ASICMINER: Entering the Future of ASIC Mining by Inventing It

[Vycid]

Or, perhaps, mining equipment will be more expensive because maintaining 20% of the hashrate will be much more difficult, and solar panels will still be as unreasonable in a few years as they are right now? Understand: his operation already gets $0.06/kWh, but that can't compete with upper Washington state ($0.01/kWh). Also, solar panels sorta don't work at night, and I bet you don't want to give up half of your income.

well, my house is powered by solar, has been for 12 years, and I run power 24/7.

Granted, I am not running a data center, but saying solar is unreasonable is just false.  There are data centers powered by solar/wind, and in China, those resources are cheaper than anywhere else.  Still, you're looking at a 3 year ROI for a solar system, though wind can be 1-2 years in the right place.

Think about this:  solar cost $5/watt 12 years ago.  It costs $.5 a watt today.  You can expect it to continue to decrease as production and technologies improve.  It will easily half before the bitcoin reward does.

back to the other stuff you were discussing...

The 3 year ROI on solar is based on typical US costs for electricity at ~$0.15/kWh. Friedcat gets ~$0.06/kWh. His solar ROI is too far out to make sense, especially since he's going to need to have a bunch of UPS so he can switch back over to the grid at night without everything going down.

(By the way, the 3 year ROI is really good - something I'd consider for my own home. Can you get me a source for that? Last I'd heard was 9-10 years, with subsidy.)

[huhai0978]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

FIAT means inflation. And inflation is not that bad. Inflation is compensated  by interest. Have you ever thought where the interest come from? What we want is not deflation, what we want is freedom.

[Vycid]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

This is a terrible argument, sorry. A kneejerk "we should do the opposite" because "fiat is bad, mmkay" is not compelling. Even if you took as axiom that fiat is bad, you're still on the hook for demonstrating why punishing hoarding and rewarding spending is a bad thing.

Economists - yes, including the Austrian ones like Hayek and von Mises - agree that you need to penalize hoarding and encourage spending to boost the velocity of money and create a healthy economy. This is the primary reason why deflation is viewed more negatively than inflation.

It is clear that Satoshi wasn't an economist.

[JimiQ84]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

FIAT means inflation. And inflation is not that bad. Inflation is compensated  by interest. Have you ever thought where the interest come from? What we want is not deflation, what we want is freedom.

Interest is reward for lending money. That works even in BTC world, just look at loan section of this forum. It has nothing to do with inflation. If anything, it's other way around.

[JimiQ84]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

This is a terrible argument, sorry. A kneejerk "we should do the opposite" because "fiat is bad, mmkay" is not compelling. Even if you took as axiom that fiat is bad, you're still on the hook for demonstrating why punishing hoarding and rewarding spending is a bad thing.

Economists - yes, including the Austrian ones like Hayek and von Mises - agree that you need to penalize hoarding and encourage spending to boost the velocity of money and create a healthy economy. This is the primary reason why deflation is viewed more negatively than inflation.

It is clear that Satoshi wasn't an economist.

Whoa, whoa there. You mean economist like Keynes agree that you need encourage spending to create a healthy economy. And that's just plain wrong (on which Hayek and von Mises agreed).

[velacreations]

The 3 year ROI on solar is based on typical US costs for electricity at ~$0.15/kWh. Friedcat gets ~$0.06/kWh. His solar ROI is too far out to make sense, especially since he's going to need to have a bunch of UPS so he can switch back over to the grid at night without everything going down.

(By the way, the 3 year ROI is really good - something I'd consider for my own home. Can you get me a source for that? Last I'd heard was 9-10 years, with subsidy.)

Cost of solar in China is $500/kW.
His cost is $.06/kWh

So, he needs 8,333 hours for ROI. @ 7 hours a day for sunlight, that's 1190 days, or 3.26 years.

If he buys in bulk, he can get it considerably less than $500/kW, cause those are retail prices, and for a data center, he can get wholesale.  If he does a wind/solar hybrid in a suitable location, the ROI will be closer to 2 years.

For buying for your home in the US, this site has a decent cost comparison: http://www.ecobusinesslinks.com/surveys/free-solar-panel-price-survey/  

[huhai0978]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

FIAT means inflation. And inflation is not that bad. Inflation is compensated  by interest. Have you ever thought where the interest come from? What we want is not deflation, what we want is freedom.

