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Author Topic: Silk Road was the best thing that has ever happened to Bitcoins.  (Read 7930 times)
memvola
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October 15, 2011, 06:19:40 AM
 #21

You all have made valid points that all point in one direction. Bitcoins main use is for either disregarding monetary regulations, buying illegal items, and or for speculative purposes to make small amounts of fiat currency.

Add to that the ability to send either small amounts, or to people without bank connections, and with little to no fees. I must re-iterate my sarcasm about freenet/tor here. You might think that you know what Bitcoin is used for, but your impression is simply wrong. The people who cared to reply to this thread prove that it has a wider range of use case than you've imagined. I've never used BTC to buy anything illegal where I live, and haven't speculated in currency. I bet but I don't gamble, and speculate in GLBSE. Smiley

you are following a ghost a non-existent man that can control and entire currency.

Who? Care to expand this assertion?

What good has Bitcoin done for anything except spawn an entire group of basement dwellers who are trying to get rich as quick as possible, with minimal to no work. How has Bitcoin added to the national debt in any way, it's market is worth less than a cities transportation budget. In fact Bitcoin is a way of money laundering.

  • What nation are you talking about? USA? On the other hand, it's more efficient than banking, so it adds something to humanity as a whole.
  • Mining is too much work. I'm telling this for the past year and nobody listens. Some of my friends got into the mining game, spend days building rigs and writing software, and in the end they are stuck with useless graphic cards. Use Bitcoin when you need it, it's just a tool.
  • Pure currency speculation is a zero sum game, so total daytrader gain would be zero. I don't have anything against people who see Bitcoin as a long term investment tool though.
  • Who launders money using Bitcoin if all users are run-of-the-mill nerds? I know of no one who has dirty money in their hands. Maybe you are talking about a few sellers at SR? What do you really think SR's trading volume really is?

If Bitcoin ever becomes big (let's just imagine) the IRS would immediately shut down Mtgox as a form of money laundering. It would be the easiest way to launder money since the liberty dollar.

IRS can't touch MtGox directly. Plus, exchanges in US are paying taxes, it probably would be another division's duty to shut them down. But I agree that in the long run, there is a slight chance that most States might turn against Bitcoin exchanges. I see it as a remote possibility though, because when it's big enough, countries harbouring exchanges will make a shitload of money from taxes. United States is becoming a prison every passing day, and some countries are following them to the end, I know mine is. States feed on control. But it's giving other States more to gain from being free.
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October 15, 2011, 06:27:21 AM
 #22

Silk Road is the Lord Voldemort of bitcoin.

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October 15, 2011, 06:59:56 AM
 #23

Silk Road is the Lord Voldemort of bitcoin.
+1 and lol


but honestly, explaining bitcoins to non technogeeks or ecogeeks usually requires a mention a SR, otherwise people see it as a fad, sort of like camel bucks, sad but true.


Don't flame me, i know there's more but that is the first order perception.

dominus mysteria
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October 15, 2011, 06:20:16 PM
 #24


What good has Bitcoin done for anything except spawn an entire group of basement dwellers who are trying to get rich as quick as possible, with minimal to no work. How has Bitcoin added to the national debt in any way, it's market is worth less than a cities transportation budget. In fact Bitcoin is a way of money laundering.


Just because some "basement dwellers" are risking their own resources on a new technology that is utterly revolutionary, and may well profit from it, doesn't mean they deserve ridicule. In this world, you can make money through work, or through risk, and usually a combination of both. The people who risk their money and time on Bitcoin before the mainstream "gets it" are doing the world a huge service. If you don't see the potential of a frictionless currency that can be transferred across the world in less than a second, that breaks down national borders, that permits financial privacy and open markets, then you're welcome to avoid Bitcoin.

Speaking from my own experience, I've used Bitcoin extensively to pay and get paid for freelance work with people in the Philippines, China, and Spain. It has made my work more efficient, and more profitable. Bitcoin is a tremendous financial innovation. The best part? It's all voluntary. Unlike the fiat currency you clutch on to, nobody is forced to use it. Its demand comes from free men and women engaged in free thinking and free exchange.

