Bitcoin crashes when those investing realise 2 things

[rampantparanoia]

He has jumped from one reason why Bitcoin will fail to another.  Strange how much time he spends on a forum devoted to the thing he "knows" will fail.

Yeah, the other day he was banging on about this 'Bitcoin's defacto central bank' idea. I think he gave up on that one, and tried something new today.

Though I must say I'm surprised OP has appeared today on a bull price day. Usually he only pops up on correction days to say 'told you so', then when it goings up again promptly disappears. 

perhaps a warning of things to come tonight?

[molecular]

Look at it this way for a moment. Forget about labels within the ledger: Bitcoins, satoshis and whatever other sub divisions labels may exist in the future, just look at it in terms of units.


Right now the prevailing mindset is that Bitcoin is limited to 21 million units. As we move along people will have to adapt to the reality of 2.1 quadrillion, and then maybe amounts even larger than that.


Talking about the divisibility of the dollar is specious as it is a fiat currency now, it does not now derive it value from any sense of scarcity or a promise of supply constraint.

Just changing the unit doesn't mean scarcity vanishes.

You know: 16/16th of one Pizza are still worth one Pizza if you do the incredibly complex math necessary.

Also: 2 half ounce gold coins are probably worth just about as much as 1 one counce gold coin.

EDIT: revans, do you by any chance have any relation to Peter Schiff? (http://www.cnbc.com/id/101192216#comment-1121795418) I'm asking because he makes the same argument.

If you are: I suggest you don't use this argument on air: I doubt the audience will be dumb enough to buy it.

[NUFCrichard]

We need to decide if bitcoin is scarce, or if it is almost unlimited!
Right now bitcoin is basically a commodity, therefore it's scarcity is an advantage.  If it wants to be a currency, then it becomes a disadvantage..

[Kluge]

We need to decide if bitcoin is scarce, or if it is almost unlimited!
Right now bitcoin is basically a commodity, therefore it's scarcity is an advantage.  If it wants to be a currency, then it becomes a disadvantage..

Scarcity and divisibility are not related...

[amencon]

You can't increase the total amount of something by dividing it into lots of pieces. You still have the same overall amount, but there are more pieces of it, and each piece is smaller

Yes you can if this something is a mathematical abstraction not pegged nor backed by anything and whose 1/10th of a unit is as good for conveying information as the whole unit.

Right now we have 21 million coins being marketed, but this notion is wrong. We have 21 quadrillion "coins" capable of representing information, and creating more decimals has the same effect as augmenting the number of coins. It will, at some point, crash the market.

BTW I'm not trolling.

My condolences then. 

This is one of those arguments that is so stupid right on it's face that it doesn't have to be had.  The only argument you could make regarding this issue is that the market might crash because others are stupid and can't see that further division of a unit doesn't change the original unit value.  I have little faith left in humanity but even I don't think that lowly of my fellow man yet.  I haven't met many people that thought the 4 quarters in their hand had purchasing power any different than the 1 dollar bill in the other.

I commend the others in the thread that took the time to point out the plainly obvious for those that apparently need it, though predictably it doesn't appear to have done much good.  "You can't reason someone out of a position they didn't reason themselves into."

Really good troll thread though.

[Wilhelm]

From a formal point of view, it shouldn't make a difference, [...]. However, keep in mind that the valuation of any object is determined by the market, and I am not at all sure if the idea of the number of subunits tending towards infinity will not affect the valuation of the base unit.

I am 100% sure. The precision will only change if the smallest unit becomes worth an impractically large amount of money, ie. the smallest unit is too large to make small purchases. This will in no way alter the value of larger sub-units/units.

Edit: Let me also say that I DO live in a country that has removed the penny from circulation and it in no way impacted the value of my money. If the smallest unit of bitcoin becomes impractical, people will welcome the change and it will only increase the value of the system.

Stocks split two for one all the time that dosen't change the stock. As does dividing bitcoins.
If bitcoins weren't divisable then theoretically bitcoin could hit a point where it would be too big to be used as a currency.
Like trying to buy gas at a gas station with a pound of gold bullion for which there is no change.
Divisability is a good thing.

[alexeft]

1. The fact that only 21 million coins can be mined (assuming that does not get altered) is irrelevant when they can be sliced up into 100,000,000 sub units.

2. That there have already been discussions about increasing the divisibility.


When exchanges start working in sub units it may dawn on people that the scarcity argument used to promote Bitcoin is disingenuous rubbish.

Soooooooooooooooooooo, you are saying that adding zeroes to the left of the decimal point is the same as adding digits to the right end of a number!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Interesting view! I'll ask a mathematician! 

PS: It's no wonder why some people are poor! 

[molecular]

1. The fact that only 21 million coins can be mined (assuming that does not get altered) is irrelevant when they can be sliced up into 100,000,000 sub units.

2. That there have already been discussions about increasing the divisibility.


When exchanges start working in sub units it may dawn on people that the scarcity argument used to promote Bitcoin is disingenuous rubbish.

It is truly beyond me how someone can believe this. I've tried, but there's just no rational train of thought that allows me to arrive at that conclusion, except maybe "Bitcoin is SCARE, it will eat gold and gold is number one, therefore something must be wrong with bitcoin. It's probably something about the scarcity not working, because I just can't imagine that with NO BACKING. Yeah, that's it, they can just double the amount of BTC available by splitting each of them in half".

[stillfire]

In related news the price of $100 bills is falling hard due to increased competition from pairs of $50 bills.


I think it's interesting to think about how to deal with posts like this one. The OP is clearly both wrong and opposed to being set straight, even by the simplest and clearest of reasoning. Should such posts be systematically ignored, or will we be required to always try to respond?

