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Poll
Question: Do you think BTC is fungible?
Yes - 16 (64%)
No - 7 (28%)
I don't know - 0 (0%)
I don't know what is fungible - 2 (8%)
Total Voters: 25

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Author Topic: Is Bitcoin currency or goods? Fungible or not?  (Read 4954 times)
TonyT
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October 26, 2014, 10:02:08 PM
 #21


If, by your definition, fiat is fungible until it gets stolen (which is a bit nonsensical), then Bitcoin could be treated similarly:  Fungible until stolen.  Where's the problem?
 

That's not what we're talking about.  Read the thread more carefully.  And tell us how you voted... :-)

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TonyT
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October 26, 2014, 10:03:50 PM
 #22


That is how the blockchain works.  You can sometimes track bitcoins and that has happened on a few occasions.

I believe we disagree on how the blockchain works.  You are talking about combining bitcoins, or splitting them, and that's fine, but in the end you can trace them.  If you disagree show me the cite that says you cannot trace a bitcoin.  Remember, a mixer only means you're getting somebody else's bitcoin, not that you cannot trace the bitcoin.

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October 26, 2014, 10:04:29 PM
 #23


If, by your definition, fiat is fungible until it gets stolen (which is a bit nonsensical), then Bitcoin could be treated similarly:  Fungible until stolen.  Where's the problem?
 

That's not what we're talking about.  Read the thread more carefully.  And tell us how you voted... :-)

I'm interested in the demand for so-called 'virgin coins'. I'm not sure for how much longer all bitcoins will be created equal when there is a market for coins with clean transaction histories?

Forgive my petulance and oft-times, I fear, ill-founded criticisms, and forgive me that I have, by this time, made your eyes and head ache with my long letter. But I cannot forgo hastily the pleasure and pride of thus conversing with you.
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October 26, 2014, 10:06:37 PM
 #24


Answer: crude oil of a certain energy content is fungible.  That's what that gated paper says...so Alex Hern was right.

No.  The statement was:
Quote from: Alex Hern
So, for instance, crude oil is fungible, because if a trader buys a gallon of it, they don't care which gallon they get.
You don't get to substitute this statement for a different one in some gated paper.

But that was the paper you cited, not me.  Anyway I'm not going to parse this any more...I've leave the last word to you.



To get a better idea of what Levitin meant, let's expand the quote:
Quote from: Adam Levitin
One reason dollars work really well as a currency is that one $20 bill is entirely fungible with another $20 bill.  This means that when I pay, I don't have to make a decision about which $20 bill to use (unless I have some idiosyncratic attachment to the crisp ones or the like). It means that when I accept a payment, I don't care which $20 bill I am given, in part because I know that my ability to spend that $20 bill will not depend on which $20 bill it is.
(Emphasis mine)

I care which $20 bill I receive.  I'd much rather have an uncirculated one that's over 60 years old.  Is this idiosyncratic attachment?  What precisely did he mean by $20 bill?


It seems you are confused about what Adam meant--perhaps that's the problem?  It's clear to me and I think most people reading this what he meant...

TonyT
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October 26, 2014, 10:08:36 PM
 #25


If, by your definition, fiat is fungible until it gets stolen (which is a bit nonsensical), then Bitcoin could be treated similarly:  Fungible until stolen.  Where's the problem?
 

That's not what we're talking about.  Read the thread more carefully.  And tell us how you voted... :-)

I'm interested in the demand for so-called 'virgin coins'. I'm not sure for how much longer all bitcoins will be created equal when there is a market for coins with clean transaction histories?

That's an interesting point.... so you are after coins newly minted by miners?  Presumably they are untainted, which works both ways it seems to me.   Being untainted they might be more easy to trace to one owner.

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October 26, 2014, 10:09:35 PM
 #26


If, by your definition, fiat is fungible until it gets stolen (which is a bit nonsensical), then Bitcoin could be treated similarly:  Fungible until stolen.  Where's the problem?
 

That's not what we're talking about.  Read the thread more carefully.  And tell us how you voted... :-)

I'm interested in the demand for so-called 'virgin coins'. I'm not sure for how much longer all bitcoins will be created equal when there is a market for coins with clean transaction histories?

That's an interesting point.... so you are after coins newly minted by miners?  Presumably they are untainted, which works both ways it seems to me.   Being untainted they might be more easy to trace to one owner.

I never thought of that..

