Bitcoin Forum
September 29, 2016, 08:25:20 AM *
News: Due to DDoS attacks, there may be periodic downtime.
 
   Home   Help Search Donate Login Register  
Pages: « 1 2 [3]  All
  Print  
Author Topic: On Hoarding  (Read 11108 times)
Red
Full Member
***
Offline Offline

Activity: 210


View Profile
August 05, 2010, 02:05:40 AM
 #41

Why does one cares about the relative wealth of another individuals versus our own, especially in a system where people can mutually gain from exchanges? If anything, one should be concerned about one's own absolute wealth over time, not one's relative wealth to another.

Are you kidding?

In a market based society there is only relative wealth. Bill Gate is not rich because he has 40 billion dollars. He is rich because we all don't have 40 billion dollars. If we did all did the "average" house would cost 100 billion dollars and we'd all still have mortgages.
1475137520
Hero Member
*
Offline Offline

Posts: 1475137520

View Profile Personal Message (Offline)

Ignore
1475137520
Reply with quote  #2

1475137520
Report to moderator
1475137520
Hero Member
*
Offline Offline

Posts: 1475137520

View Profile Personal Message (Offline)

Ignore
1475137520
Reply with quote  #2

1475137520
Report to moderator
1475137520
Hero Member
*
Offline Offline

Posts: 1475137520

View Profile Personal Message (Offline)

Ignore
1475137520
Reply with quote  #2

1475137520
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
1475137520
Hero Member
*
Offline Offline

Posts: 1475137520

View Profile Personal Message (Offline)

Ignore
1475137520
Reply with quote  #2

1475137520
Report to moderator
kiba
Legendary
*
Offline Offline

Activity: 980


View Profile
August 05, 2010, 02:16:02 AM
 #42

Why does one cares about the relative wealth of another individuals versus our own, especially in a system where people can mutually gain from exchanges? If anything, one should be concerned about one's own absolute wealth over time, not one's relative wealth to another.

Are you kidding?

In a market based society there is only relative wealth. Bill Gate is not rich because he has 40 billion dollars. He is rich because we all don't have 40 billion dollars. If we did all did the "average" house would cost 100 billion dollars and we'd all still have mortgages.

Nonsense. I have a house, a computer, fancy operating system, foods, medication and the like. Compared to the kings of old, I have more absolute wealth in many area you can measure.

Gavin Andresen
Legendary
*
Offline Offline

Activity: 1652


Chief Scientist


View Profile WWW
August 05, 2010, 02:19:50 AM
 #43

In a market based society there is only relative wealth. Bill Gate is not rich because he has 40 billion dollars. He is rich because we all don't have 40 billion dollars. If we did all did the "average" house would cost 100 billion dollars and we'd all still have mortgages.
Hah!  While I was typing this, Kiba said essentially the same thing...

We are all rich because we have computers and the Internet and Wikipedia and other wonders the world has never seen before.

There is absolute wealth.  We are healthier and wealthier and live longer than any previous generation, and that's a wonderful thing.

How often do you get the chance to work on a potentially world-changing project?
Anonymous
Guest

August 05, 2010, 04:33:58 AM
 #44

In a market based society there is only relative wealth. Bill Gate is not rich because he has 40 billion dollars. He is rich because we all don't have 40 billion dollars. If we did all did the "average" house would cost 100 billion dollars and we'd all still have mortgages.
Hah!  While I was typing this, Kiba said essentially the same thing...

We are all rich because we have computers and the Internet and Wikipedia and other wonders the world has never seen before.

There is absolute wealth.  We are healthier and wealthier and live longer than any previous generation, and that's a wonderful thing.

Sometimes you forget how wealthy you are relative to some of the poorer areas of the world.To someone living in somalia you would look like Bill Gates  Smiley
Red
Full Member
***
Offline Offline

Activity: 210


View Profile
August 05, 2010, 05:15:08 AM
 #45

Nonsense. I have a house, a computer, fancy operating system, foods, medication and the like. Compared to the kings of old, I have more absolute wealth in many area you can measure.
You absolutely have more bitcoins, but less gold than the kings of old.

But seriously, four guys discover the bitcoin system they all have $10,000 they want to trade for bitcoins, but they aren't sure about the system.

The first guy says what the fuck and trades his $1,000 for 200,000 BTC
The second guy decides a month later and trades his $1,000 but gets only 20,000 BTC.
The third guy is a little slower but says WFT a month later and trades $1,000 but gets only 2,000 BTC.

