Bitcoin revolutionary?

[esenminer]

I think in terms of technology Bitcoin is revolutionary but I don't see how it could revolutionize our current economic system.

The key problem is that it does not address the distribution and accumulation of wealth. In fact the current mining system promotes this. People mine, collect coins, re-invest. Those with more coins can invest more and make more and over time the distribution of coins is unequal with a small percentage of people holding a majority of the coins.

The second problem is it's link with FIAT money which it needs for it to have any current real world use. This link makes it a commodity, like gold, and wealthier people always end up with more.

If the world were to implement a complete Bitcoin system wouldn't we just end up in the same place we are now? Minority of people holding the majority of Bitcoins? Instead of everything being done with various FIAT it would be done with Bitcoin - sure everything would be much simpler, digital, some things cheaper and less worry about inflation but for all intents and purposes the exact same underlying economic system.

An economic revolution would have to address the distribution and accumulation of wealth.

[tutkarz]

the difference is that nobody will rob you with inflation forcing you to spend money when you dont want to do this.

[Chet]

The medium will never change the behavior of the people using it. Bitcoin will stop the bankers from taking a rake everytime you  want to move money around.
There are already a lot of real world goods you can buy with bitcoin and more everyday.
And many of those things are from small startup businesses, so we can slow down feeding the big corporations too.

[semaforo]

   Yes, it's true that patterns of accumulation would be unlikely to change. However, the political structure of the planet may end up becoming much more unified. There is the potential that "the whole is greater than the sum of its parts" and that unifying as one planet could reveal emergent properties (http://en.wikipedia.org/wiki/Emergence) in humanity and take us to another level of evolution. The laws of nature are unlikely to change, but a revolution is literally the beginning of a new cycle. Bitcoin may also facilitate interplanetary trade since its value is based on mathematics, a universal language, rather than politics or commodities which may have limited utility on planets with different atmospheres or technology.
       Wealth will likely concentrate again and again, but divorcing the value of currency from the fate of nations is likely to bring about changes. Death, decay, and corruption are a natural part of life, and so is renewal. Bitcoin is such a force of renewal.

[franky1]

the problem with wealth distribution is not bitcoin related. its user related.

bill gates is not a rich man because he mined gold in the 1980's
oprah winfrey . ditto ditto ditto

mining is just one way to become wealthy.

and if you compare it to gold mining, the actual people doing the mining.. the african slaves etc are not billionaires, its the traders that play the markets.

infact inventing a product / service can make you more wealthy then someone digging for gold/satoshi dust each day.

the secret is to not sit on your hands saying "i can't be an elite because....." but instead "lets make a plan to do something"

bitcoin has opened up new freedoms for self employed people to accept something of value for their labour without it having to be fiat.

its opened up opportunities for these self employed people to then send their earnings to other countries without the need of banks and bureaucracy.

with my bitcoins i can get on a plane and meet someone at the vacation destination and convert my coin to their native currency without the need of travellers cheques, special internationally accepted credit cards, or needing the services of banks, 'bureau de change', travel-ex, etc.

to set up a website, i don't need to pay X per month with a card processing company.

the whole entrepreneurial hurdles and paperwork has become less and less by just using bitcoin. Look at all the licence requirements exchanges need for handling FIAT. and ask yourself, wouldn't it be great if there was no direct need for fiat, think of something everyone needs that would work even better without the need of FIAT.. and make that your plan.

then you will become one of the elite.

for me food is an essential which is why for the last year i have been casually prompting the likes of foodler. just-eat, and other food delivery establishments. which are slowing becoming interested.

next stage is getting wholesalers, suppliers, manufacturers to accept bitcoin so that its even easier to convince retailers that get stock from these suppliers to shift away from fiat.(well maybe not shift away, but easier to include bitcoin)

[esenminer]

the problem with wealth distribution is not bitcoin related. its user related.

bill gates is not a rich man because he mined gold in the 1980's
oprah winfrey . ditto ditto ditto

mining is just one way to become wealthy.

and if you compare it to gold mining, the actual people doing the mining.. the african slaves etc are not billionaires, its the traders that play the markets.

infact inventing a product / service can make you more wealthy then someone digging for gold/satoshi dust each day.

the secret is to not sit on your hands saying "i can't be an elite because....." but instead "lets make a plan to do something"

bitcoin has opened up new freedoms for self employed people to accept something of value for their labour without it having to be fiat.

