My criticism of BitCoin

[Za1n]

2. One would think they came up with a new currency system so theft could be prevented. No, BC gets stolen all the time.
Why couldn't they "disable" the serial numbers of the currency that was stolen? Thats the kind of system that should have been designed.

Ultimately I think this may prevent Bitcoin from being widely adopted. That doesn't mean it can't continue to exist as a niche system. But, the average person is willing to pay a certain amount, to a credit card for example, in order to be able to have customer support (i.e., insurance) in the event of theft.

What makes you think that "the average person" (whoever that is) is willing to pay extra? I see constant examples (even here) where people have no idea how expensive credit cards are and how every customers pays more for every item in a store that is accepting credit card payments. On top of that people are constantly in pursuit of "free" services where the only price you pay is that the provider spies on you can sells the information to advertising companies. While its a perfectly fine way to finance something, I dont think most people using a service like google are aware of the price they pay.

With all that being said I think bitcoin is actually capable of enabling a service to provide transparent insurance of your coins (for an extra ofc). E.g. some of the treasurers for the board secure a part of its funds for a fee.

My credit card cost less then $10 a year. No fee when i use it. That $10 include an incurance from theft. Reduced prices in a lot of stores and chargeback in case of a seller not delivering. The bitcoin is the currency with extra payment.

You are conveniently leaving out the 3-5% fee the credit card companies charge the merchants for accepting that piece of plastic. Why do you think some gas stations offer 3-4% discounts for cash, or cash equivalent users? You may not see the fee directly, but it sure as heck is passed on to you when the merchant if setting his prices. Even if they do not charge a noticeable fee or offer a cash discount, the CC fees are just spread out amongst all users, but in no way are they free or even cheap.

[Hopalong]

2. One would think they came up with a new currency system so theft could be prevented. No, BC gets stolen all the time.
Why couldn't they "disable" the serial numbers of the currency that was stolen? Thats the kind of system that should have been designed.

Ultimately I think this may prevent Bitcoin from being widely adopted. That doesn't mean it can't continue to exist as a niche system. But, the average person is willing to pay a certain amount, to a credit card for example, in order to be able to have customer support (i.e., insurance) in the event of theft.

What makes you think that "the average person" (whoever that is) is willing to pay extra? I see constant examples (even here) where people have no idea how expensive credit cards are and how every customers pays more for every item in a store that is accepting credit card payments. On top of that people are constantly in pursuit of "free" services where the only price you pay is that the provider spies on you can sells the information to advertising companies. While its a perfectly fine way to finance something, I dont think most people using a service like google are aware of the price they pay.

With all that being said I think bitcoin is actually capable of enabling a service to provide transparent insurance of your coins (for an extra ofc). E.g. some of the treasurers for the board secure a part of its funds for a fee.

My credit card cost less then $10 a year. No fee when i use it. That $10 include an incurance from theft. Reduced prices in a lot of stores and chargeback in case of a seller not delivering. The bitcoin is the currency with extra payment.

You are conveniently leaving out the 3-5% fee the credit card companies charge the merchants for accepting that piece of plastic. Why do you think some gas stations offer 3-4% discounts for cash, or cash equivalent users? You may not see the fee directly, but it sure as heck is passed on to you when the merchant if setting his prices. Even if they do not charge a noticeable fee or offer a cash discount, the CC fees are just spread out amongst all users, but in no way are they free or even cheap.

Are you stupid or something? I guess so. I dont get a discount for paying cash. I get a discount for using my card.

[VirosaGITS]

You few last posters; Mastercard AND Paypal keep an additional 2.5-3% to the user when converting from a currency to an other. That is not negligible and i was able to avoid, with bitcoin, very hefty conversion rate while trading with odd currency and a fair % on CAD/USD conversion.

For example while i used my CC i had a conversion rate of 0.74~ CAD/USD instead of the real conversion rate which is 0.77! You want to transfer 600$ and they keep almost 20$.

There are tons of small semi-hidden fees like that...

[Hopalong]

You few last posters; Mastercard AND Paypal keep an additional 2.5-3% to the user when converting from a currency to an other. That is not negligible and i was able to avoid, with bitcoin, very hefty conversion rate while trading with odd currency and a fair % on CAD/USD conversion.

For example while i used my CC i had a conversion rate of 0.74~ CAD/USD instead of the real conversion rate which is 0.77! You want to transfer 600$ and they keep almost 20$.

