gjdunga (OP)
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February 09, 2011, 09:15:41 PM |
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Hello.
Disclaimer: I just signed up a matter of minutes ago.. Please be gentle.
Question:
What prevents some one like 'Acme Banking and fiat services', or Scrooge Mc'duck, from purchasing BT in mass. causing a hostile takeover or another form of monopoly or control.
I understand that the system is pretty airtight in regards to creation, and inflation control from "miners", but If i was "Scrooge Mc'duck" and I bought 15 or 19 million BT, I would then hypothetically be able to hold onto those virtual credits thus causing a major inflation or deflation of the currency..
I'm sure that this has probably been discussed somewhere, could some one please direct me to the discussion thread? I didn't quite know what to call this 'question'!!
Gabriel
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"In a nutshell, the network works like a distributed
timestamp server, stamping the first transaction to spend a coin. It
takes advantage of the nature of information being easy to spread but
hard to stifle." -- Satoshi
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davout
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1davout
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February 09, 2011, 09:18:41 PM |
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Well, first of all, they would have to pay loads of money in this scenario.
The more they would buy, the more deflation there would be, the higher the price of remaining coins.
Unlike physical currencies it's not a problem to divide coins more and more to provide for the exchange needs.
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ribuck
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February 09, 2011, 09:19:45 PM |
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If Scrooge McDuck started to buy millions of coins, the price would rise rapidly. Those who sold the coins to Scrooge would be very pleased indeed with their profit. The rest of us would just keep trading, paying "micro-coins" instead of "coins" because they would be worth so much more.
But for sure, it will cause some uncertainty and anxiety. It won't destroy Bitcoin though.
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Anonymous
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February 09, 2011, 09:20:13 PM |
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It's in nobody's best interest to commit such an attack.
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grondilu
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February 09, 2011, 09:29:51 PM |
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Cornering a hard currency is a tough enterprise, for the reasons explained above. See Hunt brothers with silver.
Not only it's difficult, but even if you succeed, it's not sure you can turn it into profit.
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gjdunga (OP)
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February 09, 2011, 09:33:50 PM |
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It would not be an interest for anyone wanting to use bitcoin that is..
I could see a third party, such as a government, a fiat, or some Idiot Billionaire "investing" with the goal to devalue or inflate the currency, with the intent to create a lack of stability to corrupt the system.
Forgive me, if I sound like the fruity nut with the nice white coat! {Laughing} We all have seen hostile take overs, and we've even seen other governments inflate of deflate other currency with their intentional moves.
Is that the only way that BT could manage this issue? Could BT stop a poisoned trade?
A Fiat only has to shift it's debt into this system.
Gabriel
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ribuck
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February 09, 2011, 10:12:23 PM |
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Could BT stop a poisoned trade?
There is no such thing as a poisoned Bitcoin trade, provided it's voluntary. The buyer and seller each get what they want, and it's not anyone else's business. |
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grondilu
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February 09, 2011, 10:18:24 PM |
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There is no such thing as a poisoned Bitcoin trade, provided it's voluntary. The buyer and seller each get what they want, and it's not anyone else's business.
So true. |
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casascius
Mike Caldwell
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The Casascius 1oz 10BTC Silver Round (w/ Gold B)
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February 09, 2011, 10:35:30 PM |
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Someone with zillions to throw at bitcoin would do well to just attempt to buy out MtGox (in other words, buy the ownership of the software and the domain and the "business") or hire someone in an attempt to compete/outdo what's already there. If they happened to be a bank, or someone equivalently licensed to do banking (like say an outfit that already processes remittances from USA to Mexico), it might mean serious business.
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Companies claiming they got hacked and lost your coins sounds like fraud so perfect it could be called fashionable. I never believe them. If I ever experience the misfortune of a real intrusion, I declare I have been honest about the way I have managed the keys in Casascius Coins. I maintain no ability to recover or reproduce the keys, not even under limitless duress or total intrusion. Remember that trusting strangers with your coins without any recourse is, as a matter of principle, not a best practice. Don't keep coins online. Use paper or hardware wallets instead.
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