If you look upon Bitcoin and see "money laundering"... then perhaps all hope is lost for you. You are so far down the statist indoctrination of what constitutes morality in monetary transfers that it's unlikely any of my words will appeal to you. Bitcoin lets free individuals exchange goods, services and labor across distance. It expands the global marketplace. It makes trade faster and more efficient. If that doesn't inspire you, what does?
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October 16, 2011, 12:47:48 AM
 #25

The illicit drugs trade has as much influence on the bitcoin market as it does the fiat market (i.e. a lot)

Immanual Stop, immanualstop@gmx­­­­.­­­com | "I forget that I am unintelligent, because I forget that I know nothing."
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October 16, 2011, 02:47:16 AM
 #26

My theory - having few bitcoins, but having read extensively on the subject and still decided to get in after the first bubble - is that the price fall of bitcoins has two separate and very much related aspects to it.

The first is that speculation works REALLY well only when supply is short.  Speculation helped fix the supply problem by creating a massive incentive for early adopters to cash out (which if they did in the 20's, they were smart because btc did not have anywhere near enough trade to support such pricing).  Speculation by people with either money to invest or money to lose vested heavily based upon short term gains seen this year.  The price trends over the few years prior is probably a better indicator or the raw cash value of the currency.

While BTC's used on silk road certainly would have a stimulative effect on trading price, I doubt it was responsible for roughly 130million in total valuation that was represented at the height of the bubble.  So... bubble!  Bubble inflates people jump on board adding to the number of people interacting with the currency.  The net number of people trading in the currency will naturally cause it to appreciate because there is demand for the currency.  (Look at gold)  As idiots and investors realized that they were speculating on something that really isn't NECESSARILY worth anything (neither is gold), they sold.  Fewer interacting with currency = lower prices.  More sellers = lower prices.

Second... there was a massive BTC heist that took place earlier this year which both stalled the speculation AND served to bring to market many many btc that had to be liquidated and also likely led many early adopters to begin a sell off.

So... you have early adopters with many BTC... you have speculation... you have investors betting and losing... you have a recession. 

Recessions are bad for people that want to sell and great for people that want to buy.

At the 12terrahash area of the spectrum we're at now... lets assume that 100 mhash production costs roughly $85USD today to build.  That puts the cash value of hard assets used currently in production at 9.96 million.  That figure has deprecated rapidly, bare in mind.  Presuming a fairly natural cost to profit curve in hashing rate, we'll just multiply that value times the value E and come up with ~27million spent on mining equipment that is used today (this presumes a natural constant of depreciation, I really don't have the math background to factor in moores law into this estimate).

IE you have 27,000,000 REAL dollars invested by different individuals that are QUITE interested in maintaining their investments.  That's a really rough guess, but low side equalibrium for bitcoins, presuming confidence is maintained by those invested in it (they don't get out), should be near market value of the investments depreciated over time plus the cost of production (power).

IE 27,000,000 + the cost of electricity to produce the coins in existence should approximately be the value of the currency presuming the miners refuse to sell at a loss.  Presuming the average hash:watt is around 2:1, you're looking at somewhere around 5.5megawatts being spent on bitcoin mining right now.  That's 132 megawatt hours per day or about $15,000USD per day being spent on just MAINTAINING FUNCTION.

That's 5.5million per year in electrical costs.

So, obviously this figure has ramped up a bit this year, but presuming that the curve associated with increased production has an inverse curve related to efficiency (having to do with the advent of gpu mining), we could again presume that costs extend back in a way as to provide a degree of accurate analysis.   I'm just going to use the 5.5 million projected energy cost in the future as an example because I never got past calc one and didn't learn how to compute this stuff. 

That puts the aggregrate cash value of bitcoins in pure dollar investment (no time, no commitment, no political ideals, no other element effecting the community's commitment) at about 32.5 million USD.

7.47 million BTC... trading at $4 per have a cash value of about 30million dollars. (which I believe to be just below equilibrium, I expect prices to rise in the next month or two to around 4.75/btc where they will stay until adoption begins to occur, keep in mind, when that happens it will again be accelerated and exaggerated by speculation)

I wouldn't expect it to go too much lower and would expect to find equilibrium a little higher than we are right now.  I estimated the value of BTC to be near $5USD a piece not including speculation and early adopters flooding the market trying to collect a short term reward.  I still expect to see the graphs to trend in such a way as to indicate things to be as such.

This is what I think the base price will be.  That is before adoption takes place on a larger scale.  Once more businesses start accepting BTC and more people start using it (because it saves massive amounts of money on bank transactions), the value will go up.  It will probably go up a whole hell of a lot.

Since I am see more and more adoption instead of less and less, I do not think the currency will collapse.  I've only invested about 1400USD into a mining operation, but I did so after months and months of research and while watching a precipitous drop in the value of the currency.

