Biggest misconception in Bitcoin

[beetcoin]

how about we call it by what it is? a quasi currency. it would be silly to buy a beer with gold, but it definitely wouldn't be silly to buy a beer with BTC.

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[sublime5447]

how about we call it by what it is? a quasi currency. it would be silly to buy a beer with gold, but it definitely wouldn't be silly to buy a beer with BTC.

I can go with that, a quasi currency like the dollar. I disagree with beer for gold being silly.

[djalexr]

you brought this up before and it was as pointless then as it is now...

Does it really matter what word you use to describe it, whether you call it money, a currency, a commodity, a technology? Who cares whether it is a 'unit' of something or not? That has nothing to do with the actual function that bitcoin provides and you are basically just starting a pedantic argument over an insignificant semantic issue.

Also, whether the word 'currency' is correct or not is hardly the misconception of the century and I think there are far more significant misconceptions you could concern yourself over (such as the misconception that Bitcoin can easily be shut down, etc.)

[beetcoin]

how about we call it by what it is? a quasi currency. it would be silly to buy a beer with gold, but it definitely wouldn't be silly to buy a beer with BTC.

I can go with that, a quasi currency like the dollar. I disagree with beer for gold being silly.

how would you give change in gold, especially when an ounce trades at $1300+? you certainly can't cut the coins/bars up..

[Hippie Tech]

It is computer data and as such, should not be considered currency and/or a means to build wealth/prosperity.

It is being used to fool us into going cashless.

What will you do if they turn your power and/or chip off ?

 

[sublime5447]

you brought this up before and it was as pointless then as it is now...

Does it really matter what word you use to describe it, whether you call it money, a currency, a commodity, a technology? Who cares whether it is a 'unit' of something or not? That has nothing to do with the actual function that bitcoin provides and you are basically just starting a pedantic argument over an insignificant semantic issue.

Also, whether the word 'currency' is correct or not is hardly the misconception of the century and I think there are far more significant misconceptions you could concern yourself over (such as the misconception that Bitcoin can easily be shut down, etc.)

It is hugely important. It causes asset price inflation and distortion of the global economy.

http://howestreet.com/2012/12/wake-up-investors-money-is-imaginary/

[fizzmine]

Sublime, you may be trolling, but I'll engage in discussing this train of thought.

I think your underestimating the potential intrinsic value of bitcoin.  You compare them to baseball cards,  yet a baseball card can not be traded nearly instantly with high security anywhere in the world.

Bitcoin's value is that it allows you to accomplish something that previously has required the might if an entire nation to do.  Money only has value because there are laws in place that encourage you to honor it's value.   

The very nature of bitcoin however is that the security of your store of value does not depend on expensive anti-counterfieting technology, millions of highly paid bankers, politicians, and the backing of the largest military in the world. See where I'm going with this?

Really think about all that goes into what allows the fairly common event of being able to hand a complete stranger a piece of cloth-paper with some fancy ink on it and that stranger transfer to you a valuable item such as food, clothing, shelter, transportation, or entertainment. That every day occurrence is possible due to the massive financial and governmental industries.

Now think about how much of that store of value is needed simply to guarantee its own value.  Traditional currencies require a massive middleman, imagine what the world would look like if you could utilize all the benefits of a traditional currency at a fraction of the cost.

Now, will bitcoin ever become the sole currency of the world? No, but the feature sets of of a variety of crypto currencies could eventually replace a significant portion of fiat currency.  You can see around you how many fiat systems are collapsing under thier own weight.

No one could have predicted how the ability to send information nearly instantly and with high security anywhere in the world would change it.  I'm speaking of the Internet of course.

Bitcoin simply adds the ability to guarantee uniqueness and ownership to a piece of information, but as with currency, these attributes are highly valuable.  Who knows how bitcoin may (or may not) change the world?

[sublime5447]

Dont get me wrong. The protocol is a great tech innovation, and will no doubt influence the world going forward.

But it wont destroy banks or replace government issued fiat.

That is my goal. 

[fizzmine]

Dont get me wrong. The protocol is a great tech innovation, and will no doubt influence the world going forward.

But it wont destroy banks or replace government issued fiat.

That is my goal. 

It doesn't have to destroy them to have a major impact. Just competing with them would be game-changing.  If Bitcoin or an even better iteration of the technology does eventually supplant fiat systems, all the better.

[shawshankinmate37927]

Bitcoin: store of value.

Yes store of value and medium of exchange just like a baseball card.

Except more durable, more fungible, more divisible, more easily transportable, harder to counterfeit...

Stop calling it currency 

What's it matter, anyway?

Because if you can realize that bitcoin is not currency because it is not a UNIT then you can realize that the US dollar is not currency because it is not a UNIT.

That is what Ron Paul is really asking Ben when he asks can you define a dollar for me. He is really asking what is the UNIT called a dollar equal too?

Okay Einstein, why don't you enlighten us and give us an example of something that is a currency?

[theonewhowaskazu]

Bitcoin is alot, and its ALSO a collectible.
Now just look what people pay for magic cards or baseball cards, stamps, old hardware, whatever, if its rare, there are people "hoarding" it

Currency= a system of money

Money = store of value, medium of exchange, and UNIT of account.

Unit's are definable in objective terms and are a constant. Bitcoin is not a UNIT so it is not a UNIT of account.

It isn't currency.

What is a definable in objective terms and is constant. Nothing is constant. What I'll charge for my time isn't constant, what you'll charge for your time isn't constant, what I'll charge for gold, silver, copper, bitcoin, lumber, corn, or armchairs isn't constant.

That doesn't work as a definition for money because money by definition isn't constant, its affected by the money supply & money volatility, neither of which are constant. Its also affected by people's psychological want for that form of money.