Forgive my petulance and oft-times, I fear, ill-founded criticisms, and forgive me that I have, by this time, made your eyes and head ache with my long letter. But I cannot forgo hastily the pleasure and pride of thus conversing with you.
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October 26, 2014, 11:05:25 PM
 #27


If, by your definition, fiat is fungible until it gets stolen (which is a bit nonsensical), then Bitcoin could be treated similarly:  Fungible until stolen.  Where's the problem?
 

That's not what we're talking about.  Read the thread more carefully.  And tell us how you voted... :-)

Perhaps some rest?  Your posts are getting that peaked cantankerous vibe one associated with an exhausted mind.

Feel free to retract or redraft your post once you're well rested... :-)
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October 26, 2014, 11:48:13 PM
 #28

But that was the paper you cited, not me.

I cited no paper here.  The statement was lifted directly from the article you linked to.

I believe we disagree on how the blockchain works.  You are talking about combining bitcoins, or splitting them, and that's fine, but in the end you can trace them.  If you disagree show me the cite that says you cannot trace a bitcoin.  Remember, a mixer only means you're getting somebody else's bitcoin, not that you cannot trace the bitcoin.

*sigh*  You can lead a horse to water but you cannot make it drink.  I'm out.
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October 27, 2014, 08:00:56 AM
 #29



Instead of citing something, how about a challenge? Take a look at the following transaction.

https://blockchain.info/tx/17e9f08a0674ad10b73385368d7d83a4a47cb8eafa937a325ce152275d3fa8ce?show_adv=true

It is a typical transaction, 0.00365096 BTC are transferred from 4 different addresses to 1MzdwP. Lets assume that the 0.001 BTC in 1FjApB are stolen. I challenge you to show me which satoshis now at 1MzdwP are stolen and which are not.


That's easy.  Here is a thought experiment:  a thief steals nine guns, all identical, and files off their serial numbers, so they are fungible.  He also buys a gun, legally, and files off its serial number.  The guns are worth $1000 each.  So the total value of guns is $10k  He goes to a pawn shop, and offers all ten guns for $1000.  The pawnshop is busted by the police for receiving stolen property (the low price accepted is a classic giveaway for being charged with this crime), the thief is arrested for theft, and the guns are confiscated, and the defense is:  'you don't know which gun is stolen and which gun is not stolen, so you cannot prosecute either party'.  Do you think this defense will work?  (It has been tried).

So in your example, you know one of the satoshis at 1MzdwP is the stolen one.  Which one?  It doesn't matter.

TonyT
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October 27, 2014, 08:38:10 AM
 #30

Not like currency (that each bill has a serial number and you can't break them apart), more like bank statements (the identifier identifies the transaction on a certain amount of Bitcoins), but that's still a simplification.
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October 27, 2014, 10:07:05 PM
 #31

Not like currency (that each bill has a serial number and you can't break them apart), more like bank statements (the identifier identifies the transaction on a certain amount of Bitcoins), but that's still a simplification.

Bitcoin is simply a store of value, you pay for your space in a big trusteable database (blockchain)
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October 28, 2014, 01:52:47 AM
 #32

Bitcoin is an e-currency and i dont conisder it as a goods. just a method of payment
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October 28, 2014, 05:02:14 AM
 #33

Not like currency (that each bill has a serial number and you can't break them apart), more like bank statements (the identifier identifies the transaction on a certain amount of Bitcoins), but that's still a simplification.

This is interesting if true.  So when you combine two bitcoins together, you are claiming they lose their previous identity?  If so then I concede.  Do you have a cite or this is your understanding?

TonyT
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October 28, 2014, 02:49:09 PM
 #34

Not like currency (that each bill has a serial number and you can't break them apart), more like bank statements (the identifier identifies the transaction on a certain amount of Bitcoins), but that's still a simplification.

This is interesting if true.  So when you combine two bitcoins together, you are claiming they lose their previous identity?  If so then I concede.  Do you have a cite or this is your understanding?

Admit it. You have no idea how Bitcoin transactions work.
 

Oh, here is your citation: https://en.bitcoin.it/wiki/Transaction


No my friend, I think my idea is quite accurate, note this passage in your cite: "If the input is worth 50 BTC but you only want to send 25 BTC, Bitcoin will create two outputs worth 25 BTC: one to the destination, and one back to you (known as "change", though you send it to yourself)."