If we do systematically ignore wilfully ignorant OPs, we save our time and sanity, and in the case where the OP is just trying to pick a fight/spread FUD/manipulate the market we have denied his attempt.

But the drawback of ignoring such OPs is that a malicious OP can try to use it as "evidence" that he's right, that there's no answer to his FUD or that the community is rotten, a cult and so forth. Also there will be some rare cases where OP is honestly confused and can actually be set straight by extreme repetition.

Maybe if posts could be down-voted into invisibility at the top level we could gain the benefits of the the ignore, while avoiding the costs (the posting isn't much 'evidence' if no-one can see it). As it stands now it's enough for the OP to post another response for the posting to jump back to the top of the forum even that the overwhelming consensus is that it's noise.

[Zangelbert Bingledack]

How has this gone on for 6 pages?! How many hours of human life were wasted by this thread? There are a lot more important things going on in the Bitcoin world right now.

Just ignore. No one with two halves of a brain will ever take this argument seriously.

[Kluge]

tl;dr

Personally, I think it'd be best if G.Max would just tranzizzle the OP post in cases like this.

Bitcoin crashes when dem investin realise 2 thangs
1. Da fact dat only 21 mazillion coins can be mined (assumin dat do not git altered) is irrelevant when they can be sliced up tha fuck into 100,000,000 sub units.

2. That there have already been raps bout increasin tha divisibility.


When exchanges start hustlin up in sub units it may dawn on playas dat tha scarcitizzle argument used ta promote Bitcoin is disingenuous rubbish. Yo ass know how tha fuck dey phat asses do dat shit.

[porcupine87]

Peter, is that you?

maybe Peter Schiff brings exactly the same fallacy.
http://www.youtube.com/watch?v=0VrB1Ae3xqs

Hm Peter Schiff is normaly not stupid, but this time he is wrong. But he could be right, that the price will crash down one day and many people lose money.

[Tirapon]

Just ignore. No one with two halves of a brain will ever take this argument seriously.

Two halves of a brain? They would be like, a genius or something! Much more intelligent than a mere mortal with only one single brain anyway...

[Zangelbert Bingledack]

Just ignore. No one with two halves of a brain will ever take this argument seriously.

Two halves of a brain? They would be like, a genius or something! Much more intelligent than a mere mortal with only one single brain anyway...

I'm glad someone saw what I did there.

[revans]

Once more, and then I'll just have to accept that having a vested interest means you lot will never get it.


The 21 million units that are labelled Bitcoin are just an abstraction, the Bitcoin system is actually comprised of 2.1 quadrillion subunits, which can be inflated to infinity. Now you all cry that making a currency more divisible isn't the same as inflating the supply, but the comparison is being made to long established currencies which are well defined in the market. Of course the sleight of hand here is to fix the supply of the highest denomination unit to 21 million, thus ensuring that those holding whole Bitcoins will get relatively richer and richer as more and more Bitcoin subunits are required to buy a single Bitcoin.


And why 21 million Bitcoins, why not just 1? With infinite divisibility why do you need more than 1? Or perhaps that would make it a little too easy for people to see that in a system where one tiny part of the whole and the whole can perform the same function , and that whole can be broken up to infinity, that the claims of supply constraint are meaningless.

[paratox]

And why 21 million Bitcoins, why not just 1? With infinite divisibility why do you need more than 1? Or perhaps that would make it a little too easy for people to see that in a system where one tiny part of the whole and the whole can perform the same function , and that whole can be broken up to infinity, that the claims of supply constraint are meaningless.

Do you mind pointing to a system where this statement is true? I am really curious.

[Bennmann]

Once more, and then I'll just have to accept that having a vested interest means you lot will never get it.


The 21 million units that are labelled Bitcoin are just an abstraction, the Bitcoin system is actually comprised of 2.1 quadrillion subunits, which can be inflated to infinity. Now you all cry that making a currency more divisible isn't the same as inflating the supply, but the comparison is being made to long established currencies which are well defined in the market. Of course the sleight of hand here is to fix the supply of the highest denomination unit to 21 million, thus ensuring that those holding whole Bitcoins will get relatively richer and richer as more and more Bitcoin subunits are required to buy a single Bitcoin.


And why 21 million Bitcoins, why not just 1? With infinite divisibility why do you need more than 1? Or perhaps that would make it a little too easy for people to see that in a system where one tiny part of the whole and the whole can perform the same function , and that whole can be broken up to infinity, that the claims of supply constraint are meaningless.

Someone has already mentioned stocks, but hell, I'll do it too.

stocks are infinitely divisible, just like your example. stocks are also virtual, like bitcoin and not like gold. stocks split all the time in a manner that should easily display your theory. find us ONE historical example to support your point.

** show me the data to support your view. **

i am wroth that you have spent 7 pages of forum time to not present DATA. i want to cut those seven pages into a million pieces and hand them to you. you gotta carry that weight.

[shmadz]

And why 21 million Bitcoins, why not just 1? With infinite divisibility why do you need more than 1? Or perhaps that would make it a little too easy for people to see that in a system where one tiny part of the whole and the whole can perform the same function , and that whole can be broken up to infinity, that the claims of supply constraint are meaningless.

Do you mind pointing to a system where this statement is true? I am really curious.

The only thing that comes immediately to mind would be a hologram. Apparently you can cut a hologram in half and it will still project the full image.. though you may lose some resolution. So even in this case it's not entirely true. Even though one tiny part of the whole would technically perform the same function, (showing the image) the image would not retain the same quality.

[Syke]

And why 21 million Bitcoins, why not just 1? With infinite divisibility why do you need more than 1?

It would make absolutely no difference.

[davidgdg]

Actually the OP is a clever guy and has made some interesting posts in the past. It's a good thing to have critics. They sharpen our thinking.

So it's a bit disappointing to see him coming out with this guff.