There are tons of small semi-hidden fees like that...

No idea how to get around that with a card. I have set up my Paypal to use dollars since that is what i normaly need when my own currency is no good. Then i get away from the fee when i send to someone. If i recive money trough Paypal it is also in dollar and i can send it to my bank who convert it much cheaper but not free. Yet....

[VirosaGITS]

You few last posters; Mastercard AND Paypal keep an additional 2.5-3% to the user when converting from a currency to an other. That is not negligible and i was able to avoid, with bitcoin, very hefty conversion rate while trading with odd currency and a fair % on CAD/USD conversion.

For example while i used my CC i had a conversion rate of 0.74~ CAD/USD instead of the real conversion rate which is 0.77! You want to transfer 600$ and they keep almost 20$.

There are tons of small semi-hidden fees like that...

No idea how to get around that with a card. I have set up my Paypal to use dollars since that is what i normaly need when my own currency is no good. Then i get away from the fee when i send to someone. If i recive money trough Paypal it is also in dollar and i can send it to my bank who convert it much cheaper but not free. Yet....

...there are still many cost related to using a credit card!

Proper use aside, it is also a tool that let you easily overspend and "lose" even more money on interests and again on all those fees.

The average use of mastercard comes with interest, since in marketing, the temptation of getting something "now" even though you will have to eventually pay more is rampart.

I wouldn't lending BTC is any better however, especially with how easy it is to run away with BTC.

[Hopalong]

You few last posters; Mastercard AND Paypal keep an additional 2.5-3% to the user when converting from a currency to an other. That is not negligible and i was able to avoid, with bitcoin, very hefty conversion rate while trading with odd currency and a fair % on CAD/USD conversion.

For example while i used my CC i had a conversion rate of 0.74~ CAD/USD instead of the real conversion rate which is 0.77! You want to transfer 600$ and they keep almost 20$.

There are tons of small semi-hidden fees like that...

No idea how to get around that with a card. I have set up my Paypal to use dollars since that is what i normaly need when my own currency is no good. Then i get away from the fee when i send to someone. If i recive money trough Paypal it is also in dollar and i can send it to my bank who convert it much cheaper but not free. Yet....

...there are still many cost related to using a credit card!

Proper use aside, it is also a tool that let you easily overspend and "lose" even more money on interests and again on all those fees.

The average use of mastercard comes with interest, since in marketing, the temptation of getting something "now" even though you will have to eventually pay more is rampart.

I wouldn't lending BTC is any better however, especially with how easy it is to run away with BTC.

Using a credit card on a "buy now pay later" scam or getting another card to cover debt from the first are known issues... Just as with bitcoin you need to know what you are doing.

[VirosaGITS]

You few last posters; Mastercard AND Paypal keep an additional 2.5-3% to the user when converting from a currency to an other. That is not negligible and i was able to avoid, with bitcoin, very hefty conversion rate while trading with odd currency and a fair % on CAD/USD conversion.

For example while i used my CC i had a conversion rate of 0.74~ CAD/USD instead of the real conversion rate which is 0.77! You want to transfer 600$ and they keep almost 20$.

There are tons of small semi-hidden fees like that...

No idea how to get around that with a card. I have set up my Paypal to use dollars since that is what i normaly need when my own currency is no good. Then i get away from the fee when i send to someone. If i recive money trough Paypal it is also in dollar and i can send it to my bank who convert it much cheaper but not free. Yet....

...there are still many cost related to using a credit card!

Proper use aside, it is also a tool that let you easily overspend and "lose" even more money on interests and again on all those fees.

The average use of mastercard comes with interest, since in marketing, the temptation of getting something "now" even though you will have to eventually pay more is rampart.

I wouldn't lending BTC is any better however, especially with how easy it is to run away with BTC.

Using a credit card on a "buy now pay later" scam or getting another card to cover debt from the first are known issues... Just as with bitcoin you need to know what you are doing.

Well yes, and it is also harder to control. Those known issues are intended and perpetuated by the banks to hook the citizens. It would be harder to do on Bitcoin.

This is a great video that simplify the issue for most people to understand this concept; https://www.youtube.com/watch?v=mII9NZ8MMVM

[Beliathon]

I find your criticisms wholly uncompelling, OP.

The whole idea that someone can turn on his computer/GPU and "bit mine" and earn money is ridiculous.

