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Author Topic: Satoshi, Bitcoin Is a Commodity Not a Currency  (Read 4162 times)
MoonShadow
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October 22, 2011, 07:22:06 PM
 #21

Can we relabel the front page of bitcoin to say crypto-commodity instead of crypto-currency? 
Bitcoin is digital gold that can be transfered on a network based on cryptographic principles. As the real gold it can be both commodity and currency. And like the real gold it can not be... illegal. It simply exists! How do you use it is your own business!

The day that I can take a bitcoin and hammer it into a virtual salad bowl is the day that I will agree that bitcoin is a commodity.

"The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank...sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world."

- Carroll Quigley, CFR member, mentor to Bill Clinton, from 'Tragedy And Hope'
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I.Goldstein
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October 22, 2011, 07:49:52 PM
 #22

Bitcoin is only a commodity in the sense that its backed by its ability to be transferred across the internet easily, anonymously, cheaply and securely; better than any other currency. One would usually define this as money but it could also be said that money is a commodity backed by the same use.

A logical answer seems to be that money is a commodity.
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October 22, 2011, 07:50:33 PM
 #23

Can we relabel the front page of bitcoin to say crypto-commodity instead of crypto-currency? 
Bitcoin is digital gold that can be transfered on a network based on cryptographic principles. As the real gold it can be both commodity and currency. And like the real gold it can not be... illegal. It simply exists! How do you use it is your own business!

The day that I can take a bitcoin and hammer it into a virtual salad bowl is the day that I will agree that bitcoin is a commodity.
Write the private key in the salad bowl
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October 22, 2011, 07:55:50 PM
 #24

Can we relabel the front page of bitcoin to say crypto-commodity instead of crypto-currency? 
Bitcoin is digital gold that can be transfered on a network based on cryptographic principles. As the real gold it can be both commodity and currency. And like the real gold it can not be... illegal. It simply exists! How do you use it is your own business!

The day that I can take a bitcoin and hammer it into a virtual salad bowl is the day that I will agree that bitcoin is a commodity.

If its virtual all you have to do is think it up in your head and you did it!
Actually you already did that soo.... yeah
MoonShadow
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October 22, 2011, 08:46:22 PM
 #25

Bitcoin is only a commodity in the sense that its backed by its ability to be transferred across the internet easily, anonymously, cheaply and securely; better than any other currency. One would usually define this as money but it could also be said that money is a commodity backed by the same use.

A logical answer seems to be that money is a commodity.

The process of transfering funds around the Internet is a service that the bitcoin network performs with near zero cost, but that service is neither an inherent feature of the currency that is bitcoin, nor is it possible for a service to also be a consumable with an alternative use than it's monetary intent.

Thus, back as square one.  Bitcoin is a currency, and only a currency, because it's intended to be used as such and cannot serve in any other capacity.

And the words money and currency are not interchangable.

"The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank...sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world."

- Carroll Quigley, CFR member, mentor to Bill Clinton, from 'Tragedy And Hope'
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October 22, 2011, 08:57:59 PM
 #26

Bitcoin is only a commodity in the sense that its backed by its ability to be transferred across the internet easily, anonymously, cheaply and securely; better than any other currency. One would usually define this as money but it could also be said that money is a commodity backed by the same use.

A logical answer seems to be that money is a commodity.

The process of transfering funds around the Internet is a service that the bitcoin network performs with near zero cost, but that service is neither an inherent feature of the currency that is bitcoin, nor is it possible for a service to also be a consumable with an alternative use than it's monetary intent.

Thus, back as square one.  Bitcoin is a currency, and only a currency, because it's intended to be used as such and cannot serve in any other capacity.

And the words money and currency are not interchangable.

