With other anonymous uses of Bitcoin nobody has to meet up. Since prostitution requires a meet-up I think it'd be very hard to make it work. Sting operations would simply be far too easy.

So I read your article and had a few thoughts about it. I agree that dealing with purely anonymous actors makes most people more hesitant to do business with Bitcoins. However it also provides the current biggest utility for Bitcoin. While being able to go down to Walmart and buy things with your Bitcoins would surely be awesome (and boost the heck out of the value of Bitcoin) it doesn't add anything for the average consumer buying products in a physical store. Anonymity is what really made Bitcoin this popular in the first place.

Where Bitcoin really surpasses current money for non-anonymous transactions is in its unique applications for transferring money and providing secure banking/money to people who otherwise wouldn't have access to it.  It's likely that technological advancements are going to bring the capability to use Bitcoin in the developing world long before they voluntarily reform their banking and monetary systems. I saw a project last week where someone is working on M-Pesa integration for Bitcoins in Kenya. With such a huge portion of that country's economy coming from remittances (something like 40% if I remember right) there is a huge potential for a method with lower fees to catch on. Beyond that many local currencies in the developing world are on shaky ground and can be devalued by their small central banks at a whim. People using their Bitcoin for banking and remittance applications are going to want to deal with real people rather than pseudonyms so this is a great area for "privacy".

Businesses are free to release as much information as they can in order to gain consumer trust. The problem with Bitcoin right now is that people are far too trusting of a community built around a trust-less system (the protocol itself). Escrows need to be used far more than they are currently if people don't want to release their real life info. I agree with your assessment that trusting forum user names is simply a bad idea no matter how many posts they have. I've seen many different people in the last few months posting useless post after useless post to jack up their post count and become a "Hero Member" very quickly. It's going to take a few more Bitcoin forum scams before people realize the value of dealing with a business that can be held accountable to the public.

The coolest thing about Bitcoin to me is that it's the world's first real global currency. Having a global currency is going to make international trade so much more efficient that I really think this will be the longest lasting contribution it makes to our society and the eventual highest contributor of value to Bitcoin.

I think what it really comes down to is choice. Bitcoin gives users the option to be anonymous, private, or public depending on how much information is disclosed and what procedures are used. There's a place in the global economy for all three of these applications and they all give Bitcoin more value. I never see Bitcoin replacing the US dollar entirely but I do see it possibly becoming the standard currency for international trade if it can spread worldwide and not depend so much on the Dollar.

This really does make a lot of sense. Holding your own Bitcoins is still going to be the top pick for experienced users I imagine but this ETF is going to let the average person invest without fear of losing their coins to malware or a shady exchange. That's going to make it the number one place that Bitcoin is traded on a daily basis.

Thanks for the great insight!

BTW are you really Dr. Greg Mullhauser? If so, welcome to the forum!

There's a lot of smart people around but also a lot of people just here to try and make money who don't really understand economics. Don't let them scare you off!

spiral_mind

Have a good 4th! Thanks for the raffle!

If you read the articles they state they will charge an undisclosed fee for their new instrument.

I think they want to make money.


/thread

This one quote in particular is painfully bad.

Source: http://finance.yahoo.com/blogs/breakout/winklevosses-trying-bring-bitcoin-mainstream-investors-171834667.html



How stupid can these 'journalists' get? Satoshi Nakamoto doesn't back the value of Bitcoin personally. He's not a central banker. He doesn't even develop code for Bitcoin anymore as far as we know.

They could have bothered to do even a little bit of research before jumping to publishing.

They say this right after explaining that "if someone will pay $100 for a Bitcoin" that's what its worth. Well that's certainly half of it. Satoshi doesn't back Bitcoin himself rather the community of developers and the community of users who trust the cryptography and design of Bitcoin do.

Lets call mBTC "credits" like in sci-fi movies.

While ASICminer certainly has a large chunk of the network they do have a profit motive to maintain their hashing power or sell that equipment. That generally will keep their contribution to the network fairly constant.

I think the biggest worry when it comes to ASICminer and centralization is the threat of their operation being shut down by the Chinese government. If they become aware of Bitcoin they would likely see it as an obvious weakness to attack. If ASICminer was shut down all at once there would definitely be big problems for Bitcoin.

I've read from a Chinese person who posted here that even though state TV mentioned Bitcoin they really are not aware of it yet. That might change as it becomes a bigger deal and more people use it.

Avalon got caught running their own private mining operation with customers' pre-order units and had to stop.

It's certainly harder to trust random forum users with a decentralized and anonymous currency. Bitcoin isn't supposed to replace the requirement for trust in the marketplace. It just replaces the need to trust central institutions that manage the currency itself with community created organizations which maintain it through collective public consent.

I really think it would suck compared with even the cheapest ASIC.

Nice thought! Either we figure out a way to make a profit from colonizing outer space or humanity will consume all its resources while still stuck on Earth and die out.

There are people selling parts of their miner pre-orders' future profits. I wouldn't invest in them though. They are backed only by how much you trust the user.

Since they are individuals linked only to a forum name there is nothing stopping them from taking your money and paying you back nothing. Or from claiming they got less profits than they did and pocketing the rest.

By that reasoning US dollars are just as much "memory" as Bitcoin. I think its certainly a perspective you can take, but it isn't any more correct than calling it a "currency" really.

It's shared public memory that is totally focused on exchanges of value: aka currency.

So your hypothetical government's master plan to wipe Bitcoin off the planet is foiled by people who back up their Bitcoin wallets.

Shouldn't that be everyone? What idiot doesn't back up their Bitcoin wallet? This is no threat to Bitcoin, this is a joke.

Did you ever pay out those two 10 BTC bounties you posted (for showing there is a problem with your BitShares and sub-currencies linked to nothing proposal)? Someone deserves them at least. Your proposal had nothing to make it work just like this 'threat' to Bitcoin so you really should put your money where your mouth is if you want anyone to take you seriously.

The unknown % has suddenly dropped down to 6% immediately after it was revealed that Avalon has been mining using customers' units.

See: https://bitcointalk.org/index.php?topic=236348.0.

 One issue with linking the huge changes in unkown miners to Avalon is that in this post he knew Avalon was mining with his units because of stored pool information (indicates they were not solo mining with these particular units).  Perhaps Avalon was scared off of mining with customers units since they were discovered and abandoned a sizable solo hashing operation as well.
My bet is on Avalon having a stockpile of many thousands of BTC from solo mining and that this particular miner's Avalon units are just the tip of the iceberg.

The Supreme Court ruled that using an infrared camera on people's homes is illegal.

I don't think high electricity usage is a sufficient condition for them to bust your door down by itself.

While you're right that search volume itself doesn't directly cause the price to move that doesn't necessarily mean its a useless datapoint. I think that Bitcoin searches in google are a good thermometer of public interest in Bitcoins.

You say that price drives search volume but what drives price? I think it's public interest in Bitcoins from people who are just learning about it. It's a very cool idea and there's quite a bit of info to absorb.
Someone in that situation is likely to type Bitcoin into google at least a few times and be more likely to buy them as well.

That said I really think the current price is on the high side. I predict about half the current price will be our real bottoming out point.

I've read many people's estimates and ran some of my own and I would guess about 200 million by end of year.