Interest is reward for lending money. That works even in BTC world, just look at loan section of this forum. It has nothing to do with inflation. If anything, it's other way around.

Look at those guys in the loan section of this forum. They are going to bankrupt. Lending an deflation money is a Ponzi scheme!!!

[Vycid]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

FIAT means inflation. And inflation is not that bad. Inflation is compensated  by interest. Have you ever thought where the interest come from? What we want is not deflation, what we want is freedom.

Interest is reward for lending money. That works even in BTC world, just look at loan section of this forum. It has nothing to do with inflation. If anything, it's other way around.

Okay, let me break this down:

If you're using a currency with 10% annual inflation, and Joe wants to lend Bob 100 currency units, then Joe will make no profit if he lends at 10% APR, since 110 units in a year will be equivalent in value to 100 units now. Does that make sense?

So Joe would have to lend at, say, 15% APR, and 15 - 10 = 5% profit that Joe wants. 15% looks like a lot to Bob, so he says "I'll borrow from someone else". Joe is in trouble; if he sits on his 100 currency units, they'll be worth less in a year. He agrees to loan for 10% APR so that he doesn't lose any money. Bob is happy because 110 currency units will be easy to pay off in a year.

Let's suppose we're now using a currency with 10% deflation. Joe wants to lend Bob 100 currency units. In order to make a 5% profit, this means Joe must lend at -5% APR.

Wait - that doesn't work! Bob could borrow 100 units, sit on them for a year, and return 95. Joe has made a 5% profit, but Bob has actually come out ahead!

So Joe could simply sit on his currency for a year, and make 10% profit instead of the 5% he'd make from a loan with 5% inflation-adjusted APR. In the inflationary scenario, Joe would have been willing to lend out his money at 0% inflation-adjusted interest just to avoid losing money from inflation!

Realistically, in a deflationary economy, this means that nobody wants to make loans, and in an inflationary economy everyone wants to make loans. Of course, too much inflation is bad because it destroys value, so the ideal situation is close to what you see in the fiat of most major, stable countries: a few percent (I personally would rather see 0%, but that's not practical for a number of reasons). It's enough to discourage hoarding and encourage lending (which enables business); but low enough not to seriously damage money as a store of value.

[Vycid]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

This is a terrible argument, sorry. A kneejerk "we should do the opposite" because "fiat is bad, mmkay" is not compelling. Even if you took as axiom that fiat is bad, you're still on the hook for demonstrating why punishing hoarding and rewarding spending is a bad thing.

Economists - yes, including the Austrian ones like Hayek and von Mises - agree that you need to penalize hoarding and encourage spending to boost the velocity of money and create a healthy economy. This is the primary reason why deflation is viewed more negatively than inflation.

It is clear that Satoshi wasn't an economist.

Whoa, whoa there. You mean economist like Keynes agree that you need encourage spending to create a healthy economy. And that's just plain wrong (on which Hayek and von Mises agreed).

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

Nobel laureate Friedrich Hayek, an Austrian Economist, stated of deflation during the Great Depression:
I agree with Milton Friedman that once the Crash had occurred, the Federal Reserve System pursued a silly deflationary policy. I am not only against inflation but I am also against deflation. So, once again, a badly programmed monetary policy prolonged the depression.
Interview with Diego Pizano (1979)[23]

...

They are therefore rewarded by holding money. This "hoarding" behavior is seen as undesirable by most economists, as Hayek points out:
It is agreed that hoarding money, whether in cash or in idle balances, is deflationary in its effects. No one thinks that deflation is in itself desirable.[24]

[huhai0978]

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

Nobel laureate Friedrich Hayek, an Austrian Economist, stated of deflation during the Great Depression:
I agree with Milton Friedman that once the Crash had occurred, the Federal Reserve System pursued a silly deflationary policy. I am not only against inflation but I am also against deflation. So, once again, a badly programmed monetary policy prolonged the depression.
Interview with Diego Pizano (1979)[23]

...

They are therefore rewarded by holding money. This "hoarding" behavior is seen as undesirable by most economists, as Hayek points out:
It is agreed that hoarding money, whether in cash or in idle balances, is deflationary in its effects. No one thinks that deflation is in itself desirable.[24]

I think Friedrich, Friedman and Friedcat are related in some way.

[Jake McVitie]

Maybe it's possible to have both inflationary and deflationary currencies running side-by-side within one economy.

