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Author Topic: 90 Cents is the Best Bitcoin Value  (Read 6514 times)
Enochian
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June 18, 2011, 01:21:48 AM
 #21

There are a number of community-based alternative currencies in circulation right now, and their success revolves largely around the type of incentives I mentioned in my original post.

Then why bother with Bitcoin and it's silly mining. Just use those currencies.

They are paper currencies, and therefore somewhat difficult to send over a wire.

If you made them digital, and employed a published transaction block chain and the cryptographic methods of Bitcoin, you would have something along the lines of what I am suggesting.

Mining seems to me to be a bit of a distraction, in that it seems to attract peoples attention out of proportion to its importance.  The most important parts of Bitcoin, in my opinion, are how it prevents double spending without a central mint, and the cryptography employed to keep coins secure and transfer them between users.



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niemivh
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June 18, 2011, 01:29:32 AM
 #22

If we could make a stable market in Bitcoins at a price of 90 cents each, Bitcoins would take off as an alternative currency.

First, regular merchants could advertise that they accept payment for purchases from their store in either Bitcoins or dollars.  This would give customers paying in Bitcoins an automatic 10% discount on their purchases.  This discount for customers paying in Bitcoins, and the fact that the store accepts Bitcoins, would attract additional business to the merchant, and more than cover the cost of giving the discount.

There actually are people outside the US, you know? I for one would rather have the bitcoin at 90 EUR-cents for your reasons, heck, make that 9 EUR, that would be quite close to the actual price!
 Cool


WHat?  I thought the only thing outside of the US was the deep dark cold of space.... At least that's what they've been telling us.

I'll keep my politics out of your economics if you keep your economics out of my politics.

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niemivh
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June 18, 2011, 01:31:17 AM
 #23

I for one am all in favor of a Bretton Woods II setting fixed parity for BTC and USD.


 Wink

I'll keep my politics out of your economics if you keep your economics out of my politics.

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Enochian
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June 18, 2011, 01:33:22 AM
 #24

OK.   Huh

The most important part of Bitcoin, in my opinion, is mining. This is how it prevents double spending without a central mint, and it employs cryptography to keep the coins secure and transfer them between users.

This is completely wrong.  Double spending is prevented by the published hashed block chain which requires a "proof of work" for each valid block.

Mining coins has absolutely nothing to do with preventing double spending.  After all 21 million bitcoins have been mined, Bitcoin will still work fine and prevent double spending.  The only change is that the incentive for block generation will change from creating coins to redeeming transaction fees.

Enochian
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June 18, 2011, 01:47:33 AM
 #25

Where in god's name does that block chain come from?

I see that the Wiki defines "mining" as the generation of blocks, rather than the generation of coins.

In that context, your prior post is less wrong.


kwukduck
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June 18, 2011, 01:51:35 AM
 #26

I was about to yell "TRROOLL ALERTT!"
But i think OP seriously doesn't get it...

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June 18, 2011, 01:55:12 AM
 #27

I can't agree with any exact number Bitcoin should be. The market will determine that. However, I do agree that it would be easier to spend if they were less "valuable".

From a consumer point of view, I wouldn't think twice about spending digital money worth a dollar. When it starts getting on the $20-$30 level, it doesn't seem like something I want to spend impulsively.

Enochian
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June 18, 2011, 02:04:18 AM
 #28

Please do some more research before you post. Bitcoin is mining. Without one, the other does not exist.

As Richard Feynmann observed, learning the name of a bird doesn't tell you anything about the bird.

I understand Bitcoin thoroughly, minor differences in terminology notwithstanding.

It was "coin generation" I meant to suggest attracted peoples attention out of proportion to its actual importance.

However, we digress from the original theme, which is how to we make Bitcoin easier for people to use, and easier for traditional merchants to accept for transactions.


Enochian
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June 18, 2011, 02:17:03 AM
 #29

You understand Bitcoin thoroughly yet don't realize the importance of mining?

Yes, I understand Bitcoin thoroughly.  I've coded my own client, including all the crypto.  I've been hacking Bitcoin for months.

Please don't confuse my slight misunderstanding of the terminology you employ to describe Bitcoin with a misunderstanding of the inner workings of the protocol.

They are two completely different things.

Enochian
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June 18, 2011, 02:30:34 AM
 #30

I apologize. You've misunderstood the term "mining"?

Yes.  Mining generally refers to the production of something of value, and I had not looked at the Wiki page which specifically defines it as the production of blocks.  The client code is sparsely documented, and I therefore incorrectly inferred that folks were employing the term to describe the creation of new coins, particularly in light of all the analogies to gold mining.

Now can we move on?





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June 18, 2011, 02:39:21 AM
 #31

I apologize. You've misunderstood the term "mining"?

Yes.  Mining generally refers to the production of something of value, and I had not looked at the Wiki page which specifically defines it as the production of blocks.  The client code is sparsely documented, and I therefore incorrectly inferred that folks were employing the term to describe the creation of new coins, particularly in light of all the analogies to gold mining.

Now can we move on?







Now it makes sense that everything you've said is stupid.

You didn't even understand the very basic concepts of how bitcoin worked.

