EFF Stops Accepting Bitcoin, Regifts All Donations

Gendou writes "The EFF issued a statement that it will no longer accept Bitcoin donations, has not used any of the donations, and will transfer all past donations to The Bitcoin Faucet. See also additional and forum threads."

Comments

Haha suck it Ayn Randtards

[Anonymous Coward]

Hahahahaha. Bitcoin sucks dick you Ayn Rand worshipping losers!

Plus Taco has a tiny penis that is so small that it takes the world's most powerful microscope to resolve. Hence why his wife jumps from one gangbang to another every night.

Re:Haha suck it Ayn Randtards

[Lumpy]

So the world of "bioshick" wont become real?

Re:Haha suck it Ayn Randtards

[Spy Handler]

Plus Taco has a tiny penis that is so small that it takes the world's most powerful microscope to resolve.

I almost never respond to trolls but this one was so funny it made me laugh out loud... literally. (people in nearby cubicles are staring at me)

No surprises here

[betterunixthanunix]

Hm, following news of high volatility, major security problems, and the fact that one compromised account panicked an entire exchange, can anyone claim they are surprised by this?

Re:No surprises here

[hedwards]

The news here is that they were foolish enough to accept them in the first place. I had no idea that their judgment was that bad.

Re:No surprises here

[Anonymous Coward]

What's the problem? Just exchange the bitcoins for USD as soon as someone donates them.

Re:No surprises here

[E IS mC(Square)]

Just because implementation sucked does not mean idea sucked too.

Re:No surprises here

[nedlohs]

Why is it foolish?

It's just another way to get money. If the cost/hassle isn't worth what it brings in then obviously you get rid of it.

Are charities that accept bottles that they can return for the deposit, or aluminum cans then can be paid for handing over to a recycling center or clothes they can then sell to others foolish as well?

Re:No surprises here

[Lunix Nutcase]

You do realize it doesn't work that way, right? You can't just go "give me my dollars for bitcoin" and you instantly get it. There have to be enough requests on whatever exchange you like and depending on how much you trade you risk causing a price swing which ends up netting you less money in return.

Re:No surprises here

[jonbryce]

The problem is that they could be left open to future legal claims from the people they sold these worthless magic numbers to; and to all sorts of criminal charges.

Re:No surprises here

[Anonymous Coward]

Hm, i like black people but i sure do hate niggers. If you think you dont hate niggers do me a favor walk down a real bad inner-city neighborhood wearing lots of jewelry in the middle of the night. What do you think will happen? Think the kind gentlemanly niggers will engage you in abstract philosophical debate? Or do you think they'll rob your confused politically correct punk ass? Turns out the niggers sure do hate you! Might as well hate them back.

Just incase your confused. No job, tons of bastard kids, mysoginist, criminal leech on society = nigger. Has a job, any kids they have know who their daddy is, stable nuclear family, education, no serious criminal record = black person. Have a nice day!

Re:No surprises here

[Anonymous Coward]

Actually, the implementation was pretty sound. Nobody has cracked the Bitcoin blockchain transfer protocol. Some websites dealing with the stuff got hacked, but that happens all the time. It's the idea that sucked. Satoshi got the crypto right but fucked up the human element, economics.

Re:No surprises here

[nomadic]

I had no idea that their judgment was that bad.

Really? What about Eldred v. Ashcroft?

Re:No surprises here

[Martin Blank]

Those are accepted for a value that is relatively fixed, or at least doesn't fluctuate all that much. The value of Bitcoins can and do fluctuate a great deal. It's sort of like the difference between a donation of IBM stock and a donation of a random penny stock.

I don't think they were foolish to accept Bitcoins. Even selling them at a low rate gets them more money than they had before the donation (presuming that it covers costs). But setting a preference for something of more stable value is also within their rights.

Re:No surprises here

[hedwards]

It would be like accepting Monopoly play money, you can't readily use it to pay for attorneys or server bandwidth, sure there might be somebody that's willing to play a few cents per million for the money, but only to the extent that Parker Brothers doesn't flood the market with new bills and there's no guarantee that anybody will in the future be dealing in it.

Unlike bitcoins, aluminum cans actually have some value to them, even if you don't agree to what it is precisely, there are still uses for aluminum cans other than as a trade in. Bitcoins OTOH barely even exist, when people wake up to the scam, they're not even going to have that much.

Hence why it's so foolish. You'd be marginally better off taking currency from Zimbabwe prior to the government discontinuing it.

Re:No surprises here

[Anonymous Coward]

Bitcoin has no security problems. One of exchange points has. Everyone can setup exchange point, that that guy (mtgox.com) fucked up totally security.

Re:No surprises here

[whiteboy86]

EFF has not problem with Bitcoin itself, but it is more concerned about the recent misuse of it, all kind of blackhats are taking advantage of it. Bitcoin is all about freedom, unfortunately this level of utter freedom (no regulation what so ever) also draws criminals that otherwise would have a hard time using PayPal or other monitored and sanctioned means of payment. EFF just wants to distance themselves from money laundering and other illegal activities associated with Bitcoin recently.

Re:No surprises here

[Anonymous Coward]

It's just another way to get money.

