Bitcoin is NOT a Currency - Etsy Labs, Brooklyn - May 14th

[cbeast]

The worthy will own Bitcoin and will profit mightily from its ascendance long before the unworthy are forced aboard the train.

+1

I actually like the train analogy beyond that - it is as if we're building the world's first train, and all around us people stare and say, "That's not a horse! It won't ever work!" Meanwhile the rails are being laid to their door.

lol, reminds me of Noah building the ark. It took him 120 years to build, and during that time there was no rain at all, and he was building it on dry land, so it naturally had its detractors. He was 600+ years old before the actual flood came.

And he was even older when he was fucking is daughters.  [review scriptures...]  Oops.  Wrong guy;  I guess that was Lot.   So Noah was even older than 600 years when he was caught 'exposing himself.'  Both were drunk.  Were these guys boozing creepers or what!?!

Thanks, now I gotta redo my next Buried Keys Biblical Dig. Looks like this train got derailed.

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[benjamindees]

Yeah, this guy is probably going to argue that currency requires a counterparty (government).  That's wrong, but whatever.  It's a commodity.  It's a commodity-currency.  The counterparty is the market.  That's more reliable than a government anyways.  Fuck him.  We don't need Bloomberg or whatever this guy does.  He's just talking his book.

[lonelyminer (Peter Šurda)]

Why are you so angry at him? Without listening to his argument even? The law often defines currency as a medium of exchange with special legal status. Sure, this is a statist definition, but so what? It's illogical to be angry about a definition.

[enmaku]

Here's my argument for Bitcoin's currency status.

I don't care much what economists decide the critera for a bona fide "currency" are, I care how something is used and to really grasp what the use of currency looks like we have to go back to a time before it existed. Once upon a time there was barter. If I were a shepherd and you were a chicken farmer I could trade you sheep for eggs, but there were some problems here: What if you don't want my sheep? What if I can't break down one of my sheep into a quantity that's worth the number of eggs I want? This scenario could easily turn into a long drawn-out series of trades across the marketplace for me to simply trade sheep for eggs in the desired quantities and I probably lose value with each successive trade - and I *definitely* lose value in the time I have to spend making the trades. What's more, I need to know the value of everything as expressed in everything else. I can't trade my sheep for berries then trade berries for eggs if I don't know the exchange rates for all those things. A barter-based market looks like this:



My fellow computer nerds will recognize this as a "mesh topology" - a type of network where everything is linked with everything else. It's very resilient but it's also very complex and doesn't scale well.

Now let's introduce a currency - let's say silver coins (though it could be anything so long as the whole market decides to use the same thing). I trade my sheep for silver and my silver for eggs - the most trades I have to make to get from anything to anything else is two and my mental load is lessened since I only have to know the value of everything in silver. The silver is more divisible than my sheep and in this silver-based marketplace it's almost guaranteed that you'll want my silver since you can exchange my silver for anything else that you want. This marketplace looks like this:



This should also be recognized by my fellow computer nerds as a star topology. The thing at the middle, in this case silver, is the currency. That's my criteria in a nutshell - is there a marketplace that has what looks like a star topology with Bitcoin being the thing in the center? As of today there is indeed a marketplace, albeit a fairly limited and young marketplace, that looks just like the above with Bitcoin in the center, so for all practical purposes, Bitcoin is a currency.

Do note, of course, that having only one bit in the center is an over-simplification. In an old marketplace you might use silver for small purchases and gold for large and in international marketplaces there might be multiple currencies all exchangeable for one another in a mini-mesh, but the point is that there's something small and comparatively simple in the middle surrounded by a great many things that are exchangeable for what's in the center. The fact that many businesses do business in Bitcoin then exchange it for local currency has no bearing (in this example anyway) on Bitcoin's use and therefore status as a functional currency.

[SpontaneousDisorder]

Today I will explain why an obviously superior technology will not take my job. 

[Boussac]

Today I will explain why an obviously superior technology will not take my job. 

I hold my breath

[meanig]

So, did anyone go?

[Crypt_Current]

The worthy will own Bitcoin and will profit mightily from its ascendance long before the unworthy are forced aboard the train.

+1

I actually like the train analogy beyond that - it is as if we're building the world's first train, and all around us people stare and say, "That's not a horse! It won't ever work!" Meanwhile the rails are being laid to their door.

+1000
What school did you attend?  Did you major in mind-blowing analogies?