its opened up opportunities for these self employed people to then send their earnings to other countries without the need of banks and bureaucracy.

with my bitcoins i can get on a plane and meet someone at the vacation destination and convert my coin to their native currency without the need of travellers cheques, special internationally accepted credit cards, or needing the services of banks, 'bureau de change', travel-ex, etc.

to set up a website, i don't need to pay X per month with a card processing company.

the whole entrepreneurial hurdles and paperwork has become less and less by just using bitcoin. Look at all the licence requirements exchanges need for handling FIAT. and ask yourself, wouldn't it be great if there was no direct need for fiat, think of something everyone needs that would work even better without the need of FIAT.. and make that your plan.

then you will become one of the elite.

for me food is an essential which is why for the last year i have been casually prompting the likes of foodler. just-eat, and other food delivery establishments. which are slowing becoming interested.

next stage is getting wholesalers, suppliers, manufacturers to accept bitcoin so that its even easier to convince retailers that get stock from these suppliers to shift away from fiat.(well maybe not shift away, but easier to include bitcoin)

as a bitcoin miner you are not one of the people working in the mines you are the owner operator, you make an investment, pay your expenses and keep the profit. the hardware in a sense are your workers and they perform the labour. this is text book case of capitalism.

the link between bitcoin and fiat means they are basically interchangeable. it follows that bitcoin economics will simply reflect economics as we know it - a minority of people holding the majority of wealth. yes there is a whole new arena of opportunities and some people will get rich but this is exactly the system we now have in place, nothing will have changed except the addition of a few more wealthy people.

economic opportunity is not economic revolution. your argument can be made for the internet itself as it has provided more economic opportunities (and made more people wealthy) with less barrier to entry than anything (including bitcoin) before it.

look, the point of the post was to get people thinking about the distribution and accumulation of bitcoin. it doesn't have to be the same as our current model. for example, and this is only a thought experiment, do not spam me what if you only got to keep 50% of your earnings and the rest were distributed across the network? every bitcoin user (ignoring the technical problems of identifying individual users) would have a steady stream of income - not much but they could always make more by mining themselves or investing. maybe even enough for basic living? yes they would be getting something for nothing but so what? most executives make salaries that are disproportionation to the amount of revenue that they are directly responsible for. if you want a economic revolution it can't just be the same old same old, you have to try something new.

[ganabb]

So far, Bitcoin has been used to buy games and virtual products from Internet merchants.

[Carlton Banks]

It's a more democratic way of distributing money than anything else that's been before.

Gold? If you didn't have or couldn't physically use a pickaxe and shovel, you were always getting gold at a premium price. And you had to find it to begin with. Pretty exclusive.

Fiat? If you're not a large financial company, you cannot benefit from the initial distribution of fiat money. Absolutely exclusive.

The only thing that's stopping people mining BTC is the fear of the technical challenge. Well, and the upfront capital. And ASICs are less exclusive now, and that trend will only continue since USB key style ASICs with a 1.99 BTC price tag are available. Bitcoin, while not perfectly equal opportunities, still wins against the previous monetary paradigms.

[Elwar]

An economic revolution would have to address the distribution and accumulation of wealth.

Redistribute all of the wealth today and in 10 years we will be exactly where we were yesterday.

[QuestionAuthority]

I just read through Satoshi's paper again and no where does it say he invented this system to overthrow governments or create a revolution. Why does everyone want to use it for that? Isn't it enough to just screw over banks that are raping everyone with ridiculous fees? 

[dancupid]

I think in terms of technology Bitcoin is revolutionary but I don't see how it could revolutionize our current economic system.

If (and that's one huge IF) the people wake up to fiat money and the power of the centralized authority in determining the value of their currency, it could be replaced. The first step is for our brothers and sisters to stop voting for puppet officials. And this can only happen if somehow they can wake up to the propaganda and mind control being spewed by our current television programming.

Most people are awake - that's why they don't care.
Why would anyone waste their lives worrying about this?
I'm living in the richest most technologically advanced period in the history of the world -
I'm richer and healthier and happier than 99.9% of all the humans who have ever existed.
I don't even vote anymore because it's irrelevant.

[Etlase2]

The key problem is that it does not address the distribution and accumulation of wealth. In fact the current mining system promotes this. People mine, collect coins, re-invest. Those with more coins can invest more and make more and over time the distribution of coins is unequal with a small percentage of people holding a majority of the coins.

