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Author Topic: Convince me that the bitcoin elite cannot become the next Rothschild family  (Read 10557 times)
Killdozer
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January 31, 2012, 09:28:43 AM
 #101

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deflationary currency is going to promote hoarding, and it is going to mean that the wealthy will always have more power over the unwealthy as they do not need to spend 90% or more of their income per year on food and rent.

The wealthy WILL always have more power over the unwealthy, PERIOD.
That's how everything works, and the only alternative is communism, and we all know how good that works.

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When you have trillions, you don't spend it, you manipulate. Look at politicians, ever bending to the will of corporations because they will get piddly sums for their campaigns.

Yeah, and when the politicians get paid, that original money is spent. You are not somehow magically generating money just because you got in early.

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Don't you, as a regular citizen of the world, get sick of this shit? Isn't the root of most crime simply due to the fact that many people cannot sustain a life above poverty? When you die, don't you want to be able to give your children the wealth of your many years of hard work?

I AM a regular citizen of this world, and there is no "shit". If we are talking about most developed countries right now and don't consider failed states and such, the only thing that is causing poverty and crime is that people think it is easier to rob than to actually work. There are exceptions to this in some countries of course, like in the US which has multiple issues, with health insurance, the government bailing out unjust banks and so on...

And it's really funny how you bring up the argument of "give your children the wealth of your many years of hard work", because that's exactly what the Rothschild family members have been doing for all these years, and you somehow think that is unjust because they have more money than you.

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I don't see how bitcoin fixes any of these meta-problems. I don't think bitcoin ever intended to.
That's exactly right. There is no magical technology or mathematical rule that is going to fix all humanity problems. Too bad, this kind of makes this whole discussion pointless.

If you really wont to fix something like that, become politician or some other public figure that can actually make a change. Right now it seems there is a very good chance to do that if someone could preach to the Occupy Wallstreet people, they don't seem to have a clue of what the hell it is they actually want, besides "more money". If someone could go there and give them ACTUAL ideas and steps for how the things should be done, that person could very well become the leader of the new party.

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Etlase2
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January 31, 2012, 09:43:05 AM
 #102

The wealthy WILL always have more power over the unwealthy, PERIOD.

But my point, as I have stated several times, is that the wealth/power graph is exponential, not linear.

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Yeah, and when the politicians get paid, that original money is spent. You are not somehow magically generating money just because you got in early.

Ok, but you aren't getting the meta-game here. Politicians are only getting that money because it will invariably lead to more wealth for those who gave them it.

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I AM a regular citizen of this world, and there is no "shit". If we are talking about most developed countries right now and don't consider failed states and such, the only thing that is causing poverty and crime is that people think it is easier to rob than to actually work.

Riiiiight. You know, it sounds crazy, but at some point we are going to have to accept that not everybody can work. There is only so much production that can be achieved, and the amount that humans contribute to that production is only likely to dwindle as more processes become automated. If more people were able to live off of earlier work or off of their parents' work, they could focus on other pursuits such as art, or volunteerism, or many other things. This is the kind of revolution that could bring about unheard of changes in society. But while we are slaves to money, it will never happen.

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And it's really funny how you bring up the argument of "give your children the wealth of your many years of hard work", because that's exactly what the Rothschild family members have been doing for all these years, and you somehow think that is unjust because they have more money than you.

Yeah and I think the point was you shouldn't have to be a trillionaire to be able to do it. Money devalues so quickly; interest rates expect a certain portion of every loan to default; property is amassed by the wealthy and re-sold to the middle and poor in a never-ending cycle by design.

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January 31, 2012, 09:56:25 AM
 #103

A summary is on the Bitcoin wiki. A discussion is on the Bitcoin wiki talks page, and continues on the forum. My forum posts also include references to support my claims.

So it boils down to, "these people say it works" and "these people say it won't" ok man I am convinced.

BTW,

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With gold/fiat, this requires the creation of debt instruments, which then, after being generally accepted in exchange, become money substitutes and a part of the money supply.

This shows an extreme bias or a lack of knowledge in the history of money. Not to mention the fact that debt-free money wasn't even considered a possibility.

http://en.wikipedia.org/wiki/United_States_Note

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January 31, 2012, 01:37:38 PM
 #104

So your point is that if an invention like bitcoin or any monetary innovation does not solve ALL the problems  of the existing banking system at once, then it should be rejected: that's a fallacy favoring the statu quo, benefiting the banking cartel.

