Thank you for that information I will look though it , FX is a very confidence related vechical , so anything that effects confidence is of importance.
Just confirming FX is Forex.
If we consider it similar to Forex Bitcoin is a separate exchange entity and as such still needs to develop so yes confidence is of importance.
That said resilience is also important and bitcoin has shown that.
I understand about the exchange centralization but I don't see that as a large negative long term . Plus look at the recent incident, the price was flat to up on response.
Exchange centralization is not a negative, however as there are differences in how the rules are applied based on the jurisdiction based on
MSB's for example and the policy in the United States versus Canada and that may add to some uncertainty in the mid-term until the rules are fully clarified.
This impacts lenders more than it does users and we have seen the collapse of some exchanges back historically
I would recommend reading the Gamma Fund history if you want a good example of this beyond recent incidents
https://bitcointalk.org/index.php?topic=74975.0;topicseenhttps://bitcointalk.org/index.php?topic=74975.msg1239841#msg1239841 From here on-wards is an example
The collapse of GLBSE exchange which was a significant collapse.
There's a lot of history on these forums so it helps to determine some information.
A fair bit of funds defaulted just a year ago so centralization may be a neutral factor.
That said Bitcoin was designed as a decentralized currency and the primary benefit is that it removes the middle man in person to person transactions, cuts down on fees regarding these services while providing worldwide access as long as the money can be withdrawn in that country. Of course some service such as a Bank unless people trade with localbitcoins will need to occur. But centralization may be a part of the design but not the primary component and is not required in all transactions.
Clearly the market does not see exchanges as a threat so far. They seem to be confident that others would quickly take up the distribution load. I agree.
Exchanges are not a threat was trying to say they are not the only option
My reference to ASIC is directly related to confidence , as is the risk reward price ratio .
For example , a buyer may look to invest in say Google , but they see Google as a multi faceted entity , confidence would be strong but they have a very high price also ,.
Its a risk based on difficulty, makes sense more ASIC mining = harder difficulty = less reward for more risk.
Bitcoin is a risk vechical like Gold .
True enough but bitcoin is really not a commodity or a currency primarily but is a hybrid it is a bit unfair to compare to just gold. But it can be compared to that.
https://bitcointalk.org/index.php?topic=47111.0People may tell you different and if you are close to the community you may believe different , but I can tell you that an approaching 4 Trillion USD Fed balance sheet is why bitcoin is where it is .
People are looking for yeild and protection , in a zero interest rate world .
I hope I can expand your outlook of global markets also .
Considering that Central Banking has gotten us into this problem, I will argue against Keyne's and personally evaluate the merits of Hayek and the ideas of Bitcoin instead.
Every-time a recession occurs these sentiments increase but it is true that in the last 100 years we have seen more recessions and economic bubbles than all the years before that.
It is true that world growth is increasing and at the same the rapid pace and technological changes contribute to that, along with increases in inflation to ensure money is spent in the economy.
That said third-world or the Global South are still lagging behind and bitcoin can help solve some currency issues and address those inequalities by allowing itself to be based on multiple fiat currencies not based on any one government exchange rate.
I would not say bitcoin is a tulip mania but is a real currency that can adapt and supplement current financial systems.
Technically this forum is libertarian in alignment but the algorithms are math based and simple enough to prove.
Its not a belief in what the community say's but it comes down to an algorithm which anyone can look at and come to that decision.
That also explains its resilience
As they say you can't just spend your way out of all your problems.
A factor of bitcoin's growth is this distrust of how governments finance their affairs and people believing they can do better
Real growth and real GDP will build economies.
With Quadrillions in bitcoins when it finishes producing it can handle the economy of the future.
Furthermore although Bitcoin is deflationary it will be inflationary as long as we live.
So people looking for yield and protection in a zero interest rate world will find that their is still interest in bitcoin's.
If we argue with economics an argument assuming that money is perfectly mobile as it is in bitcoin finance, we can say that money will move to the place with the highest interest yield for risk. Seeing as their are no transportation costs for transporting bitcoins I would argue that if bitcoin develops it will have perfectly liquid capital around worldwide markets.
You missed a very obvious centralization argument , because information in the market was near zero at the inception of bitcoin , how many individuals garnered the early blocks .
This is not an empty argument , a real world example would be if you had just discovered gold for the first time in history .
Using the gold argument again , perhaps you built your house with gold , maybe you believed it would be valuable .
Then as the market was a a small one and information low, there is a proclivity towards centralization or if you like monopoly .
Long term it may not have an effect , but I'm talking about new investors taking on information for an investment , I still rate buy ~~ hold.
Well in that essence bitcoin was not a Ponzi scheme unlike some of the newly minted coins
https://bitcointalk.org/index.php?topic=176333.0Gets to the point
People can sell whenever they want it has advantage for early investors who contributed to developing the infrastructure and to late investors who can still use it.
But to reply to your gold argument
Early adopters are rewarded for taking the higher risk with their time and money. The capital invested in bitcoin at each stage of its life invigorated the community and helped the currency to reach subsequent milestones. Arguing that early adopters do not deserve to profit from this is akin to saying that early investors in a company, or people who buy stock at a company IPO (Initial Public Offering), are unfairly rewarded.
This argument also depends on bitcoin early adopters using bitcoins to store rather than transfer value. The daily trade on the exchanges (as of Jan 2012) indicates that smaller transactions are becoming the norm, indicating trade rather than investment. In more pragmatic terms, "fairness" is an arbitrary concept that is improbable to be agreed upon by a large population. Establishing "fairness" is no goal of Bitcoin, as this would be impossible.
Looking forwards, considering the amount of publicity bitcoin received as of April 2013, there can be no reasonable grounds for complaint for people who did not invest at that time, and then see the value (possibly) rising drastically higher.
By starting to mine or acquire bitcoins today, you too can become an early adopter.
https://en.bitcoin.it/wiki/MythsThat should pick apart that argument you just made but good questions as they say knowledge requires asking questions.
