We can never survive through mass adoption without decentralized exchanges

[Matthew N. Wright]

The following post was an emotional blog entry by me but the topic has been redefined by post #5 below, so you know, just go with it.


Dear cultists,

Please stop fleecing newbies and preaching bitcoin's salvation, claiming it will destroy governments, cripple banks and lead us to libertarian heaven. Bitcoin is an experimental proof of concept that does not need spokespeople to sell it like a pump-and-dump scam, nor extremists who use their position in the community to get rich off of everyone else (honestly, 99% of bitcoin businesses are shovel manufacturers-- 50% of which are scams).

Because you surround the topic of bitcoin with your hyperbole and irrational behavior, I am forced to defend against you; to alert those around me the dangers of following a group that actually believes bitcoin is decentralized and snidely creates memes to mock those "non-believers" around them as "missing out on an investment opportunity".

               

Bitcoin is not decentralized because money is a social construct, not a mathematical one. People will always join together in large groups for safety and transparency. It is an inevitable part of human history, anyone who tells you otherwise is selling you something, probably bitcoin (so that theirs is worth more).

Bitcoin is not a currency because it is absolutely undependable as a currency and has no stability whatsoever. It is also backed by *nothing* other than the USD, the very currency BTC is supposedly intended to "replace", brought in by followers of said cultist leaders to make their own investment "worth more".

If you want the principles of bitcoin to succeed, stop participating in these forums run by corrupt individuals who make promises in order to receive funds and then do nothing with them; you only serve to give it legitimacy and bring more sheep here for the slaughter.

If you want the principles of bitcoin to succeed, stop creating fan-boy products for other bitcoiners and start providing an actual service or product that people can use (Coffeepress is not a viable product, asshole).

If you want the principles of bitcoin to succeed, treat exchanges just like you would mining pools and never let an exchange get 51% of the volume, no matter how hard it is for you personally.

Stick up for your beliefs, ignore the talking heads on these forums.

I am an anti-cultist and I back bitcoin, only while it makes sense to.

[1714981946]

1714981946

[1714981946]

1714981946

[BitBuster]

Haven't agreed with some things said in the past dear chap, but this is absolutely spot on.

BB.

[Mosper]

I'm with you 100%. Bitcoin will succeed in spite of the "true believers" if it succeeds. Not because of them.

[Sage]

Very good points.  But you need to make the distinction between Bitcoin and the supporting infer-structure. The exchanges being the most critical link.

Bitcoin itself has already proven itself.  Hell, it even survived a blockchain split!  Think about that.

The problem is the centralized exchanges.  We can never get through hyper-exponential mass adoption (that has to happen if Bitcoin becomes used by even 1% or less of all transactions) until we get a decentralized exchange.

We desperately need a decentralized exchange.

There is no reason it cannot be done. It just needs a group of dedicated developers to do it. 

Over a billion and a half was taken from the market cap of Bitcoin, not because of Bitcoin, but because of the complete ineptitude of a few individuals.

None of this would happen with a decentralized exchange.

Mtgox will never fix itself.  They gotta go.  It's only a matter of time before it happens again.

Another exchange isn't the answer.  A new decentralized exchange architecture is.

Developers, lets get the conversation started on this now.

[Matthew N. Wright]

I can agree with you that that would eventually destroy the plans of the cultist leaders by providing a free market, something the current situation is a far cry from. Anyway, I still think the cultist leaders here need to be ignored and let Bitcoin do it's own thing. If someone doesn't use bitcoin, it should be their problem. We do not need to witness to everyone in the world like a religion. They should ideally come to us for help in making their lives simpler. If we have to *sell* something to do them, then it's a scam already.

Developers, lets get the conversation started on this now.

I relinquish the floor to you. *updates topic title*

[Elwar]

With FinCEN requiring every currency exchange to register with them paying millions in fees, that would mean that every peer in the exchange would have to pay millions of dollars.

See how government created monopolies work?

[Matthew N. Wright]

With FinCEN requiring every currency exchange to register with them paying millions in fees

Link? I don't think BitInstant paid millions in fees, and I'm pretty sure BitStamp in Sweden didn't pay millions in fees, nor are they subject to US FinCEN regulation for that matter. Correct me if I'm wrong, IANAL. Besides, USA != World.

[cryptoanarchist]

The problem is the centralized exchanges.  We can never get through hyper-exponential mass adoption (that has to happen if Bitcoin becomes used by even 1% or less of all transactions) until we get a decentralized exchange.

We desperately need a decentralized exchange.

Already have one - its called localbitcoins.com.

Honestly, a year ago there was one person in all southern CA on that site - Stephen Gornick. Now, getting coins or selling them in LA is a breeze as long as you're not scared of actually meeting someone in person.

Granted, LA is a big city, but I'm just saying that the trend has been towards more local exchangers, and its only getting easier.