That sounds like banking lobby propaganda to me.
The mention of a so-called " bitcoin elite" that would be comparable to bankers is also typical propaganda technique.

lonelyminer (Peter Šurda)
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January 31, 2012, 02:48:57 PM
 #105

So it boils down to, "these people say it works" and "these people say it won't" ok man I am convinced.
No, it boils down to: I provided references and a logically coherent position, connection to various other economic concepts and schools. Some people do not want to think about it so they just repeat things tangentially related to the issue.

This shows an extreme bias or a lack of knowledge in the history of money. Not to mention the fact that debt-free money wasn't even considered a possibility.
You have not provided an argument, you just whine. Also, what you say makes no sense. Wasn't even considered a possibility by whom? How is this relevant in any way?

Your own reference supports my position. Bank notes began as debt instruments, redeemable in gold (or whatever the specie was). In several steps performed by the state (legal tender laws, suspension of specie payments, banking regulation, elimination of competition, etc.), this link was abolished. So both of my points (presence of state force and the creation of debt instruments) are confirmed.

If you attempt to perform credit expansion with Bitcoins, you'll end up with a financial instrument incompatible with Bitcoin, similar to the Mt. Gox code. On the example of Mt. Gox code, you can see that it is more difficult to use as a method of payment than normal Bitcoins.
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January 31, 2012, 03:22:55 PM
 #106

With the sigmoid curve, why would anyone go in first? They would all be fighting over scraps of coins, and all the electricity they burned would be much more efficiently utilized past -2 on the horizontal line, when the coins start coming in abundance. Waiting would encouraged.

The coins would start coming into abundance as bitcoin increased in popularity.

Well, that's the hope anyway. Depending on the scale of the curve, if done wrong, sigmoid-coin could start taking off after the first block reward decrease (kind of like bitcoin,) or it could start taking off while the block reward is still at 1.5625 BTC, and I don't think that kind of reward is going to prompt a bunch of for-profit miners... yet with a popular coin, and a low difficulty, you'd sure get a lot of "miners" jumping in with the intent of taking over and/or destroying the blockchain. Basically, there's no way a specific curve can be an automatic cure for what you're considering a problem.


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Posting a message on a crypto board that had all of 10 posts in an entire year is not exactly a big way to get the word out.

True, but would you drop millions into an ad campaign for an untested new form of currency? And what if, instead of people paying attention, the only ones who did were banks and others who might find the coin a threat? The incentive for adoption is at least as important as the ad campaign... all the ads in the world won't persuade me to jump on board with a new technology that I see no advantage to getting involved with, but if the campaign is big enough it WILL broadcast the existence of that new technology to exactly the wrong people.


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You say there is no incentive, but if the early adopters could prove its use as a currency such as selling a pizza for 50 BTC instead of 10,000, how would that make any difference? If it had still not taken off by the time the distribution reached maximum (probably 50 btc/10 min) then it was unlikely to take off anyway. But, if it did start working, then as the curve approached 50 btc, you'd have thousands upon thousands of people mining as you do now,

It would make a difference because potential miners would look at the curve, and say "meh, I'll wait until the block reward increases. No point in jumping in this early." The last thing you want is growing awareness without a growing number of new miners.


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and the early adopters would still have a very large sum of bitcoins worth a significant amount of money, but they would not have a complete stranglehold over the supply.

But you can't predict how long miners will wait to jump in, and hence how many coins early adopters will have. My contention is that it might be just about as many coins as they have now, relatively speaking.


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I admit, it sounds good, but I don't think it fixes the real "problem": the coins flowing into the hands of a few right up until they have a significant number of them.

Excellent, I addressed this in one of my posts where I said it may just be the first big business that starts accepting BTC that becomes the real elite.

I don't understand. How is one big business being the big early adopter any better than having several independent geeks be the early adopters?


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I'd really like to hear a method that directly addresses the number of participants, and then their subsequent share of coins.

encoin: https://bitcointalk.org/index.php?topic=49683.0 (again, it's overly complex but I set out to fix 51% attacks, pools, and other issues)

A quick scan of the material at the link and at the wiki doesn't seem to address the number of participants. Could you boil it down to the essential idea? How does encoin directly address making sure the number of participants is followed by the output of coins?


