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Author Topic: Bitcoin Shrinking - The Long View  (Read 17732 times)
Synaptic
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July 16, 2011, 10:24:23 PM
 #241

No, Synaptic, let's stay with the same post and examine that, for the sake of clarity.

A number of people have mentioned how great BTC are for international currency transport and exchange and they're correct, though this use doesn't require any valuation higher than relative parity with the strongest currencies; In fact it still works perfectly fine at 10:1 or even 100:1, the only reason for it to be higher is greedy miners hoarding to artificially restrict supply.

What are you saying here exactly? That for international currency transfer and exchange we don't need a BTC value of more than $1? That's a total of $6m?

Explain.



Look I'm getting really fucking tired of your inability to comprehend the very words you're reading...
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Edward50
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July 16, 2011, 10:28:03 PM
 #242

just because the last bitcoin sold for $13.5 does not mean bitcoin is worth $13.5 x 6million. only say 10,000 would say at $13.5, most would sell far below that.

Empty your mind, be formless, shapeless — like water. Now you put water in a cup, it becomes the cup; You put water into a bottle it becomes the bottle; You put it in a teapot it becomes the teapot. Now water can flow or it can crash. Be water, my friend.
Synaptic
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July 16, 2011, 10:29:09 PM
 #243


You look at it from a naively optimistic point of view, as that of a child imagining what a superhero might eat for breakfast.

The correct way to approach it is "At 1:1 USD/BTC, which places the total Bitcoin market cap at $6m of value, what market forces produce enough value to support that price?"

The answer as it's been for the past 3.5 months is hype. As the hype has faded and reality sets in and the price deflates as I'm explaining to you it will, even at $6m of value the answer is: Practically Nothing.

See, Bitcoins basically need the equivalent of a "GDP" to sustain it's value.  There is no "GDP" behind Bitcoins now, nor will any "GDP" be growing within 6 months, or a year, or likely ever, for all the reasons I've listed across many threads over the past 2 months.

But I'll turn it over to you and that other genius that started posting:

Given a 1:1 parity with the dollar, what in all of the God's Hells impart $6m of market value?

Don't spout off bullshit about people paying what they think it's worth: that's speculation, and speculation isn't value...

Slow down a bit......

GDP wise, there is no nation Wink

But ignoring that, BTC has generated economic activity around it's existence. You mightn't place much value on it, but people creating the various sites for trade and exchange of varying goods and services is what gives bitcoin it's economy, and that's an important point of this whole exercise, people are essentially working and producing in exchange for BTC, essentially giving it value.

All currencies start out as nothing, it's the work of the people behind the nations currency that gives it value. You can argue that bitcoin is over valued, but certainly not of no value. I don't think it unreasonable that bitcoin has generated more then 6 million usd of economic activity by now.

That's why I said "GDP," as a turn of phrase.

I'm not saying there's no Bitcoin economy AT ALL, just not enough of an economy to justify anywhere NEAR the current trade price, now or in the near future.

Hence, my entire premise that the market value will continue to contract as the artificial inflation subsides and takes BTC back to where it belongs.

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July 16, 2011, 10:31:05 PM
 #244

No, Synaptic, let's stay with the same post and examine that, for the sake of clarity.

A number of people have mentioned how great BTC are for international currency transport and exchange and they're correct, though this use doesn't require any valuation higher than relative parity with the strongest currencies; In fact it still works perfectly fine at 10:1 or even 100:1, the only reason for it to be higher is greedy miners hoarding to artificially restrict supply.

What are you saying here exactly? That for international currency transfer and exchange we don't need a BTC value of more than $1? That's a total of $6m?

Explain.



Look I'm getting really fucking tired of your inability to comprehend the very words you're reading...

This isn't about you.
Synaptic
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July 16, 2011, 10:38:01 PM
 #245

No, Synaptic, let's stay with the same post and examine that, for the sake of clarity.

A number of people have mentioned how great BTC are for international currency transport and exchange and they're correct, though this use doesn't require any valuation higher than relative parity with the strongest currencies; In fact it still works perfectly fine at 10:1 or even 100:1, the only reason for it to be higher is greedy miners hoarding to artificially restrict supply.