Then people can chop and choose which one they use and eventually a self-sustaining equilibrium will be achieved.

There'll be no more arguing about which system is better because both systems are available and a healthy balance is maintained.

[JimiQ84]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

This is a terrible argument, sorry. A kneejerk "we should do the opposite" because "fiat is bad, mmkay" is not compelling. Even if you took as axiom that fiat is bad, you're still on the hook for demonstrating why punishing hoarding and rewarding spending is a bad thing.

Economists - yes, including the Austrian ones like Hayek and von Mises - agree that you need to penalize hoarding and encourage spending to boost the velocity of money and create a healthy economy. This is the primary reason why deflation is viewed more negatively than inflation.

It is clear that Satoshi wasn't an economist.

Whoa, whoa there. You mean economist like Keynes agree that you need encourage spending to create a healthy economy. And that's just plain wrong (on which Hayek and von Mises agreed).

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

Nobel laureate Friedrich Hayek, an Austrian Economist, stated of deflation during the Great Depression:
I agree with Milton Friedman that once the Crash had occurred, the Federal Reserve System pursued a silly deflationary policy. I am not only against inflation but I am also against deflation. So, once again, a badly programmed monetary policy prolonged the depression.
Interview with Diego Pizano (1979)[23]

...

They are therefore rewarded by holding money. This "hoarding" behavior is seen as undesirable by most economists, as Hayek points out:
It is agreed that hoarding money, whether in cash or in idle balances, is deflationary in its effects. No one thinks that deflation is in itself desirable.[24]

Once Crash occured deflationary policy was wrong. High inflation and high deflation are wrong. Right, I agree. But Bitcoin's programmed deflation after adopton is lower (created only by lost coins, otherwise is BTC inflation/deflation neutral) than current 3-5% annual US dollar inflation. Bitcoin wins.

And if you think that Bitcoin's deflationary nature is bad than I don't see a point of you staying invested in bitcoin business.

[Vycid]

The 3 year ROI on solar is based on typical US costs for electricity at ~$0.15/kWh. Friedcat gets ~$0.06/kWh. His solar ROI is too far out to make sense, especially since he's going to need to have a bunch of UPS so he can switch back over to the grid at night without everything going down.

(By the way, the 3 year ROI is really good - something I'd consider for my own home. Can you get me a source for that? Last I'd heard was 9-10 years, with subsidy.)

Cost of solar in China is $500/kW.
His cost is $.06/kWh

So, he needs 8,333 hours for ROI. @ 7 hours a day for sunlight, that's 1190 days, or 3.26 years.

If he buys in bulk, he can get it considerably less than $500/kW, cause those are retail prices, and for a data center, he can get wholesale.  If he does a wind/solar hybrid in a suitable location, the ROI will be closer to 2 years.

For buying for your home in the US, this site has a decent cost comparison: http://www.ecobusinesslinks.com/surveys/free-solar-panel-price-survey/  

Ahhhh... I see the problem, here. You assume that for all 7 hours of sunlight, the power output will be at the maximum possible. This is false, of course. The workaround is to use insolation times area times external quantum efficiency.

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

So we'll use the Canadian Solar panel from the website you linked as an example. It has an EQE of 15.23% (here: http://www.solarsystems-usa.net/solar-panels/#.UdXTxPm1Eqg). Its area is (60 cells x 156 × 156 mm), or 1.46 m². You said $0.5/W, so we'll stick with that; the cost of the panel is $166/panel in bulk, for a cost of $0.72/W; we'll assume serious bulk and Chinese discounts, so the actual cost will be computed $166 * 0.5/0.72 = $115.28. Hopefully you agree that price is reasonable.

So here are the characteristics so far:

Area: 1.46 m²
EQE: 15.23%
Price per 1.46 m²: $115.28

Now, we look up the insolation in Shenzen province, China.

http://www.greenrhinoenergy.com/solar/radiation/empiricalevidence.php

This looks like about 1500 kWh/m²-year to me. If you can find a better source, that'd get a more accurate calculation.

So, the energy output per year is

1.46 m² * 1500 kWh/m²-year * 0.1523 = 333.537 kWh/year

Now, since we're using a power cost of $0.06/kWh,

333.537 * $0.06 = $20.01 worth of power per module per year.

At a cost of $115.28 per cell, that's on the order of 6 years.

Insolation is enormously important in any solar calculation. If you use maximum wattage all the time, you're gonna end up getting screwed by people looking to sell you solar power.

