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PrintCoins (OP)
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October 30, 2012, 03:35:20 PM |
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On the newbie forum there was a thread about how to safely stash bitcoins for long term storage. I wrote a response, and realized that hoarding is a big deal for bitcoin users, and this might be worth its own thread:
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Simplest way to stash bitcoin - don't do it!
Bitcoins are ment to be spent! All this hoarding does nothing for the bitcoin economy.
If everyone just stashed bitcoins away forever, do you know what bitcoins would be worth once you did take them out again - squat.
You may be dead in 10 years - and all that investment in bitcoin will vanish with your squishy brain wallet.
Buy some alpaca socks and enjoy your bitcoins today.
One day, when a super-quantum computer cracks the encryption to all of the bitcoin addresses in 5 minutes, and everyone cries about their lost coins, you will have warm and comfy feet.
This advise applies to hoarding of all monies - including precious metals (I heard that there is enough gold in the earth's core to cover the earth with 1 meter deep of gold (probably exaggeration)).
Happiness is the only thing you should hoard.
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"Bitcoin: mining our own business since 2009" -- Pieter Wuille
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jim618
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October 30, 2012, 03:57:57 PM |
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'Hoarding', which is identical to 'Saving', is the act of giving a 'future-you' what you do not need to consume today. Aesop's fable: the Ant and the Grasshopper |
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Akka
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October 30, 2012, 04:03:28 PM |
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'Hoarding', which is identical to 'Saving', is the act of giving a 'future-you' what you do not need to consume today. Aesop's fable: the Ant and the GrasshopperThere is a small but important difference between Hoarding and Saving. Saving is, put aside what you don't need today for future use. While hording is to acquire as much as possible of something, therefore short its availability and artificially increases the value. This is indeed damaging the BTC economy. Edit: When I read the threads title, I came here to troll state my opinion that hoarding damages Bitcoin, but I was just lured in. I totally agree with the OP. |
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jim618
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October 30, 2012, 04:16:25 PM |
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There really is no difference economically between 'hoarding' and 'saving'. They are both words for a person's demand for money ( http://en.m.wikipedia.org/wiki/Demand_for_money#section_1). If you read in that wiki some of the demand for money is its transaction value and some is because of its value as an asset. Because of the fixed supply model for Bitcoin, there is more asset demand for Bitcoin compared to print-all-you-want fiat money. The only difference in the terminology is that 'hoarding' is deemed to be bad but 'saving' is good. Both reflect demand for money, to project to future usage. |
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jimbobway
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October 30, 2012, 04:41:44 PM |
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I've learned in my economics 101 class that a good economy is one that saves and spends equally...whatever that means.
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Portnoy
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My money; Our Bitcoin.
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October 30, 2012, 04:50:55 PM |
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I happily spend BTC when it rises in value above what I originally paid for it... if I happen to find something that I want/need that I can pay for with BTC... and especially if the merchant offers a discount in BTC over other forms of payment. Those latter things are fairly lacking at the moment so I just save that BTC for when I can make good use of it. And I see that as being more beneficial to the BTC economy than harmful. /edit btw I do let my customers know that I take BTC and I offer them a discount over cash or cheques and a greater discount over paypal. Oh my gosh... now that I am editing this post I see that I have to press that "save" button... I am somewhat reluctant to do that now that it appears there is a negative stigma against such practices... oh well I will get over it... thank god it doesn't offer the option to "hoard" my post...  and another btw... in regard to the OP... what good is happiness which isn't shared?  |
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Stephen Gornick
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October 30, 2012, 05:16:09 PM
Last edit: October 31, 2012, 08:21:11 PM by Stephen Gornick |
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All this hoarding does nothing for the bitcoin economy.
