of thinking on this forum that its not a way to prevent crime! It prevents crime by creating a psychological deterrent. Here is a story to clarify:My friend John insures his wallet in a custom insurance group in Bitinsure. His wallet is hacked and 20 BTC are stolen and sent to the thief's wallet. We submit the thief's first degree wallet address to The Red List. Using the same wallet, the thief attempts to pay for an OKCupid subscription. OkCupid runs the public address against The Red List using the API and gets a first degree match - a definite redlist. Since the wallet is first degree, OkCupid decides to send personal information gleaned from the thief's OkCupid profile to The Red List for investigation. Here is a second story:My friend John insures his wallet in a custom insurance group in Bitinsure. His wallet is hacked and 20 BTC are stolen and sent to the thief's wallet. We submit the thief's first degree wallet address to The Red List. The thief sends the BTC to two more wallets. We submit the second degree wallet addresses to The Red List. The thief uses one wallet to purchase cooking ware on Amazon via BitSpend. BitSpend checks the wallet address against The Red List, gets a second degree match, and issues the thief a questionnaire asking where he got the money from at the time of purchase. BitSpend may also send minimal identifying information such as a piece of the address back to The Red List for private storage and factoring into the indefinite algorithm which will increase The Red List ranking if the same minimal identification information is flagged/sent again by the same or another business. The thief gets his cooking ware from Amazon via BitSpend but after the questionnaire is apprehensive so decides to use a mixing service on the contents of the second wallet. The thief mixes his BTC and gets BTC transferred into a new wallet. A different person who used the mixing service spends the BTC on a Gyft gift certificate. Gyft runs the public address against The Red List and issues that second person a questionnaire - that person reveals he recently used a mixing service and names the service. The results of the questionnaire are sent to The Red List. The Red List now has money laundering evidence against the mixing service and suspicions against/algorithm inputs for an identifying piece of information from the first wallet. What if John was lying and he did all the spending himself and just claimed, and even did the hacking himself - how does this prevent that? |
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The invisible hand was a reference used a lot by Adam Smith, the Father of modern economics.
As for the 2 roles of government, one is the security of the land from outside forces, the other is the enforcer of law inside the country.
Really, its just about enforcing and protecting property rights and nothing much else.
All other elements of society can be provided by a third party. Road infrastructure, health, education and welfare don't have to be done by government, although many people couldn't imagine a world where they weren't!
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As far as I was aware, Ireland suffered from easy lending and being a gateway to the EU for US companies. This meant that it got a lot of infrastructure funding, which then ballooned the property prices, and this funded extravagant lifestyles. The difference with Ireland, is that people knew it was happening, and just rode the boat, knowing it would come to an end eventually. Other countries, such as the UK thought it was mostly down to what their governments were doing, and didn't see it was just an easy credit boom until it was much later! Ireland is bust in the traditional sense, however, unlike previous recessions, this time, all the financial institutions know that if they don't start scrambling for debt recovery, then we won't get serious poverty. They all know that if we were to add up all our holdings, we would not get anywhere near our debts, so why not play the long game? This time, Europe is going through stagflation for a decade - don't expect any real growth until 2020 and even then its only going to happen if we find a new industry to invest in - maybe like bitcoin etc. Until then, expect the EU to flex its muscles every few months - while ignoring that its own accounts haven't passed auditing in almost 20 years - pot kettle black etc! wait wait this is a mixed up argument we have controls in place to prevent this happening ... that's the banking sector ... this is their CORE BUSINESS and PRIME FUNCTION ... it's not a side line ... they give loans based on ability to repay and are extremely well rewarded for this ... banks have a monopoly on this function the loan takers are NOT to blame, because they are not the experts here, nor are they expected to be, they go to a bank and the bank will make their decision ... it's like selling someone a car with faulty brakes and when it crashes blaming the driver ... LOL! I guess you weren't in school the day they were teaching the concept of Caveat emptor - Buyer Beware? As the buyer you are the decision maker, not the sales person. If I decide to sell you magic beans, and they suddenly turn out not to be magic, who's fault is that? The answer is you for being an idiot! |
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This is a nice idea that will possibly serve better as a suggestion that bitcoin is regulated against fraud, rather than be a tool to prevent it. There are far too many ways that fraud can take place, that I can't see this project being much more than the equivalent to Spamhaus for the Bitcoin community. However, if it wasn't for the likes of Spamhaus, would email be used as much as it is today? Would email be subject to far more regulation? I like the Red List project, but please try to explain to some of the hard of thinking on this forum that its not a way to prevent crime! |
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