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Author Topic: Bitcoins and the less savoury  (Read 662 times)
Hunterbunter
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June 17, 2011, 11:52:16 AM
 #1

So here's a question to the well established, knowledgeable, speculators and coinkind:

Seeing as bitcoins are quite a "free market" being driven purely by the shakey panic prone will of the early adopters, what of the attention of sharks?

I mean...with people making blogs about "why I'm investing all my money into bitcoins" and "300000000% growth!!" surely the professionals in the investment banks on wall street will take a gander, and decide to very easily crush the market to gain control? It seems a bit wild-westy at the moment, relying on nothing but trust that other people won't be jerks.

I mean...these are people experienced in harsh wall-street conditions, and watching the BTC/USD charts the last few days I've seen how fragile it is to manipulation. Even 1 well funded person can cause wild volatility, selling violently, causing panic to build their pie slice, etc.

Isn't this the biggest risk to bitcoins success? I don't really see a natural defense mechanism (except collapse and death) to combat all its coins to still manage to find their way into the pockets of people it was designed to avoid. What am I missing? The current holders and investors can only stomach so much before they decide to take whatever they can and leave.

I've noticed DDoS attacks happen quite frequently to pools, too...obviously if your network can hash quickly enough, knocking out competitors for a few hours means all the BTC are yours during that time (at least what you can hash in time, an unfair advantage). No big deal when BTC are worth a few dollars, but eventually if it survives, that block could be worth hundreds of thousands, or millions. I understand its difficult to achieve, but it's not impossible, and its lucrative. What is there to stop this happening? Because it will, if there's nothing. I know difficulty will be at play, but I don't think it'll stop people doing this.

I understand that the end goal of BTC is to build an economy that actually lets you trade your BTC for goods/services, but if the BTC production can be controlled, or encouraged into certain wallets (through bullying, not cheating), until you can get the majority of what you want via BTC and not need to transfer in and out of $$ etc, won't it just turn businesses trying to build stable prices off?
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ignoringpeople
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June 17, 2011, 11:55:46 AM
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The chances of seeing anyone like a real investor/bank is outrageously slim. If you were a large legit company, you would not even want to associate yourself with bitcoin due to hackers, DDoS, and the infinite amount of speculation on bitcoin.
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June 17, 2011, 01:10:44 PM
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Yeah I was thinking more independents, who didn't mind quick in-out ninja profit taking/destroying.
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June 17, 2011, 01:21:40 PM
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The network is already big enough to prevent any small time operator from taking control.

As for the rest of it, I wouldn't worry. Someone once wrote something to the effect that the entire world economy could run off one bitcoin (because it is divisible by so much). As for stable prices, well. They'll come soon enough. As more and more people use bitcoin, prices will stabilise. You'll always get people like me who are willing to use bitcoin simply because we desire a truly independent currency. Bitcoin works for that.

Web development and stuff, for bitcoin - http://next-nexus.info/ (http://next-nexus.info/)
Also I exist on the Wiki: http://en.bitcoin.it/wiki/User_talk:Michael
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June 17, 2011, 01:28:00 PM
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Yeah I agree - bitcoin's success is all about what you can do with them. Make it worth people's time (other than mining) to have any denomination of BTC, and we'll have some interesting times ahead!

if 1 microBTC actually buys you food for the week, then 1 microBTC will have value outside the market...I guess by that stage the exchange market will be like any other, with the deflation premium built in.

I was just more concerned with getting to that point in one piece.
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