GoldMoney [FB post]: James Turk in conversation with Félix Moreno de la Cova

[datafish]

So, is information something tangible?

On one hand, yes it is.  Because it always requires a medium for storage.  And that medium must be physical.   Even if it's in your head, it's somewhere in your brain, encoded with some of your neurons.

On the other hand, no it's not.  Information can travel through space vacuum via EM waves, a.k.a. light.  And light is a non-material substance:   you just can't hold it in any way.  It's the best example of non-tangible substance we can imagine.

The real question is:  should we care if information is tangible?  Does it matter if bitcoins can not be hold in hands?  I don't think so.

You've just rediscovered wave-particle duality.    Gold itself is mostly empty space as most of the mass is contained in nuclei which are tiny compared to the space between them.

[1713308986]

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[tvbcof]

James is a great man in his own right. He is a true gold and silver vigilante. He may be a little misguided when it comes to the topic of bitcoins. Max Keiser is the bitcoin champion.

The problem is that Keiser shows little sign that I can detect of being Austrian school or Libertarian.  This sorely limits his appeal in certain circles.  Fortunately for him (and me), his material and presentation seem to be enough to overcome his other liabilities.

[matonis]

you know, with all my kidding about that, i knew i should've gone out and grabbed that domain! 

Had thought about it before but not quite so sure you would be as professionally courteous as he is with Matonis (themonetaryfuture.com).

+1 sunnankar  (thanks!)

[flix]

to use Turk's language, the gold bugs do not want any "counterparty risk".  Bitcoin fulfills that definition completely.

Exactly. The whole point is having a system that doesn't require trust. You can see the code, all transactions are public, etc...

GoldMoney attempts to do this by having third-party audits.... but that just pushes trust back from the company to the auditor.

Bitcoin does away with that need.

OTOH it is still pretty volatile... until Amazon or some big site with millions of users start accepting Bitcoins, prices will continue to zigzag too much.

[hazek]

RUNTOBITCOIN.COM!!!

LMAO! Get 'em, Trace!

Domain Name: RUNTOBITCOIN.COM
      Created on: 20-Sep-12
      Expires on: 20-Sep-13
      Last Updated on: 20-Sep-12

   Administrative Contact:
      Mayer, Tracy  domains@premierarkllc.com

hahahahaha   He already snatched it up? lol

WAIT A MIN, sunnankar is Trace?! I just realized that... should have read his signature sooner lol   Awesome interview with visionvictory btw.. You did exceptionally well a side from that one little inaccuracy about being able to confiscate someone's bitcoins if you had ~$30bil worth of hardware.. all you could do with that is disrupt the payment system by blocking transactions or double spend, you couldn't confiscate someone's bitcoins. But aside from that I thought that interview was one of the best explanations of Bitcoin for non technical people to date.

[Trader Steve]

Excellent show!

Wait, why is everyone splitting hairs over James Turk's show of concern about tangibility and things like that? My interpretation is that he already has plans for some kind of hybrid product that enables gold transactions with the help of Bitcoin technology, and the real purpose of the interview was to carefully market the idea. That's how marketing is done.

Yes, I suspect this was his way of letting the market know he's warming up to bitcoin and that he's setting the stage for future options. I see no other plausible reason why he would put out this video.

[cypherdoc]

you know, with all my kidding about that, i knew i should've gone out and grabbed that domain! 

Had thought about it before but not quite so sure you would be as professionally courteous as he is with Matonis (themonetaryfuture.com).

+1 sunnankar  (thanks!)

As who was with matonis?

[n8rwJeTt8TrrLKPa55eU]

goldbugs demand tangibility, what they actually mean is :
I want to be able to be the only one who can touch it.
when someone translates them that their word "tangibility" means "absolute ownership"
they should be able to get on the right track to understanding advantages of bitcoin

To be fair, gold tangibility is a sensual thing, and not just mental ownership.  Holding gold in hand, feeling the weight, the color, the luster, it's a tremendously pleasant experience, especially if the coin is very old and has history attached.  Looking at a screen with your Bitcoin wallet doesn't quite measure up.

Regardless, someone needs to show Turk the combo 1ozAu/1000BTC Casascius coin.  That elegant merger of equals will totally blow his mind.

[Serith]

People forgetting James Turk motivation, one of the reasons why gold sells well is because people like to think that they own something they can touch, therefore James Turk has to advocate gold's tangibility.

[cypherdoc]

People forgetting James Turk motivation, one of the reasons why gold sells well is because people like to think that they own something they can touch, therefore James Turk has to advocate gold's tangibility.

Precisely. He wasn't all that coy about mentioning his firm's regulatory troubles either. He has a customer base to maintain, as well as the Goldmoney/James Turk(TM) brand name, so if was in his position I would probably proceed in a very similar fashion. And I hope his online physical gold trading business prospers.

problem is, the online gold trading is going in reverse. its now contracted back to within the Jersey shores.  not good.