What are you saying here exactly? That for international currency transfer and exchange we don't need a BTC value of more than $1? That's a total of $6m?

Explain.



Look I'm getting really fucking tired of your inability to comprehend the very words you're reading...

This isn't about you.

Well I'm sorry that I have no interest in throughly explaining myself to someone who doesn't understand what I've already written. I hope that someone else wouldn't mind "translating" or elaborating for you.
Synaptic
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July 16, 2011, 11:47:51 PM
 #246

Any valuation above relative parity with USD/EUR/AUD/GBP etc. is extremely suspect as there are absolutely zero real reasons for it to be above parity.

A number of people have mentioned how great BTC are for international currency transport and exchange and they're correct, though this use doesn't require any valuation higher than relative parity with the strongest currencies; In fact it still works perfectly fine at 10:1 or even 100:1, the only reason for it to be higher is greedy miners hoarding to artificially restrict supply.

It's just patently absurd to say that BTC has any value above the strong fiat currencies that have the GDP of ENTIRE FUCKING NATIONS behind their value, and bitcoin has absolutely jack shit. The only reason for it to hold parity is for conveniences sake anyway.

Okay, I see why you get to this conclusion. You are not aware of or don't understand the Equation of Exchange of monetary theory, see http://en.wikipedia.org/wiki/Equation_of_exchange

M*V = P*Q

Since money supply, M, is much smaller for BTC, than for USD, a much smaller demand is needed to have 1 unit of the BTC currency be worth more than 1 unit of the USD currency. If demand increases, V increases, and if M is constant, then the price P*Q will increase too. Now try to keep V constant and decrease M from the USD money supply 850.7 billion USD (2008) to the bitcoin money supply (8.6 million BTC). Then price P*Q must decrease 98,918 times. So if V for USD is more than 98,918 times V for BTC, then 1 BTC will represent more purchase power than 1 USD.

The price of BTC relative to USD doesn't matter to the buyer. What matters is what the buyer believes he can buy for 1 BTC either now or in the future compared to what he can buy for the USD that he pays for 1 BTC. If buyers pay more USD for 1 BTC, the bitcoin businesses will just lower their prices to remain competitive.

So rather than blaming BTC for being priced too high in USD, blame the Federal Reserve for inflating the money supply. The devaluation of USD in the last 3 years alone has caused BTC to double in value against USD.

Casper


"So rather than blaming BTC for being priced too high in USD, blame the Federal Reserve for inflating the money supply. The devaluation of USD in the last 3 years alone has caused BTC to double in value against USD."

LOL, I love how you can wholly debase your entire post merely by following up with this little gem.

Hilarious.

Apart from that, you fail to address the fact that the demand for BTC now is based solely on hype as I've made clean many times already. You erroneously assume that I don't understand WHY bitcoin even has a market price. I understand better than the lions share of posters on this entire forum EXACTLY why bitcoin enjoys it's present market value. I also understand that the valuation is artificial and doomed to steadily contract as the hype wanes and the bag holders are leftto wallow in their poor investment vehicle.

And I don't blame the Fed for anything. Though I don't appreciate their monetary policy, I do realize they know much better than I or anyone else on this backwater forum how to run an economy the size of the United States. Fuck, people here don't even understand how a piddly little market like bitcoin functions, yet purport to understand how to solve all of the world's financial problems with their little hobby.

Just to put the icing on the cake though, USD inflation means absolutely FUCK ALL in relation to BTC anything, but I appreciate your ignorance.
Yeti
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July 17, 2011, 12:00:39 AM
 #247

Oh great master! As you have shown through 13 pages of thread, your wisdom of the things to come exceeds every mean known to man. So please have mercy on us blissful trifling souls and tell us what to do!

Should I sell all my coins now, while I can?