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Early adopter shit is easy to promote. Give away 2x the coins, whatever. A deflationary currency is going to promote hoarding, and it is going to mean that the wealthy will always have more power over the unwealthy as they do not need to spend 90% or more of their income per year on food and rent. They can always hoard until the value goes too high and causes recession, then buy up property and other things of real value to "spur" the economy or LEND it too.

IMO, currency should strive for a stable value so that it cannot be manipulated by the wealthy. The early adopters can get all kinds of bonuses, I don't care about that, as long as they can't use those bonuses to manipulate.

I think you're underestimating what it takes to encourage early adoption.

I knew about bitcoin in 2010, yet despite the potential for profit, I waited until 2011, until I'd heard more advertising, and got the impression there was finally the beginnings of an infrastructure, before I got involved. That despite the early adopter potential.

Giving early adopters 2x the coins, but making it so that amount is meaningless, isn't going to encourage much of anything.

There are two contradictory goals you have here: (1) encourage early adoption, (2) ensure that early adopters don't profit "too much." With item (2) in effect, what exactly are you going to use to promote item (1)? And if you're not really concerned about item (1), then what's to stop just the few people who care about the coin from being the only early adopters, leading to the exact same situation we have now?

TL;DR - There's still no method being given that demonstrably (or even theoretically) leads to a situation of having many, many early adopters.

Bitcoin is the ultimate freedom test. It tells you who is giving lip service and who genuinely believes in it.
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The idea that deflation causes hoarding (to any problematic degree) is a lie used to justify theft of value from your savings.
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January 31, 2012, 04:21:49 PM
 #107


The majority of the coins will be mined in a few months, with all of what, 100k people having tried out bitcoin? Out of 7 billion?


We won't have 50% of coins mined until well into 2013, right? 

Yeah some kind of even distribution based on life on earth would be great, but hey just eliminating massive systemic fraud will really help a lot. 
Etlase2
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January 31, 2012, 04:23:35 PM
 #108

You have not provided an argument, you just whine. Also, what you say makes no sense. Wasn't even considered a possibility by whom? How is this relevant in any way?

I love how many times you say that makes no sense. Perhaps you lack understanding? And by whom would be whomever wrote the wiki page. It is relevant because governments switched to being debt-based when they could not afford to finance themselves via gold/silver backing except in a few, rare instances.

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Your own reference supports my position. Bank notes began as debt instruments, redeemable in gold (or whatever the specie was). In several steps performed by the state (legal tender laws, suspension of specie payments, banking regulation, elimination of competition, etc.), this link was abolished. So both of my points (presence of state force and the creation of debt instruments) are confirmed.

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Despite strong opposition, President Lincoln signed the First Legal Tender Act,[9] enacted February 25, 1862, into law, authorizing the issuance of United States Notes as a legal tender—the paper currency soon to be known as "greenbacks."

The Demand Notes' printed promise of payment "On Demand" was removed and the statement "This Note is a Legal Tender" was added. Legal tender status guaranteed that creditors would have to accept the notes despite the fact that they were not backed by gold, bank deposits, or government reserves, and bore no interest.

At the end of the Civil War, some economists, such as Henry Charles Carey, argued for building on the precedent of non-debt-based fiat money and making the greenback system permanent.

Explain to me how this is a) a bank note, b) debt-based, or c) redeemable in gold. It supports your own position because you say it does?

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If you attempt to perform credit expansion with Bitcoins, you'll end up with a financial instrument incompatible with Bitcoin, similar to the Mt. Gox code. On the example of Mt. Gox code, you can see that it is more difficult to use as a method of payment than normal Bitcoins.

Again, this is not an argument against FRB. If one bank is willing to issue you money, but it is in a "certificate" form, and another is not willing to issue you money, which bank do you get a loan from? Yes, there is the benefit that no government can force anyone to accept this as currency, but when there are so few bitcoins to go around, who are you to say definitively how this will play out? If there is no bitcoin credit, or a highly restricted form of credit, who will use bitcoin except for those who already own bitcoin? How will I start a business and pay my employees in bitcoin with a 100% reserve? How will recessions not run rampant? How will anyone use bitcoin when they cannot OBTAIN bitcoin?