[allthingsluxury]

James is a great man in his own right. He is a true gold and silver vigilante. He may be a little misguided when it comes to the topic of bitcoins. Max Keiser is the bitcoin champion.

The problem is that Keiser shows little sign that I can detect of being Austrian school or Libertarian.  This sorely limits his appeal in certain circles.  Fortunately for him (and me), his material and presentation seem to be enough to overcome his other liabilities.

Agreed he definitely does have some down falls. I hardly agree with everything he says, but then again it is hard to find someone that you agree 100% with.

[beckspace]

Regardless, someone needs to show Turk the combo 1ozAu/1000BTC Casascius coin.  That elegant merger of equals will totally blow his mind.

Send him this intangible photo 

[Melbustus]

<offtopic>

...
However, I think many of them fail to see the good in having a social framework that doesn't rely on a naked "profit motive" ideology. What about a value motive? And why not have both, and allow people to choose? For example, many countries offer public health care as kind of safety net, while also giving people the option to pay for superior care in the private sector. In my view that's called Realism.

I think a lot of folks would argue that several things would happen with a really tiny government and a robust truly free-market economy:
1) In general, there'd be more prosperity as perversion of incentives and capital allocation due to government interference would be greatly reduced.
2) People would no longer grow up in an environment where they expect things of government; thus, they'd be more self-motivated. This, in theory, sharply reduces the pool of people in need of a safety-net.
3) People who really cannot (or still will not) provide for themselves now have a greater pool of well-off friends/family to mooch off of.
4) Private philanthropy can now cover a much greater percentage of the safety-net needs since the pool of people requiring it is much smaller, plus there's more private capital in general.

But who knows...

</offtopic>

Back on topic...

The interview seemed to suggest a grudging acknowledgement by Turk that bitcoin is important. But it's obvious he still has lots of hang-ups and just can't bring himself to accept a few things; namely that bitcoin and gold are similar in that neither is backed by anything - they are *both* fundamental. He's also failing to fully understand the fact that bitcoin transactions *are* immediately extinguished at the time of transaction just like trading a silver coin for a meal. He seemed to imply that because bitcoin is a "currency" (his distinction vs. gold), it therefore has counter-party risk, whereas gold doesn't. He hasn't yet internalized the ownership model of bitcoin. It does take some getting used to, of course, so I'm not going to begrudge him too much... And obviously he needs to push his own goldmoney service (which *does* have real counter-party risk, clearly).

[hazek]

Off topic:

And why not have both, and allow people to choose?

Yes, why not indeed. I hope you understand though that advocating for a limited government is advocating against the choice you just advocated for..

[marcus_of_augustus]

The interview seemed to suggest a grudging acknowledgement by Turk that bitcoin is important. But it's obvious he still has lots of hang-ups and just can't bring himself to accept a few things; namely that bitcoin and gold are similar in that neither is backed by anything - they are *both* fundamental. He's also failing to fully understand the fact that bitcoin transactions *are* immediately extinguished at the time of transaction just like trading a silver coin for a meal. He seemed to imply that because bitcoin is a "currency" (his distinction vs. gold), it therefore has counter-party risk, whereas gold doesn't. He hasn't yet internalized the ownership model of bitcoin. It does take some getting used to, of course, so I'm not going to begrudge him too much... And obviously he needs to push his own goldmoney service (which *does* have real counter-party risk, clearly).

Turk is conceptually correct in saying that there is counter-party risk with bitcoin, the counter-party being the bitcoin network itself. If the bitcoin network were to fail in some way, e.g. successful hack/attack, take-over by evil devs, etc then those are counter-party risks similar to relying on a centralised clearing house. Since it is a decentralised network of clearing then the risks are much diminished but not zero, as it is with gold.

[Melbustus]

The interview seemed to suggest a grudging acknowledgement by Turk that bitcoin is important. But it's obvious he still has lots of hang-ups and just can't bring himself to accept a few things; namely that bitcoin and gold are similar in that neither is backed by anything - they are *both* fundamental. He's also failing to fully understand the fact that bitcoin transactions *are* immediately extinguished at the time of transaction just like trading a silver coin for a meal. He seemed to imply that because bitcoin is a "currency" (his distinction vs. gold), it therefore has counter-party risk, whereas gold doesn't. He hasn't yet internalized the ownership model of bitcoin. It does take some getting used to, of course, so I'm not going to begrudge him too much... And obviously he needs to push his own goldmoney service (which *does* have real counter-party risk, clearly).

Turk is conceptually correct in saying that there is counter-party risk with bitcoin, the counter-party being the bitcoin network itself. If the bitcoin network were to fail in some way, e.g. successful hack/attack, take-over by evil devs, etc then those are counter-party risks similar to relying on a centralised clearing house. Since it is a decentralised network of clearing then the risks are much diminished but not zero, as it is with gold.

Mmm... Perhaps you could argue that there are two types of network risk:
1) The risk that everyone will lose confidence in bitcoin and leave the network, thereby rendering bitcoin useless.
2) The risk, as you state, that the network/protocol will actually be compromised, leading to #1 above.