To call bitcoin a currency is debatable what if everyone used Bitcoins as a representation of stocks of ownership and each address what to show the amount of Stocks each person held. I dunno just throwing it out there that I think bitcoin is just "Bitcoin" and its so new and crazy idea that nobody knows what it is or what potential we can do with it. But all i know is if we classify it, we could possibly restrict our selves to future uses if we Define Bitcoins as anything other then a Bitcoin.
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October 22, 2011, 11:08:15 PM
 #27

Bitcoin is to currency what plutonium is to fuel. (this belongs in the one-liner thread)

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
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October 23, 2011, 02:17:33 PM
 #28

Bitcoin is not a commodity though it shares some properties of a commodity (namely inelastic supply).  That's a useful framework for thinking about how the value of bitcoin fluctuates and how it trades, but it does not make it a commodity.  
Bitcoin is a protocol, but that doesn't really say much about why bitcoin is useful.  However, it does give one a clue as to what gives bitcoin its fundamental value.

Jeff Garzik described it as a distributed digital notary service, which I think is a great description of the role mining and the block chain serves in bitcoin.

If I type in "definition of commodity" into google, it yields "A raw material or primary agricultural product that can be bought and sold, such as copper or coffee."  Under this definition, bitcoin is not a commodity.  A second definition says "A useful or valuable thing, such as water or time."  You could make a plausible argument that bitcoin is a commodity under this second definition.  However, when people use the term commodity in association with bitcoin, I think they are most often drawing comparisons with the inelastic supply of precious metals and fungibility.  But inelastic supply is not a property that all commodities share (and even precious metals aren't as inelastic as bitcoin).  And commodities are not innately useful as a monetary system or currency (not even gold until you fashion it into coins or bars to facilitate exchange).  The term commodity is generally used in association with something whose individual units have some utility value, and that doesn't describe bitcoin.  So, I have to disagree with the title of this thread that claims bitcoin is a commodity.  It is not.

If I type in "definition of money" into google, it yields "A current medium of exchange in the form of coins and banknotes; coins and banknotes collectively" (among many other hits).  This certainly does not describe bitcoin, however I think this definition might be too narrow.

If I type in "definition of currency" into google, I see "A system of money in general use in a particular country."  That also doesn't describe bitcoin (because it's not in general use and it's trans-national), but I might again argue this definition is too narrow.

If you believe that the physical bills and coins that represent USD are currency, while the US dollar system in general is money, then under more general definitions of money and currency, you could argue that the bitcoin protocol is a system of money, while the actual software and transactions used for transferring bitcoins are the currency of that monetary system.

Personally, I think the website has about the best possible description when it says bitcoin is a p2p digital currency.  That might not be desirable for legal purposes in certain countries, but I hardly think what the website says is going to sway rulings on bitcoin one way or another.  Lawyers will examine how bitcoin is used in practice rather than focus too much on what some website says.  The website should describe as best as possible what bitcoin is for the benefit of potential users rather than worry about how courts might view bitcoin.  In the long run, users are what matter most.


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June 21, 2017, 01:21:15 PM
 #29

Revive old topics, since this one is not settled.

In this morning Wall Street Journal, Paul Vigna subtitle his article : "Battling camps at odds over digital currency’s purpose—commodity or quick way to settle transactions?" - https://www.wsj.com/articles/the-virtual-currency-war-that-threatens-to-tear-bitcoin-apart-1497956400

I take offense with the word "Purpose"; the purpose of Satochi was to create a Currency and he failed miserably; he created a Commodity because wanted to make sure noone controls it.

To have a Currency, you need to have Control over it's user, over the commodity in which you give the artificial value; without Control you cannot have a currency. And that is why I disagree with Eric Voorhees 2011 version because he didn't account for the control portion.

Bitcoin is Deflationary because it's a commodity that people Hoarder (https://youtu.be/XNu5ppFZbHo?t=2m17s) but is it a bad thing ? Can we create a society where we consume less ?

Theo Chino
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June 21, 2017, 02:28:53 PM
 #30

My thoughts:

Community <-> Commodity

^There is something related (at least some letters)

Crypto - sure

Currency / Sound money ?  both flawed

-> Social crypto commodity

New asset class for sure!