/endthread
Enochian
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June 18, 2011, 02:43:00 AM
 #32

Yes, explain how the United States and European markets are free.

For most goods and services, the government regulates neither price nor supply, and transactions take place between parties at mutually agreed upon prices, with neither party employing threats or fraud.  This results in the aggregate market operating according to the laws of supply and demand.  According to proponents of free markets, such markets are the most efficient markets.

Of course, there are exceptions, but quite a few goods and services are freely traded in the markets of the US and Europe.



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June 18, 2011, 02:44:44 AM
 #33

Yes, explain how the United States and European markets are free.

For most goods and services, the government regulates neither price nor supply, and transactions take place between parties at mutually agreed upon prices, with neither party employing threats or fraud.  This results in the aggregate market operating according to the laws of supply and demand.  According to proponents of free markets, such markets are the most efficient markets.

Of course, there are exceptions, but quite a few goods and services are freely traded in the markets of the US and Europe.





You are so full of fail, stop posting. Roll Eyes
Enochian
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June 18, 2011, 02:46:39 AM
 #34

You didn't even understand the very basic concepts of how bitcoin worked.

Your counterintuitive use of the term "mining" has absolutely nothing to do with my understanding of how Bitcoin works.

I prize working code over quibbling about what things are called.

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June 18, 2011, 02:48:17 AM
 #35

You didn't even understand the very basic concepts of how bitcoin worked.

Your counterintuitive use of the term "mining" has absolutely nothing to do with my understanding of how Bitcoin works.

I prize working code over quibbling about what things are called.



Wow, triple epic fail.
Enochian
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June 18, 2011, 02:54:46 AM
 #36

Don't all of those markets have taxes?

Yes they do, but tax collection, enforcement of contracts, and protection of private property rights are the three things the role of government is limited to in a free market.

Taxation doesn't automatically exclude something from being a free market, although obviously it has some potential to be used to that end, particularly along the tariff and subsidy axis.

 
Enochian
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June 18, 2011, 02:57:35 AM
 #37

I prize working code over quibbling about what things are called.
Wow, triple epic fail.

And that goes double for trying to wade through buggy badly documented bloatware.

Travis
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June 18, 2011, 03:02:54 AM
 #38

If we could make a stable market in Bitcoins at a price of 90 cents each, Bitcoins would take off as an alternative currency.

First, regular merchants could advertise that they accept payment for purchases from their store in either Bitcoins or dollars.  This would give customers paying in Bitcoins an automatic 10% discount on their purchases.  This discount for customers paying in Bitcoins, and the fact that the store accepts Bitcoins, would attract additional business to the merchant, and more than cover the cost of giving the discount.

Second, as long as merchants used their Bitcoins to purchase stuff they needed from other merchants also accepting Bitcoins, accepting Bitcoins wouldn't cost them anything at all.  The 10% cost of converting Bitcoins back into dollars would only affect the last guy in the chain.  This would suck dollars into the Bitcoin economy and keep the Bitcoins circulating.

Third, at a price of 90 cents each, early adopters who created and stashed hundreds of thousands of Bitcoins away back when mining was easy, have no chance of becoming Bitcoin Multibillionaires.  They would have to settle for a modest reward for their contributions.

Bitcoins are presently trading at $15.80.  What sorts of things could we do to incentivize them to trend towards their ideal value of 90 cents?





Maybe you and others whom agree with you could create an exchange and subsidize bitcoins with your own money from the market price down to ninety cents.

Just tell me when the site launches, I want to be the first one there.
Enochian
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June 18, 2011, 03:06:11 AM
 #39

And if you think that minimal role is the only one the governments of today's world has, you are naive. Please tell me you don't believe that.

Today no one believes in either totally unregulated free market capitalism, nor complete central control.  Most economic systems in the world today are amalgamations of lots of things from a variety of sources.

So of course, the US and Europe aren't completely free markets.  But neither are they North Korea.

The driving economic forces in the world today are Globalization, and the desire on the part of less developed nations to elevate a critical mass of their population to the middle class.





Travis
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June 18, 2011, 03:35:57 AM
 #40

Quote from: Holliday
Aww.. that's not true. I believe in both. I also think both can be beneficial. One requires an intelligent populace. The other requires an intelligent individual. After all, what kind of intelligence would work to destroy humanity?


Then you are confused. Central planning does not work because of the calculation problem.
Government's can't allocate resources in any rational way, no matter how intelligent and good intentioned you think the government planners are or can be. And lets face it, the political system is like a filter, only amoral sociopaths climb their way in to seats of power. The system is such that you have to lie to, pander to, and bribe voters with other peoples money in order to get elected. Complete central control is inherently total power, no moral person would want that power, no wise person would think they could use that power to make the world a better place. Only the moral/psychologically corrupt want that power, its like the smell of death attracting buzzards, they are drawn to power because of their especially flawed natures. So only the bad want to be in positions of power ("central planners"), and for the most part only the bad can succeed in becoming a part of the ruling class because they have to lie to the voters and exploit their ignorance in order to get the job. And then once they become central planners, they have very very little incentive to do a good job or pursue what is right.
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