If I am right about my predictions, my getting in now should equate to something like a 1.75:1 return on my investments in a year without the full value of BTC realized.  If adoption occurs how I think it might, we might be looking at more like 20-30:1 in the next 5 years and 100-10000:1 in 10 years.

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October 16, 2011, 03:16:16 AM
 #27

http://bitcoincharts.com/charts/mtgoxUSD#rg180zvztgSzm1g10zm2g25

If you look there you'll see the sell offs happened all at once.  I bet if you did some digging, it would be a minority of transactions representing the total sell off.   So it probably isn't typical trading.  It's large sell offs over and over again by people trying to pull cash out of bitcoin rather than using it as a long term hedge.
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October 16, 2011, 03:27:00 AM
 #28

Oh... another thing.

If we can get namecoin domain (.bit) resolution into chrome and firefox, expect that currency to appreciate many thousands of times.
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October 16, 2011, 03:40:02 AM
 #29

Oh... another thing.

If we can get namecoin domain (.bit) resolution into chrome and firefox, expect that currency to appreciate many thousands of times.
Who's we? If you want to help, then do it yourself and stop waiting for innovation.
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October 16, 2011, 03:45:42 AM
 #30

My theory - having few bitcoins, but having read extensively on the subject and still decided to get in after the first bubble - is that the price fall of bitcoins has two separate and very much related aspects to it.

The first is that speculation works REALLY well only when supply is short.  Speculation helped fix the supply problem by creating a massive incentive for early adopters to cash out (which if they did in the 20's, they were smart because btc did not have anywhere near enough trade to support such pricing).  Speculation by people with either money to invest or money to lose vested heavily based upon short term gains seen this year.  The price trends over the few years prior is probably a better indicator or the raw cash value of the currency.

While BTC's used on silk road certainly would have a stimulative effect on trading price, I doubt it was responsible for roughly 130million in total valuation that was represented at the height of the bubble.  So... bubble!  Bubble inflates people jump on board adding to the number of people interacting with the currency.  The net number of people trading in the currency will naturally cause it to appreciate because there is demand for the currency.  (Look at gold)  As idiots and investors realized that they were speculating on something that really isn't NECESSARILY worth anything (neither is gold), they sold.  Fewer interacting with currency = lower prices.  More sellers = lower prices.

Second... there was a massive BTC heist that took place earlier this year which both stalled the speculation AND served to bring to market many many btc that had to be liquidated and also likely led many early adopters to begin a sell off.

So... you have early adopters with many BTC... you have speculation... you have investors betting and losing... you have a recession. 

Recessions are bad for people that want to sell and great for people that want to buy.

At the 12terrahash area of the spectrum we're at now... lets assume that 100 mhash production costs roughly $85USD today to build.  That puts the cash value of hard assets used currently in production at 9.96 million.  That figure has deprecated rapidly, bare in mind.  Presuming a fairly natural cost to profit curve in hashing rate, we'll just multiply that value times the value E and come up with ~27million spent on mining equipment that is used today (this presumes a natural constant of depreciation, I really don't have the math background to factor in moores law into this estimate).

IE you have 27,000,000 REAL dollars invested by different individuals that are QUITE interested in maintaining their investments.  That's a really rough guess, but low side equalibrium for bitcoins, presuming confidence is maintained by those invested in it (they don't get out), should be near market value of the investments depreciated over time plus the cost of production (power).

IE 27,000,000 + the cost of electricity to produce the coins in existence should approximately be the value of the currency presuming the miners refuse to sell at a loss.  Presuming the average hash:watt is around 2:1, you're looking at somewhere around 5.5megawatts being spent on bitcoin mining right now.  That's 132 megawatt hours per day or about $15,000USD per day being spent on just MAINTAINING FUNCTION.

That's 5.5million per year in electrical costs.

So, obviously this figure has ramped up a bit this year, but presuming that the curve associated with increased production has an inverse curve related to efficiency (having to do with the advent of gpu mining), we could again presume that costs extend back in a way as to provide a degree of accurate analysis.   I'm just going to use the 5.5 million projected energy cost in the future as an example because I never got past calc one and didn't learn how to compute this stuff. 

That puts the aggregrate cash value of bitcoins in pure dollar investment (no time, no commitment, no political ideals, no other element effecting the community's commitment) at about 32.5 million USD.