Carpe diem  -  cut the down side  -  be anti-fragile
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June 21, 2017, 03:25:12 PM
 #31

However it wants to be labeled, bitcoin can either be classified as currency or commodity. When defining commodity or currency, then we will understand bitcoin can be any of the two.

According to merriam webster;
Quote
Definition of currency
  • circulation as a medium of exchange - there already
  • general use, acceptance, or prevalence a story gaining currency - Kinda getting close
  • the quality or state of being current :  currentness needed to check the accuracy and currency of the information - not sure
  • something (such as coins, treasury notes, and banknotes) that is in circulation as a medium of exchange - though digital but still coin
  • paper money in circulation - ok, that won't pass
... and so on and so forth

Definition of commodity
  • a product of agriculture or mining agricultural commodities like grain and - though not agricultural, but we still mine it
  • an article of commerce especially when delivered for shipment - don't know about that
  • a mass-produced unspecialized product commodity chemicals commodity memory chips - we have limited amount, so...
  • something useful or valued that valuable commodity, patience; - well, we all know what's up with bitcoin value
  • convenience, advantage - One of the advantages I love the most
  • obsolete :  quantity, lot - we are just starting
  • good or service whose wide availability typically leads to smaller profit margins and diminishes the importance of factors (such as brand name) other than price - smaller profit margins? I doubt
  • one that is subject to ready exchange or exploitation within a market - Yeah right! Trading all day like crazy

MY VERDICT
Whatever we want to call it, commodity or currency, Bitcoin still remains a special innovation that will change the world but from the definitions above though, I will rather classify it as ... ehm... BOTH, ... well, it somehow falls in both categories.

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June 21, 2017, 04:10:47 PM
 #32

In this morning Wall Street Journal, Paul Vigna subtitle his article : "Battling camps at odds over digital currency’s purpose—commodity or quick way to settle transactions?"

The beauty of Bitcoin it can be everything that can be represented in digital form. Using it as money is just the simple use case.

BTW, you should learn the difference between money and currency!

18sNtvUmtW6nrQXfYt1wvviGockSWxhPBX
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June 21, 2017, 04:15:26 PM
 #33

Yeah it is a commodity, and also a currency.

People use it as a store of value and a long term investment. A safe house for keeping your money. Because keeping you rmoney in FIAT in almost any country means you are losing value each year as inflation picks up.

Using it as a currency is obvious. We use it to buy and sell things. We use it as a means of trade, ergo a currency. Many many people and businesses now accept bitcoin, it essentially is a currency for a lot of people.

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June 21, 2017, 04:23:45 PM
 #34

At first bitcoin was created for currency purpose, it's for doing transaction globally, but after seeing the price movements that go up really fast and the value of bitcoin is going up, people used it as investment and trading tools, and now more people used it as commodity not as currency, but bitcoin can be used as both

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June 21, 2017, 04:28:04 PM
 #35

Yeah it is a commodity, and also a currency.

People use it as a store of value and a long term investment. A safe house for keeping your money. Because keeping you rmoney in FIAT in almost any country means you are losing value each year as inflation picks up.


Using it as a currency is obvious. We use it to buy and sell things. We use it as a means of trade, ergo a currency. Many many people and businesses now accept bitcoin, it essentially is a currency for a lot of people.

The inflationary risks of holding wealth in USD pales in comparison to the volatility risks of holding wealth in Bitcoin. The federal reserve targets an inflation rate of 2% per year. Bitcoin reguarly hits swings of 25% in a single week. Do not let bitcoin's LONGTERM general upward trend disguise the actual risk of of severe short term losses when you may need cash. To the rational investor, it's not even a question.


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Reid
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June 21, 2017, 04:29:37 PM
 #36

Whew!
A lot of legendary's and Donator's here and it seems they cant approve with one answer.
I do think it is a commodity too. But somehow when I think about the merchants who have accepted it is a means of payment it becomes a currency.
It is like gold for me just made it online. It is mined and there is this buy and sell with a lot of movements with its price same with gold. Currencies dont move like that. Ergh! Can it be both?

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