Bitcoin making things interestingseeking alpha

Submit a link via GitHub. What [bitcoins] lack is their own fundamental intrinsic value. So, intrinsically, the bitcoin itself has no value. It only has value as a medium of exchange so long as people are willing to accept it. Then came the malware, the black market, the legal ambiguities and The Man. Today, you can't even use it to buy Facebook stock. Thus, we have an answer before us: From a monetary standpoint, as devised and formulated by Ludwig von Mises, they are on a par with the stuff you find at Chuck E.

Of course, in a rational world, none of that will be written, except perhaps as satire. Bitcoin's crash is less of a currency crisis than an opportune moment for internet wisecracks. So, anyone out there buying Bitcoins at ridiculously inflated prices, please recognize the risk you are taking.

You will likely lose everything. But in the end, the answer was obvious. He thinks that bigger players will enter the field and improve upon Bitcoin's weaknesses. I think there are two realistic directions the bitcoin ecosystem could go in. First, it could just implode and disappear if governments decide that virtual currencies cause too much harm and are too hard to regulate.

Long-term investments in bitcoin would then go up in smoke. Second, it could continue as a virtual currency that is only used on the dark web with exchanges that are run by people willing to break the laws.

There's nothing keeping it being a thing. If people lose faith in it, it's over. Bitcoin is fiat currency in the most literal sense of the word. In other words, Bitcoin is a Ponzi scheme libertarians use to make money off each other—because gold wasn't enough of one for them. Bitcoins will never achieve this. It is a mania going up. It will be a mania coming down. It will not increase the division of labor, because people will recognize it as having been a Ponzi scheme, and they will not again buy it.

They will not use it in exchange. Companies will not sell goods and services based on Bitcoins. Bitcoins have to have stable purchasing power if they are to serve as money, and they will never, ever achieve stable purchasing power. My primary interest in Bitcoin is that I think it's a great platform for making jokes.

This price collapse will occur by the first half of DR; the current banking industry and late-period capitalism may suck, but replacing it with Bitcoin would be like swapping out a hangnail for Fournier's gangrene. Bitcoin represents more of the same short-sighted hypercapitalism that got us into this mess, minus the accountability.

The electronic pseudocurrency has had a good run. Ideologues, speculators and scammers enjoyed the fun while it lasted. But now that the authorities are taking notice, the price has much further to fall. You can either work doing something useful, or you can set up a botnet to mine BitCoins, or you can fork the code behind BitCoin and set up your own slightly-tweaked virtual cryptographic money network.

Setting up a new, alternative network is really cheap. Thus unless BitCoin going can somehow successfully differentiate itself from the latecomers who are about to emerge, the money supply of BitCoin-like things is infinite because the cost of production of them is infinitesimal.

So far almost all of the Bitcoin discussion has been positive economics — can this actually work? To be successful, money must be both a medium of exchange and a reasonably stable store of value. And it remains completely unclear why BitCoin should be a stable store of value. As a Serious Economist, I had been happily ignoring the recent bitcoin frenzy, safe in the smug knowledge shared by all Serious Economists that the surge in bitcoin value is a bubble that will soon pop.

Dimon said in an interview with CNBC. There is no more reason to believe that bitcoin will stand the test of time than that governments will protect the value of government-created money, although bitcoin is newer and we always look at babies with hope. The Bitcoin phenomenon seems to fit the basic definition of a speculative bubble — that is, a special kind of fad, a mania for holding an asset in expectation of its appreciation.

Watson sounds even more negative on bitcoin. I think once the world becomes more accustomed and attuned to the platform of bitcoin, the noise will go away, and the currency will go away too. But despite knowing that Bitcoin could fail all along, the now inescapable conclusion that it has failed still saddens me greatly. The fundamentals are broken and whatever happens to the price in the short term, the long term trend should probably be downwards. I will no longer be taking part in Bitcoin development and have sold all my coins.

Bitcoin did have great potential, but it is damaged beyond repair. A replacement is badly needed. The Bitcoin community has been hampered by a dysfunctional culture that has grown increasingly hostile toward experimentation. That has made it difficult for the Bitcoin network to keep up with changing market demands As a phenomenon bitcoin has all the attributes of a pyramid scheme, requiring a constant influx of converts to push up the price, based on the promise of its use by future converts.

So the ultimate value for bitcoin will be the same as all pyramid schemes: In my view, digital currencies are nothing but an unfounded fad or perhaps even a pyramid schemebased on a willingness to ascribe value to something that has little or none beyond what people will pay for it.

My best guess is that in the long run, the technology will thrive, but that the price of bitcoin will collapse. I just don't believe in this bitcoin thing.

I think it's just going to implode one day. I think this is Enron in the making. Some works may be subject to other licenses. Toggle navigation Satoshi Nakamoto Institute.

The Skeptics A Tribute to Bold Assertions "We propose a global and morally mandatory heuristic that anyone involved in an action which can possibly generate harm for others, even probabilistically, should be required to be exposed to some damage, regardless of context.

And when you tell a random person that you invest the first question these days is if you own or trade bitcoins or not. These things are actually not that hard to explain, but not really necessary to understand the key idea behind the blockchain.