What, sir? You would make a ship sail against the wind and currents by lighting a bonfire under her decks? I pray you excuse me. I have no time to listen to such nonsense.

said to Robert Fulton, upon hearing of his plans for a steam-powered engine.

Arthur Clarke's Three Laws:

1. When a distinguished but elderly scientist states that something is possible, he is almost certainly right. When he states that something is impossible, he is very probably wrong.

2. The only way of discovering the limits of the possible is to venture a little way past them into the impossible.

3. Any sufficiently advanced technology is indistinguishable from magic.

[fryarminer]

You spelt bitcoin wrong.

[Mickeyb]

You few last posters; Mastercard AND Paypal keep an additional 2.5-3% to the user when converting from a currency to an other. That is not negligible and i was able to avoid, with bitcoin, very hefty conversion rate while trading with odd currency and a fair % on CAD/USD conversion.

For example while i used my CC i had a conversion rate of 0.74~ CAD/USD instead of the real conversion rate which is 0.77! You want to transfer 600$ and they keep almost 20$.

There are tons of small semi-hidden fees like that...

^^ This!

Everything is designed in a current system so the end user pays the most. That's why this Bitcoin revolution is so important. We need to end or at least fix this nonsense.

[bornil267645]

I get your points. But you need to understand that bitcoin was invented to fill up some of the gaps of the modern currency, it was never intended to be as a "SO CALLED" currency.

[runpaint]

I dont like BitCoin for these reasons:

1. The whole idea that someone can turn on his computer/GPU and "bit mine" and earn money is ridiculous.

Lots of companies already have lots of computers earning money.  Visa, Mastercard, Western Union, they use computers to send money.  They provide a valuable service with computers, and that's how they earn their money.  Bitcoin also uses computers to run a transaction network which provides the same valuable service as Western Union or Visa.

People should earn money when they work hard for it.

People get money in exchange for something of value, whether or not they have to work for it.  If I do 500 pushups a day, and I lose 50 pounds, will you pay me for that?  I worked hard, but I didn't give you anything of value that you want to spend money for.

But you're confused about the difference between earning money and creating money.

Bitcoin requires a lot more work to create money, compared to fiat money which comes out of thin air, doesn't even exist, and is essentially worthless.

Turning on a computer and leaving it to run does not and should not count.

You left out the part where they had to spend thousands of hard-earned dollars to get the computers in the first place.

After they get the computer, they can't just turn it on and leave it running.  They have to apply knowledge and education, and even then they have to provide something valuable to other people.  What if they leave their computer running to mine another coin that never becomes as valuable as Bitcoin?  Then they didn't make the most profitable decision.

This is a waste of electricity as well and therefore it causes greenhouse gases and has a carbon footprint.

If it was a waste, people wouldn't spend millions of dollars on it every day.  If you think computers hurt the earth, then turn off your computer.

2. One would think they came up with a new currency system so theft could be prevented.

Here's your chance!  Give us a currency that can't be stolen.  If you can't, then don't expect other people to do the impossible.

No, BC gets stolen all the time.

Not as often as fiat money.

Why couldn't they "disable" the serial numbers of the currency that was stolen?

U.S. Dollars have serial numbers.  Why does theft still exist?

Who do you think should decide which Bitcoins are stolen?  If I lie and say your money belongs to me, do you want some government employee to be able to push a button and take all your money away just based on my word?

Thats the kind of system that should have been designed.

If you think it should be designed, then design it.  

3. BC is unstable.

The U.S. Dollar is unstable.  It continues to lose value every year for over 100 years.  

People lost a lot of money

People lose more money with fiat investments.

and they did nothing wrong.

Yes they did.  They paid too much and sold for too little.  

They could have waited 2 more years and maybe Bitcoin will be worth a lot more than they paid.  So obviously they did something wrong, if they lost money when other people became millionaires with Bitcoin.

A good modern currency should not have this defect.

Please name the currency you're talking about.  Which currency doesn't lose value?  Which currency can't be stolen?

And now tell us which currency gained 1000% in 3 years, while every other currency in the world lost value.

One would think if a new digital currency was created it wouldnt have issues like this. Computers and software are so powerful now.

You just said that computers and software don't do anything valuable and they can't do work.  

But now you think computers can solve all the world's problems?

"Then dont use it" Or "Why dont you make your own currency system?"
These are not valid responses so they shouldnt be said here.

If they're not valid statements, then WHY ARE YOU SAYING THEM?

All you are saying is, "Why don't you make a better currency system?"

