Why BTC is losing value.

[stryker]

in a similar thread I stated I cant help feeling all this in-fighting, hacking and general 5 year olds behaviour may of damaged peoples confidence in btc too

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[stryker]

3) Contrary to popular belief, spending Bitcoins does not make them more valuable or bolster their market price. In fact, the opposite is true, when you sell a Bitcoin in exchange for a good, you are expressing a preference of the latter over the former and increasing the supply of Bitcoin while decreasing the supply of goods. In other words, every time you sell a Bitcoin, whether for USD or a good or service, you are increasing the market supply of the coin and thus it's relative price will be slightly less. Consider the counter-factual: if nobody ever sold a Bitcoin for anything, it's price would rise to infinity. If your goal is to increase the BTC price, don't ever offer them in a transaction for anything.  

Sorry have to call B.S on that.  Ok I appreciate its a complicated system but lets consider:

I have these special 5 rocks, they are pretty and there are no others like them in the world.  I have all 5 so they must be worth unlimited fiat currency right?  WRONG

See you have no interest in my rocks, they are not useful to you hence worth nothing to you.

The only way bitcoin is worth anything is if its useful to people thus making them want it... on the simplest level being if they can be exchanged for goods.... the only reason merchants will work to accept BTC is if people spend BTC, then we have all sorts of cool stuff you can get with BTC, then maybe people will want to earn BTC, thus BTC for services and labour....

Hoarding BTC does sweet F.A for bitcoin.... in fact I'd only hoard if I was confident in everyone else doing the right thing and making it worth something regardless of my not being involved.... thats one of my other gripes about early adopters being a security threat to the btc money base but thats another thread :-)

If satoshi is dead he'll be frikin spinning in his grave at your comment.... BTC is only worth what someone will trade for it.... the fact it interfaces with other currencies is only as a vehicle for others to acquire the currency, supposedly because they want to spend it.... or worse still they want to join the hoarders.

Thats my 2c

[Cluster2k]

I have these special 5 rocks, they are pretty and there are no others like them in the world.  I have all 5 so they must be worth unlimited fiat currency right?  WRONG

See you have no interest in my rocks, they are not useful to you hence worth nothing to you.

I would like to offer 100 ClusterCoin for your 5 special rocks 

[stryker]

Hmm I dunno, my 5 special rocks are very dear to me.... erm emotional ties etc :-)

Besides I'm too distracted by the fact MtGox has done more trade in the last 2 days than the whole week previous, me thinks some people are cashing out.

[BCEmporium]

3) Contrary to popular belief, spending Bitcoins does not make them more valuable or bolster their market price. In fact, the opposite is true, when you sell a Bitcoin in exchange for a good, you are expressing a preference of the latter over the former and increasing the supply of Bitcoin while decreasing the supply of goods. In other words, every time you sell a Bitcoin, whether for USD or a good or service, you are increasing the market supply of the coin and thus it's relative price will be slightly less. Consider the counter-factual: if nobody ever sold a Bitcoin for anything, it's price would rise to infinity. If your goal is to increase the BTC price, don't ever offer them in a transaction for anything.  

Translation of this load of baloney: «Hold the door for me while I cash out»

[aq]

I’d say we need to polish the Bitcoin client

That could be very easy, one "only" has convince Gavin to use bitcoin-qt.

[stryker]

People need confidence to put their money and effort in bitcoin and I think a few thinks at this time that rock that confidence include (and please these are not stabs at people or groups just matter of fact).

1) bad press: one thing after another and one spat after another leaving us looking like squabbling fools.

2) appearance: ok so realsolid acted like a dick but the outside world needs to see a little leadership and organisation, such as better tools for enabling merchants to set up etc (like the promised solidcoin API).

2a) less ridiculous actions like that of artforz (or wheover he is) think of someone looking to invest in bitcoin.... from the outside his actions look like that of a very socially mal-adjusted individual much in need of a woman's first touch.  People outside the project see peeps like him inside and perhaps in an ill-informed thought process probably fear the havok he wreaked.

3) hoarders syndrome as pointed out above.  There are many, some early adopters some freak miners who have large stashes of coins due to the very very slow launch of bitcoin.  That represents a risk to the security of the money base.  Those users are not helping bitcoin grow and when they do cash out or get robbed they hurt bitcoin all over again.

4) freak miners.  I say freak but only because I can't understand what posses someone to but 30quadzillion gh/s of mining rig.... I mean is it a fevered gold rush "woohoo giddady giddady yehaw I'm gonna be rich an get me some people teeth" I dunno.  However the falling price of BTC only proves the point that someone would think "so how long will these people be able to run all this kit when they are earning no money?" well the answer is probably not long so great swaves of the networks hashing power could suddenly melt away.  Its a shame really as bitcoins greatest achievement is the fact it draws strength from being decentralised... miners should all be casual miners in bitcoins best interests..... a casual miner being one who on their current income from they day job can run the kit they have indefinitely with profit or NOT because its fun, plus nice to give back to bitcoin.

Thoughts or anything I've missed?