Well, not quite true. Let's say an item I need is priced in dollars, and the price is $10. So if I prefer to pay for that purchase in bitcoins, I then buy $10 worth of bitcoins. It doesn't matter what the exchange rate is. If BTC/USD is $10, then I need 1 BTC. If BTC/USD is $2 then I need 5 BTC. Either way, I am exchanging $10 of fiat to get $10 worth of bitcoins. So in that context, you are correct. Hoarding does nothing for the bitcoin economy -- it doesn't hurt nor help. Now if I am a Bitcoin-related entrepreneur I might hold bitcoins. And I might be looking to raise funds for my entrepreneurial ambitions. If there is hoarding of coins and the exchange rate rises quite a bit, my coins have more buying power as the result of others hoarding. Thus hoarding helps the undercapitalized risk-taking entrepreneur who bought or mined bitcoins for speculation earlier. At the same time, an increase in the exchange rate due simply to hoarding increases the risk of a price collapse. If that demand isn't due to those bitcoins being used in commerce for buying and selling, then many hoarders have greater control over the exchange rate. There was a nearly 30% drop in the exchange from the October high to October low. During that time there probably wasn't a 30% decrease in the use of bitcoins for commerce transactions so the bulk of that move was speculative buying and selling (mostly selling). If there wasn't hoarding the price probably would never have reached $13, and thus the drop wouldn't have been as dramatic. This exchange rate volatility, which can be attributed to speculative activity (hoarding) then actually does do something for the Bitcoin economy -- it hurts it, at least from a merchant's perspective. A merchant doesn't want to see the profits from a sale vaporize because the currency rate took a turn south. As a result the merchant will use a payment processor to convert those coins to fiat, which add costs (which makes Bitcoin less favored for commerce) and also lessens the likelihood that the merchant in turn will use those coins for its purchases. The thing is, ... there's no "right" way. Bitcoins function as a store of value, and they will be held for speculative purposes by those willing to take that risk. No matter what payment method is used, a merchant -- especially one starting with no customer base, has a very tall hill to climb. That some investors are holding onto bitcoins should really be of little concern to that merchant. |
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Isokivi
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October 30, 2012, 05:16:58 PM |
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I very much agree with the op, hence Im only holding on to a small precentage of the coins I recieve. My thinking is that this way the coins I hold on will be worth more in the unforseeable future. In oppose to if we all hoard every bitcent we get, bitcoin fails.
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Bitcoin trinkets now on my online store: btc trinkets.com <- Bitcoin Tiepins, cufflinks, lapel pins, keychains, card holders and challenge coins. |
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Stephen Gornick
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October 30, 2012, 05:17:22 PM |
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One day, when a super-quantum computer cracks the encryption to all of the bitcoin addresses in 5 minutes,
Why would you troll like that? You're not a dumb guy. Why would you write that? |
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vokain
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October 30, 2012, 05:19:47 PM |
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this would only be true if bitcoins appreciated at a rate faster than I can find useful things to buy for myself, and that's clearly not true  |
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TTBit
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October 30, 2012, 05:25:49 PM |
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Be careful what you wish for, if bitcoin was not worth saving, by definition it would be worthless. Said another way, the less bitcoin savers you have, the less bitcoin is worth.
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good judgment comes from experience, and experience comes from bad judgment
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Akka
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October 30, 2012, 05:49:31 PM |
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Gee, thanks for telling me what to do with my Bitcoins...
Spend, save, destroy, donate, gamble, invest, et cetera, do what you want with your bitcoins! Some of us are here because we are sick of people telling us what to do with our money.
I suppose OP has never heard of a "store of value" which is most certainly a valid use for bitcoins, especially considering they are limited, unfreezeable, and know no borders.
For me it's spend fiat, save bitcoin (among other things). Thank you very much.
On a side note, the world is full of people who are willing to consume today while neglecting to prepare for tomorrow. I don't think that "hoarding" is going to be a problem considering how many people have a need for instant gratification. Those who consume less today in the hopes of actually having something to consume in the future should be praised!
