Vow not to exchange bitcoin for fiat

[Steve]

Bitcoin is set square in the sights of speculators (or vampires if that's how you see them).  The infrastructure seems built primarily for them (as opposed to merchants or craftsmen) and the only way they'll ever go away is if the money goes first.

I think you are right to look elsewhere for something more aligned with socialism, communalism, anarcho-syndicalism or whatever you want to call it.  OpenTransactions, Ripple, the MetaCurrency Project, the P2P Foundation, and community gardens seem like good places to start.

I think this is completely backward.  Bitcoin is not targeted at speculators and is explicitly designed to facilitate trade.  Speculators are attracted to bitcoin because it is actually valuable.  Bitcoin isn't any more or less aligned with these *isms than those other technologies you point out.  Also, systems like Ripple that are based on debt are not a good idea for the basis of a monetary system (just as the USD and other fiat currencies based on debt are not a good idea).  A debt backed money eventually turns everyone into debt slaves to each other.  As debt becomes further and further extended, you eventually reach a point where people cannot possibly repay and begin to default.  The whole system becomes a house of cards that comes unglued when certain key debtors (or groups of debtors) default.  Ripple isn't as bad as fiat currencies where currency only exists with some debt obligation backing it and there is a central issuer, but it's still debt based and encourages people to mortgage their future in exchange for current consumption.

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[elggawf]

Speculators are attracted to bitcoin because it is actually valuable.

Speculators are attracted to Bitcoin because during the inflationary stage any time the growth of the economy outpaces the newly minted Bitcoins there's money to be made. We borderline need at least a few speculators as market makers to smooth out the discrepancy between the two factors so we can have some semblance of a stable price. What we don't need is runaway speculation like we had on the way to $30, but I don't think anyone's going to make that mistake again.

I still personally think the focus needs to be on finding new people to join the economy as merchants. New users spending Bitcoin is a shitty way to focus, because in almost all cases (except for shit that's illegal or where privacy is imperative) there is very little to be gained and a whole lot to be lost buy buying something with Bitcoin versus your local currency. Bitcoin benefits me greatly, as it lets me accept micro-payments and/or "group pay" without getting ravaged by fees, and I don't have to worry about chargebacks as much - but beyond the ability for a few guys to sit down and run their GPUs at night in order to get a "free" server for that month, there's almost nothing to be gained for my customers to use it.

I realize it's a catch-22, that merchants won't want to bother with it if there aren't potential customers ready to use it, and that that's where encouraging people to spend rather than exchange could help...

[netrin]

The bitcoin exchange is exciting because it is volatile and volatile because bitcoin is exciting. Take any revolutionary idea, hell, just about any idea or company, and it will swing violently in perceived value on its slow march toward general acceptance. Ultimate stability will come only after we trade fiat denominated in bitcoin rather than bitcoin denominated in fiat. A system like Ripple will be stable because it has enormous interpersonal friction. That is both an advantage and a disadvantage. Bitcoin is enormously liquid, that is its advantage. This highly liquid 'pure money' (money whose only function is money with neither industrial nor aesthetic value), bitcoin has perhaps the least friction of any quantifiable commodity humanity has every created. Speculation does not harm bitcoin, it only makes is more liquid and ultimately more stable. There are no bitcoin 'bank runs'. No one should ever hold more of a volatile asset than one can handle. Bitcoin is burning gasoline.

The only people who are complaining about the volatility are those who are attempting to speculate but are getting burned. Otherwise, I must suggest: Check your motivations and expectations! If you are holding bitcoin because they are interesting, because you think a bitcoin has a value in and of itself, then you should not care about the exchange rate.

We may wish bitcoin were more stable. Just as a revolutionary wishes for peace.

[Etlase2]

What is this bullshit?

No offense, but this idea is stupid as hell. That bubble to $30 was nothing but an elaborate game of musical chairs caused by rampant speculation. But who cares about fixing that, and encouraging an actual, stable, and sustainable economy. No, let's just repeat the thing by having everyone pledge to hold coins and artificially inflate the price again! \o/

Again, we'll be starting a brand new game of musical chairs, only this time people are "pledging" not to sit down when the music stops. Do you not see how completely fuckin' retarded such an idea is? If I had to put my finger on the pulse of the one chief issue that's plaguing Bitcoin, it's that it rewards people who are dishonest at the expense of those who aren't. This idea of yours will do exactly the same thing, those who break their pledge first when the price gets too delicious will benefit at the expense of those who hold to the pledge.