The problem is not specifically that a small percentage hold a majority, the problem is that small percentage can use that power to control everyone else.

The second problem is it's link with FIAT money which it needs for it to have any current real world use.

I agree. The solution to this is to have a currency that can find its own value relative to a basket of goods so that it cannot be manipulated by those with a lot of the currency.

If the world were to implement a complete Bitcoin system wouldn't we just end up in the same place we are now? Minority of people holding the majority of Bitcoins? Instead of everything being done with various FIAT it would be done with Bitcoin - sure everything would be much simpler, digital, some things cheaper and less worry about inflation but for all intents and purposes the exact same underlying economic system.

An economic revolution would have to address the distribution and accumulation of wealth.

I also agree, and I have proposed some very advanced ideas to change this. See the link in my signature.

if you want a economic revolution it can't just be the same old same old, you have to try something new.

See the link in my signature.

[Stampbit]

I think the fundamental issue with wealth distribution lies in our inability as humans to be autonomous. What we keep converging towards is efficiency, whereby in its effect aristocracy is born. If we can all accept to live in a world full of inefficiency then we can all accept both its benefits and costs equally, but as long as we strive for a more efficient world we will have to accept a select few to hold the reigns.

[FreeMoney]

The key problem is that it does not address the distribution and accumulation of wealth. In fact the current mining system promotes this. People mine, collect coins, re-invest. Those with more coins can invest more and make more and over time the distribution of coins is unequal with a small percentage of people holding a majority of the coins.

It does. The people who manage the system and the people who help them and the people who help them and the people who help them and the people who help them and so on get bitcoins.

The second problem is it's link with FIAT money which it needs for it to have any current real world use. This link makes it a commodity, like gold, and wealthier people always end up with more.

It is not linked, it is compared, and that is just what happens to everything. Castles, cars, candy and clothes all get compared to units of whatever people's local money happens to be. When the monies die the things still have their value, possibly extra value. It would be truly bizarre for two monies to coexist without there being an exchange rate between them.

An example of linked would be the dollar and the cent.

[QuestionAuthority]

I just read through Satoshi's paper again and no where does it say he invented this system to overthrow governments or create a revolution. Why does everyone want to use it for that? Isn't it enough to just screw over banks that are raping everyone with ridiculous fees? 

As if there were a clear divide between the groups mentioned in your post.

Hey Holliday! Long time no talk. lol

[QuestionAuthority]

I just read through Satoshi's paper again and no where does it say he invented this system to overthrow governments or create a revolution. Why does everyone want to use it for that? Isn't it enough to just screw over banks that are raping everyone with ridiculous fees? 

As if there were a clear divide between the groups mentioned in your post.

Hey Holliday! Long time no talk. lol

I'll let you in on my current revolutionary theory. Don't tell anyone though. It's a secret. I think BFL is going to ship en mass within the next month or two. I just bought a shitload of Bitcoins to add to my mining savings. When the diff skyrockets because of the mining increase price will follow and I'm gonna sell all, move to Thailand and wage war on a bottle of Scotch for the rest of my life. What do you think. Good plan?

[QuestionAuthority]

I just read through Satoshi's paper again and no where does it say he invented this system to overthrow governments or create a revolution. Why does everyone want to use it for that? Isn't it enough to just screw over banks that are raping everyone with ridiculous fees? 

As if there were a clear divide between the groups mentioned in your post.

Hey Holliday! Long time no talk. lol

I'll let you in on my current revolutionary theory. Don't tell anyone though. It's a secret. I think BFL is going to ship en mass within the next month or two. I just bought a shitload of Bitcoins to add to my mining savings. When the diff skyrockets because of the mining increase price will follow and I'm gonna sell all, move to Thailand and wage war on a bottle of Scotch for the rest of my life. What do you think. Good plan?

Some day you'll have to introduce me to Scotch that is actually worth drinking. Bourbon on the other hand...

Bourbon will work in a pinch but I'd walk all the way to Glasgow for a bottle of Glengoyne. 

[shawshankinmate37927]

I think in terms of technology Bitcoin is revolutionary but I don't see how it could revolutionize our current economic system.

Bitcoin will revolutionize our current economic system because it gives individuals the ability to opt-out of fiat currencies and transact or save in a currency that bankers have no control over.