[wumpus]

It's funny how much Δ(exchange rate) affects the kind of talk on these forums. It's not about the price, folks.

Having said that, I hope the reliance on exchanges will eventually lessen, and people will move to local trading. The DDoSes and stampede hordes of users disabling exchanges may even be slightly helping there, as it means that people are forced to move to other options for trading.

[superduh]

it's the end of bitcoins if the sole purpose is to manipulate pricing constantly and just make money off the newbie panic sellers.
the utility is completely destroyed. sigh

[Elwar]

With FinCEN requiring every currency exchange to register with them paying millions in fees

Link? I don't think BitInstant paid millions in fees, and I'm pretty sure BitStamp in Sweden didn't pay millions in fees, nor are they subject to US FinCEN regulation for that matter. Correct me if I'm wrong, IANAL. Besides, USA != World.

BitInstant:

We are now a legal MSB sanctioned by the Dep't of the Treasury! MSB Registration number 31000005031107

            A person that creates units of this convertible virtual currency and uses it to purchase real or virtual goods and services is a user of the convertible virtual currency and not subject to regulation as a money transmitter. By contrast, a person that creates units of convertible virtual currency and sells those units to another person for real currency or its equivalent is engaged in transmission to another location and is a money transmitter. In addition, a person is an exchanger and a money transmitter if the person accepts such de-centralized convertible virtual currency from one person and transmits it to another person as part of the acceptance and transfer of currency, funds, or other value that substitutes for currency.

Sure, you can have a decentralized exchange that does not include US citizens. Until the other countries adopt similar laws.

[Matthew N. Wright]

BitInstant:

Sorry, I wasn't clear, I was asking for the link to substantiate your claim that BitInstant paid millions of dollars in fees to become MSB licensed.

[sega01]

We have a decentralized exchange. It's called bitcoin-otc.com.

[Matthew N. Wright]

We have a decentralized exchange. It's called bitcoin-otc.com.

Sitting around on IRC waiting for one of a few hundred people to respond to a request to buy or sell when they may or may not have anything to sell is not what I'd call an appropriate exchange to lead the way.

[gdbutler]

It seems obvious that a P2P solution is the only answer. I'm not a developer, coder, or anything like that, but why can't there be a peer to peer client built that would fulfill this need? I suppose ripple does this to a degree but at first glance it seems too complicated for the average person to use. I suppose the difficulty comes from the transfer of fiat to/from a peer to peer client?

[Sage]

The problem is the centralized exchanges.  We can never get through hyper-exponential mass adoption (that has to happen if Bitcoin becomes used by even 1% or less of all transactions) until we get a decentralized exchange.

We desperately need a decentralized exchange.

Already have one - its called localbitcoins.com.

Honestly, a year ago there was one person in all southern CA on that site - Stephen Gornick. Now, getting coins or selling them in LA is a breeze as long as you're not scared of actually meeting someone in person.

Granted, LA is a big city, but I'm just saying that the trend has been towards more local exchangers, and its only getting easier.

Localbitcoins doesn't cut it.  It needs to be fast, liquid, and have no central point of attack.  It cannot have its own central website period!

[gdbutler]

If you think ripple is hard, then a P2P exchange client would be alien to you.

A P2P exchange would be great, yet for two reasons it isn't ever going to happen. First is that it would be insanity difficult to get dollars into the exchange unless you have centralized gateways just like ripple. Second it would kill bot trading as you know it. P2P exchange would be like re-inventing bitcoin again, something I don't think will happen anytime soon.

Yeah, that is what I figured. I guess one of the inherent problems of bitcoin adoption is the difficulty of interfacing with fiat. Although I guess you wouldn't have to get fiat into an exchange if there was a standardized voucher system that could be purchased though businesses similar to bitinstant.

[Elwar]

BitInstant:

Sorry, I wasn't clear, I was asking for the link to substantiate your claim that BitInstant paid millions of dollars in fees to become MSB licensed.

The million+ number for a license came from this thread:
https://bitcointalk.org/index.php?topic=154672.0

No idea of the source from there.

[Matthew N. Wright]

BitInstant:

Sorry, I wasn't clear, I was asking for the link to substantiate your claim that BitInstant paid millions of dollars in fees to become MSB licensed.

The million+ number for a license came from this thread:
https://bitcointalk.org/index.php?topic=154672.0

No idea of the source from there.

That thread shines a light on a solution actually, and it is a solution supported by decentralized exchanges.

[virtualmaster]

Humans are how they are.
Some are idealists, some are materialists, some are altruistic, some are greedy, some are honest, some are corrupt, some are smart, some are stupid, some beleave in God and some beleave in nothing.
Nobody will change his nature just because he/she is interested in bitcoin.
You can exchange 1-2 bitcoins decentralized but you cannot exchange tausends of bitcoins against fiat money in a secure way without a centralized exchange. At least not now.