That's one weird, needlessly abstracted definition of "money" you've got there...

Re:No surprises here

[Dunbal]

The US dollar will soon have roughly the same value and credibility of Bitcoin if the US keeps spending the way it is.

Re:No surprises here

[Anonymous Coward]

Precisely. There was a bubble, a panic, and a market collapse. We, as a country, were willing to shell out trillions of dollars to lowlife scum so that the dollar still had meaning (banking crisis). Basically the same thing would have needed to be done for Bitcoint, but nobody had the credit and desire to prop up Bitcoin during its collapse.

What do you know, start minting currency, and start running into the same age-old market problems. Who woodathunkit?

Re:No surprises here

[Omnifarious]

If you RTFA, you'll see that this has been a move they've thought through carefully and had been planning for awhile. It has nothing to do with recent events. Their biggest concern is that bitcoin is a legal grey area that might possibly make them the subject of the sort of legal action they try to defend others against.

Re:No surprises here

[DarkOx]

Foolish to accept them? They might not be worth much of anything but if someone offers you a bitcoin what exactly is the harm in accepting it? I suppose the EFF might have taken bitcoin from a few people who might otherwise have given dollars, but in the grand scheme of things I doubt they lost out on much if anything.

Re:No surprises here

[horza]

That doesn't make any sense. Why is it bad judgment to accept Bitcoin? Those that gave Bitcoin did so probably because they weren't going to donate cash in dollars or another currency, ergo they haven't lost anything.

So they got something for free. And decided not to cash it in so lost nothing. Big deal. If they don't want free money then that is their prerogative.

Phillip.

Re:No surprises here

[Anonymous Coward]

It makes it look like the EFF is endorsing Bitcoin as being worth more than nothing.

Re:No surprises here

[Abstrackt]

I don't think they were foolish to accept Bitcoins. Even selling them at a low rate gets them more money than they had before the donation (presuming that it covers costs). But setting a preference for something of more stable value is also within their rights.

It seems their concerns were legal: "While EFF is often the defender of people ensnared in legal issues arising from new technologies, we try very hard to keep EFF from becoming the actual subject of those fights or issues. Since there is no caselaw on this topic, and the legal implications are still very unclear, we worry that our acceptance of Bitcoins may move us into the possible subject role."

Re:No surprises here

[Omnifarious]

You are a troll. And likely willfully ignorant of the fact that half the stuff you spout off has approximately the same relation to reality that a Faux News broadcast does.

Re:No surprises here

[KDR_11k]

It might be stolen property.

Re:No surprises here

[Anonymous Coward]

I'll count it as money when I can pay my taxes and buy pizza with it. Until then, bitcoin is just mental masturbation.

Re:No surprises here

[pitterpatter]

The news here is that they were foolish enough to accept them in the first place. I had no idea that their judgment was that bad.

Care to expand that? It isn't intuitively obvious to me why accepting a no-strings gift would automatically be foolish. No, I don't accept "free" offers from spammers or telemarketers, but that's because of the strings, not necessarily the nature of the gift.

Sure, the gift might be worthless, but I wouldn't think it would be likely to have a large negative value.

Re:No surprises here

[hairyfeet]

Ya I'd say that is the real news here, that the EFF was accepting BTC which is on legal shaky ground number one, and number two I'd say that by its very design (those that got in first were able to rack up quickly, those that come later find it harder and harder to get anything) that it is a pyramid scam. Then add in the fact that there are already money laundering and dope dealing going on with it and the EFF would be nuts to actually use the things, unless they want to be the defendants for once.

Personally I wouldn't accept anything I can't cash easily or hold in my hand. if you want to start a new currency fine, make it out of something, gold, silver, hell fricking iron bars for all I care, but at least have something you can hold in your hand. I figure BTC has maybe a year at most before implosion, either through huge swings in value, someone figures out how to pull a massive fraud on them, or the governments shut them down for all the criminal activity using them. In any case the EFF was nuts to accept them in the first place IMHO.

Re:No surprises here

[Anonymous Coward]

With those kinds of detailed, intelligent counterpoints to his argument, you have clearly forced me to change my perceptions.

Re:No surprises here

[Lumpy]

Here is a fun fact.... the same can happen to the Euro and US dollar. All fake currency suffers from this potential.Hell the Federal Reserve is printing money so fast that the US dollar is going to go flat almost as fast...

GO back to coins made of real copper, nickel, silver and gold. suddenly the currency regains it's value and cant be destroyed..... Unless someone perfects alchemy and turns lead into gold or synthesizes gold.

For the naysayers complaining about carrying coins... do you realize how much a 1 troy oz gold coin is worth?

Problem is the Federal Reserve was given too much power by the US government so they continue to crush any alternatives like the Liberty dollar....

“Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism,” U.S. Attorney Anne Tompkins said. “While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country.”

Question: If Americans starting using the Gold Maple Leaf, would the government seriously go to war with Canada to stop the "economic terrorism"?

Re:No surprises here

[travdaddy]

Are charities that accept bottles that they can return for the deposit, or aluminum cans then can be paid for handing over to a recycling center or clothes they can then sell to others foolish as well?