Seems to me that Gold can suffer #1 as well. It has value because people think its properties are useful. Gold doesn't suffer from #2 in the same way as bitcoin; however, as time goes by, the likelihood of #2 goes down significantly, to the point (we might already be asymptotically close) where the risk of #2 is really only a total disintegration of society and hence the internet. Clearly gold can still be useful after an internet-destroying apocalypse, whereas bitcoin can't.

But I don't think that's what Turk was implying when he insinuated that bitcoin suffers from counterparty risk.

[tvbcof]

The interview seemed to suggest a grudging acknowledgement by Turk that bitcoin is important. But it's obvious he still has lots of hang-ups and just can't bring himself to accept a few things; namely that bitcoin and gold are similar in that neither is backed by anything - they are *both* fundamental. He's also failing to fully understand the fact that bitcoin transactions *are* immediately extinguished at the time of transaction just like trading a silver coin for a meal. He seemed to imply that because bitcoin is a "currency" (his distinction vs. gold), it therefore has counter-party risk, whereas gold doesn't. He hasn't yet internalized the ownership model of bitcoin. It does take some getting used to, of course, so I'm not going to begrudge him too much... And obviously he needs to push his own goldmoney service (which *does* have real counter-party risk, clearly).

Turk is conceptually correct in saying that there is counter-party risk with bitcoin, the counter-party being the bitcoin network itself. If the bitcoin network were to fail in some way, e.g. successful hack/attack, take-over by evil devs, etc then those are counter-party risks similar to relying on a centralised clearing house. Since it is a decentralised network of clearing then the risks are much diminished but not zero, as it is with gold.

Mmm... Perhaps you could argue that there are two types of network risk:
1) The risk that everyone will lose confidence in bitcoin and leave the network, thereby rendering bitcoin useless.
2) The risk, as you state, that the network/protocol will actually be compromised, leading to #1 above.

Seems to me that Gold can suffer #1 as well. It has value because people think its properties are useful. Gold doesn't suffer from #2 in the same way as bitcoin; however, as time goes by, the likelihood of #2 goes down significantly, to the point (we might already be asymptotically close) where the risk of #2 is really only a total disintegration of society and hence the internet. Clearly gold can still be useful after an internet-destroying apocalypse, whereas bitcoin can't.

But I don't think that's what Turk was implying when he insinuated that bitcoin suffers from counterparty risk.

Then he should have been more clear because that is nothing like what it typically meant by the term.  Bitcoin is just as counter-party free as gold...one's holdings in either are not a liability to someone else.  Period.

For the record, and I've stated it before, Bitcoin appeals to me more than gold because it suffers from this theoretical weakness and it is much more tenable for an 'attack' to take this form compared to gold.  Put another way, if the 'haves' of Bitcoin take advantage of their position to much, it is possible that the peeps could simply walk away and choose a different (but effectively the same) solution.  It would be much easier than with gold I feel...just a software update.  So the 'have nots' would have somewhat more leverage in a peer-to-peer crypto-currency economy.  In my theory at least.

[sunnankar]

But I don't think that's what Turk was implying when he insinuated that bitcoin suffers from counterparty risk.

Mr. Turk was referring to counter-party risk in the context of financial ability to pay which is different from performance risk.

For example, GoldMoney does not have counter-party risk with the gold bullion it stores because it is held on the balance sheets of the customers and not GoldMoney. However, customers do have performance risk that GoldMoney will honor and perform the contract.

So likewise, Mr. Turk is wrong in ascribing financial asset status or counter-party risk to Bitcoin is not a financial asset and has no counter-party risk; bitcoins are a digital object of organized information just like gold is a physical object of organized atoms. There is also no performance risk with Bitcoin because the performance is ascribed by the rules in the code.

Additionally, to assert that corporealness is an element of tangibility is another logical error Mr. Turk makes; an assertion he contradicts by ascribing tangibleness to abstracted Goldgrams.

In other words, Bitcoin:gold::math:physics/chemistry.

[Melbustus]

...
So likewise, Mr. Turk is wrong in ascribing financial asset status or counter-party risk to Bitcoin is not a financial asset and has no counter-party risk; bitcoins are a digital object of organized information just like gold is a physical object of organized atoms. There is also no performance risk with Bitcoin because the performance is ascribed by the rules in the code.
...

Yes, precisely. He's failing to understand that bitcoins can be owned/managed/stored/handled/spent/whatever uniquely by any individual without reliance on a 3rd (central) party of some sort. That has never been the case with digital currency/commodities/money before, and will likely remain a wall in Mr. Turk's thinking for some time. His current monetary view has been built up and hardened over decades; he's not likely to get off the made-up-of-atoms-tangibility soap-box anytime soon.

Heck, you can even argue that gold can physically fail due to implications from quantum mechanics, it's just incredibly unlikely. But so is fundamental protocol failure of the bitcoin network at this point. Just a matter of degrees...

[420]

where get the behind the scenes image?