Maximum number of bitcoins

[ribuck]

NewBank: The bank where YOU own the bank!

Depositor-operated "banks" have a long history. In the United Kingdom they are known as Building Societies if they lend on property, and as Credit Unions if they lend for other things.

They flourished in the past, but nowadays it's impossible for a small group of individuals to set one up legally. You're not allowed to start with less than £1 million, and the application process takes two years.

After all, society can't allow innovative new businesses to compete with established banks.

[myrkul]

NewBank: The bank where YOU own the bank!

Depositor-operated "banks" have a long history. In the United Kingdom they are known as Building Societies if they lend on property, and as Credit Unions if they lend for other things.

They flourished in the past, but nowadays it's impossible for a small group of individuals to set one up legally. You're not allowed to start with less than £1 million, and the application process takes two years.

After all, society can't allow innovative new businesses to compete with established banks.

Yeah, I had the feeling I was reinventing the wheel. Credit unions are just about the only banks you can trust, over here in the US.

What's the Bitcoin banking situation look like?

[FatherMcGruder]

Well, under the plan I outlined, the bank's shareholders are it's depositors are it's investors. This would need to be clearly outlined in the deposit agreement, and spelled out in no uncertain terms, preferably verbally, before anything is signed. This could be spun positively:

NewBank: The bank where YOU own the bank!

But would definitely need to be said, Lest the depositor wonder where their interest is. The upside of this is, While few would actually make use of it, each account holder would have a say in the decisions of the bank (Again, votes based on shares, and thus, risk).

Give each depositor a vote and you have a mutual bank, no?

[we6jbo]

I don't know if it's been mentioned before but what would happen if one person like Bill Gates bought most of the bitcoins with the intention of selling them back for a higher price.

[ribuck]

I don't know if it's been mentioned before but what would happen if one person like Bill Gates bought most of the bitcoins with the intention of selling them back for a higher price.

The price would rise while he's buying them, then drop while he's selling them. The bitcoin system would cope with that.

He would make a profit, but only because the bitcoin value is rising anyway. If it weren't for that, the price rise while he buys would be expected to equal the price drop while he sells.

When someone with a lot of money starts buying up bitcoins, we know that Bitcoin has "made it" and is here to stay.

[Mike Hearn]

Fractional reserve issued currency is inflation by any reasonable definition of the word and is where nearly all inflation in todays fiat currencies comes from. Or did you think it's possible to inflate a currency the size of the US dollar by noticeable amounts through physically running printing presses?

Now if you want to argue that this is not "inflation" feel free but all it means is you aren't using the mainstream accepted definition of the word.

[myrkul]

Give each depositor a vote and you have a mutual bank, no?

I don't think it quite fits that definition, as you're using it, since each depositor would have votes proportional to the amount they have "signed over" to the bank. Since that investment is at risk, the more they have invested, the more they should have control of how the bank's funds are used. Most small investors would not likely use this capability, but it would be there.

Fractional reserve issued currency is inflation by any reasonable definition of the word and is where nearly all inflation in todays fiat currencies comes from.

Well, yes, of course it is. I'm not arguing that the dollar isn't bloated beyond belief by spreadsheet dollars.

What I'm saying is you can't spend spreadsheet Bitcoins, as you can Dollars. When you attempt to transfer "fake" btc from your account to the seller, you'll get a double spend error. The bank can "loan" as many spreadsheet bitcoins as they want, but as soon as someone attempts to spend more than the real balance that the bank has on-hand, FAIL.

So, Unless you can show a way that a bank can make large amounts of usable bitcoins from thin air, Inflation isn't happening at the bank.

[wordstoworlds]

Someone needs to come up with the names of these fractions of bitcoin now and make them entrenched. Hopefully based on the number of zeros in front of the final number. Like a two5 bitcoin or a seven1 bitcoin because its pretty much inevitable that whole bit coins will keep going up in the number of any other currency needed to buy them. And humans are soo soo bad at comparing anything with more then 7 things all together. .0000000005 as opposed to a .00000000005. Those would be nine5 bit coins and ten5 bit coins respectively.. and when you get down to that scale I would not be surprised if theres a difference of 10 of any fiat currency you care to name between the two. Which would suck if you meant to buy a loaf of bread (which sells for 1 dollar) for ten5 bitcoin and ended up paying 11 dollars or nine5 bitcoins because you didn't count the zeros. At that point you know someone would offer bread at ten4 bitcoin.. which would be... .90 cents? See, my brain isnt wired for this currency..
Already someone needs to invent the fractional bit coin translator too.
And having bit coins arn't going to take the fluctuations of supply and demand into account either. One day a loaf of bread could be ten5 bit coins, the next seven1 bit coins, the day after thirteen3 bit coins. Its the flow of information and a little bit of over production that equals smoothness now, not the ability to infinitely fracture currency. Of course instant trading and multiple other currencies could help smooth the bumps.
I am having so much fun thinking about this as a currency, more then I want to own it..

[ShadowOfHarbringer]

Someone needs to come up with the names of these fractions of bitcoin now and make them entrenched.

I did come up with something like this.

Code:

1 BTC1 = 0.1 BTC
1 BTC2 = 0.01 BTC
1 BTC3 = 0.001 BTC
1 BTC4 = 0.0001 BTC

OR perhaps:

Code:

1 BTCA = 0.1 BTC
1 BTCB = 0.01 BTC
1 BTCC = 0.001 BTC
1 BTCD = 0.0001 BTC

etc.