Yes, if the EFF accepts aluminum can donations, that would be foolish as well.

Re:No surprises here

[Anonymous Coward]

Only dumb insecure fags say "Faux News" when obviously referring to Fox News. And judging by your low UID, I'm going to have to assume butt hurt from wasting all of your parents' electricity "mining" bitcoins.

Re:No surprises here

[Lumpy]

Sounds great, can I buy that TV from you? I have 1200 cans in my pocket....

Re:No surprises here

[AvitarX]

Perhaps they received too many to be able to cash them out.

Re:No surprises here

[Anonymous Coward]

I could understand if they were accepting bitcoins as payment for goods, but here we're talking about *donation*. Who cares if someone donated 10 bitcoins the day they were worthless. And with bitcoins EFF isn't setting a preference, they're giving people an *option*. What if donating bitcoins is someone's preference. Why refuse it?

Re:No surprises here

[Anonymous Coward]

Exactly. The idea sucks for totally different reasons.

Re:No surprises here

[SharpFang]

Less money than what? Than nothing? Than no money you have with your assets frozen as bitcoin? Would they get less for selling it than by giving it to "the tap"?

Say, EFF tomorrow receives a donation of one trillion Mozambique dollars. Should they exchange it to USD as soon as possible or worry that selling them all now may earn them less money?

If EFF sets the policy: "sell ASAP at current price" then there is no worry. They are not a currency trade company, they are a charity. They can freely treat Bitcoin as "donation of other goods" and it's their duty to keep the assets in a safe form, not to speculate and wait for best offer for unsafe/volatile goods.

Re:No surprises here

[Vegemeister]

What do bitcoin, USD, the euro, and gold all have in common? Their value as a trade good far exceeds their utility.

Re:No surprises here

[TrueSatan]

The main reasons for rejecting Bitcoin were twofold: 1) Accepting them was, without justification, being used by others to make the claim that the EFF endorsed Bitcoin. 2) Possible future legal issues resulting from trading in Bitcoin...passing on a worthless item for instance.

Re:No surprises here

[bay43270]

...if someone offers you a bitcoin what exactly is the harm in accepting it?

"Bitcoin raises untested legal concerns related to securities law, the Stamp Payments Act, tax evasion, consumer protection and money laundering, among others. And that’s just in the U.S."

Re:No surprises here

[Anonymous Coward]

"what exactly is the harm in accepting it"

There's no financial reason not to accept a donation. The EFF paid $0 for the bitcoin and at worst they can sell it for $0. However, as mentioned in the article, there are a lot of concerns regarding the legality of accepting this currency. The EFF mentions possible money laundering laws as one example. Absolutely none of this has been tested in court so it extremely risky to accept bitcoins because the legal fees of defending yourself in any lawsuit is going to far exceed the value of the donations.

Re:No surprises here

[Anonymous Coward]

The news here is that they were foolish enough to accept them in the first place. I had no idea that their judgment was that bad.

Care to expand that? It isn't intuitively obvious to me why accepting a no-strings gift would automatically be foolish. No, I don't accept "free" offers from spammers or telemarketers, but that's because of the strings, not necessarily the nature of the gift.

Sure, the gift might be worthless, but I wouldn't think it would be likely to have a large negative value.

Please read the summery, which addresses both of your points.

Re:No surprises here

[Anonymous Coward]

The news here is that they were foolish enough to accept them in the first place. I had no idea that their judgment was that bad.

You appear to not understand the nature of donations, so let me explain.

Donations, by their very nature, are gifts. Unlike with purchases, there is no transfer of goods or rendering of services in exchange for the money (or non-money, in this case) received. As such, donations can freely be accepted (legal restrictions and regulations for non-profits nonwithstanding). If I donated 1000 Zimbabwe dollars to some organization 20 years ago, and it turned out today that due to rampant hyperinflation, the bill wouldn't be worth the paper it's printed on anymore, nothing would strictly be lost: it makes no sense to say that the organization would have been better off not accepting it in the first place.

The same applies to Bitcoins. Yes, they are worthless. So what? It wasn't clear that they'd turn out to be, and now that they did, the EFF didn't lose anything compared to the hypothetical scenario where they didn't accept them in the first place.

I hope this will clear things up for you so that next time you read about "donations", you will understand what is being talked about.

Re:No surprises here

[Anonymous Coward]

Only dumb insecure fags say "butt hurt", and they always mean "I surrender the argument completely and unconditionally" when they say it.

Re:No surprises here

[MichaelKristopeit350]

what if it's someone's preference to donate cocaine or high explosives?

you're an idiot.

Re:No surprises here

[nedlohs]

Alumum cans don't have any value them aside from the value that someone else will pay for them. Bitcoins are exactly the same.

And it wouldn't be foolish to accept Monopoly play money either. I'm sure the local charity store will accept a monooly game, play money and all, as a donation and happily put it on the shelf with a price sticker on it. If people have been buying just the play money, then I'm sure they'll take just that too.

They'd take pokemon cards too.

It doesn't matter if bitcoins are going to be worth 0 in the future they are worth something more now, so there's nothing foolish with accepting the donation and then selling the bitcoins.