You now, you can still save bitcoin, while spending them. Every time you want to buy something for Fiat, just look if you can get it for BTC. Then just exchange the fiat for BTC and immediately buy what you want. This way, you spend the same, you don't need to touch you savings, but you help the BTC economy and therefore increase the worth of your savings. It's just a little effort, but if everyone would do this, there would be a significant impact on Bitcoin. |
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Troll Toll
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October 30, 2012, 06:01:28 PM |
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I must admit, I am "hoarding" the shit out of bitcoin. regret=none  |
You gotta pay
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hazek
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October 30, 2012, 06:07:13 PM |
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One man's hoarding is another man's prudent saving for a rainy day.
OP you are lucky I highly value my integrity which didn't allow me to edit your title and replace "Hoard" with a provocative capital H to propaganda neutral "save".
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My personality type: INTJ - please forgive my weaknesses (Not naturally in tune with others feelings; may be insensitive at times, tend to respond to conflict with logic and reason, tend to believe I'm always right)
If however you enjoyed my post: 15j781DjuJeVsZgYbDVt2NZsGrWKRWFHpp
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TTBit
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October 30, 2012, 06:08:36 PM |
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Gee, thanks for telling me what to do with my Bitcoins...
Spend, save, destroy, donate, gamble, invest, et cetera, do what you want with your bitcoins! Some of us are here because we are sick of people telling us what to do with our money.
I suppose OP has never heard of a "store of value" which is most certainly a valid use for bitcoins, especially considering they are limited, unfreezeable, and know no borders.
For me it's spend fiat, save bitcoin (among other things). Thank you very much.
On a side note, the world is full of people who are willing to consume today while neglecting to prepare for tomorrow. I don't think that "hoarding" is going to be a problem considering how many people have a need for instant gratification. Those who consume less today in the hopes of actually having something to consume in the future should be praised!
You now, you can still save bitcoin, while spending them. Every time you want to buy something for Fiat, just look if you can get it for BTC. Then just exchange the fiat for BTC and immediately buy what you want. This way, you spend the same, you don't need to touch you savings, but you help the BTC economy and therefore increase the worth of your savings. It's just a little effort, but if everyone would do this, there would be a significant impact on Bitcoin. Introducing a third party does not increase the value of bitcoin (he sold you his btc). Increasing the amount of transactions does not either. In this scenario, BTC would rise in value only if the person selling goods for BTC then saved (hoarded) them for future purchasing power. |
good judgment comes from experience, and experience comes from bad judgment
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Akka
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October 30, 2012, 06:13:05 PM |
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Introducing a third party does not increase the value of bitcoin (he sold you his btc). Increasing the amount of transactions does not either. In this scenario, BTC would rise in value only if the person selling goods for BTC then saved (hoarded) them for future purchasing power.
The increase in value is from Stores making BTC revenue and therefore showing the usability of BTC. If everyone would at least do this, then the amount of BTC revenue would probably attract more stores and therefore more users. |
All previous versions of currency will no longer be supported as of this update
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Topazan
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October 30, 2012, 06:56:06 PM |
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I disagree that saving is bad for the reasons others have provided, but I will say it would be nice if there were more and better investment opportunities. I don't like having a ton of BTC buried in my virtual backyard, but I don't know what else to do with them. They've provided a better return than any fiat investment I've ever made.
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Save the last bitcoin for me!
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Elwar
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Viva Ut Vivas
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October 30, 2012, 07:41:20 PM |
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I hoarded my large Bitcoin purchase for over a year. I had a few electronic copies of my private address as well as a piece of paper in my house with it written down.
Then I was short on funds for a downpayment on a house.
I was able to stop hoarding and put those BTC toward cash for my house.
If I had not hoarded and spent on Alpaca socks I would have warm feet...out on the street.
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First seastead company actually selling sea homes: Ocean Builders https://ocean.builders Of course we accept bitcoin. |
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byronbb
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HODL OR DIE
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October 30, 2012, 10:22:11 PM |
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There is nothing I want to buy with bitcoins that I can't buy with fiat. So why would I choose bitcoins over fiat when the former has a potential upside of a tin can under a lit stick of dynamite? Is the guy who spent 10,000BTC on a pizza thrilled he contributed to the "cause" or would he rather have ~$100,000 from an nominal investment of a few dollars?
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