The key problem is that it does not address the distribution and accumulation of wealth.

Sure it does.  New bitcoins are distributed to the miners that process the transactions, validate the blockchain, and secure the network.  This is a brilliant way to distribute bitcoins because it rewards those that are providing value and offers an incentive to join the network and become a miner.  With fiat currencies, newly created money is distributed to bankers, politicians, those with political connections, and people that are taking on debt and living beyond their means at the expense of savers.  With Bitcoin, wealth is accumulated by those who choose to save, those who invest wisely, or those who provide goods and services that others are willing and freely choose to pay for.  With fiat, it's the bankers, politicians, and people with political connections that accumulate the wealth.

In fact the current mining system promotes this. People mine, collect coins, re-invest. Those with more coins can invest more and make more and over time the distribution of coins is unequal with a small percentage of people holding a majority of the coins.

New bitcoins are distributed to miners according to the amount of hashing power they contribute to the network.  If you're like me and don't mine, then you can purchase bitcoins that someone else mined at market value.  It doesn't get any more fair than that.

The second problem is it's link with FIAT money which it needs for it to have any current real world use. This link makes it a commodity, like gold, and wealthier people always end up with more.

We have to have exchanges because it takes time to transition to a new currency.  This sort of thing doesn't just happen overnight, especially when you're talking about the world's reserve currency.  We are still in the early stages of transitioning to honest, sound money.  It's going to take a while, you'll just have to be patient.  As more and more people come to understand the benefits of Bitcoin, more of their transactions will be in Bitcoin and there will be less need to exchange back and forth between fiat.

Gold isn't a commodity.  That's what bankers want us to think.  Gold is money.  There is also an exchange rate between euros and dollars.  Does this mean that the euro is a commodity?

If the world were to implement a complete Bitcoin system wouldn't we just end up in the same place we are now? Minority of people holding the majority of Bitcoins? Instead of everything being done with various FIAT it would be done with Bitcoin - sure everything would be much simpler, digital, some things cheaper and less worry about inflation but for all intents and purposes the exact same underlying economic system.

Yes, a minority of people have the majority of bitcoins right now, but over time they will be sold or spent and that wealth will be spread out to others.  Clearly, the Bitcoin monetary system is the best alternative out there right now because it in no way resembles the current fiat monetary system that bankers and politicians are so fond of.

It's also important to remember that one of Bitcoin's greatest features is that it is completely voluntary.  As of right now, there is no banker or politician forcing anyone to use bitcoins.  If there is some aspect of it that someone considers unfair, they don't have to use it.  In fact, anyone is free to copy the code, modify it to their liking, introduce a new currency and then let the free market determine it's value.

[DoomDumas]

Whitout the "interest" factor, and a without bank money creation scheme, BTC will tend to equalize within its users.  The fact that whealthy fiat owner are making more and more just by having tons of fiat is largely due to the interest thing, linked with bank's money creation system, wich cannot really apply to bitcoin.  Yrs there is mining, and those with a lot of BTC can invest more in mining, but this is minor whealth creation compare to the interest scheme we see in the fiat world.

IMO, bitcoin is a much more fair system than the modern fiat monetary mechanic.

[esenminer]

The key problem is that it does not address the distribution and accumulation of wealth. In fact the current mining system promotes this. People mine, collect coins, re-invest. Those with more coins can invest more and make more and over time the distribution of coins is unequal with a small percentage of people holding a majority of the coins.

It does. The people who manage the system and the people who help them and the people who help them and the people who help them and the people who help them and so on get bitcoins.

The second problem is it's link with FIAT money which it needs for it to have any current real world use. This link makes it a commodity, like gold, and wealthier people always end up with more.

It is not linked, it is compared, and that is just what happens to everything. Castles, cars, candy and clothes all get compared to units of whatever people's local money happens to be. When the monies die the things still have their value, possibly extra value. It would be truly bizarre for two monies to coexist without there being an exchange rate between them.

An example of linked would be the dollar and the cent.

By distribution and accumulation I am referring to the bias in capitalistic markets wherein people with more wealth can more easily increase their wealth by investing. Over time the total wealth of a country sits in the hands of a very small minority of the population. Governments redistribute some wealth through taxation and government spending (i.e. healthcare, education etc) but over time the disparity grows. Bitcoin does nothing to address this. A bitcoin based economy will have the same disparity over time.

Agreed that compared is a better word.