Or is the only role we can envision for bitcoin is as a side currency/investment that may or may not increase in value depending on when someone with a lot of them decides to sell? Or as a vehicle for businesses to hopefully save a few cents here and there by converting back into traditional fiat as quickly as possible? I don't think you are capable of seeing the forest for the trees.


Basically, there's no way a specific curve can be an automatic cure for what you're considering a problem.

Never said it was, but it would mitigate the one-sidedness.

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It would make a difference because potential miners would look at the curve, and say "meh, I'll wait until the block reward increases. No point in jumping in this early." The last thing you want is growing awareness without a growing number of new miners.

But this is silly. This is not what brought people in in the first place--an alternative currency. The chance of a profit opportunity being realized at the beginning was very, very small. A block reward increase doesn't mean bitcoin suddenly has value, it just means you have more digital nothings in a digital wallet. And if it did become popular, by then you are competing with thousands over 50 btc rather than tens or hundreds over 10/whatever btc.

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Excellent, I addressed this in one of my posts where I said it may just be the first big business that starts accepting BTC that becomes the real elite.

I don't understand. How is one big business being the big early adopter any better than having several independent geeks be the early adopters?

LOL it isn't, that's the whole point. Money will get squeezed to the top either way. Big business will be the machine and we its lowly cogs asking, "please, sir, may I have another?"

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A quick scan of the material at the link and at the wiki doesn't seem to address the number of participants. Could you boil it down to the essential idea? How does encoin directly address making sure the number of participants is followed by the output of coins?

The hashing difficulty is independent of the number of people hashing. In fact, no hashing has to happen at all to secure the network--merchants would do this via a system of reputation. Pools would be managed by the network (randomly assigned). Difficulty increases via a moore's law concept where an increase in the speed of coin blocks produced increases the difficulty; additionally, the coin award is restricted by 33% (6 coins to 4.5 coins) every so often to encourage competition and allow more efficient miners to profit even more than less efficient miners, further increasing the difficulty--this accounts for koomey's law and decreases in energy usage. However, I've come up with some better ideas than this since then, and am working on a simpler proposal.


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I think you're underestimating what it takes to encourage early adoption.

I knew about bitcoin in 2010, yet despite the potential for profit, I waited until 2011, until I'd heard more advertising, and got the impression there was finally the beginnings of an infrastructure, before I got involved. That despite the early adopter potential.

Giving early adopters 2x the coins, but making it so that amount is meaningless, isn't going to encourage much of anything.

Well the great thing about bitcoin already existing is that any new currency can be piggy-backed on to bitcoin with merged mining. Mine for just gold, or mine for gold and silver at no additional cost. I don't have to worry about early adoption because bitcoin has already been early adopted.

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There are two contradictory goals you have here: (1) encourage early adoption, (2) ensure that early adopters don't profit "too much." With item (2) in effect, what exactly are you going to use to promote item (1)? And if you're not really concerned about item (1), then what's to stop just the few people who care about the coin from being the only early adopters, leading to the exact same situation we have now?

The point is not to keep early adopters from profiting "too much," it is to keep them from having a stranglehold over the supply. If early adopters try to hoard instead of promote commerce, the profit opportunity arises for new people to simply mine new coins and bring the price down. The early adopters cannot control the value of the coins.

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January 31, 2012, 04:57:44 PM
 #109

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Mine for just gold, or mine for gold and silver at no additional cost. I don't have to worry about early adoption because bitcoin has already been early adopted.

Convince me that the downward pressure applied on "gold" (bitcoin) prices by the availability of a competing commodity ("silver") is offset completely by the amount of silver I would mine (remembering that your "silver" will be worthless until it is "adopted", bitcoin still struggling for adoption 3 years after its inception).



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January 31, 2012, 05:09:40 PM
 #110

Convince me that the downward pressure applied on "gold" (bitcoin) prices by the availability of a competing commodity ("silver") is offset completely by the amount of silver I would mine (remembering that your "silver" will be worthless until it is "adopted", bitcoin still struggling for adoption 3 years after its inception).

There is no downward pressure unless silver becomes a viable alternative. And if that is the case, the downward pressure would be exerted whether or not you are mining for silver. A competing alternative with merged mining wouldn't care what the eventual outcome was for bitcoin, it is only part of the bootstrapping process so that early adoption doesn't have to be as hard.