Now there are some costs associated with them, they've decided those costs outweight the benefits, which is fine. That doesn't make it foolish in the first place though.

Re:No surprises here

[Lundse]

Copper, Nickel, etc. are no more real. Some have an actual use value, yes, but that is not what they are being traded for, and it varies greatly depending on location and time. If everyone decided that gold was no longer cool, that would be the end of the gold standard too.

The only standards that are somewhat stable would be food and shelter...

Bitcoin is a better standard, being more easily transferable. It may have problems re. the auto-inflation - or it may be a strength. I don't know, I am not an economist.

But Bitcoins are no more silly than seashells, paper or some arbitrary metal. It's just that fewer people use them...

Re:No surprises here

[MichaelKristopeit401]

you are an ignorant hypocrite.

cower in my shadow some more behind your universally evil based pseudonym, feeb.

you're completely pathetic.

Re:No surprises here

[pla]

Who cares if someone donated 10 bitcoins the day they were worthless.

The IRS cares.

The EFF functions as a 501c3 in the US, meaning Americans can deduct their donations to the EFF on their federal tax return.

By accepting BTC, entirely aside from its own actions and legal status, the EFF inadvertently provided a loophole by which you could launder a potentially "rogue" currency into US dollars at 35% of its exchange value, via the US government itself.

Re:No surprises here

[Bengie]

Cans can....pun?... have value because they are not money. They are something to be directly used. A Block of aluminum cannot be directly used. It must first be machined, which is a service.

Money is a way to exchange "work effort". The more money you have, the more someone is willing to work for it. As long as others are willing to work for the money, it has value. If someone finds a way to "print off" more of that money, the current money gets devalued and people are less and less likely to do the same amount of work for a said amount of money.

No currency has real value. If you want to trade real value, you need to use a barter system, not a currency system. Bartering is a huge hassle and you can't have debt and you can't invest.

People who value BitCoin for its USD exchange rate may not find it useful, but people who are willing to exchange services like web-hosting, storage, or other easy to provide services, may still continue to trade in BitCoin.

Maybe someone will make an OpenSource project for Distributed Computing where you can request BitCoin payment for exchange of running some distributed client. As long as I can make more BitCoins doing that, then mining for them it would be worth it.

BitCoin has potential, but it needs to be accepted, just like how the USD had to be accepted as you cannot trade USD for gold. USD is backed by potential services, not gold/etc.

Re:No surprises here

[Anonymous Coward]

The issue is that the EFF is willing to defend other people's freedoms, the EFF does not want to become a client. BitCoins (and other virtual currencies, InternetCash, Flooz, beenz) do not have a great of legal backing in the courts. The EFF does not want to get caught accepting a form of payment that may have negative legal implications later: Like someone accusing BitCoin of being a Pump-and-dump scheme - and then suing the EFF as knowing what was going on and trying to take the EFF for all they are worth.

Re:No surprises here

[h4rr4r]

The worry is that bitcoin may not be legal at all. Would you as the head of a charity want to take that risk?

Re:No surprises here

[ackthpt]

Hm, following news of high volatility, major security problems, and the fact that one compromised account panicked an entire exchange, can anyone claim they are surprised by this?

We have to read about something besides house fires, car crashes and political scandals, how else are we to know it's news?

Re:No surprises here

[BitZtream]

Aluminum cans have other uses besides exchange for money.

Aluminum cans can be used as tools for cutting, scooping, of course holding things and many other things I don't have on the top of my head.

Monopoly money and Pokeman cards can be used to play the games they came from, so they have value on their own.

Bitcoin has absolutely no use other than as a fiat currency.

The fact that they took bitcoins in the first place puts serious doubts into my mind about the understanding of technology at the EFF. Typically its clear they have a clue, however this is one of those moves that makes you wonder. Well not this one, this one makes sense. It was the accepting them in the first place part that boggles my mind.

Re:No surprises here

[dnaumov]

Then add in the fact that there are already money laundering and dope dealing going on with i

You mean exactly like with the real, traditional, cold hard cash?

Re:No surprises here

[HaZardman27]

Comparing a donation of bitcoins to a donation of contraband substances is what's idiotic. I know, I shouldn't even bother responding to one of the MichaelKristopeit drones, oh well.

Re:No surprises here

[iluvcapra]

What's interesting with Bitcoin is that all coins are essentially "marked," you can trace the posession of a sum through all of the endpoints it passes through, and if someone alleges that they had BTCs stolen from them, they can tell you what endpoint they went to, the transaction is in the public tree, and software that would recognize funds that came from that endpoint (or any subsequent endpoints) is possible, without having to invent any exotic new technology.

If someone is defrauded, it should be possible to put some sort of temporary or disputable "fraud alert" out on the funds, that wouldn't positively stop that money being transferred, but would alert people that they shouldn't accept that money and would help people identfiy bad actors.

But this is Bitcoin, and like all things laissez-faire, possible is far from routine.

Re:No surprises here

[Anonymous Coward]

It's Mikey! Great news, everyone! Little Mikey's back! Slashdot's most predictable crackpot is here again!

Thanks, man. I was starting to get tired of the usual circle-jerk of hate that goes on in here. I needed a good laugh like seeing you again.