If you think it's a good question to ask us, then it's a good question to ask you.  Why don't you make a better currency?

We don't make our own currency because we don't think Bitcoin has these "problems" you're talking about.

Since you're the one who sees these things as problems, you're the one who should "fix" the problems.  Everybody else will continue to use Bitcoin.  

[runpaint]

Credit cards gets 3% of everything you spend, and Paypal takes 6%.

They charge you to spend the money, and they charge again for the other party to receive your money.

If you like that, then keep doing it.  You'll eventually use Bitcoin anyway, and the rest of us will have a lot more money than you.

[d5000]

I dont like BitCoin for these reasons:

1. The whole idea that someone can turn on his computer/GPU and "bit mine" and earn money is ridiculous.
People should earn money when they work hard for it. Turning on a computer and leaving it to run does not and should not count.
This is a waste of electricity as well and therefore it causes greenhouse gases and has a carbon footprint.

1a. Then I guess when farmers use automated network controlled tractors and etc to harvest their crops, that isn't work either and isn't really "proper crop".

1b. When a single volcano erupts on earth, it throws off more green house gases into the atmosphere then a few decades of human civilization.
      A Volcano is a larger threat to the ozone layer then Bitcoin is and there is one going off every few minutes.

It's highly probably that OP is one of these Scandinavians habiting the boreal woods (and internet forums ), but this indeed is a problem of Bitcoin.

A farmer - even if he uses automatized technology - is providing an useful service to society. Mining can be seen as a service to the bitcoin user community as it's securing the blockchain. But there are "miningless" alternatives like Proof of Stake and Proof of Burn that do the same job and are far more energy-efficient.

So basically miners can be compared to workers doing terribly inefficient work. To keep with the farmer example, it would be the case of a farmer who uses lots of electricity for his automated system and has the same productivity than another farmer that doesn't waste any electricity.

It is possible (and even probable) that our current banking system is even less efficient than Bitcoin and other PoW coins. But the efficiency problems of BTC are real.

[superpanos2]

All of these flaws you stated are there to enhance decentralisation.
Bitcoin is designed in such a way to be independent.
If you wan't to be monitored and enslaved by your government you can very well
use fiat.

[jonald_fyookball]

Bitcoin mining is EXTREMELY competitive.

If you think it involves just "turning your computer on and making money",
you're wildly mistaken.

Anyway, I think it is much more valid than the government turning
on a printing press and making money.  

If you don't believe in a tokenized method of value exchange
then lets all just go back to the barter system.

As far as thefts go, thievery began long before Bitcoin
and will continue long after.  There is even institutionalized
theft of money (Cypress).  Bitcoin is not the solution to
all of mandkind's problems.  That being said, you can
properly secure your bitcoins so they won't get stolen.
There are also insured bitcoin services available like Bitgo.

[grendel25]

I dont like BitCoin for these reasons:

1. The whole idea that someone can turn on his computer/GPU and "bit mine" and earn money is ridiculous.
People should earn money when they work hard for it. Turning on a computer and leaving it to run does not and should not count.
This is a waste of electricity as well and therefore it causes greenhouse gases and has a carbon footprint.

2. One would think they came up with a new currency system so theft could be prevented. No, BC gets stolen all the time.
Why couldn't they "disable" the serial numbers of the currency that was stolen? Thats the kind of system that should have been designed.

3. BC is unstable. People lost a lot of money (one tiny example; there are probably hundreds and thousands) and they did nothing wrong. A good modern currency should not have this defect.

It does have positive points which is why many people are using it but it would have been nice if it didnt have the above problems.

One would think if a new digital currency was created it wouldnt have issues like this. Computers and software are so powerful now. It should have been possible to design a currency with none of the issues above.

"Then dont use it" Or "Why dont you make your own currency system?"
These are not valid responses so they shouldnt be said here.

My rebuttal:

1.  No, it's not ridiculous.  Day traders have been doing it from home for decades.  People that earn money through their computers or technology really are earning it.  It's not a waste of electricity and if anything it will only become more efficient than it is today.

2.  I actually agree with you on this point.  This is the point of technology: solve problems.  I don't doubt that there are already coins with this in mind.