7.47 million BTC... trading at $4 per have a cash value of about 30million dollars. (which I believe to be just below equilibrium, I expect prices to rise in the next month or two to around 4.75/btc where they will stay until adoption begins to occur, keep in mind, when that happens it will again be accelerated and exaggerated by speculation)

I wouldn't expect it to go too much lower and would expect to find equilibrium a little higher than we are right now.  I estimated the value of BTC to be near $5USD a piece not including speculation and early adopters flooding the market trying to collect a short term reward.  I still expect to see the graphs to trend in such a way as to indicate things to be as such.

This is what I think the base price will be.  That is before adoption takes place on a larger scale.  Once more businesses start accepting BTC and more people start using it (because it saves massive amounts of money on bank transactions), the value will go up.  It will probably go up a whole hell of a lot.

Since I am see more and more adoption instead of less and less, I do not think the currency will collapse.  I've only invested about 1400USD into a mining operation, but I did so after months and months of research and while watching a precipitous drop in the value of the currency.

If I am right about my predictions, my getting in now should equate to something like a 1.75:1 return on my investments in a year without the full value of BTC realized.  If adoption occurs how I think it might, we might be looking at more like 20-30:1 in the next 5 years and 100-10000:1 in 10 years.



What's your name on Something Awful? Oh wait you can't be a goon you're a complete idiot.
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October 16, 2011, 03:54:33 AM
 #31

The surest sign of intelligence.  Trolling.

May I humbly submit myself before you, lord.
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October 16, 2011, 03:57:44 AM
 #32

Oh... another thing.

If we can get namecoin domain (.bit) resolution into chrome and firefox, expect that currency to appreciate many thousands of times.
Who's we? If you want to help, then do it yourself and stop waiting for innovation.

Ohhhh... I'm sorry.  I guess I shouldn't share any ideas because they're worthless unless I can enact them all for myself.

The Magna Carta was BS rag because it took many hands to make.

The great wall of china is a hoax, since the guy(s) that came up with it didn't make it happen for themselves.

[edit for posterity]

The point being... that one does not have to contain within himself every piece of knowledge or every tool in order to aide/create great things.  One merely has to press himself to the desired outcome and to work to that end.  Whether I code it all myself, or help in the design, or I donate to another that volunteers to make the changes... I am still a participant.
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October 16, 2011, 09:18:11 AM
 #33

The point being... that one does not have to contain within himself every piece of knowledge or every tool in order to aide/create great things.  One merely has to press himself to the desired outcome and to work to that end.  Whether I code it all myself, or help in the design, or I donate to another that volunteers to make the changes... I am still a participant.

+1

The fact that you said "we" is a sign of commitment itself. Wink
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October 17, 2011, 03:08:00 AM
 #34

Thank you!  I believe this community has the seeds within it of the next paradigm of humanity.  Collective, work based participation.
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October 17, 2011, 04:53:19 AM
 #35

I want to start buying bitcoin because I believe in anarchy, and cryptography, and would like to push the boundaries of free expression.  Whether some want to use bitcoin to get high is beside the point; no one has ever made a system of currency based on mathematics until now, and it's exciting for anyone who believes that man will only be free when the last king is strangled with the entrails of the last priest.
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October 17, 2011, 05:43:27 AM
 #36

How do I access it? I have TOR, and Aurora, but it doesn't pull up when I put in the URL. Is the site down a lot or what?
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October 17, 2011, 06:25:39 AM
 #37


If Bitcoin ever becomes big (let's just imagine) the IRS would immediately shut down Mtgox as a form of money laundering. It would be the easiest way to launder money since the liberty dollar.


BitcoinBomb, I have one word to your assertion that the IRS could shut-down Mtgox whenever they wanted. WIKILEAKS. No doubt they''lll have some success but the genie is out of the bottle.

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October 17, 2011, 11:11:59 AM
 #38

Please is there any site that is alternative to silkroadmarket.org? It seems they are shut down.
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October 17, 2011, 12:04:19 PM
 #39

Please is there any site that is alternative to silkroadmarket.org? It seems they are shut down.

 Cheesy Who made that link?    And was that a way to get on Silk Road without TOR or something?

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October 17, 2011, 08:34:52 PM
 #40

I've heard of bitcoin forever, but it wasn't until I recently bought a radeon 6970 and someone mentioned it is good for mining, did I actually look into it. I am a very tech savvy person. If I didn't actually know how bitcoin worked, I can't imagine most ANY non-tech person would.

What I find most fascinating about bitcoin is its p2p nature, how bitcoins are generated, and the artificial scarcity.

If people only learned more about what bitcoin is, it could really take off.

The most off-putting thing to me is the difficulty to mine (hardware arms race). I REALLY like the prospects of Litecoin, CPU vs GPU really seems to level the playing field.
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