What you basically do is, instead of trusting security to a single party that hopefully bitcoin making things interestingseeking alpha a smartly designed system you substitute that by a large amount of computational power provided by multiple parties. There is a lot more to it than that, but that is just noise and implementation details. Just a large amount of computational power would actually not be bad.

Chips always get faster and more efficient. So if bitcoin making things interestingseeking alpha get 10 times faster the computational power required to keep the network secure simply increases with the same factor. Additionally, the amount of computational power required scales with the value of the transactions being done on the network. You need enough computational power to make it unattractive for an attacker to acquire even more computational power and take control of the network.

But for sure the amount is high. An attacker only needs a short moment to inflict huge and long-lasting damage on the network. They could for example double spend coins, hurting not only those who would receive them, but also causing a massive loss of trust in the system that would be longer lasting.

So why is this all so problematic? Using bitcoin as a currency is the biggest obvious problem. If you use bitcoin for money laundering or other black market transactions it also not a problem [5]. The current hype is mostly driven by speculation, and for most real-world applications high transaction fees are a very serious obstacle.

There are probably some niches where it makes sense, but I think broad adaptation of blockchain technology would in most cases be a step backwards. Scaling performance is still hard. It is also going to be hard for bitcoin. Currently miners get First of all great to see someone else experience the pain of conversations about investing invariably ending up at Bitcoin. Bitcoin ran up too bitcoin making things interestingseeking alpha, what coin is only a few cents a piece; all-in.

Here are my 2 cents:. Especially with Bitcoin that runs on some kind of ASIC powered algorithm the time will come, relatively soon, where it is extremely hard to bitcoin making things interestingseeking alpha the hardware outside of the Bitcoin ecosystem. Perhaps the difficulty increases could be throttled back. I believe this is another argument in favor of Bitcoin especially against Ethereum and blockchains powered by GPU based algos.

Fwiw, I agree way the usefulness of the Bitcoin blockchain as a trading currency is limited. Its primary selling point is security. If it works it is because people have spend a shitload of money on specialized chips. As a result to provide the same level of security it will simply have to have more computational power and use more electric power. In most cases that removes bitcoin making things interestingseeking alpha whole bitcoin making things interestingseeking alpha that makes the blockchain unique and useful, and you just end up reinventing something that already exists.

There are bitcoin making things interestingseeking alpha number of solutions like lightning networks. Pietje I enjoy talking about Bitcoin that article is sent bitcoin making things interestingseeking alpha by email to subscribers to the COIN ticker as well as my followers.

That would remedy this concern, right? I think that eventually a bigger problem is that crypto currencies are extremely intolerant against human error, which is a big thing in the retail banking business. I think that banks that flag uncommon transactions and bitcoin making things interestingseeking alpha protect the customer in many other ways as well offer a compelling service; and that they can be effectively controlled by the law is valuable as well.

If someone manages to figure out a proof of stake algorithm that really works, yes not too up to date on that to be honest, but thought that these have some unsolved flaws as well — but not sure if these are fundamental unfixable flaws, or fixable ones. And yes, I agree with you that there are lots of practical problems to use bitcoin making things interestingseeking alpha securely and successful as well.

Nicely written article, thank you. Buying a pizza with my virtual currency? Next week it will be up another 50 percent! I think for large international transactions or remittances it could be useful.

But a major overlooked thing for bitcoin speculators is holding period of bitcoins. And an additional concern for everyday transactions is the confirmation period. This can be several hours. So this would either be an additional cost or you have to wait for several hours before your transaction is confirmed. The most important and fundamental feature for bitcoin is its censorship resistance and decentralization. Every design choice of the bitcoin network is to ensure bitcoin can continue to be bitcoin making things interestingseeking alpha resistant money.

To your point, because the system requires high amounts of decentralized computational power, it will always cost a non trivial amount of money to update the base blockchain. However, the media and newcomers to bitcoin seem to make a much bigger deal about this factor than it is and will be.

First off, the world already has great, cheap, centralized transacting systems, especially in the US. What BTC excels at is being a revolutionary new store of value that is portable, divisible, scarce and highly secure — a digital gold if you will, that is provably scarce and not exposed to the whims of central banks.

Let that sink in. Finally, because the bitcoin network is permisionless, it will help provide access to the financial world to the bn underbanked individuals in countries where banks do not serve today.

Perhaps it can become some store of value successfully. People buy Bitcoin because it has gone up a crazy amount in the past, and are hoping that it will continue going up in the future. A good store of value would have a less volatile value. Perhaps Bitcoin can graduate into that bitcoin making things interestingseeking alpha the future. For me the problem is that if Bitcoin is solely a store of value it has nothing to base that value on.

Sure, I know there is a limited supply of bitcoins, so the scarcity can make them valuable. But at the same time there is an unlimited supply of alternative crypto currencies. I bitcoin making things interestingseeking alpha a Bitcoin transaction yesterday.

Transaction cost was 0. In case it was not clear from the above comments, off chain settlement solutions such as Lightning network mentioned by Bram or Thunder network could significantly reduce transaction fees. So could other layer two solutions. Fees could also be reduced by other network connectivities such as those discussed by the Dash cryptocurrency on the below article:. Your email address will not be published.

The fact that the security is provided by a large amount of computational power is bad. Here are my 2 cents: Leave bitcoin making things interestingseeking alpha Reply Cancel reply Your email address will not be published.