1YetiaXeuRzX9QJoQNUW84oX2EiXnHgp3 or http://payb.tc/yeti

Since Bitcoin Randomizer is dead, join the Bitcoin Pyramid (referrer id #203)! Be quick, be on top! Instant payout as soon as one of your referrals deposits!
Synaptic
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July 17, 2011, 12:05:17 AM
 #248

Oh great master! As you have shown through 13 pages of thread, your wisdom of the things to come exceeds every mean known to man. So please have mercy on us blissful trifling souls and tell us what to do!

Should I sell all my coins now, while I can?

Sure, go ahead.

EDIT: Then again, maybe you should buy more.
Yeti
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July 17, 2011, 12:14:06 AM
 #249

Nah, I won't. Let's play this "Ponzi scheme" a little longer. C'mon, 60,000 accounts on Mt. Gox?! Any decent stock has more investors. I think we can bring in a million more people before it crashes.

Seriously though, with all the uncertainties here in Europe and in the US, all it takes for a lot of people to lose faith in their currency and pump at least some of their money into bitcoins are headlines like
"Republicans c***block debt ceiling compromise! USA defaults on 3-month bonds!"
or
"Financial aid package for Greece, Portugal, Ireland and Italy costs x trillion €, driving inflation up 10%!"

If you can then cleverly convince people to put their money in bitcoins, it will take off. Just like the bucket of shit you wish to promote or cigarettes became the de-facto currency in post-WWII-Germany.

1YetiaXeuRzX9QJoQNUW84oX2EiXnHgp3 or http://payb.tc/yeti

Since Bitcoin Randomizer is dead, join the Bitcoin Pyramid (referrer id #203)! Be quick, be on top! Instant payout as soon as one of your referrals deposits!
Synaptic
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July 17, 2011, 12:21:40 AM
 #250

Nah, I won't. Let's play this "Ponzi scheme" a little longer. C'mon, 60,000 accounts on Mt. Gox?! Any decent stock has more investors. I think we can bring in a million more people before it crashes.

Seriously though, with all the uncertainties here in Europe and in the US, all it takes for a lot of people to lose faith in their currency and pump at least some of their money into bitcoins are headlines like
"Republicans c***block debt ceiling compromise! USA defaults on 3-month bonds!"
or
"Financial aid package for Greece, Portugal, Ireland and Italy costs x trillion €, driving inflation up 10%!"

If you can then cleverly convince people to put their money in bitcoins, it will take off. Just like the bucket of shit you wish to promote or cigarettes became the de-facto currency in post-WWII-Germany.

Your blind faith in the weakness of world economies is cute, yet still infantile.

Fortunately the world financial markets aren't dying or in danger of imminent catastrophic collapse. Indeed, the developed world will continue plodding onwards just as it has for hundreds of years, allowing even the lowest classes some of the highest standards of living in the world, with plenty to eat, drink and be merry about.

And diehard bitcoiners will lube up for another wank with sugar-plum visions dancing in their silly little minds, of fire and brimstone bearing down upon fiat windmills...
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July 17, 2011, 12:27:28 AM
 #251

No, Synaptic, let's stay with the same post and examine that, for the sake of clarity.

A number of people have mentioned how great BTC are for international currency transport and exchange and they're correct, though this use doesn't require any valuation higher than relative parity with the strongest currencies; In fact it still works perfectly fine at 10:1 or even 100:1, the only reason for it to be higher is greedy miners hoarding to artificially restrict supply.

What are you saying here exactly? That for international currency transfer and exchange we don't need a BTC value of more than $1? That's a total of $6m?

Explain.



Look I'm getting really fucking tired of your inability to comprehend the very words you're reading...

This isn't about you.

Well I'm sorry that I have no interest in throughly explaining myself to someone who doesn't understand what I've already written. I hope that someone else wouldn't mind "translating" or elaborating for you.

Let's me see here...

It seems that in order to make OP's assertion valid, one must simply rephrase "The long term trend for bitcoin value is contraction, not expansion." as "The long term trend for fiat/bitcoin exchange rates is contraction, not expansion."