Re:No surprises here

[Anonymous Coward]

IF we went back to the gold standard the entire world economy would collapse. When the housing bubble collapsed, the value lost in property values was worth more than the entire world supply of gold ( gold on the planet, not gold that has been dug up). Money is a way of trading goods and services. Money doesn't help if you horde it - If you restrict the money supply (ie go back to the gold standard) people will horde money because of its scarcity, and then collapse the economy.

In short: If you keep the same amount of money in circulation, but increase the population of people spending money, then there will be insufficient money to spend. People will still want to work and get paid but there isn't the money to pay them. This problem gets worse as the population increases.

If there isn't enough currency to go around then people will go back to the barter system. I am not an advocate of the barter system.

Re:No surprises here

[Americano]

The same applies to Bitcoins. Yes, they are worthless. So what? It wasn't clear that they'd turn out to be, and now that they did, the EFF didn't lose anything compared to the hypothetical scenario where they didn't accept them in the first place.

Yeah, nothing is lost at all - unless you count the potential thousands or millions of dollars in billable time, court fees, and judgements which you could end up having to pay because you accepted a currency which violated numerous laws in ways which have not been tested in a court of law yet.

Really, accepting donations of bitcoins is sort of like saying "I'll accept donations of radioactive waste, and just toss it in the pond out back if I can't use it for anything." I "lose nothing" by accepting a worthless donation, but I might incur all kinds of penalties and fines when the EPA and DHS find out I'm storing nuclear waste in my back yard.

Re:No surprises here

[MichaelKristopeit401]

i am not a drone... i am michael kristopeit. you are a delusional recluse cowering in my shadow behind a chosen pseudonym.

if it's determined that anyone that resells bitcoins are responsible for their value, as there is no central authority to take on that liability, then bitcoins are themselves contraband if it's known to the seller of their worthlessness.

you're an idiot.

cower some more, feeb.

you're completely pathetic.

Re:No surprises here

[idontgno]

Sure, the gift might be worthless, but I wouldn't think it would be likely to have a large negative value.

I think the EFF would be properly hesitant to accept donations in "Liberty Dollars" or counterfeit US cash.

I suspect that Bitcoin is close to the former in legal status, and some commentators have implied the latter (probably in borderline slander, but whatever). Statute law on alternate currencies seems inconsistent, but the authorities have been energetic applying what law is available to any exchange currency in the borders of the U.S. which might compete with the official currency. The EFF is not in the habit of making itself the guinea pigs of law like this, so avoiding nonstandard currency makes sense. (This is not the EFF's fight; it might help the occasional Don Quixote tilt at the occasional windmill, it's not going to be getting up on Rosinante itself.)

IANAL. I just google a lot.

Re:No surprises here

[Anonymous Coward]

No, aluminum cans have value in that you can melt them down and then build stuff out of aluminum. Your argument could be used to say that nothing has value aside from value that other people give it, which is ridiculous.

Re:No surprises here

[Anonymous Coward]

Cans can....pun?... have value because they are not money. They are something to be directly used. A Block of aluminum cannot be directly used. It must first be machined, which is a service.

Money is a way to exchange "work effort". The more money you have, the more someone is willing to work for it. As long as others are willing to work for the money, it has value. If someone finds a way to "print off" more of that money, the current money gets devalued and people are less and less likely to do the same amount of work for a said amount of money.

No currency has real value. If you want to trade real value, you need to use a barter system, not a currency system. Bartering is a huge hassle and you can't have debt and you can't invest.

People who value BitCoin for its USD exchange rate may not find it useful, but people who are willing to exchange services like web-hosting, storage, or other easy to provide services, may still continue to trade in BitCoin.

Maybe someone will make an OpenSource project for Distributed Computing where you can request BitCoin payment for exchange of running some distributed client. As long as I can make more BitCoins doing that, then mining for them it would be worth it.

BitCoin has potential, but it needs to be accepted, just like how the USD had to be accepted as you cannot trade USD for gold. USD is backed by potential services, not gold/etc.

And that is the problem. Why should I accept Bitcoin as payment for my services when I cant turn it around and pay my rent, my bills or for food.
What possible reason is there for trading in Bitcoin. Even Trading in Baseball Cards and Postage Stamps has turn around value.

Looks like the gullibles were the ones were easily taken in by this scheme.

Re:No surprises here

[nedlohs]

But none of those uses are things most places that take them would actually do. Their entire reason for taking them is because they can sell them to other people.

You can sell bitcoins to other people too.

It doesn't matter if other people are putting value on them because they can play a game with them, or because they like how they look, or because they are idiots.

Now you wouldn't want to hold on to them, just accept and sell - it's all digital I'm sure that can be completely automated. Why not take something that you can sell for $10 this second? Who cares if it will be worth $0 next week?

I understand why they don't want to accept them. But it has nothing to do with their value likely going to end up at 0.

Re:No surprises here

[csnydermvpsoft]

Here is a fun fact.... the same can happen to the Euro and US dollar. All fake currency suffers from this potential.Hell the Federal Reserve is printing money so fast that the US dollar is going to go flat almost as fast...