The fourth guy gets on twitter and says, "Screw bitcoin, it's a pyramid scheme. I'm trading for ฿ and spending them on Thai hookers. That's the way I want to be fucked!"

No one sees that as in obvious danger?


bytemaster
Hero Member
*****
Offline Offline

Activity: 728

BitShares


View Profile WWW
August 05, 2010, 05:54:49 AM
 #46

No danger there because it is not a pyramid scheme.   It simply means that people want BTC more than USD.  If that were not true then the ratio would not have changed.  It simply means that the early adopters recognized value before the late adopters.  This is the market auto-correcting. 

https://steemit.com  Blogging is the new Mining
Insti
Sr. Member
****
Offline Offline

Activity: 294


Firstbits: 1duzy


View Profile
August 05, 2010, 07:28:09 AM
 #47

However for your metaphor, who is this very rich man? Why is he the ONLY one with money when we start the system? Why does this guy get to decide what the price for OUR services are? That doesn't seem very market based to me?

Isn't the 'problem' you are describing the problem with ANY monetary system?
Red
Full Member
***
Offline Offline

Activity: 210


View Profile
August 05, 2010, 04:19:54 PM
 #48

I'll repeat this question, as it's important: do you think Bitcoins would become popular if the supply was already fixed and no more minting could occur? I will assume you will say no (please let us know), but this will contradict your position - if you are going to fix the supply, it will have a similar (although less extreme) effect whether you do it now or in the future.

The point is, we all want monetary stability. By not increasing the supply with the user base, this will not be achieved though - that's my whole point.

Re-read the whole thread. I found lots of wisdom in it, and this unanswered question. So I'll go first in answering it.

No. I don't think Bitcoins would become popular if the supply of bitcoins was already fixed and no more minting was occuring.

Does anyone disagree? Because bitcoin's dreaded monetary inflation is trivial to stop right now.
bytemaster
Hero Member
*****
Offline Offline

Activity: 728

BitShares


View Profile WWW
August 05, 2010, 04:42:14 PM
 #49

Yes, I think bit coins would become popular even without mining because the supply of bit coins *is* fixed even now.  They are just contractually obligated to future block generation.

The creator of a currency initially owns 100% of said currency.  That is true with bitcoins as well. 

To add value to a bit coin requires CPU time and this costs money.  Thus, the creator of the currency is choosing to reward those who contribute with "shares" of his currency stock and thus early adopters are speculating on the future value by *investing* in bitcoin stock.  He could have found an investor who would accept payment in this bitcoin and provide a server farm to bootstrap the system and then allowed 3rd parties to run their own servers and everyone compete on transaction costs alone.   

I think it was a smart decision to pay people to provide the bootstrapping CPU time. 

So the question you have to ask yourself is, what other "means" could a creator of a bitcoin like system use to encourage adoption?   He could have auctioned the entire stock into existence and let speculators estimate the potential value of such an anonymous fixed supply currency.   These investors would then be motivated to see the currency adopted as it increases the value of their shares of the investment.  Some may choose to sub out compute farms, others may offer anonymous services and exchange systems.  In fact, it may have been better to auction it off because that would give more people incentive to see bitcoins grow.  I suppose investors could still buy bitcoins as they are generated. 

So one way to look at it is that the supply is fixed and the creator chose to reward "stock" based upon compute time instead of money.  A perfectly valid approach, but it is not the mining that makes bitcoin popular.   

I suspect that the porn-industry could take this technology to enable their customers to be more anonymous by having them by BTC from them and once bought allowing them to trade among themselves and others.  Thus, it is not the mining that makes BTC valuable or popular. 

https://steemit.com  Blogging is the new Mining
Red
Full Member
***
Offline Offline

Activity: 210


View Profile
August 05, 2010, 06:13:59 PM
 #50

Yes, I think bit coins would become popular even without mining because the supply of bit coins *is* fixed even now.  They are just contractually obligated to future block generation.

I obviously disagree, but it is a point that can only be proven empirically.

Thus, the creator of the currency is choosing to reward those who contribute with "shares" of his currency stock and thus early adopters are speculating on the future value by *investing* in bitcoin stock. 

Your point is well made, but I want to suggest that talking about bitcoins as "stock" is risky semantically. There are lots of agencies that investigate fraud in such areas. It is common for scammers to tout their schemes as "shares" in an "investment opportunity". Metaphors show intention. It is intention that gets people locked up. I know you don't think of this as a scam. But it is wise not to share terminology with scammers.