People also proposed the µBTC and mBTC, but for some reason i think these won't work. Perhaps because "normal" (non-geeky) people don't really know names of all SI units.

[mewantsbitcoins]

People also proposed the µBTC and mBTC, but for some reason i think these won't work. Perhaps because "normal" (non-geeky) people don't really know names of all SI units.

Well maybe these people ought to become really normal and learn to add a couple new words to their dictionaries once in awhile

[FatherMcGruder]

Well maybe these people ought to become really normal and learn to add a couple new word to their dictionaries.

And stop using Internet Explorer while they're at it.

[ShadowOfHarbringer]

Well maybe these people ought to become really normal and learn to add a couple new word to their dictionaries.

And stop using Internet Explorer while they're at it.

Also, they could start fighting for their personal freedoms and abolish governments...
Did that fairytale have dragons in it ?

Seriously, not gonna happen. Stupid people will mostly stay stupid.

[N12]

What the hell is complicated about 0.001 BTC = 1 mBTC and 0.001 mBTC = 1 uBTC?

I refuse to believe that anyone would be too stupid to get this, even most Americans. It’s damn simple.

[roy]

What the hell is complicated about 0.001 BTC = 1 mBTC and 0.001 mBTC = 1 uBTC?

I refuse to believe that anyone would be too stupid to get this, even most Americans. It’s damn simple.

technically to talk about bitcoins completely you need to use nano. The issue with nano is it starts at 10^-9 so you have 10 nanobitcoins, but not 1nanobitcoin.
(bitcoins only go upto 10^-8)

we should use some name that sounds as good as bitcoin to talk about these base units.. like 'bitcoin units' or BCUs?
(i know people have suggested 'satoshis', but i don't see how that can be shortened..)
if we then ran most systems with both Bitcoins/BTC and Bitcoin Units/BCUs then I think it will alleviate issues of readability with decimal places.

[ShadowOfHarbringer]

What the hell is complicated about 0.001 BTC = 1 mBTC and 0.001 mBTC = 1 uBTC?

I refuse to believe that anyone would be too stupid to get this, even most Americans. It’s damn simple.

technically to talk about bitcoins completely you need to use nano. The issue with nano is it starts at 10^-9 so you have 10 nanobitcoins, but not 1nanobitcoin.
(bitcoins only go upto 10^-8)

Well, we all could just agree that when it comes to BTC, 'nano' means 10 ^ -8, instead of the usual 10 ^ -9. But that may be a bad idea.

[WNS]

Fractional reserve issued currency is inflation by any reasonable definition of the word and is where nearly all inflation in todays fiat currencies comes from. Or did you think it's possible to inflate a currency the size of the US dollar by noticeable amounts through physically running printing presses?

Now if you want to argue that this is not "inflation" feel free but all it means is you aren't using the mainstream accepted definition of the word.

Of course nobody really has to worry about this, not because it's not possible to implement a fractional reserve system in BTC, but because even a monkey could arbitrage the inflationary USD against the deflationary BTC.

If you want a lot of BTC get a loan in USD, and then convert, as your payments come due liquidate BTC and receive the advantage of the additional spread in conversion rate. No BTC bank could offer loans at low enough rates to compete with this poor mans arbitrage.

[caveden]

Fractional reserve issued currency is inflation by any reasonable definition of the word and is where nearly all inflation in todays fiat currencies comes from.

That's not quite accurate.
What causes the inflation in our world today are central banks, when they inflate the monetary base.

Fractional reserves are direct responsible for inflation only when the compulsory decreases. When it increases, it causes deflation. In a period where the compulsory is fixed, fractional reserves are nothing but a constant multiplier applied to any change the central bank promotes. If the central bank doesn't inflate nor deflate, a constant-compulsory fractional reserve system won't inflate nor deflate either.
You see what I mean?

[caveden]

... it's not possible to implement a fractional reserve system in BTC...

It is perfectly possible to implement fractional reserves with BTC or any other currency.

[FreeMoney]

Fractional reserve issued currency is inflation by any reasonable definition of the word and is where nearly all inflation in todays fiat currencies comes from.

That's not quite accurate.
What causes the inflation in our world today are central banks, when they inflate the monetary base.

Fractional reserves are direct responsible for inflation only when the compulsory decreases. When it increases, it causes deflation. In a period where the compulsory is fixed, fractional reserves are nothing but a constant multiplier applied to any change the central bank promotes. If the central bank doesn't inflate nor deflate, a constant-compulsory fractional reserve system won't inflate nor deflate either.
You see what I mean?

Fractional reserve banking doesn't increase base money, only credit money. We've been living in a bubble, protected from fractional banks collapsing by the FDIC and FED printing. In our world credit money is as good as base money because base money will be debased if credit money is ever worth a penny less.

In free banking world there may be lots of new credit money, but that credit money will be a truly different thing than actual money. We just live in bizzaro world where the gov/banks make base money and they make credit money so they can keep them equal in value. But it's not natural for a promise to pay a dollar to be worth exactly a dollar when it's publicly known that the dollars aren't there.

[WNS]

... it's not possible to implement a fractional reserve system in BTC...

It is perfectly possible to implement fractional reserves with BTC or any other currency.

Nice job not quoting the leading negation.