I also am compelled to point out that I assumed your figure of $0.50 was correct. If we used the original $0.72/W value, the ROI would be about 9 years, like I thought (also: installation is not free).

EDIT: Found a better map. I'm sticking with 1500 kWh/m²-year.

http://solargis.info/doc/_pics/freemaps/1000px/ghi/SolarGIS-Solar-map-South-And-South-East-Asia-en.png

[freedomno1]

Nice post aaaz  

Onto this topic

Saving encourages investing

Capital for entrepreneurs to create business needs to come from savers
All businesses need equity before they can operate and create growth that money comes from savings of people, not central banks.
There is nothing wrong with having a culture of saving at all it just builds equity for the future and ensures that the market really grows as it promotes entrepreneurs with new ideas who can maximize your profits.

The problem with Keynesian economics is that the growth of the money supply is not always tangibly connected to real growth of the economy.
The argument can be made that first world countries success comes from resource allocation taken from third world countries.

Furthermore mismanagement of the money supply by countries that do not live within their means can and does lead to economic crisis and collapse.
Multiple times in the last 2 decades we have seen recessions on a large scale due to excessive spending or excessive borrowing.
An example which we all know is the subprime mortgage crisis lending to people with bad credit to promote housing.
Another example we can observe is the Cyprus crisis that made bitcoin even more popular and the European Zones current chaos.
An example of a future bubble is the rising cost of student loans and tuition fees but when that will occur is still being debated.

Satoshi is arguing from the saving side of economics as well as arguing that deflation is acceptable.  
Where true supply meets true demand spending and loaning only occurs when economic opportunities to grow money arrive at a rate that is faster than hoarding your own income.
Simply at equilibrium
The benefits that accrue from the lack of central banking are higher for transferring of money between individuals as well due to a decreased fee.
The ability to transfer that money nearly instantly worldwide also creates a perfectly liquid money supply with high mobility
Think a large M1 and M2 that can be moved quickly and nearly instantly.
Since the money supply grows at a declining fixed rate until 2100+ and as the network receives transaction fees as bitcoin grows the rewards will still be there.

Additional
I assume that the multiplier also contains negative correlations
For example in the housing crisis before that there was a housing bubble which boosted the economy great for the party in power election wise
However the negative long term effects can be greater than the short term benefits
Lost jobs etc.
Secondary argument
I acknowledge that according to Keynes increased printing of more money has increased the standard of living in some countries
But in reality that is connected to innovation and real growth of the economy
Even to an extent the argument that the richest are those who develop the economy and create jobs and promote innovation
However with a grain of salt as well since corporations allocate resources to maximize profit and export jobs to other countries.
And in doing so increase the gap between the richest and the poorest in some countries while building economic growth in another but not as much as the profits they make from lower wages

[Vycid]

Maybe it's possible to have both inflationary and deflationary currencies running side-by-side within one economy.

Then people can chop and choose which one they use and eventually a self-sustaining equilibrium will be achieved.

There'll be no more arguing about which system is better because both systems are available and a healthy balance is maintained.

Yes. I agree absolutely. I believe a deflationary store of value that may be used for transactions (Bitcoin) will exist alongside traditional currencies used for lending.

[Vycid]

4) Satoshi is great. He solved one important technical problem. But, trust me, he doesn't know how money works. Why should we encourage hoarding? Why should we punish those who is spending? We, as bitcoiners, would someday come to a conclusion that let the total number of bitcoins increases 3% every year and make the mining a sustainable career.

Because BTC is opposite to FIAT money and that's exactly what FIAT is NOT doing - it's punishing hoarding and rewarding spending. Satoshi wanted something different.

This is a terrible argument, sorry. A kneejerk "we should do the opposite" because "fiat is bad, mmkay" is not compelling. Even if you took as axiom that fiat is bad, you're still on the hook for demonstrating why punishing hoarding and rewarding spending is a bad thing.

Economists - yes, including the Austrian ones like Hayek and von Mises - agree that you need to penalize hoarding and encourage spending to boost the velocity of money and create a healthy economy. This is the primary reason why deflation is viewed more negatively than inflation.

It is clear that Satoshi wasn't an economist.

Whoa, whoa there. You mean economist like Keynes agree that you need encourage spending to create a healthy economy. And that's just plain wrong (on which Hayek and von Mises agreed).