So in fact bitcoin is not fungible, you can always trace smaller amounts, and they don't combine to lose their identity (correct me if I'm wrong)


TonyT
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October 28, 2014, 07:51:07 PM
 #35

No my friend, I think my idea is quite accurate, note this passage in your cite: "If the input is worth 50 BTC but you only want to send 25 BTC, Bitcoin will create two outputs worth 25 BTC: one to the destination, and one back to you (known as "change", though you send it to yourself)."

So in fact bitcoin is not fungible, you can always trace smaller amounts, and they don't combine to lose their identity (correct me if I'm wrong)

Bitcoins don't have identities.

Out of the entire page, you reference one example and claim it proves your assertion. Let me summarize the rest of the page.

A transaction consists of one or more inputs and outputs. An input consists of a reference to an output in a previous transaction and parameters for the referenced output's script. An output consists of a value representing an amount of bitcoins and a script. The parameters in the inputs must satisfy the scripts they reference and sum of the values in the outputs must be greater than the sum of the values in the referenced outputs.

This diagram should help:
 


Your cut and paste job seems incomplete.  You still did not answer the question (because perhaps, like me, you're not 100% sure of the answer), and that is:  can you trace bitcoins if they are split up or not? I say you can.  If you claim you cannot, and somehow the blockchain loses that information (as it does for example with DarkCoins), please let me know.  A citation is optional but nice if you have one.


TonyT
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October 29, 2014, 03:41:09 PM
 #36

You still did not answer the question (because perhaps, like me, you're not 100% sure of the answer), and that is:  can you trace bitcoins if they are split up or not?

You can trace bitcoins that have never been combined with other bitcoins.

What happens when the bitcoins are combined with other bitcoins?  You cannot trace them?  I've never heard of that, are you sure?

TonyT
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October 29, 2014, 05:33:14 PM
 #37

You still did not answer the question (because perhaps, like me, you're not 100% sure of the answer), and that is:  can you trace bitcoins if they are split up or not?
You can trace bitcoins that have never been combined with other bitcoins.
What happens when the bitcoins are combined with other bitcoins?  You cannot trace them?  I've never heard of that, are you sure?

I no longer feel the need to justify my responses because you have doubts based on your own ignorance.
Please read the page I linked. It is complicated, so you will want to study it thoroughly. Everything I have written is supported by that page.

You have not made your case though.  Appeals to authority are a cop-out.  Anybody else?

TonyT
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October 29, 2014, 09:15:11 PM
 #38



Instead of citing something, how about a challenge? Take a look at the following transaction.

https://blockchain.info/tx/17e9f08a0674ad10b73385368d7d83a4a47cb8eafa937a325ce152275d3fa8ce?show_adv=true

It is a typical transaction, 0.00365096 BTC are transferred from 4 different addresses to 1MzdwP. Lets assume that the 0.001 BTC in 1FjApB are stolen. I challenge you to show me which satoshis now at 1MzdwP are stolen and which are not.


That's easy.  Here is a thought experiment:  a thief steals nine guns, all identical, and files off their serial numbers, so they are fungible.  He also buys a gun, legally, and files off its serial number.  The guns are worth $1000 each.  So the total value of guns is $10k  He goes to a pawn shop, and offers all ten guns for $1000.  The pawnshop is busted by the police for receiving stolen property (the low price accepted is a classic giveaway for being charged with this crime), the thief is arrested for theft, and the guns are confiscated, and the defense is:  'you don't know which gun is stolen and which gun is not stolen, so you cannot prosecute either party'.  Do you think this defense will work?  (It has been tried).

So in your example, you know one of the satoshis at 1MzdwP is the stolen one.  Which one?  It doesn't matter.

"It doesn't matter", to who ?

What if, in the above example, 0.0000001 were stolen and 50,000 btc were legit ?   Would the whole balance be deemed illegitimate ?

A law is only a law if it is enforceable, after all.

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October 30, 2014, 01:56:02 AM
 #39

It is a currency. No more arguments or questions. It is a currency.
TonyT
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October 30, 2014, 07:42:10 AM
 #40


"It doesn't matter", to who ?

What if, in the above example, 0.0000001 were stolen and 50,000 btc were legit ?   Would the whole balance be deemed illegitimate ?

A law is only a law if it is enforceable, after all.



Yes, the whole amount is illegitimate, Google: 'commingling of assets'.  But I am not a lawyer.  Here is one link relating to bankruptcy, not criminal law:  http://en.wikipedia.org/wiki/Commingling


TonyT
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