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January 31, 2012, 06:44:24 PM
 #111


There is no downward pressure unless silver becomes a viable alternative.

This assertion is highly questionnable.
Its easy to create what is known as market confusion: this affects negatively all innovations.
Again the whole concept of merged mining is counterproductive unless its applied with a distinct purpose like namecoin.
Namecoin and bitcoin complement each other instead of competing head to head.

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January 31, 2012, 06:55:37 PM
 #112

... The Rothschilds got money as bankers long before fiat money was normal. The made a fortune when England won the Battle of Waterloo.
All so easely prooven wrong!
i) It was a coalition of allied forces not England alone defeating the french plus ii) the Rothschilds had loads of money collected before.
 ...  uhm to be honest again.  Grin

i) doesn´t matter even if the french had won, Rothschilds would have just played the other way round.
ii) does matter. (btw. Hawker is right here, as they made a fortune then)
But why? They controlled the monetary system!
How could they? ... simple as that, everybody else was playing game.

Everybody knew those Rothschilds to have the better and faster spys. So they would know the outcome of that battle first.
While the Rothschilds (a bit like Spy vs. Spy) were very well aware of this.
So as soon as they heard Napoleon is defeated they started to sell, falling prices and Rothschilds sell, everybody now realized it is about time to rush ...
While they started to pick up the shattered pieces, for much less than the money just earned shortly before by selling some shares.
They ended up with more money plus more shares than before.

This game is still going on in various performances.
Al long as we play game (whilst not really necessary), we can be controlled.
The more blame you put on Rothschild, Bill Gates, Satoshi Nakamoto or whom what so ever, realize it is likely more your fault than theirs.

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lonelyminer (Peter Šurda)
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February 01, 2012, 08:32:38 AM
 #113

I love how many times you say that makes no sense.
So that's why you keep repeating things that make no sense?

Perhaps you lack understanding?
You're the one lacking understanding. You merely touch the surface of the issue without referring to the processes causing the shape of the surface. I have spent months thinking about it, reading books, formulating and reformulating, pitting arguments against each other, considering new phenomena unconsidered before.

And by whom would be whomever wrote the wiki page. It is relevant because governments switched to being debt-based when they could not afford to finance themselves via gold/silver backing except in a few, rare instances.
(emphasis added) This is only relevant for Bitcoin if governments decide to heavily interfere with it. Even if they forced an exchange ratio (e.g. by monopolising exchanges), unless Bitcoin is legal tender, it would not have the expected effect. Have you thought about this really more than 5 seconds?

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The Demand Notes' printed promise of payment "On Demand" was removed and the statement "This Note is a Legal Tender" was added. Legal tender status guaranteed that creditors would have to accept the notes despite the fact that they were not backed by gold, bank deposits, or government reserves, and bore no interest.
Are Bitcoins legal tender? Is anyone forced to accept them if they don't want them? If not, then why should anyone accept "government Bitcoins" instead of actual Bitcoins? Can someone else than government declare legal tender?

Explain to me how this is a) a bank note, b) debt-based, or c) redeemable in gold. It supports your own position because you say it does?
Explain to me how this can be done without legal tender status. Are you suggesting that government will make Bitcoins legal tender?

Again, this is not an argument against FRB.
Again, you did not get the point. This is an argument against credit expansion, of which FRB is a subset.

If one bank is willing to issue you money, but it is in a "certificate" form, and another is not willing to issue you money, which bank do you get a loan from?
If noone accepts a payment using this certificate, then it's not suitable for the purpose of lending. Exactly as my example with apples and oranges.

Yes, there is the benefit that no government can force anyone to accept this as currency, but when there are so few bitcoins to go around, who are you to say definitively how this will play out?
I already explained my reasoning. Transaction costs. Transaction costs are the reason why people accept, say, a bank note, cheque or EFT instead of cash. With Bitcoin, this difference in transaction costs is not only absent, but also tends to work in the opposite direction. Have you even read the wiki article? I explain it there. I could provide references from books, which explain that transaction costs are the reasons why money substitutes came to existence, but I'm on a laptop now and it's more difficult to do these quotations with just one monitor and without a mouse. Some sources even say that FRB came chronologically after money substitutes, whereas I even consider it possible for them to arise simultaneously.