GO back to coins made of real copper, nickel, silver and gold. suddenly the currency regains it's value and cant be destroyed..... Unless someone perfects alchemy and turns lead into gold or synthesizes gold.

For the naysayers complaining about carrying coins... do you realize how much a 1 troy oz gold coin is worth?

What intrinsic value do precious metals have that makes them so valuable? Many of them can be made into shiny jewelry, which has some value; there's also some value for use in electronics and other products. Apart from that, the only value they have - just like any other piece of property, physical or otherwise - is their desirability to others.

I don't care for shiny jewelry, and I have no intention of manufacturing products that would use precious metals. Therefore, the only value those metals have to me is their scarcity and the fact that others find them useful. How is this different than the paper money I have in my wallet?

I have no problem with your decision that precious metals are a safer currency for you than USDs or Euros. I fail to understand, however, how government-issued money is a "fake currency". My USDs are accepted in trade for all the products and services I desire, meeting the only criterion - ability to be freely traded - necessary to fulfill its role as a "real" currency.

Any form of currency - USD, Bitcoins, precious metals, seashells, etc. - is simply a shortcut to enable trade without the hassles of bartering. I agree that governments aren't always stable, but neither are commodities markets. Perhaps the USD is about to collapse - but the gold bubble could also pop at any minute. If you want to avoid any currency with the possibility of instability, go back to bartering. Alternatively, trade in your preferred currency with the realization that it is not a panacea.

Re:No surprises here

[MichaelKristopeit402]

ur mum's face is great news.

why do you cower in my shadow? what are you afraid of?

you're exactly what you've claimed to be: NOTHING.

Re:No surprises here

[Anonymous Coward]

"it is I, Karl Marx" /lowers glasses

Re:No surprises here

[Anonymous Coward]

No, they are not similar. The Euro and the Dollar are backed by the countries that use it - the people, the industries, the services. Something that goldbugs fail to realize.

Re:No surprises here

[HaZardman27]

Ok, I'll bite. Contraband: goods whose importation or exportation or possession is prohibited by law Hmmm... doesn't sound like Bitcoin at all. Cower some more, illiterate idiot. You're completely pathetic.

Re:No surprises here

[MichaelKristopeit402]

contraband n.
the fruits of fraud, forgery etc.

i know, i shouldn't expect you to understand that you're an ignorant hypocrite, oh well.

cower in my shadow behind your chosen pseudonym some more, feeb.

you're completely pathetic.

Re:No surprises here

[Anonymous Coward]

No, copper's monetary value right now is about equal to its intrinsic value (it's an important construction material for pipes and electrical wire). That's largely because it's not being used as currency, of course.

If I ever start my own cryptocurrency, I'd want it backed with a physical commodity, but I wouldn't use a precious metal; they're too volatile because of peoples' bizarre obsession with gold. I think I'd use a 12oz bottle of beer. "Beercoin", that's got a nice ring to it. Unlike gold, beer has intrinsic value!

Re:No surprises here

[Anonymous Coward]

One of the other problems with bitcoin is that any talk of fiat currency brings out the flakes who talk of "fake" currency. That's not actually any problem with the design of bitcoin it's just the kind of company that it attracts. If you think that the economy hasn't been great recently it would be nothing compared to the depression that a return to the gold standard that Lumpy proposes would bring.

Blah blah Federal Reserve .. too much power blah ... just the slashdot version of the tea party.

Re:No surprises here

[Ruke]

"Dumb insecure fags": +1 Irony

Re:No surprises here

[Anonymous Coward]

if they can sell and exchange smime certificates, they can sell bitcoins.

labelling them a currency may prove to be a gray area, but there is nothing inherently illegal in exchanging bits for money.

Re:No surprises here

[Anonymous Coward]

"If it's P2P then it must be good!"

Re:No surprises here

[arth1]

Why not take something that you can sell for $10 this second? Who cares if it will be worth $0 next week?

The person who possesses it next week.

Like all bubbles, the Bitcoin one depends on a steady influx of new investors who are willing to drive up the price. When that influx stops, the bubble bursts. This isn't exactly rocket science, but still people get fooled over and over again.
If you get something for nothing, it means someone else gets nothing for something. Unless you're an early player with an instinct for when to get out, you're likely to belong in the second category. It's that simple

Re:No surprises here

[Nursie]

Agreed.

Limited supply, deflation, absurdly huge difference in 'mining' speeds between first adopters and the comparatively early adopters on the thing now, various other weirdnesses... these all counted against it.

As a P2P crypto currency system it's pretty cool. It just had a few things wrong.

Oh, and the morans on the bitcoin forum. Dear god is that place 'live with 'em.

Re:No surprises here

[Anonymous Coward]

But if someone gives you a dollar, there's a guarantee it isn't? Or if someone makes an electronic transfer to you? Heck, the way the banks go about, you could argue that they are paying their staff with stolen property...

Re:No surprises here

[MichaelKristopeit403]

you're as dumb as your mother made you.

contraband is anything that is the fruits of fraud... or did your brain hurt too much after reading only the first definition in the dictionary?

you're an idiot.

idiot: you.... Hmmm... sounds like you're an idiot.

cower in my shadow some more, feeb.

you're completely pathetic.