See, we no longer talking about bitcoin's value--only about the ability of market makers (like MtGox crew, etc) to maintain fiat/bitcoin current exchange rates for more than a month or two. OP is right, bitcoin's true value is WAY BELOW current exchange rates due to bitcoin not having any economy to call Home. So, stop worrying about the exchange rates that market makers are feeding you every day. Instead, start offering your bitcoins to merchants... Let's see if they do value BTC more than their local fiat currencies.

Bitcoins are earned, not traded! If you plan on hoarding BTC, you're on my target list. (And yes, it is possible to swim in BTC.)

Don't give me that Bull... I'm one of those honey eating Bears that the bees hope to never meet again... Viva la BTC!!!
Synaptic
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July 17, 2011, 12:35:11 AM
 #252

No, Synaptic, let's stay with the same post and examine that, for the sake of clarity.

A number of people have mentioned how great BTC are for international currency transport and exchange and they're correct, though this use doesn't require any valuation higher than relative parity with the strongest currencies; In fact it still works perfectly fine at 10:1 or even 100:1, the only reason for it to be higher is greedy miners hoarding to artificially restrict supply.

What are you saying here exactly? That for international currency transfer and exchange we don't need a BTC value of more than $1? That's a total of $6m?

Explain.



Look I'm getting really fucking tired of your inability to comprehend the very words you're reading...

This isn't about you.

Well I'm sorry that I have no interest in throughly explaining myself to someone who doesn't understand what I've already written. I hope that someone else wouldn't mind "translating" or elaborating for you.

Let's me see here...

It seems that in order to make OP's assertion valid, one must simply rephrase "The long term trend for bitcoin value is contraction, not expansion." as "The long term trend for fiat/bitcoin exchange rates is contraction, not expansion."

See, we no longer talking about bitcoin's value--only about the ability of market makers (like MtGox crew, etc) to maintain fiat/bitcoin current exchange rates for more than a month or two. OP is right, bitcoin's true value is WAY BELOW current exchange rates due to bitcoin not having any economy to call Home. So, stop worrying about the exchange rates that market makers are feeding you every day. Instead, start offering your bitcoins to merchants... Let's see if they do value BTC more than their local fiat currencies.

Absolutely. You've summarized quite accurately.

Now, my OPINION is that BTC will never find a use with the wider public because it's "advantages" are really quite meaningless to your average consumer, and CERTAINLY don't outweigh the glut of inconveniences inherent to it.

But what's not opinion is that the exchange rate is massively overvalued and is now headed down to a more accurate valuation as the hype continues to subside.
netrin
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July 17, 2011, 12:39:44 AM
 #253

The price of bitcoins doubled *almost* every month....ON AVERAGE...lol and here;s the best part, SINCE THE BEGINNING.

Oh man, what a wonderful glut of qualifiers you've got there imperi....

If the price strictly doubled every month since October 2010 (a month after data begins), the price would be above $31 today. Which is *almost* correct. If we experienced 80% gains monthly we'd have a price of $12 today. My data/calcs:

2010-10       .06      .06
2010-11       .12      .11
2010-12       .24      .19
2011-01       .48      .35
2011-02       .96      .63
2011-03      1.92     1.13
2011-04      3.84     2.04
2011-05      7.68     3.67
2011-06     15.36     6.61
2011-07     30.72    11.90

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Synaptic
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July 17, 2011, 01:15:51 AM
 #254

And I don't blame the Fed for anything. Though I don't appreciate their monetary policy, I do realize they know much better than I or anyone else on this backwater forum how to run an economy the size of the United States.

LOL. They sure know how to run an economy. US debt is now almost 100% of GDP.

"The number of people in the Supplemental Nutrition Assistance Program, known as food stamps, hit a record 44.2 million in January. "

"More than 8.4 million people are collecting either state or federal jobless benefits."

"Ninety-one percent of respondents to a recent poll said they are somewhat or very concerned about the rising rate of inflation, according to a national CNN/Opinion Research Corp. poll released Tuesday. And 86% said they are worried about jobs."