If there was a bitcoin company and its goal was to make money by providing a service. And it sold shares that inherently increased in value based upon profit from customer's paying the company for that service. Then you could call justifiably call it stock. But you can't form a company whose business is SOLELY to sell the company's stock. And tout that if you buy the stock early, the people who come later will want to pay you more for that stock because it is a limited commodity.

Trust me. Doing that is "a bad thing." :-)

I think it was a smart decision to pay people to provide the bootstrapping CPU time. 

It was a brilliant decision! I've said that in another thread.

But sometimes brilliant bootstrapping decisions can lead to hamstrung growth decisions. We disagree about this, but the truth will eventually play out empirically.

So the question you have to ask yourself is, what other "means" could a creator of a bitcoin like system use to encourage adoption?   

I wrote on this in this post, but it got buried by a flippant comment about relative wealth. I would appreciate some comment on it.
http://bitcointalk.org/index.php?topic=75.msg7603#msg7603

I suspect that the porn-industry could take this technology to enable their customers to be more anonymous by having them by BTC from them and once bought allowing them to trade among themselves and others.  Thus, it is not the mining that makes BTC valuable or popular. 

I think the porn-industry could find value here. However, for that to benefit the bitcoin system as a whole, there needs to be something the porn-industry could spend their new BTC on BESIDES dollars. Maybe hosting. Maybe an associates program that pays for referrals in BTC. Then coins would be in the hands of more people in exchange for actual services rendered. More coin holders opens more possibilities for people to sell random commodities for BTC. That would create a real BTC economy of both coins and commodities/services circulating.

If the majority of people just buy BTC for dollars, then spend them anonymously on porn, and the porn industry sells the coins back for dollars; then you have "a money transfer service" which cries out for the regulators to attack.
Boussac
Legendary
*
Offline Offline

Activity: 1172


e-ducat.fr


View Profile WWW
September 15, 2011, 09:56:12 PM
 #51


There is absolute wealth.  We are healthier and wealthier and live longer than any previous generation, and that's a wonderful thing.

Wealth is often defined as the ability to give. Bill Gates certainly understand this with his Foundation.
Wealth is ok as long as what is given is not taken from someone in need or from someone in the future.
It seems to me that today's wealth is partly borrowed from future generations.

Going back to the "hoarding" topic imho hoarding cannot be lethal for the BTC economy because bitcoins can be used as a meta-currency.
The value of bitcoins in this use case stems from the merits of the bitcoin network as a transaction processing network.
Goods can be sold in state currency with bitcoins being used just as a transaction vehicle (converted in real time at each end of the transaction).
Transaction fees over the bitcoin network can be competitive compared to card schemes.

catfish
Sr. Member
****
Offline Offline

Activity: 270


teh giant catfesh


View Profile
September 16, 2011, 12:40:15 AM
 #52

The most important thing AFAICT regarding the health (or stability) of the Bitcoin economy is that people continue to *buy* bitcoins and that the overall flow at the sum total of all exchanges (i.e. between other global currencies and BTC) is not constantly negative. Some hoarding IS necessary - if every newly-mined bitcoin is put up for sale as soon as it's mined, then this produces a downward pressure on the value of BTC.

Of course, it's beginner FX stuff that if more people are selling than buying currency A against currency B, currency A will become cheaper in terms of currency B.

I've been watching the GBP value of 1 BTC depreciate from around £10 or so (when I first started mining) to the current rather miserable £3. There have been some 'incidents' (either unfortunate or utterly incompetent, depending on how much you know about hacking) which could be said to reduce market confidence in Bitcoin, thus reducing the price the market is willing to pay, but the steady decline points more to a fundamental surplus of BTC sellers over BTC buyers. There were spikes when the 'incidents' occurred, but chop those out and the market still declines.


The only way I can see BTC stabilising in value relative to the world's fiat currencies is if either:

a) some significant market springs up that can only be paid for in BTC, or is very inconvenient to pay for with existing fiat currencies;
b) enough essential goods and services can be paid for with BTC such that an average person could get away with using BTC as the main means of exchange;
c) we start seeing significant businesses that buy their supplies with BTC and sell the finished goods for BTC - without using local currency.

