Bitcoin price increases are just getting started

[markm]

The fact that so many bitcoin enthusiasts don't seem inclined to buy into alternative blockchains is actually a selling point for new chains in some cases.

For example part of the "point" in using chips in poker, or using various game-currencies in various games, is precisely to de-couple the value of them from "real money" so that players can decide for themselves how much they will use each of the colours of chips / types of game-currency to represent for the purpose of any "real money" agreements they might choose to make with each other regarding whether and how the disposition of such things in some game or other is to alter their "real money" positions.

I hope some of the game nations in the Freeciv Galactic Milieu will decide to use for their own blockchain-based currency a blockchain set up in some way that will allow them to open it right up to public "thick clients" and "miners" right from the start. (Such as by having no per block minting of coins just one lump sum of the total coins they will be issuing right in the genesis block ready for them to start issuing them.)

Partly this is because they can thus let other people do the blockchain building for them, partly it is because it eliminates the "but it is not fully universal person to person" objection to the private-net ones such as CDN and UKB, but largely because then we could maybe see actual blockchain-wars happen if some nations think it might be economical to try to double-spend and such on other nations' blockchains.

Some people pay real money in the course of playing games, so who knows, maybe some might "pay" real hashing too to try to gain an economic advantage compared to an opponent...

...I had thought to simply "simulate" such hashing wars by comparing the computer technology level and number of datacentres of each nation but hey maybe actual hashing wars could be more interesting and also maybe more pertinent to other blockchains as actual cases of "weak/cheap" blockchains attacking each other and being attacked by outsiders and so on.

Also if a chain has no per block minted coin rewards right from the start we can see right from the start how nice transaction fees look as rewards.

-MarkM- (World of Warcraft gold actually *tried* to decouple from "real money" didn't it and still often fails to do so?)

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[FreeMoney]

Also if a chain has no per block minted coin rewards right from the start we can see right from the start how nice transaction fees look as rewards.

How do any coins come into existence?

[enmaku]

Just got a response email from Intrade - and not the automated nameless kind either

Hello David,

Thanks for your email. This is something we are definitely going to research and discuss. It may not be for a week or two, but I will be back in touch afterwards or if I have any questions for you.


Kind regards,

Carl Wolfenden
Exchange Operations Manager
Intrade - The Prediction Market

Hope it pans out!

[marcus_of_augustus]

There is already at least one competing blockchain, namecoin.

Ostensibly, it is for providing a distributed database for DNS (domain name serving) name registration but as it a bitcoin clone (very little has been altered of the transaction behaviour of the code) then namecoins can be traded in much the same ways as bitcoins. The blockchain is 6690 odd blocks long and network difficulty is 1290. No gui client but namecoins can be traded using the CLI with namecoind.

Namecoin is to bitcoin somewhat as silver is to gold, since namecoin has more practical applications and uses (like silver) but can also be stored and traded like bitcoin, but is not purely for that purpose like bitcoin.

There may be other covert blockchains already in existence that will be revealed when the time is right ...

[opticbit]

I was thinking of stopping by my stock broker's local branch and asking them what they thought of bitcoins (I expect them to have no clue what the are)

[markm]

Also if a chain has no per block minted coin rewards right from the start we can see right from the start how nice transaction fees look as rewards.

How do any coins come into existence?

21 million per block for the first/genesis block and none thereafter could be one method.

-MarkM-

[abyssobenthonic]

It isn't 'bad'. It's just that the value of bitcoin is it's difficulty and it's acceptance. A new incarnation won't have those things. Anyone coming in and deciding between Bitcoin and Bitcoin2 rationally chooses Bitcoin. Now if something totally different with new/different properties is created then maybe it has a chance.

The best option for an alternative block chain currency is probably to fork off of the bitcoin blockchain (before whatever block #, it considers the same block as bitcoin does to be valid; afterwards it considers blocks meeting a different set of criteria to be valid (e.g. ones that enforce demurrage or that have a minimum block reward)) with all bitcoin balances at the point of the fork carrying over as balances in the new coin.  That pretty much guarantees some level of currency exchange over the first several post-fork blocks between the two coins: if the forked chain then offers a better BTC-denominated return for the miners then some miners will switch with a backup plan of coming back to bitcoin if the fork doesn't pan out.  If enough miners switch, then the new chain offers at least some appeal to actual users on that basis.

Of course, an alternative block chain currency that's more or less identical to bitcoin (just with a different set of early adopters) is almost certainly doomed to failure.

[enmaku]

Apologies for the necromancy but I just got another reply from InTrade:

Hello David,

I have had the chance to review BitCoin as a possible option. The only way Intrade could use BitCoin at the moment is to integrate it into our current systems and exchange. Creating a separate exchange that uses only BitCoin is not an option for us at the minute.

So what we would need is a mechanism to convert incoming BitCoins into USD, and then convert USD back into BitCoins when users wish to withdraw funds from their Intrade account. Do you know of anyone who is doing this already? Or if this is possible (or feasible)?



Kind regards,

Carl Wolfenden
Exchange Operations Manager
Intrade - The Prediction Market

I of course chatted with him about Mt. Gox and its associated trade API.