"Debt has grown $3.5 trillion on Obama's watch"

http://money.cnn.com/2011/04/12/news/economy/government_safety_net/index.htm

http://money.cnn.com/2008/03/18/news/economy/cnn_poll_inflation/index.htm?postversion=2008031813

http://www.cbsnews.com/8301-503544_162-20035569-503544.html

None of what you listed has anything to do with the Fed, and everything to do with Congress, the Senate, and the overbearing multi-nationals. Get a grip.

EDIT: I should clarify I didn't mean to suggest that the Fed run the US economy, I should have said "Manage interest rates and inflation relative to the economic decisions of the US government."

SECOND EDIT: Contrary to the prevailing fool's wisdom, the Fed is entirely beholden to the US Government and if anyone bothered to vote in our elections for candidates with integrity you might see a different result. It matters not about all the BS about the Fed being a private bank and whatever the hell else. If you voted in honest candidates you'd get honest monetary policy. Deal with it and quit bitching about it. Bitcoin certainly isn't going to change a goddamn thing about it.
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July 17, 2011, 01:33:54 AM
 #255

No, Synaptic, let's stay with the same post and examine that, for the sake of clarity.

A number of people have mentioned how great BTC are for international currency transport and exchange and they're correct, though this use doesn't require any valuation higher than relative parity with the strongest currencies; In fact it still works perfectly fine at 10:1 or even 100:1, the only reason for it to be higher is greedy miners hoarding to artificially restrict supply.

What are you saying here exactly? That for international currency transfer and exchange we don't need a BTC value of more than $1? That's a total of $6m?

Explain.

Look I'm getting really fucking tired of your inability to comprehend the very words you're reading...

This isn't about you.

Well I'm sorry that I have no interest in throughly explaining myself to someone who doesn't understand what I've already written. I hope that someone else wouldn't mind "translating" or elaborating for you.

Let's me see here...

It seems that in order to make OP's assertion valid, one must simply rephrase "The long term trend for bitcoin value is contraction, not expansion." as "The long term trend for fiat/bitcoin exchange rates is contraction, not expansion."

See, we no longer talking about bitcoin's value--only about the ability of market makers (like MtGox crew, etc) to maintain fiat/bitcoin current exchange rates for more than a month or two. OP is right, bitcoin's true value is WAY BELOW current exchange rates due to bitcoin not having any economy to call Home. So, stop worrying about the exchange rates that market makers are feeding you every day. Instead, start offering your bitcoins to merchants... Let's see if they do value BTC more than their local fiat currencies.

Absolutely. You've summarized quite accurately.

Now, my OPINION is that BTC will never find a use with the wider public because it's "advantages" are really quite meaningless to your average consumer, and CERTAINLY don't outweigh the glut of inconveniences inherent to it.

But what's not opinion is that the exchange rate is massively overvalued and is now headed down to a more accurate valuation as the hype continues to subside.

It is opinion.  The only thing we know for sure is that their are offers and bids in the high thirteens right now. Everything else is opinion.  Value is what a willing buyer and seller agree on. 

insert coin here:
1Ctd7Na8qE7btyueEshAJF5C7ZqFWH11Wc

Open an exchange account at CampBX: options, lowest commissions, and best security
https://campbx.com/register.php?r=0Y7YxohTV0B
Synaptic
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July 17, 2011, 01:39:27 AM
 #256

No, Synaptic, let's stay with the same post and examine that, for the sake of clarity.

A number of people have mentioned how great BTC are for international currency transport and exchange and they're correct, though this use doesn't require any valuation higher than relative parity with the strongest currencies; In fact it still works perfectly fine at 10:1 or even 100:1, the only reason for it to be higher is greedy miners hoarding to artificially restrict supply.

What are you saying here exactly? That for international currency transfer and exchange we don't need a BTC value of more than $1? That's a total of $6m?

Explain.

Look I'm getting really fucking tired of your inability to comprehend the very words you're reading...

This isn't about you.

Well I'm sorry that I have no interest in throughly explaining myself to someone who doesn't understand what I've already written. I hope that someone else wouldn't mind "translating" or elaborating for you.

Let's me see here...

It seems that in order to make OP's assertion valid, one must simply rephrase "The long term trend for bitcoin value is contraction, not expansion." as "The long term trend for fiat/bitcoin exchange rates is contraction, not expansion."