[Crypt_Current]

I'm curious as to the reasons behind categorizing bitcoin one way or another.  I see earlier in this thread, according to at least one person, the ostensible reasons for establishing btc as a commodity would be in order to tax it.
What would be the reasoning for establishing it as a currency?  I think I remember reading somewhere that the reason for this would be to render it illegal:  It is treasonous (? maybe?  not sure what law or laws are violated here) to create a currency that is not whichever nation's established currency for payment of taxes in that nation.

So, I guess what I'm wondering is, whether BTC is established as currency or commodity, wouldn't either situation be detrimental to the BTC ecosystem and possibly its fundamental purpose?

I'm fine with it being a shmurrency...

[Stephen Gornick]

So, did anyone go?

"Bitcoin works. That's the problem." - Ken Bromberg, Bloomberg LP #bitcoin
 - http://twitter.com/#!/dbkahn/status/202189415618056192

The only Tweets I saw were from:
 - http://twitter.com/#!/dbkahn

[DeathAndTaxes]

Why are you so angry at him? Without listening to his argument even? The law often defines currency as a medium of exchange with special legal status. Sure, this is a statist definition, but so what? It's illogical to be angry about a definition.

No that would be legal tender.

[lonelyminer (Peter Šurda)]

Why are you so angry at him? Without listening to his argument even? The law often defines currency as a medium of exchange with special legal status. Sure, this is a statist definition, but so what? It's illogical to be angry about a definition.

No that would be legal tender.

Depends on the context, I think I wasn't explicit enough. USD is a legal tender in the USA, but euros or yen are still a currency (while Bitcoin or gold most likely are not). This has an effect on taxation, regulation and so on.

[cbeast]

Why are you so angry at him? Without listening to his argument even? The law often defines currency as a medium of exchange with special legal status. Sure, this is a statist definition, but so what? It's illogical to be angry about a definition.

No that would be legal tender.

Depends on the context, I think I wasn't explicit enough. USD is a legal tender in the USA, but euros or yen are still a currency (while Bitcoin or gold most likely are not). This has an effect on taxation, regulation and so on.

If special legal satus is a requirement for a currency, then currency is subject to the winds of political change and not something with long term storage of value.

[lonelyminer (Peter Šurda)]

If special legal satus is a requirement for a currency, then currency is subject to the winds of political change and not something with long term storage of value.

If it merely has a special legal status, that does not necessarily mean that the politics can influence the production or distribution of it. But you're correct in that the definition is a statist one. Its purpose is to be usable for tax and accounting, not for economic or financial analysis.

[realnowhereman]

A currency is $DEFINITION_OF_CURRENCY_THAT_SUITS_MY_ARGUMENT.

Bitcoin, therefore, is/isn't a currency.


Bitcoin is what it is; let's leave semantics to the future historians.

[julz]

BK Tech Talks - Bitcoin is NOT a currency
http://www.youtube.com/watch?v=NULPfp0Zu5g

[Serge]

nice vid, interesting to watch, too bad they disabled comments or at least it didn't work for some reason for me.

the guy is pretty objective and honest in his views. first half of video i had a feeling he was pretty much endorsing bitcoin, but his stance that it won't work long term only because that the powers that may be will never give up their powers.

another of his points was that we don't have any developed investment vehicles with which i pretty much disagreeing as seeing GLBSE picking up pace in real investments sector

[EskimoBob]

BK Tech Talks - Bitcoin is NOT a currency
http://www.youtube.com/watch?v=NULPfp0Zu5g

What a waste of time that was.

[Etlase2]

another of his points was that we don't have any developed investment vehicles with which i pretty much disagreeing as seeing GLBSE picking up pace in real investments sector

I think he was referring more to bonds. "Buy money; get more money guaranteed!"

The gist is no bonds, no taxes, not a currency as these are the two things that keep the fiat cycle running. And since governments are unlikely to ever accept bitcoin for taxes because it reduces their power, and bonds can't be hand, bitcoin will never be a true medium of exchange for the world. It's an opinion and he said as much.

One would hope that if enough of the people demanded bitcoin payment for taxes that governments would eventually acquiesce. But I think it would be pretty unlikely with what world governments have been doing lately.

"If you don't want to go to jail, bitcoin can't be your currency." It makes sense.

[hazek]

BK Tech Talks - Bitcoin is NOT a currency
http://www.youtube.com/watch?v=NULPfp0Zu5g

What a waste of time that was.

Ty, I was 2min in and paused reading this thread. I closed the tab now.