Just thought I'd keep you all up to date 

[w0mbat]

better told him about tradehill.

[dacoinminster]

Apologies for the necromancy . . .

Necromancy?! This is my favorite thread! This thread will die when I do!

[enmaku]

better told him about tradehill.

I did mention it of course, but as they're looking for automation and TradeHill's API isn't ready/published yet...

[Hans0]

dacoinminster, finally I see that I am not crazy because our reasoning pretty much agrees: http://forum.bitcoin.org/index.php?topic=7715.msg167918#msg167918

I have not met _one_ person who agrees with this reasoning. They all say nothing and ignore what I just said. I guess it gets discarded by peoples bullshit filter quickly before they can intellectually evaluate it. It is too outrageous.

[dacoinminster]

dacoinminster, finally I see that I am not crazy because our reasoning pretty much agrees: http://forum.bitcoin.org/index.php?topic=7715.msg167918#msg167918

I have not met _one_ person who agrees with this reasoning. They all say nothing and ignore what I just said. I guess it gets discarded by peoples bullshit filter quickly before they can intellectually evaluate it. It is too outrageous.

Yes, I haven't seen a good argument against this logic (although I personally put different numbers into the equation). No matter how you do the math though, the current price of a bitcoin seems laughably low.

[MoonShadow]

dacoinminster, finally I see that I am not crazy because our reasoning pretty much agrees: http://forum.bitcoin.org/index.php?topic=7715.msg167918#msg167918

I have not met _one_ person who agrees with this reasoning. They all say nothing and ignore what I just said. I guess it gets discarded by peoples bullshit filter quickly before they can intellectually evaluate it. It is too outrageous.

Yes, I haven't seen a good argument against this logic (although I personally put different numbers into the equation). No matter how you do the math though, the current price of a bitcoin seems laughably low.

What math?  Are you talking about guessing the 'proper' value of a bitcoin, based upon assumptions of the size of the (non-speculation based) Bitcoin economy?  Because it's a rediculous assertion that you, me or anyone can actually know what that is.  We can't even get a decent guess without first knowing how much trade goes on within such walled gardens as SilkRoad, OTC or BlackMarket.  Just looking at the volume of trade on those currency trading sites like MtGox doesn't tell you anything of usefullness, except that the market price is what the market price says that it is.

[dacoinminster]

What math?  Are you talking about guessing the 'proper' value of a bitcoin, based upon assumptions of the size of the (non-speculation based) Bitcoin economy?  Because it's a rediculous assertion that you, me or anyone can actually know what that is.  We can't even get a decent guess without first knowing how much trade goes on within such walled gardens as SilkRoad, OTC or BlackMarket.  Just looking at the volume of trade on those currency trading sites like MtGox doesn't tell you anything of usefullness, except that the market price is what the market price says that it is.

Not math specifically. Rather, the logic of my first post in this thread, which yields an equation you can plug numbers into.

I in no way assert that one can know the numbers to plug in with any precision. Rather, I assert that any reasonable guess at the numbers yields a per-bitcoin value orders of magnitude higher than current prices.

[MoonShadow]

What math?  Are you talking about guessing the 'proper' value of a bitcoin, based upon assumptions of the size of the (non-speculation based) Bitcoin economy?  Because it's a rediculous assertion that you, me or anyone can actually know what that is.  We can't even get a decent guess without first knowing how much trade goes on within such walled gardens as SilkRoad, OTC or BlackMarket.  Just looking at the volume of trade on those currency trading sites like MtGox doesn't tell you anything of usefullness, except that the market price is what the market price says that it is.

Not math specifically. Rather, the logic of my first post in this thread, which yields an equation you can plug numbers into.

I in no way assert that one can know the numbers to plug in with any precision. Rather, I assert that any reasonable guess at the numbers yields a per-bitcoin value orders of magnitude higher than current prices.

Ah, yes.  But those assumptions could take decades to come to fruition.  They have almost zero bearing on what the value of a bitcoin will be next week or next year.

[dacoinminster]

Ah, yes.  But those assumptions could take decades to come to fruition.  They have almost zero bearing on what the value of a bitcoin will be next week or next year.

I guess everyone will decide what time-frame they care about. I personally am expecting additional massive increases in bitcoin prices in the coming years, so I have no problem holding bitcoins through these fluctuations.

[Hans0]

Ah, yes.  But those assumptions could take decades to come to fruition.  They have almost zero bearing on what the value of a bitcoin will be next week or next year.

Exactly! I always say that short-term market fluctuations are entirely unpredictable. Daytrading bitcoin does not make sense to me. I intend to hold 5-10 years.

[dacoinminster]

This video interview is great:

http://www.youtube.com/watch?v=ygoqDBfjimM

It's Bruce Wagner describing bitcoin, and he goes into detail on what bitcoins could be worth someday. He describes something similar to my logic from post #1.

(Warning, it's a LONG interview, but worth it).

[PandaMiner]

Wow. I just read this thread (because of your siggy).

Nice discussion. Wow, you sure "talk" a lot with your friend there. How fast do you type that your friend doesn't have time to respond to each "send" ?   lol