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

Nobel laureate Friedrich Hayek, an Austrian Economist, stated of deflation during the Great Depression:
I agree with Milton Friedman that once the Crash had occurred, the Federal Reserve System pursued a silly deflationary policy. I am not only against inflation but I am also against deflation. So, once again, a badly programmed monetary policy prolonged the depression.
Interview with Diego Pizano (1979)[23]

...

They are therefore rewarded by holding money. This "hoarding" behavior is seen as undesirable by most economists, as Hayek points out:
It is agreed that hoarding money, whether in cash or in idle balances, is deflationary in its effects. No one thinks that deflation is in itself desirable.[24]

Once Crash occured deflationary policy was wrong. High inflation and high deflation are wrong. Right, I agree. But Bitcoin's programmed deflation after adopton is lower (created only by lost coins, otherwise is BTC inflation/deflation neutral) than current 3-5% annual US dollar inflation. Bitcoin wins.

And if you think that Bitcoin's deflationary nature is bad than I don't see a point of you staying invested in bitcoin business.

This is a common misconception: deflation is more than how much money is being created. If your economy is growing 3% every year, that demands a 3% larger money base every year; so you should be creating 3% more currency to to maintain the same price level.

In other words: in a healthy economy, 0% inflation means printing money (or, the more modern method: the central bank buys bonds).

And Bitcoin will see much faster than 3% growth as new users come on board. It will probably be strongly deflationary. Already, people selling goods denominated in bitcoins peg them to the USD/BTC exchange rate. www.bitcoinstore.com is an example.

[velacreations]

Ahhhh... I see the problem, here. You assume that for all 7 hours of sunlight, the power output will be at the maximum possible. This is false, of course. The workaround is to use insolation times area times external quantum efficiency.

no, I'm not making that assumption.  I am at a similar latitude as he is, and that is based on a daily average.  Now, he may have less, because of cloudy days, but we average about 7 hours of full power a day. We have sunlight for 10-12 hours most of the year, but you only get peak power for 4 hours, 1/2 power for another 4, 1/4 power for the other 4.

When you actually live on solar power, you learn how it really does in a real world situation.

Also, you add a tracking array, and you can gain an extra 25% of power per day.  There are other methods for gaining efficiency, like MPPT controllers, etc, but I won't go into that too much here.

You said $0.5/W, so we'll stick with that; the cost of the panel is $166/panel in bulk, for a cost of $0.72/W;

yeah, because you are paying Canadian markup, shipping to Canada, etc.  Buying in bulk in China is considerably cheaper.  And when you are talking a data center, you are talking serious bulk.  That price is for 20 panels, which would be great for a house or 2, but not for a data center.  Now, imagine buyng 2,000 panels straight from the factory in China.

For a system like this, you want grid-tie, to avoid needing batteries, so at night, you pull from the grid, and in the day, you feed to the grid.  It is a standard installation, and even in China, you can get it done quickly and professional at little cost.

If you are seriously interested in this stuff, PM me, but I won't clog this thread anymore with solar talk.  I'm just saying it is certainly possible, and his ROI is lower than the figures you are using.

[Rival]

Although for accounting purposes, we like to look at a chart and or ticker and say that asset X is worth Y. Unfortunately, it is far more complicated than that. The first thing to understand is the difference between gambling and investing. In gambling, your odds of success are either certain or guessed, and then an event happens. Once the event occurs, the results are tallied and you move on to the next event. Investing is different in that you as an individual decide when the event has ended. What that means in a nutshell is that until you sell an asset, the profit or loss has not been determined. You may hold an asset for months or years, with the spot value rising dramatically and crashing spectacularly a dozen times, but all that matters is the value the day you sell. This has a direct affect on the hoarding of BTC.

Currency is not worth anything at all until the day that you exchange it for goods and services.

There are those who will argue that it can be used as an investment vehicle, and that it has potential value if it rises or falls against other currencies. This is true, however, the end of the investing event is still the day you spend (convert) it. The value of currency is never inherent, it only expresses it's value when it is accepted for goods and services. Marx knew this quite well, it seems many seemed to have forgotten this.

Consumers do not want dollars, they do not want gold, they do not want BTC. They want what they can exchange currency for on the day of THEIR CHOOSING. A boat, some cheese, some petrol for their car. No one wants to die and be burred with their BTC. The currency is a means to an end, not an end in itself. BTC, like any other currency, is designed to be spent. The larger the ecosystem grows, the more it will be spent.

