Discussion in 'Bullion Investing' started by Tyler, Apr 1, 2013.
bitcoin making a move at 8328.99
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Might want to sell on the dead cat bounce
Does anyone on this board think digital currency is not the future? Seems like the only question is which one.
Digital currency may be the future — but not in its current, unregulated, anything goes state.
yea better than it was four days ago
I certainly agree because it lacks the backing of any entity with staying power and it is not understandable to the general public. As has been stated many times, it is difficult as a customer and merchant to accept payment in the form of an asset that can fluctuate wildly in value.
If you are Starbucks maybe because you can work off of the law of large numbers. But to any small merchant it cannot work in its present form. Let's remember that something like 90+% of all businesses in the US are small businesses. Worldwide ~80% and in the US ~40% of all transactions are in cash. Electronic advocates would have you believe these are largely illegal or uninformed consumers, but the truth is many people are just sick of being tracked as was evidenced by the Zuck testimony before Congress.
I think it is more likely that digital currencies will be accepted once they emerge backed by governments than by some unidentifiable or unknown entity. Public understanding and confidence play a big role in acceptance of any currency. You can issue your own currency when it has the backing of taxing power or a metal, but some mystical concept that the general public cannot grasp is not backing. Two good smell tests are "is Warren Buffet buying it?" and "would I put my whole retirement savings in it?"
There is a reason that most books are written to a sixth grade audience. Try to get a millennial cashier to make change to a dollar with any purchase. Most lack the basic math skills to add to a hundred much less grasp digital currency.
Bitcoin is backed by math. The same math that backs the laws of the universe. Math has "staying power". Just because you have not bothered to understand it, or lack the mental faculties to do so, does not mean it is not understandable for the general public. Quite a few of us understand math.
As for your merchant acceptance difficulties - 1) not really, payment processors such as Coinbase and Bitpay immediately turn bitcoin payments into fiat currencies for their merchant customers eliminating market fluctuation risk. They do this with fees lower than credit card processors. 2) Try paying with Gold or Silver next time you are at a merchant.
If you think backing a crypto currency by a government is a good idea you do not understand the main reason for crypto currency's existence. The entire point is not having to trust a 3rd party with your monies.
Well when there is a loss on Bitcoin because of fraud or electronic fraud how do I contact "math" to get my money back. Math isn't currency.
Let me stop by my local gas station or sandwich shop and try to pay with Bitcoin. The same millennial who cannot make change to a dollar in all likelihood cannot handle a fractional Bitcoin transaction. I understand the premise behind Bitcoin but I also believe if it begins to undermine the existing currencies then governments will step in to regulate it and perhaps even establish exchange rates.
There is also an assumption made here that I often see coming from people who live in areas where the internet is always available. There are large swaths of the world (and US) where this isn't true.
You only needed to watch about five minuets of the Zuck/Congressional hearings to understand the problem. Technology is rarely the issue, people are the problem. Once in control of data and the power it brings, politicians are rarely willing to relinquish that power. I really dislike government regulation, but regulation of banking and currency is a must to keep confidence in any country's economy.
When the data gives unethical people like Zuck access to influence opinion or push sales they will fight for control. I have a long and deep understanding of the proper and improper use of technology and I stayed away from social media because I knew where the data collection was headed, and we are there.
I believe there is an interesting clause in the Constitution that has not been challenged yet and it might prove to be interesting. Congress reserves the right to coin and print money, and to establish values. During the gold rush in the 1800's several people tried to create their own coins only to be shut down by the government. There is no prohibition against an individual making their own coins, but there is a problem when they work them into the legal tender status. I believe Congress will eventually fall back on this clause and regulate all crypto currencies and their popularity may prove to be their downfall. If they continue to exist in their current state then they will probably be in the securities world and not in the legal tender world.
But just my take on it and there is still room for lots of opinions.
Yes, but it's not the math at issue here.
In college and grad school, I learned a lot about formal logic, formal verification, and reasoning about algorithms. It's possible to write fairly large programs that can be proven correct -- in other word, you can prove that they do exactly what their specifications say they should do, for any input.
The problem is, there's no way to prove that your specifications are correct. At some point, what you want is a system that "does what I mean" -- and there aren't any formal tools to solve that problem, especially when even I don't know exactly what I mean.
It's quite possible that Bitcoin "does what Satoshi means", or "does what Bitcoin Farmer Li means", or "does what you mean", or "does what 7-11 means". It's also quite possible that those intentions are different, and possibly quite incompatible. Even if all the parties understand and agree on the mathematical underpinnings of Bitcoin, the mapping to the real world is still ambiguous and in flux.
Sorry for going off the deep end a bit -- it's been a long time since grad school, and my math has gotten quite rusty, but this did capture my enthusiasm back then.
I had no idea! I'll try to remember to look into this.
Sorry I missed this little jab, but I do have an understanding of the technology, and a long history of running large financial technical operations. Having run technology for a Fortune 500 bank for quite a while I understand much more than most who will post here. So maybe personal pokes at people assuming ignorance isn't a good thing. I saw many abuses of power related to "can't miss" or "new things" and know a problem when I see it.
Any time someone says "this is a can't miss proposition" it is always suspicious. Many times when someone says "you just don't understand" it is either a control move or a fraud issue. Remember securitization of mortgages? The guys on Wall Street would tell you "it is perfectly safe, you just don't understand it." Or Bernie Madoff who was a genius investor, "we just weren't smart enough to understand his investment strategies or methods?" Or the S&L crisis of the 80s where rates weren't the issue, "we just needed more volume." Or the ENRON abuse of technology to manipulate oil markets.
Let's keep the conversation to the discussion of events and skip the personal jabs. We can have differences of opinion and still post here politely.
Until internet fraud, hacking, mining etc. are stopped, which will NEVER happen, there will be no future for cripro.
I tend to agree with you and find it unlikely governments will stay on the sidelines. Regulation is coming and government issued crypto is probably going to happen. I doubt the fans of current crypto will embrace the government stuff.
I think the real game changer will occur when e-giants like Amazon begin accepting it as payment.
As for the small merchant not being able to accept BC, there was a post here about a person who was at a coin show and one of the vendors accepted BC, and the member here bought his coin with BC.
I don't understand crypto at all. That didn't stop me from making a few bucks with it. One thing I DO understand is that this "Un-hackable" form of "currency" has had an awful lot of hacks. Consumer confidence is low. Doesn't look good...
If Amazon ever takes one, they will have first MADE one. It'll come with a free digital subscription to the Washington Post.
This might be on the road to acceptance, but it could also be an Achilles' heel. They control such a large portion of the retail market that it might be the trigger event for government intervention. I think it is unlikely that Congress will understand it individually or collectively. But you only need one or two Treasury or DOJ officials to understand it and the regulation may come quickly.
We could very easily wind up with another Sarbanes-Oxley Act, a Dodd-Frank Act, or a Glass-Steagall Act. Any of these type moves by Congress would rein in activity until the crypto currency world moves closer to the fiat world.
Agreed, and maybe there will be a Prime, Prime Plus, Prime Universal and other versions.
New legislation is probably going to happen in any case. It will interesting to see if they can write it in a way that can't be easily circumvented.
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