Here's an idea, let the market do what it wants... isn't that, you know, the whole economic reasoning behind Bitcoin after all? Exactly how full of shit are the libertard ideals that make up much of this community if it's "laissez faire" until the market does something we don't like, then we conspire to "fix" it? Oh, let me guess - it's only market manipulation when the government does it? If it's private people it's just the invisible hand, right?

This is just wrong, wrong, wrong. If I send you Bitcoins, do whatever the fuck you want with them. With any luck and some really well funded market makers, we'll end up at a stable price (whatever that may be, it really doesn't matter) and we can go back to encouraging more merchants to use it.

rofl, nice post.

[netrin]

guarantee its stock price in terms of US dollars? I am considering offering a mining company that will buy back any shares based on the US$ value of the company. The assets can be sold in US dollars so there is no risk to the company or investor. If you buy one share at 1 btc and btc goes down 50% to the US$ the company will be willing to buy back your share for 2 bitcoin. Perfect hedge in protecting value, while investing in a bitcoin operation.

Are you personally backing the price up with dollars?

[elggawf]

The only people who are complaining about the volatility are those who are attempting to speculate but are getting burned. Otherwise, I must suggest: Check your motivations and expectations! If you are holding bitcoin because they are interesting, because you think a bitcoin has a value in and of itself, then you should not care about the exchange rate.

Not entirely, as basically any merchant accepting BTC is forced into some extent of speculation no matter what. At the very least, you're stuck speculating until the payment confirms.

But as it stands right now, there's still a lengthy time between when the buyer pulls the trigger and when you have a USD value that's on it's way to your account. Companies like Bit-pay and MtGox (if they start acting as a merchant provider as well, I've toyed with this idea but trusting MtGox with any amount of income is still a bitter pill) can reduce this time by automatically liquidating the BTC for you ASAP, and could potentially do it further by guaranteeing you a set rate at say, the first confirmation. The issue there is that that act moves the speculation onto them, so instability in the currency means they have to widen their margins to stay solvent.

Finally, holding BTC at all is basically speculating. With the uncertainty of the economy (it wasn't long ago that I'd commented about the "stability" around $5 was leading me to develop a frame of reference for the price that didn't involve mentally exchanging the currencies to work out if something was a good price), you can accept BTC for one item, then if your buying power halves before you go to buy something with that BTC, you just got hosed. It's tough to convince anyone to just let that shit slide.

[netrin]

I consider every example you gave as speculation. If a merchant hopes to get USD out of the deal, then speculation (risk) must be part of his equation. Any loss greater than his risk tolerance must be considered irrational gambling, ignorance, or just bad luck which just as easily could have gone in his favour.

I am making no qualitative statement as per bitcoin ("is this good for bitcoin?"); Bitcoin simply is. It is only for humans who use bitcoins to make qualitative statements ("is bitcoin good for me?").

In that respect, each bitcoiner wears two shoes, likely with different weights in each. Am I speculating with bitcoin or do I value a bitcoin in and of itself? Personally, I'm quite comfortable with my bipolar/schizophrenic perspective and I believe early adopters will need to get used to this state of 'crazy'.

[netrin]

guarantee its stock price in terms of US dollars? I am considering offering a mining company that will buy back any shares based on the US$ value of the company. The assets can be sold in US dollars so there is no risk to the company or investor. If you buy one share at 1 btc and btc goes down 50% to the US$ the company will be willing to buy back your share for 2 bitcoin. Perfect hedge in protecting value, while investing in a bitcoin operation.

Are you personally backing the price up with dollars?

YES!   I or the company will back up the share price with US dollars. The reason for doing this is because the assets can always be sold in US$ There will be a floor to the stock price, it will only go down due to the deprecation of assets. It seems to me to be a rather safe investment.

I don't 100% follow the business model, but think it's a good initiative.  I don't have a personal interest in an asset guaranteeing a stable dollar price.  I could just hold dollars if I wanted them.  Just do it and see if you get investors.  I understand you're already mining, so it's only lost time writing up documentation, right?