See, we no longer talking about bitcoin's value--only about the ability of market makers (like MtGox crew, etc) to maintain fiat/bitcoin current exchange rates for more than a month or two. OP is right, bitcoin's true value is WAY BELOW current exchange rates due to bitcoin not having any economy to call Home. So, stop worrying about the exchange rates that market makers are feeding you every day. Instead, start offering your bitcoins to merchants... Let's see if they do value BTC more than their local fiat currencies.

Absolutely. You've summarized quite accurately.

Now, my OPINION is that BTC will never find a use with the wider public because it's "advantages" are really quite meaningless to your average consumer, and CERTAINLY don't outweigh the glut of inconveniences inherent to it.

But what's not opinion is that the exchange rate is massively overvalued and is now headed down to a more accurate valuation as the hype continues to subside.

It is opinion.  The only thing we know for sure is that their are offers and bids in the high thirteens right now. Everything else is opinion.  Value is what a willing buyer and seller agree on. 

Please edit your post daily to reflect the dropping prices.
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July 17, 2011, 01:45:18 AM
 #257


Well I'm sorry that I have no interest in throughly explaining myself to someone who doesn't understand what I've already written. I hope that someone else wouldn't mind "translating" or elaborating for you.

Let's me see here...

It seems that in order to make OP's assertion valid, one must simply rephrase "The long term trend for bitcoin value is contraction, not expansion." as "The long term trend for fiat/bitcoin exchange rates is contraction, not expansion."

See, we no longer talking about bitcoin's value--only about the ability of market makers (like MtGox crew, etc) to maintain fiat/bitcoin current exchange rates for more than a month or two. OP is right, bitcoin's true value is WAY BELOW current exchange rates due to bitcoin not having any economy to call Home. So, stop worrying about the exchange rates that market makers are feeding you every day. Instead, start offering your bitcoins to merchants... Let's see if they do value BTC more than their local fiat currencies.

Absolutely. You've summarized quite accurately.

Now, my OPINION is that BTC will never find a use with the wider public because it's "advantages" are really quite meaningless to your average consumer, and CERTAINLY don't outweigh the glut of inconveniences inherent to it.

But what's not opinion is that the exchange rate is massively overvalued and is now headed down to a more accurate valuation as the hype continues to subside.

And by "not opinion", I'm assuming you meant that "it's a fact"?... If so, then I concur: all of the shelves with fiat currencies have been emptied out; only the shelves with overripened "bananas" still remain. If only bitcoin miners could survive on bananas, we'd be fine!

As far as BTC finding its use with the wider public, you and I are of a different opinion. You see, there's still hope that miners would eventually realize that without spending, there can never be a deflation in the deflationary "by design" economy. In order to get from 21,000,000BTCs (monetary base) to 2,100,000,000,000,000BTCs (expected total money supply), all of 21,000,000BTCs must be constantly exchanging hands (and the more hands the better). Miners hoarding bitcoins is equivalent to the central banks (in inflationary economies) raising the minimum reserve requirements of their member banks (or bitcoin users, in our case), thus reducing the available money supply.

As for bitcoin advantages, perhaps you should try looking at the bitcoin network as the best-in-class accounting system/ledger of who owes what to whom. For example, what stops one neighbor (a computer buff) from agreeing with another neighbor (a landscaping business owner) to exchange their skills/services for bitcoins, rather than for local fiat currency? Bitcoins are perfect for that type of contracts.

Bitcoins are earned, not traded! If you plan on hoarding BTC, you're on my target list. (And yes, it is possible to swim in BTC.)

Don't give me that Bull... I'm one of those honey eating Bears that the bees hope to never meet again... Viva la BTC!!!
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July 17, 2011, 01:52:23 AM
 #258


It is opinion.  The only thing we know for sure is that their are offers and bids in the high thirteens right now. Everything else is opinion.  Value is what a willing buyer and seller agree on. 

If only we knew for sure that those were the real bids/offers, and not the market makers themselves trying to maintain a certain profit level by simply massaging the numbers inside their database. Do you really have trust in the unregulated market makers?