A unit of account is any method of expressing the worth of account. In other words, I can't use armchairs as a unit of account because 3 armchairs doesn't mean anything to anyone. 3 Bitcoins, however, does, because it means something somewhat standard to most people.

[Ecurb123]

The biggest misconception is that it is currency... it's not.

I have been harping on this for a while now, but here it is from the owner of  second largest exchange BTC-china.

 

"China has been known as a nation of savers, who are always saving for a rainy day,” says Lee.  ”Bitcoin is a digital asset, like real estate, gold, or stock. It is just one more option now. With Bitcoin hard-coded to be limited, it’s like a collectible.”"

It isnt currency.
It is a digital collectible.

My point Sublime is who cares if it's "currency" or not, if it does the job which people want it to do, then who cares what it is.

[Kazimir]

Because if you can realize that bitcoin is not currency because it is not a UNIT then you can realize that the US dollar is not currency because it is not a UNIT.

So what IS a currency, then, you think? (Just an example will do)

Dont get me wrong. The protocol is a great tech innovation, and will no doubt influence the world going forward.

But it wont destroy banks or replace government issued fiat.

Sure. Just like email didn't replace postal services.

Obviously they will still exist in 5-10 years. But they'll play a much smaller (only marginal) role.

[Beans]

It is computer data and as such, should not be considered currency and/or a means to build wealth/prosperity.

It is being used to fool us into going cashless.

What will you do if they turn your power and/or chip off ?

 

What happens to your dollars when we run out of trees? Seems about as likely.

[Kazimir]

It is computer data and as such, should not be considered currency and/or a means to build wealth/prosperity.

Funny to see how people STILL don't realize that your precious U.S. Dollars are just as digital.

This is 2013, there is hardly any paper / coin money left (less than 1%). Virtually ALL dollars are only numbers in your bank's computer.

It is being used to fool us into going cashless.

By whom, exactly?

By the way, Bitcoin is cash. Digital cash.

What will you do if they turn your power and/or chip off ?

They won't, cause that would immediately kill all regular bank&money transactions, online banking, credit cards, paypal, western union traffic, stock markets, everything.

Seriously, wake up. We live in the information age. Every currency and form of payment is digital these days.

[sublime5447]

Bitcoin: store of value.

Yes store of value and medium of exchange just like a baseball card.

Except more durable, more fungible, more divisible, more easily transportable, harder to counterfeit...

Stop calling it currency 

What's it matter, anyway?

Because if you can realize that bitcoin is not currency because it is not a UNIT then you can realize that the US dollar is not currency because it is not a UNIT.

That is what Ron Paul is really asking Ben when he asks can you define a dollar for me. He is really asking what is the UNIT called a dollar equal to?

Okay Einstein, why don't you enlighten us and give us an example of something that is a currency?

bytes, kilowatts, the dollar in 1970,oil, metals they can all  be currency. Because they all can be mediums of exchange, stores of value, and a UNIT of account.   

[Hippie Tech]

It is computer data and as such, should not be considered currency and/or a means to build wealth/prosperity.

Funny to see how people STILL don't realize that your precious U.S. Dollars are just as digital.

This is 2013, there is hardly any paper / coin money left (less than 1%). Virtually ALL dollars are only numbers in your bank's computer.

It is being used to fool us into going cashless.

By whom, exactly?

By the way, Bitcoin is cash. Digital cash.

What will you do if they turn your power and/or chip off ?

They won't, cause that would immediately kill all regular bank&money transactions, online banking, credit cards, paypal, western union traffic, stock markets, everything.

Seriously, wake up. We live in the information age. Every currency and form of payment is digital these days.

I am awake. lol  I never implied that the status quo is or was any different. That plug can and will be pulled just as easily. eg. austerity measures, bank bailouts, sanctions, ect..

Who ? The ruling elite .. http://youtu.be/aZYB_IOqeOE

[LiteCoinGuy]

bitcoin is the honey badger of money 

[IsaacGoldbourne]

It's not a currency in the same way that email is not mail and html is not text.

Right now most people don't even realize that the basic "currency" function is just a small subset of things that Bitcoin can do.  Once distributed contracts take off,  things are going to get really interesting.  There is nothing even remotely comparable in existence right now. No currency, no commodity, no collectible.

The biggest misconception in Bitcoin is that is fits into some historical asset class.  The truth is that is has created a whole new asset class of its own.

This. It is both everything and nothing at the same time. Thats why it will change the world!

[Tirapon]

Hi sublime

This unit thing is dragging on a bit, eh? I think I've figured out where your confusion lies.

You assert that Bitcoin is not a unit. Have a look at one definition of a unit, and it seems that you are correct:

http://en.wikipedia.org/wiki/Units_of_measurement

Units of measurement are used to measure physical things which are 'objectively real'. Therefore Bitcoin is not a unit of measurement.

It is, however, a unit of account:

http://en.wikipedia.org/wiki/Unit_of_account

Units of account are used to measure monetary value, e.g. the amount of wealth/value stored in $1000.

Value is an abstract and subjective concept which doesn't exist physically. You seem to be confusing units of measurement with units of account. Some things may fit both definitions, for example an ounce of gold: as a unit of measurement, a 1oz gold coin represents the amount of mass which people have agreed upon to be equal to 1oz. It also has value (an abstract/subjective quantity) and can be used to represent 'the amount of value contained in 1oz of gold'. Value is not physical/objectively real and is therefore subject to change as dictated by the market.

Does this help at all?

EDIT:

Also see here:

http://en.wikipedia.org/wiki/Currency

A much more general use of the word currency is anything that is used in any circumstances, as a medium of exchange

So by the general/colloquial use of the term 'currency', Bitcoin fits the definition as it is (or can be) used as a medium of exchange.