As far as 'a' goes - I can only see the black market providing this. One can already buy drugs etc. on the internet, but transaction charges (Western Union, to name one) are exorbitant. Bitcoin transactions are in a different league for fees, but does anyone want the BTC economy to be associated primarily with illegal activity?

The problem with 'b' is that BTC works best online - and few people buy everything via the internet. Perhaps this will change, but physical person-to-person transactions require each person to carry a sophisticated piece of technology that's constantly online. Rich cities in wealthy countries could manage it - if an iPhone, Android and Blackberry client is written and made easily usable (actually *giving* someone my BTC address requires a separate email or SMS - can you remember and speak out your main BTC address??) then one could easily send someone else some BTC with low transaction costs, just like cash. But even with my love of gadgets, I'd hesitate at the idea of running a BTC client on my iPhone due to the huge cost of GSM data traffic... Also, Bitcoin is up against active resistance, in the form of existing online means of exchange. Companies like PayPal need to dominate their market, and Bitcoin challenges their market position. They will actively try to destroy the market.

I don't know if 'c' has started happening yet, but the volatility of the currency poses problems with pricing - nobody wants a hyperinflation-style intra-day wild price fluctuation, since it slows down purchasing decisions (i.e. trying to time the market for FX or equities is one thing, but needing to time the market for a loaf of bread is NOT the recipe for a healthy economy).


This sounds rather like I've written Bitcoin off as doomed to failure - actually I desperately hope it doesn't. Can anyone show me charts with a timeline of *net* flow at the major exchanges? I'm not sure what it looks like in the USA, but certainly the GBP/BTC rate appears to be declining slowly with a spread suggesting a preponderance of sellers and not enough buyers.

...so I give in to the rhythm, the click click clack
I'm too wasted to fight back...


BTC: 1A7HvdGGDie3P5nDpiskG8JxXT33Yu6Gct
sukiho
Full Member
***
Offline Offline

Activity: 180


View Profile
September 19, 2011, 07:09:51 PM
 #53

Can anyone show me charts with a timeline of *net* flow at the major exchanges? I'm not sure what it looks like in the USA, but certainly the GBP/BTC rate appears to be declining slowly with a spread suggesting a preponderance of sellers and not enough buyers.
not sure if this one helps http://www.bitcoinmonitor.com/
Etlase2
Hero Member
*****
Offline Offline

Activity: 798


View Profile
September 23, 2011, 05:59:15 AM
 #54

Not sure why this thread was bumped, but for those interested, I have proposed a system that unwittingly incorporated some of the ideas in this thread and I am trying to promote discussion.

https://bitcointalk.org/index.php?topic=44682.0

Based around a constant cost to produce (not simply giving money away to latecomers by reducing the value to earlycomers) and the destruction of currency via transaction fees, I believe it addresses many of the issues brought up in this thread.

petercyr
Jr. Member
*
Offline Offline

Activity: 36


View Profile WWW
September 29, 2011, 02:54:24 PM
 #55

Here's my stance on Hoarding...

For bitcoin to have any value, you have to be able to spend them. If everyone is hoarding, no one is earning coins through the sale of goods and services. If merchants aren't making enough to justify using bitcoins then why would other merchants get on board? And with less merchants means less ways of spending your coins.. You don't make stupid business decisions on purpose normally so if people know there's no point, then they wont bother. If they don't bother then bitcoin goes nowhere, existing merchants will eventually get out since they're just wasting their time and bitcoin wont go anywhere.

People hoard because they want to make money. To make money, the value has to go up. If there's no reason to buy them then they wont be sold and the price wont go up.

Bitcoins can't keep on raising in value simply because everyone wants to make a quick buck... Not quite sure how anyone could get the idea that it'll just keep on going up just because "we want it to"?

dunand
Hero Member
*****
Offline Offline

Activity: 620



View Profile
September 29, 2011, 09:32:54 PM
 #56

Where can I spend my bitcoins ? I do not gamble, I'm not a drug addict. I'm a cheap ass. There is not a lot of good deals in bitcoin stores.

When I sell something in classified ads. I mention that I accept to trade in bitcoins but we are not legion.

marhjan
Full Member
***
Offline Offline

Activity: 215


Poorer than I ought to be


View Profile
March 28, 2013, 09:44:58 PM
 #57

Bumping/Necroing one of the best threads in the history of this forum.  Recommended reading

Donations happily accepted @ 15qxNsc7pBiz5kXpAJykw4etzMbZitm2mk
Pages: « 1 2 [3]  All
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!