Bitcoins are earned, not traded! If you plan on hoarding BTC, you're on my target list. (And yes, it is possible to swim in BTC.)

Don't give me that Bull... I'm one of those honey eating Bears that the bees hope to never meet again... Viva la BTC!!!
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July 17, 2011, 01:56:08 AM
 #259


Well I'm sorry that I have no interest in throughly explaining myself to someone who doesn't understand what I've already written. I hope that someone else wouldn't mind "translating" or elaborating for you.

Let's me see here...

It seems that in order to make OP's assertion valid, one must simply rephrase "The long term trend for bitcoin value is contraction, not expansion." as "The long term trend for fiat/bitcoin exchange rates is contraction, not expansion."

See, we no longer talking about bitcoin's value--only about the ability of market makers (like MtGox crew, etc) to maintain fiat/bitcoin current exchange rates for more than a month or two. OP is right, bitcoin's true value is WAY BELOW current exchange rates due to bitcoin not having any economy to call Home. So, stop worrying about the exchange rates that market makers are feeding you every day. Instead, start offering your bitcoins to merchants... Let's see if they do value BTC more than their local fiat currencies.

Absolutely. You've summarized quite accurately.

Now, my OPINION is that BTC will never find a use with the wider public because it's "advantages" are really quite meaningless to your average consumer, and CERTAINLY don't outweigh the glut of inconveniences inherent to it.

But what's not opinion is that the exchange rate is massively overvalued and is now headed down to a more accurate valuation as the hype continues to subside.

And by "not opinion", I'm assuming you meant that "it's a fact"?... If so, then I concur: all of the shelves with fiat currencies have been emptied out; only the shelves with overripened "bananas" still remain. If only bitcoin miners could survive on bananas, we'd be fine!

As far as BTC finding its use with the wider public, you and I are of a different opinion. You see, there's still hope that miners would eventually realize that without spending, there can never be a deflation in the deflationary "by design" economy. In order to get from 21,000,000BTCs (monetary base) to 2,100,000,000,000,000BTCs (expected total money supply), all of 21,000,000BTCs must be constantly exchanging hands (and the more hands the better). Miners hoarding bitcoins is equivalent to the central banks (in inflationary economies) raising the minimum reserve requirements of their member banks (or bitcoin users, in our case), thus reducing the available money supply.

As for bitcoin advantages, perhaps you should try looking at the bitcoin network as the best-in-class accounting system/ledger of who owes what to whom. For example, what stops one neighbor (a computer buff) from agreeing with another neighbor (a landscaping business owner) to exchange their skills/services for bitcoins, rather than for local fiat currency? Bitcoins are perfect for that type of contracts.

But the point is that fiat currencies aren't evil, serve their purpose just fine and have for many hundreds of years and likely will for a hundred years to come. Do some currencies hyper-inflate? Sure do, and then they correct and recover. And it's not the fact that a currency can be inflated that makes fiat "evil," it's that there are corrupt governments, and Bitcoin isn't going to do a single fucking thing to remedy the fact that people allow corrupt governments to exist.

In fact, the motherfucking BITCOIN economy/exchange is more corrupt than the US economy and the FED right now!
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July 17, 2011, 02:01:24 AM
 #260


It is opinion.  The only thing we know for sure is that their are offers and bids in the high thirteens right now. Everything else is opinion.  Value is what a willing buyer and seller agree on. 

If only we knew for sure that those were the real bids/offers, and not the market makers themselves trying to maintain a certain profit level by simply massaging the numbers inside their database. Do you really have trust in the unregulated market makers?

If I want to buy right now, I know what I have to pay. If I want to sell right now, I know what I have to charge.  If the volumes are high, the price will move to the next best offer/bid. You are right that the market depth chart is not completely reliable, but for small amounts, it doesn't hardly matter at all.

Buyers may think its overvalued and sellers think it's undervalued. They meet in the middle just the way they are supposed to if they want to transact now. otherwise they bide their time and take their chances. Both sides.  

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