Bitcoin Interest Rate

[whitelife]

If I deposit some Bitcoins with a trader like Kraken shouldn't I be earning interest on my bits?

No because your bitcoin are not being used for something else (like investement or being lended to other people as with banks) in fact it should be the opposite lol since they are providing a service by storing your coins, and don't forget don't leave much of your coins on exchanges or else you risk to get goxed

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[Tammy Chan]

Thanks. By deflation my bits are losing value?  

It's the other way. Inflation means losing value and deflation means appreciation.
But to be more presice, BTC is still in the inflation stage and around 4000 coins are mined everyday.

Inflation is when BTC prices are going up. Btc is in the deflationary stage.

In economics, "inflation" is an increasing money supply. It may or may not result in increasing prices. In layman's terms, "inflation" means increasing prices of goods, which may or may not be caused by an increasing money supply. "Deflation" is the same, except opposite.

So, in economics terms, bitcoin will always be in inflation, until block reward become zero, right?

[DannyHamilton]

So, in economics terms, bitcoin will always be in inflation, until block reward become zero, right?

Maybe.

However, there will probably always be people losing small amounts of bitcoins (hard drive crash, lost password, deleted private key, etc).

Meanwhile, the block reward will get VERY small:
7.03124928 BTC per day in 2050
0.10986192 BTC per day in 2075
0.00085824 BTC per day in 2100
0.00001296 BTC per day in 2125
0.00000144 BTC per day in 2139

If the amount of bitcoins lost each day from the total supply is more than the amount of new bitcoins created, then you could say that is when deflation begins.

[batmanbad]

Wait so I had the similar mind as well this, but I wont be alive to see those prices since its prob in the near 2140.

[monim1]

Thanks. By deflation my bits are losing value?  

It's the other way. Inflation means losing value and deflation means appreciation.

But to be more presice, BTC is still in the inflation stage and around 4000 coins are mined everyday.

Inflation is when BTC prices are going up. Btc is in the deflationary stage.

I am also newbie. Its clear to me that I will not get any interest. One member saying that BTC is in the inflation stage, other saying BTC is in the deflationary stage. Its quite confusing to me. If 4000 coins are mined everyday than BTC must be in inflationary stage.

[BitThink]

Yes, you are correct.

[muxxxamed]

Of course NO! There is no inflation so no interest for keeping money. Welcome to the new world without banks and              debts.))))
Дoбpa!=)

[Chemistry1988]

If 4000 coins are mined everyday than BTC must be in inflationary stage.

Yes, you are right.

Of course NO! There is no inflation so no interest for keeping money. Welcome to the new world without banks and              debts.))))
Дoбpa!=)

Maybe you could read post #16.
And to your surprise, borrowing and lending (with interests) exist in the bitcoin world. FYR: https://bitcointalk.org/index.php?board=65.0

[bryant.coleman]

I think that right now the only Bitcoin exchange which is offering interest on your deposits is Vircurex. But unfortunately, that exchange have been hacked multiple times in the past. So not that secure to store coins there.

What happen with the frozen accounts on Vircurex ?

I don't think that Vircurex pays any sort of interest on frozen or inactive accounts. However, I am not sure, and you will have to raise a support ticket to make sure of that.

[Kprawn]

Is there a site, where you can draw reports on what the rate was daily for say the last year.

Or year on year?

I only recently started looking into "Bitcoins" and want to see, how it fluctuated from year to year.

Hope someone can help.

You just see people making statements like ..."In 2009 1 bitcoin was 0.0000001 cents and now it's $400.

Thanks for any reply.

[Foxpup]

Is there a site, where you can draw reports on what the rate was daily for say the last year.

bitcoincharts.com/charts/

[bestsponsor]

Just buy several stable POS coins and get income from 20 to 100% per year.

[r34tr783tr78]

You can get interest on your bitcoin on at least two exchanges:
www.bifinex.com you have to lend the bitcoins to other traders, the rate is low, but it's trustworthy
www.mcxnow.com you don't have to lend the coins, interest is paid just to have them there. On the issue of trust, opinions are divided. The owner adopted some controversial commercial practices, but he warned everyone to withdraw their money when he limited the trading at the exchange and came back

[bl4kjaguar]

Banks pay interest because they lend your deposit to people at a higher rate.

That is not true; banks are not allowed to loan your deposited funds.

[r34tr783tr78]

Lending the money that is deposited on your account is the goal of any bank.
I think you wrote something you didn't want or, at least, your sentence isn't clear.

[bl4kjaguar]

Lending the money that is deposited on your account is the goal of any bank.

That is not true because bank loans are generated ex nihilo.

Professor Hyman Minsky once wrote “Banking is not money lending", which is to say: Banks do not have money to loan as a matter of fact.
Source: http://www.positivemoney.org/2013/06/banks-dont-lend-money-guest-post-by-michael-reiss/
Related source: http://www.forbes.com/sites/francescoppola/2014/01/21/banks-dont-lend-out-reserves/

The bank would first need your permission because a deposit is not property; it is a debt owed to the depositor.
I posted more info to this thread: https://bitcointalk.org/index.php?topic=521992.msg6039543#msg6039543

[r34tr783tr78]

Under a formal perspective, your money is still at your account, so the bank isn't lending YOUR money, is creating money based on your money. True.
But if you opened an account with paper money, YOUR money is going to be lent or paid to others. It won't be sitting there waiting for you. And they don't need your consent to lent it, it's implied on all banking regulations.
And, in any case, they will use your money as the base to lend to others, by creating banking money.
It's the base of fractional reserve Lending.

[bl4kjaguar]

But if you opened an account with paper money, YOUR money is going to be lent or paid to others.

You are incorrect; banks never lend out reserves, and they are not in the business of loaning money.

Did you follow the links which I graciously provided?

Here is Forbes magazine saying the same thing:

It creates this “from thin air”, not from existing money: banks do not “lend out” existing deposits, as is commonly thought.

http://www.forbes.com/sites/francescoppola/2014/01/21/banks-dont-lend-out-reserves/

Please verify this for yourself and then we can resume the discussion.

[ranlo]

So a currency can both inflate and deflate at the same time?

The number is inflating. The value is deflating. Two separate things you're looking at.

Overall we'd say that the coins, as a whole, are deflating.

[Malin Keshar]

ever heard about inflation related to price. If a gov prints money, people say that they have inflation because the price is rising, not because there is more paper supply, but because the price is rising


vircurex offers interests on bitcoin balances (if you have 1 btc or more), payment made every 6 hours, but they have been hacked this year, so up to you take the risk or not