If there is no bitcoin credit, or a highly restricted form of credit, who will use bitcoin except for those who already own bitcoin? How will I start a business and pay my employees in bitcoin with a 100% reserve? How will recessions not run rampant? How will anyone use bitcoin when they cannot OBTAIN bitcoin?
First of all, you mistake credit with expansion of credit. Second of all, lending and borrowing without expansion of credit works fine. In fact, there already is Islamic Bank of Bitcoin and Global Bitcoin Stock exchange. Also, as long as Bitcoin is competing with other currencies, you can still take a loan with the other currency and then trade that on the market for Bitcoin. With respect to hard supply and/or recessions, read e.g. Deflation and Liberty by Jörg-Guido Hülsmann.

Or is the only role we can envision for bitcoin is as a side currency/investment that may or may not increase in value depending on when someone with a lot of them decides to sell? Or as a vehicle for businesses to hopefully save a few cents here and there by converting back into traditional fiat as quickly as possible? I don't think you are capable of seeing the forest for the trees.
The utility of Bitcoin is multifaceted. It can decrease transaction costs, be used for savings / investment, and yes of course for credit. Furthermore, as the markets grow, it is possible that the demand will rise so much that even people who own a huge amount of Bitcoins wouldn't be able to change it much. The bid-ask graph would simply look very steep on both slopes.

Let me ask you a counterquestion. If there was credit expansion with Bitcoin, would that make it more or less difficult to crash the market? Huh?

It is not my place to tell Bitcoin users what they should be doing. My purpose, as an economist, is to analyse things how they are or will be, not how they should or should not be.

If you want to create a currency based on credit expansion, there are economic papers you can read which analyse such systems. For example, Fischer Black: Banking and Interest Rates in a World without Money. Other authors that analyse this to some extent include Tatsuo Tanaka, Michael Woodford, Malte Krüger (as I said, it's difficult to quote on a laptop so google for them yourself, also the last one is in German and I don't know if you understand that). I personally don't think that credit-based currency is possible without either pegging such a currency (for example to a commodity or another fiat currency) or legal tender laws. Without either of these, there is no way of making sure that people do not expand the supply willy-nilly, and this would drop the market price. Even technology can't fix this, because at some stage, a decision needs to be made whether to extend credit or not, based on empirical data. And empirical data can be twisted to the desired aim. The supply of Bitcoin, on the other hand, depends on time and computational resources. Twisting time is so difficult that we can ignore it, and if the other empirical factor, computational resources (SHA hashing performance), fails, then the only result on the supply would be that the 21 million would be issued prematurely. Which would be bad, but not a catastrophe. With credit expansion, on the other hand, the supply is unlimited so the price would equilibrate at zero.
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February 01, 2012, 11:09:31 AM
 #114

Are Bitcoins legal tender? Is anyone forced to accept them if they don't want them? If not, then why should anyone accept "government Bitcoins" instead of actual Bitcoins? Can someone else than government declare legal tender?

Why should anyone accept either?

Explain to me how this is a) a bank note, b) debt-based, or c) redeemable in gold. It supports your own position because you say it does?
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Explain to me how this can be done without legal tender status. Are you suggesting that government will make Bitcoins legal tender?

Are you saying that the only possible form of money without government intervention is gold?

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If noone accepts a payment using this certificate, then it's not suitable for the purpose of lending. Exactly as my example with apples and oranges.

Who is saying no one will accept it? Oh, you. I'm glad you feel the need to speak for the future of money and bitcoin, but unfortunately you do not control what will happen.

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I already explained my reasoning. Transaction costs. Transaction costs are the reason why people accept, say, a bank note, cheque or EFT instead of cash.

Wait, wait. I thought you said transaction costs come in to play because "money proper" (from the wiki, whatever that means) has a high transaction cost. How does a note/check/EFT have a lower transaction cost compared to cash? Does cash mean "gold"?

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With Bitcoin, this difference in transaction costs is not only absent, but also tends to work in the opposite direction. Have you even read the wiki article? I explain it there. I could provide references from books, which explain that transaction costs are the reasons why money substitutes came to existence,

This is fantastically useless information.

Quote
First of all, you mistake credit with expansion of credit. Second of all, lending and borrowing without expansion of credit works fine.

Really, care to cite something other than mises.org?