"Hoarding" is often used as a derogatory term for saving. Saving is certainly a good thing, we were all taught the fable of the ant and the grasshopper. BTC rewards savers (and investors) by being deflationary. However, it also rewards spenders. The burden of legions of banking employees, and massive buildings, and electronic substructures no longer need by subsidized by the consumer nor the producer. There is no need for ATM fees, maintenance fees, yearly fees, all of the incredible number of fees stripping billions and billion from producers and consumers and redistributing it to stockholders and subsidizing millions of jobs that can be replaced by little boxes mining away quietly in the night spread all over the world.

The currency may well be deflationary, but by replacing current systems it provides the efficiency to incentivize and reward every user everywhere, saver or spender alike.

[Vycid]

Although for accounting purposes, we like to look at a chart and or ticker and say that asset X is worth Y. Unfortunately, it is far more complicated than that. The first thing to understand is the difference between gambling and investing. In gambling, your odds of success are either certain or guessed, and then an event happens. Once the event occurs, the results are tallied and you move on to the next event. Investing is different in that you as an individual decide when the event has ended. What that means in a nutshell is that until you sell an asset, the profit or loss has not been determined. You may hold an asset for months or years, with the spot value rising dramatically and crashing spectacularly a dozen times, but all that matters is the value the day you sell. This has a direct affect on the hoarding of BTC.

Currency is not worth anything at all until the day that you exchange it for goods and services.

There are those who will argue that it can be used as an investment vehicle, and that it has potential value if it rises or falls against other currencies. This is true, however, the end of the investing event is still the day you spend (convert) it. The value of currency is never inherent, it only expresses it's value when it is accepted for goods and services. Marx knew this quite well, it seems many seemed to have forgotten this.

Consumers do not want dollars, they do not want gold, they do not want BTC. They want what they can exchange currency for on the day of THEIR CHOOSING. A boat, some cheese, some petrol for their car. No one wants to die and be burred with their BTC. The currency is a means to an end, not an end in itself. BTC, like any other currency, is designed to be spent. The larger the ecosystem grows, the more it will be spent.

"Hoarding" is often used as a derogatory term for saving. Saving is certainly a good thing, we were all taught the fable of the ant and the grasshopper. BTC rewards savers (and investors) by being deflationary. However, it also rewards spenders. The burden of legions of banking employees, and massive buildings, and electronic substructures no longer need by subsidized by the consumer nor the producer. There is no need for ATM fees, maintenance fees, yearly fees, all of the incredible number of fees stripping billions and billion from producers and consumers and redistributing it to stockholders and subsidizing millions of jobs that can be replaced by little boxes mining away quietly in the night spread all over the world.

The currency may well be deflationary, but by replacing current systems it provides the efficiency to incentivize and reward every user everywhere, saver or spender alike.

TIL: Putting money in a Ponzi scheme would be investing, but buying a bond and waiting until maturity is gambling.

[sunnankar]

Maybe it's possible to have both inflationary and deflationary currencies running side-by-side within one economy.

Then people can chop and choose which one they use and eventually a self-sustaining equilibrium will be achieved.

And that is the heart of the issue: The separation of State and Currency and Bank.

The State's interference in the currency market has led to inflation and deflation messes like the Great Depression and the 1970's Stagflation. It has allowed the infringement on civil liberties and privacy with things like Anti-Money Laundering legislation with Know Your Customer duties for banks, PRISM, and empowered the State to engage in confiscation through inflation which is a form of taxation without representation.

The US Constitution was clear on the issue of separating State and Currency and Bank. There were tens of thousands of competing currencies in the United States prior to the Civil War. What is needed to empower the economy to heal and the remove the gross infringements on civil liberties is a free market in currencies. That single change would fix almost all the ills we have in society as a result of the State's diabolical behavior. And Bitcoin being censorship resistant moves the market and society in that direction.

As Mises wrote:

It is impossible to grasp the meaning of the idea of sound money if one does not realize that it was devised as an instrument for the protection of civil liberties against despotic inroads on the part of governments. Ideologically it belongs in the same class with political constitutions and bills of rights.

Almost all of the ills in society can be traced directly back to the State and what has largely funded the State is their control over the currency markets. Just listen to Dr. Vieira, the leading scholar on American monetary jurisprudence, on the topic.