Re:No surprises here

[HaZardman27]

Even when using a more obscure definition like that, it still doesn't hold up. Cash can be the fruit of fraud or forgery if the cash is obtained as a result of selling fraudulent goods, so your trolling doesn't really apply to this conversation.

Cower in the shadow of your exile from civilization as you recklessly throw your personal information around, knowing you have nothing of value to lose, troll.

You're completely pathetic.

Re:No surprises here

[skywire]

It would behoove you to avail yourself of readily accessible information on a subject before pontificating.

Re:No surprises here

[HaZardman27]

How fun it is to watch your weak attempts at arguing an invalid point. Either we get to watch you get upset enough to log in to one of your other low-karma accounts, or you just shut up and nobody has to listen to you anymore. It's a win-win situation for us all!

Cower in the shadow of your depressing life, loser

You're completely pathetic.

Re:No surprises here

[h4rr4r]

Problem is they are a charity, that means you could deduct your bitcoin donations from your taxes. That is a rather poor way, but a way to launder money.

Re:No surprises here

[nedlohs]

Who cares abou the guy who owns them next week. He'll own them no matter whether the EFF takes the bitcoins and sells them for US dollars instantly, or if they require the donater to sell them and send the US dollars. Either way some bitcoins got traded. Taking them directly lowers the barrier to donating so they might get a few extra bucks.

That it's a bubble is completly irrelevant if you are just transacting and not ever holding.

Should they refuse a house someone wants to donate because of a property bubble? Should they refuse a silver dollar someone wants to donate because of a silver bubble? Should they refuse a US Treasury someone wants to donate because of a bond bubble? Should they refuse US dollars someone wants to donate because of a dollar bubble?

Why does it matter if something is destined to fail

Re:No surprises here

[MichaelKristopeit403]

i am michael kristopeit. i do not cower as you choose to. i am not pathetic. i live at 4513 brittany ct, eau claire, wi 54701 with my wife, children, dogs, and numerous firearms. why do you choose to lie about me?

the definition of contraband is not obscure. you introduced the term into this conversation without knowing it's meaning. you're an idiot.

if bitcoins are the result of a manipulated market with no central authority, then the seller assumes all liability, and is dealing in contraband.

if bitcoins are stolen, and then donated, and then resold, then the seller again assumes all liability, and is dealing in contraband.

you're an ignorant hypocrite.

cower in my shadow behind your chosen pseudonym some more, feeb.

you're completely pathetic.

Re:No surprises here

[porges]

Hell the Federal Reserve is printing money so fast that the US dollar is going to go flat almost as fast..

Disputed, to say the least:

The Myth That The Fed Is Printing Money

Re:No surprises here

[drinkypoo]

I don't care for shiny jewelry, and I have no intention of manufacturing products that would use precious metals.

Many if not most electronics today contain at least small quantities of precious metals.

Re:No surprises here

[MichaelKristopeit404]

do you think you know better than me, or the lawyers at the EFF who agree with me?

why do you think that?

why do you cower in my shadow behind a chosen unsafe based pseudonym?

what are you afraid of? are you afraid of being proven to be an ignorant hypocrite?

are you afraid of being proven to be an idiot?

are you afraid the shame you feel for yourself will be shared by those exposed to you? is that why you call yourself the hazard man?

cower some more, feeb.

you're completely pathetic.

Re:No surprises here

[Duradin]

So if a guy you don't know and doesn't know you is walking down the street in a city you've never been in and will never be back to hands you a gold rolex, no questions asked, you'll take it?

There are no "no-strings" gifts. Giver or receiver, there's always a consequence.

Re:No surprises here

[Anonymous Coward]

How do I know your real name is Michael Kristopeit? You're as anonymous as me!

Re:No surprises here

[MichaelKristopeit406]

ur mum's face is weak.

you believe i'm upset? that is very telling.

you believe you have the power to command me to shut up? why am i not shut up then? is it because you are a powerless ignorant hypocrite?

who is "us all"?

you are NOTHING.

Re:No surprises here

[PenisLands]

I thought you had stopped posting. I'm happy to see that you're still around, keep up the work that you're doing here.

Re:No surprises here

[MichaelKristopeit407]

why don't you tell me how you know my real name is michael kristopeit?

is it because i told you it was? i live at 4513 brittany ct. eau claire, wi 54701. come ask me in person... or has existentialism completely warped your sense of reality that you'd deny my physical presence?

are you anonymous because you're paranoid, or paranoid because you're anonymous?

cower in my shadow some more, feeb.

you're completely pathetic.

Re:No surprises here

[Anonymous Coward]

Why do bombastic statements like this 'deserve' a positive mod point? Is it likely to happen, or are they just pushing a reactionary (GOP) political agenda?

Re:No surprises here

[arth1]

Who cares abou the guy who owns them next week.

The guy who owns them next week does. And his wife, children and creditors.

Re:No surprises here

[MichaelKristopeit408]

i thought ur mum's face had stop posting.

cower in my shadow behind your chosen phallic based pseudonym some more, feeb.

you're completely pathetic.

Re:No surprises here

[Anonymous Coward]

How is this different than any other security out there?

