Is bitcoin a banana? No, PRECIOUS BITS (thread went slightly ot)

[molecular]

In response to a piece by Mathew DeBord (http://www.scpr.org/blogs/economy/2011/12/01/3923/commenting-commenters-bitcoin/), who argues that bitcoin was "a traded derivative of other currencies". Of course I argued against that, because of all things, bitcoin surely is not a derivative of anything. I answered that bitcoin was more like a banana (commodity) (avoiding carrots here).

DeBord replied to my comment arguing Bitcoin was probably not a banana: "A banana would exist without currencies. I don't think Bitcoin would." (I again argued against that)

So the old "what is Bitcoin? a commodity? a currency? ..." popped up and I think I found an expression that fits bitcoin quite well:

Bitcoin is Virtual Scarcity

I think that fits nicely, because it avoids to name some "subject" that bitcoin might be (a subclass of), but describes bitcoin merely by naming one of it's characters: scarcity.
It also fits nicely in my mind, because "virtual" and "scarcity" dont usually work together well (because information can be copied freely) and that shows how much of a ingenious invention bitcoin is.

One might add that ownership of this Virtual Scarcity is transferrable through a decentralized network, but not much more is needed to describe bitcoin, right?

What do you guys think?

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[ultima]

I think these few words describe what bitcoin is pretty good. I was always refering to bitcoin as a virtual commodity. Maybe I should change my words now.

[beckspace]

Digital scarcity.

Secret codes.

[cbeast]

The banana was genetically engineered for human consumption. While it is neither limited nor scarce, it's value was created by human need. We need a cryptocurrency. Bitcoin is only as limited as we allow it to be based on its divisibility. So yeah, bitcoin is like a banana.

[cypherdoc]

I like "fixed digital currency".

fixed>scarce: since there are plenty of bitcoins to go around if it becomes broad based whereas scarce implies not enough.

digital>virtual:   To me virtual gives an air of temporary or fleetingness

currency:  i think we need ppl to understand that Bitcoin is money.

just my two cents.

[lonelyminer (Peter Šurda)]

Bitcoin is a commoditised service.

[molecular]

Bitcoin is a commoditised service.

hey lonelyminer. it was nice meeting you in Prague.

"commoditised service" seems to be quite an esoteric expression. My dad wouldn't understand and - quite frankly - I have my problems with "commoditisation", since I never saw that word being used anywhere else.

It might well be that commoditised service fits very well and that's what it is, yet it's not a very suitable term for marketing (to "normal" people) purposes, let alone explaining what bitcoin is.

[molecular]

I like "fixed digital currency".

fixed>scarce: since there are plenty of bitcoins to go around if it becomes broad based whereas scarce implies not enough.

digital>virtual:   To me virtual gives an air of temporary or fleetingness

currency:  i think we need ppl to understand that Bitcoin is money.

just my two cents.

hmm, I'm not a native english speaker. It seems "scarcity" has negative connotations. Is there a synonym that could be used? Seldomness, rarity or something?

scarcity implies "fixed", doesn't it? I don't like "fixed", it sound like "shooting drugs up your arm" in my ear because of the german "fixen"

I agree on "digital" being somewhat better than "virtual", which sound like "vapor" indeed. Digital Scarcity? That looses something compared to "virtual", though: the fact that "bits of information" (which are abundant and cheap by their nature) had to be "virtually made scarce" to engineer bitcoin (they are not _really_ scarce, only _virtually_)

[cbeast]

Simply put, Bitcoin is a superimposed quantized deflationary value representation.

[molecular]

Simply put, Bitcoin is a superimposed quantized deflationary value representation.

Yeah, cool. That'll sell it to grandma!

[cbeast]

Simply put, Bitcoin is a superimposed quantized deflationary value representation.

Yeah, cool. That'll sell it to grandma!

She would ask you to say that with a mouthful of cookies.

[cypherdoc]

I like "fixed digital currency".

fixed>scarce: since there are plenty of bitcoins to go around if it becomes broad based whereas scarce implies not enough.

digital>virtual:   To me virtual gives an air of temporary or fleetingness

currency:  i think we need ppl to understand that Bitcoin is money.

just my two cents.

hmm, I'm not a native english speaker. It seems "scarcity" has negative connotations. Is there a synonym that could be used? Seldomness, rarity or something?

scarcity implies "fixed", doesn't it? I don't like "fixed", it sound like "shooting drugs up your arm" in my ear because of the german "fixen"

I agree on "digital" being somewhat better than "virtual", which sound like "vapor" indeed. Digital Scarcity? That looses something compared to "virtual", though: the fact that "bits of information" (which are abundant and cheap by their nature) had to be "virtually made scarce" to engineer bitcoin (they are not _really_ scarce, only _virtually_)

well, i'd say your English is pretty good.

i'm not sure there are any sovereign citizens who want a scarce currency.  people want enough if not more to give them a good life.  in fact, i'm beginning to think the masses like the inflation the CB's are providing as no one wants any pain.  they just don't realize the long term implications.

so "fixed" in this sense means enough to satisfy the masses but only a certain amount and no more.  i think the public would buy that. 

[BadBear]

I fully expected this to be an off topic thread. 

[lonelyminer (Peter Šurda)]

hey lonelyminer. it was nice meeting you in Prague.

Hello molecular, the pleasure's all mine.

"commoditised service" seems to be quite an esoteric expression. My dad wouldn't understand and - quite frankly - I have my problems with "commoditisation", since I never saw that word being used anywhere else.

I apologise, I'm terrible at marketing, I'm more of a scientist than a businessman. But maybe if I attempt to explain it in my words, someone else can build up upon that and make it marketable.

Bitcoin is somewhat similar to IP addresses. There's only 2^32 IP addresses (IPv4), so they're scarce. They're more-or-less fungible, i.e. it does not matter which one you have. They only have value because they allow communication (i.e. provide a service), they cannot be consumed. They are only defined as an abstract concept, and their functionality is upheld by a mix of consensus and the network effect. They can be traded to a certain extent. They are not very usable as money, but they are a precedent for commoditised service that has a purely abstract basis.

[molecular]

i'm not sure there are any sovereign citizens who want a scarce currency.  people want enough if not more to give them a good life.  in fact, i'm beginning to think the masses like the inflation the CB's are providing as no one wants any pain.  they just don't realize the long term implications.

lol, the problem with that is that printing money doesn't increase wealth. Its simply theft (from the people that have USD), because it decreases their wealth.

More and more people will realize that and wake up to the fact that they have all been scammed, bigtime! They will then demand "good money", which will either be gold or silver or something backed by gold/silver or bitcoin . Some might demand bananas and/or carrots.

[molecular]

lol, who of you guys twittered this: https://twitter.com/#!/Beautyon_/status/142955342467309568

Bitcoin is not a good or a service or money, it is a Virtual Scarcity: http://www.scpr.org/blogs/economy/2011/12/01/3923/commenting-commenters-bitcoin/

[phelix]

I say: digital gold - everybody can understand that

[molecular]

I say: digital gold - everybody can understand that

I agree, "digital gold" is really good. captures many of the features.

[cbeast]

I say: digital gold - everybody can understand that

I agree, "digital gold" is really good. captures many of the features.

That claim is also more than a little grandiose. Sure, gold is a commodity, but Bitcoin is nowhere near that valuable.

[molecular]

I say: digital gold - everybody can understand that

I agree, "digital gold" is really good. captures many of the features.

That claim is also more than a little grandiose. Sure, gold is a commodity, but Bitcoin is nowhere near that valuable.

Noone said that bitcoin was as valuable as gold. It's not about quantities, but about qualities.