3.  Yes, bitcoin is unstable.  That's really good for traders.  Enjoy it while it lasts.  If people don't understand the instability and risk then they should not get involved with bitcoin.  That's more of a personal decision but not really a detractor of bitcoin.  It's only a detractor if you want a low risk portfolio at this time.  But then again, bitcoin has been going strong for years so it's actually continuing to prove itself as viable and getting more integrated with various ecommerce channels like newegg, tigerdirect and overstock.com

[Za1n]

2. One would think they came up with a new currency system so theft could be prevented. No, BC gets stolen all the time.
Why couldn't they "disable" the serial numbers of the currency that was stolen? Thats the kind of system that should have been designed.

Ultimately I think this may prevent Bitcoin from being widely adopted. That doesn't mean it can't continue to exist as a niche system. But, the average person is willing to pay a certain amount, to a credit card for example, in order to be able to have customer support (i.e., insurance) in the event of theft.

What makes you think that "the average person" (whoever that is) is willing to pay extra? I see constant examples (even here) where people have no idea how expensive credit cards are and how every customers pays more for every item in a store that is accepting credit card payments. On top of that people are constantly in pursuit of "free" services where the only price you pay is that the provider spies on you can sells the information to advertising companies. While its a perfectly fine way to finance something, I dont think most people using a service like google are aware of the price they pay.

With all that being said I think bitcoin is actually capable of enabling a service to provide transparent insurance of your coins (for an extra ofc). E.g. some of the treasurers for the board secure a part of its funds for a fee.

My credit card cost less then $10 a year. No fee when i use it. That $10 include an incurance from theft. Reduced prices in a lot of stores and chargeback in case of a seller not delivering. The bitcoin is the currency with extra payment.

You are conveniently leaving out the 3-5% fee the credit card companies charge the merchants for accepting that piece of plastic. Why do you think some gas stations offer 3-4% discounts for cash, or cash equivalent users? You may not see the fee directly, but it sure as heck is passed on to you when the merchant if setting his prices. Even if they do not charge a noticeable fee or offer a cash discount, the CC fees are just spread out amongst all users, but in no way are they free or even cheap.

Are you stupid or something? I guess so. I dont get a discount for paying cash. I get a discount for using my card.

Myself, I often find that using insults in place of a proper rebuttal is a more telling indicator of intelligence.

As far as your discount, my point is that merchants have to absorb the fees to accept credit cards in the first place. In some cases they will offer cash customers discounts to offset these fees. What you are describing is using merchants who simply absorb the fees across the board and pass it along to all customers.

Here is an example, a merchant accept CCs and has a contract to pay the processor a monthly flat fee, say $100 and then 3.5% on all transactions. He also decides to make it easier he will simply spread this cost amongst all customers instead of just a CC ones, a common practice. One particular item he buys wholesale for $45 and he decides if he can sell if for $75 he will offset his cost and make a profit. One of those costs is the CC processing fee. In this example the CC cost would be $2.62 for this particular purchase. So when he was figuring out his profit margins, that cost was taken into account and applied when he set the price.

In simpler terms, the price of the item was set to $2.62 higher than the merchant would need to if he simply accepted cash or payments that didn't require a processing fee. So even when you believe you are getting a discount using your CC, this belief is false as you paid a higher hidden fee.

All this really requires is a bit of common sense, as CC companies surely aren't in business to give money away. The rewards and discounts are more than offset by the fees, hidden or otherwise, that the users pay.

[d5000]

Bitcoin mining is EXTREMELY competitive.

If you think it involves just "turning your computer on and making money",
you're wildly mistaken.

Anyway, I think it is much more valid than the government turning
on a printing press and making money.  

That doesn't make mining more efficient. If there is a much more efficient solution, then mining is a waste of energy and money. That's what technological progress is about.

And regarding the "government press", I will play devil's advocate: The government "printing press", as you call it, is providing price stability, when it's managed well. Bitcoin has no mechanism for this important issue.

[jonald_fyookball]

Bitcoin mining is EXTREMELY competitive.

If you think it involves just "turning your computer on and making money",
you're wildly mistaken.

Anyway, I think it is much more valid than the government turning
on a printing press and making money.  

That doesn't make mining more efficient. If there is a much more efficient solution, then mining is a waste of energy and money. That's what technological progress is about.

And regarding the "government press", I will play devil's advocate: The government "printing press", as you call it, is providing price stability, when it's managed well. Bitcoin has no mechanism for this important issue.

Nobody said it was necessarily more efficient.  Securing the network through proof-of-work is
the cost of a decentralized currency.  Some people say proof of stake is more efficient
but still others say distributed consensus by proof of stake is impossible (and I agree).