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In fact, there already is Islamic Bank of Bitcoin and Global Bitcoin Stock exchange.

Whoa, stop the presses, there is lending! Bitcoins for everybody!

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Also, as long as Bitcoin is competing with other currencies, you can still take a loan with the other currency and then trade that on the market for Bitcoin.

So then you have answered my question that Bitcoin is not suitable as a replacement currency. Got it.

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With respect to hard supply and/or recessions, read e.g. Deflation and Liberty by Jörg-Guido Hülsmann.

You know, I started reading it, but I have to say, of the few articles I have read on mises.org, I seem to find inaccuracies in almost every single one.

Quote from: mises.org
The reason is that paper money is protected through legal-tender laws and other legislation. That leaves barter as the only legal alternative to using paper money,

Wat?

Quote from: mises.org
In all known cases, it was only under extreme duress— when the purchasing power of their paper money holdings dwindled within hours, so that indirect exchange became impracticable—that the market participants finally ignored the laws and started using moneys other than the legal tender.

WAT? Wait, so I'm breaking the law if I give someone an IOU? I'm breaking the law if I use one of hundreds of non-legal tender currencies around the United States? I'm breaking the law by using bitcoin? How the fuck am I supposed to respect anything this man has to say? Because there are lots of words?

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Let me ask you a counterquestion. If there was credit expansion with Bitcoin, would that make it more or less difficult to crash the market? Huh?

Am I supposed to say more?

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With credit expansion, on the other hand, the supply is unlimited so the price would equilibrate at zero.

This statement leads me to believe that you think FRB will work exactly the same as it does with a central bank. How could you, an apparently educated person, possibly believe this? Or are you just trying to be dramatic because you think it makes your point look better?

Anyways, I only originally said what I said about FRB running rampant because bitcoin is going to be in a constant flux of liquidity crises, and FRB would be a way to reduce that. Although FRB would be much more heavily restricted and it would be consumer choice to participate, whereas that is not the case in government fiat.

But, as you mentioned, one could take out a loan in fiat and buy bitcoins. Is this not the same as bitcoin FRB? Who, really, is going to loan money when hoarding is nearly guaranteed to provide better interest? Bitcoin, backed by fiat.™ Has a nice ring to it. Let someone else loan their money and I'll make money on it by virtue of nothing.

If FRB does not work for whatever various reasons, then bitcoin will die. The boom and bust cycles of the currency's value will constantly leave people holding the bag; poorer and pissed off as the cycle of wealth continues to flow upwards until people are finally sick of the scam. In reality, FRB is only a band-aid, not a solution to a flawed currency.

grondilu
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February 01, 2012, 11:21:03 AM
 #115

I retract what I said about this thread being great.
lonelyminer (Peter Šurda)
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February 01, 2012, 04:45:08 PM
 #116

Etlase2,

You continue not to make sense. It's evident that you did not read what I wrote, or at least did not try to comprehend it. You're not interested in a debate. If you were, you would have made an effort to understand my points, which you did not. You're just rambling.
grndzero
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February 02, 2012, 05:30:07 PM
 #117

I am sick and fucking tired of the world being manipulated by the powers that be. It isn't about wealth, it is about control. It is about debt-based economies that keep the middle and poor classes under its boot and stifle humanity.

I'm sick and tired of people whining about how they are sick and tired of this or that and everyone else is to blame. Take some personal responsibility for your situation and quit blaming everyone else. You still have the freedom to make your own destiny, though it seems you would rather blame others than use it.

I want the world to be a better place, and I truly believe that central banking is at the core of war and famine. It is hilariously sad that the "richest nation in the world" has 47 million people in poverty.

Bleak fact, but the the above applies to them as much as you. All 47 million will not become permanently middle class if all the wealth was spread around. Some people are in bad situations that they can't currently control, but some are also just looking for a handout and will put themselves right back in the same position eventually no matter how much you give them.

I find it disheartening that my fellow citizens and I are manipulated into believing that leaders like Muammar Gaddafi are evil and worthy of assassination; when reality shows that the people of Libya were wealthy and happy.

I'm not going to argue the human rights angles of taking out dictators, especially since you used it as a straw man argument. If you think that dictatorial regimes are the end all, be all of personal freedom and financial equality I implore you to go join one and see how you like it.



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