There is risk in any investment, including currency.

Re:No surprises here

[Anonymous Coward]

Suuuuuure. Or you picked some poor bastard's name and address in the hopes that he'd get physically harassed for your trolling.

Re:No surprises here

[Lumpy]

"If there isn't enough currency to go around then people will go back to the barter system. I am not an advocate of the barter system."

Because you hate freedom?

I love the barter system.... Why? because it's non taxable and not traceable by the King.

I can make horseshoes, and you have two lovely daughters.... I'll trade you a lifetime of horse shoes for that pretty 18 year old redhead daughter of yours.

Works great. Today? I'll trade you 4 hours of IT work for 4 hours of automotive work. I need parts for the car? will you take another 3 hours of IT work to cover that? great!

I do this now. I have a $4500.00 custom paint job on my motorcycle for the IT work I did for a Custom paint shop. Bartering happens at a honest rate instead of a inflated MSRP of "how much can I get out of you"....

Granted rich assholes that like to rob people blind don't like barter because it forces an equalization... you cant justify your high value to your work and discount the value of the other persons work without coming across as a complete jerk. So Honestly in pricing is forced upon the transaction. Now quality of work after the fact is another matter, but that already happens and is a problem with the current money for goods and services method.

Re:No surprises here

[Lumpy]

What intrinsic value do precious metals have that makes them so valuable?

Scarcity and the fact that it's works well for 900,000,000 years... I'm guessing history puts more weight behind it. Plus history also shows how the fake money systems collapse... History is riddled with how Fiat Money systems fail over and over throughout time.

Re:No surprises here

[man_of_mr_e]

Computer people think "Hey, i can setup a miner on all the PC's at my job and nobody will know, and then i can cash those coins in for moohlah! and I don't have to do any real work"

By that, I mean bitcoin is insanely attractive to people who sit at computers all day.

Re:No surprises here

[nedlohs]

But him owning them next week isn't changed by the EFF accepting or not accepting such donations.

Re:No surprises here

[man_of_mr_e]

"We believe in complete and total freedom!"

"Ummm.. yeah, but there's criminals there, and you might get associated with them"

"Oh, umm.. nevermind."

Re:No surprises here

[Anonymous Coward]

Bitcoin doesn't work that way. There is no way to connect Bitcoin transactions to people.

Re:No surprises here

[s73v3r]

What if donating bitcoins is someone's preference. Why refuse it?

What if I, as the receiver, don't want BitCoins? That's like saying, if I'm buying services from you, and my preference is to pay in BitCoins, why refuse it?

Re:No surprises here

[Anonymous Coward]

If you have been paying attention to the news at all, you'd know the amount of dollar bills on the open market has skyrocketed over the last two years thanks to a really crappy Fed policy. Bernanke has done his best to destroy the value of the dollar.

Re:No surprises here

[s73v3r]

Who cares abou the guy who owns them next week.

Well, presumably the guy you're selling them to now is either that guy, or will try to sell them to that guy. If people don't think they'll be able to unload the BitCoins, they're going to stop accepting them.

That it's a bubble is completly irrelevant if you are just transacting and not ever holding.

Until you're stuck with hundreds of worthless BitCoins that you paid for.

Re:No surprises here

[Dunbal]

Yeah, a Canadian living in Costa Rica is "pushing a GOP agenda". See how closed minded you are? You want reactionary, look in a mirror. The only reason I care about the US and the US dollar is because when it goes down, it's going to take a fair chunk of the world with it. I couldn't give a shit about your political parties and your petty little political fights because the serious issues simply haven't been dealt with. The US has a limited range of answers when faced with a problem: Solution 1) Throw more money at it and Solution 2) Bomb it; it has been this way for many, many years. Nah but candidate X's opinion of "gays in the military" or "right to life" is far more fucking important than the trillions of dollars you are burying yourselves under.

Oh and it was 2 mod points, because before getting modded up, I was modded down.

Re:No surprises here

[s73v3r]

If someone is defrauded, it should be possible to put some sort of temporary or disputable "fraud alert" out on the funds, that wouldn't positively stop that money being transferred, but would alert people that they shouldn't accept that money and would help people identfiy bad actors.

If you're going to go that far, then why not just stop it from being used altogether?

Re:No surprises here

[hrimhari]

And hopefully the EFF.

By the way nedlohs, remind me to never trade with you.

Re:No surprises here

[jonbryce]

There is however a way to connect dollar transactions to people, and if the EFF receives dollars in exchange for bitcoins, it is possible to trace where those dollars came from.

Re:No surprises here

[s73v3r]

Problem is the Federal Reserve was given too much power by the US government so they continue to crush any alternatives like the Liberty dollar....

You mean the currency that was not only designed to look very much like an actual US Legal Tender coin, so as to be confused with one, but also was bought and sold for values much different than the value of the silver it was made of, because it was just a scam to make profit for the guy making them?

Re:No surprises here

[s73v3r]

Because you hate freedom?

Because unlike jackasses like you, he realizes that bartering has other huge problems associated with it, that currency very nicely resolves. For instance, in your example, what if the shop had no use for IT work? Then you'd be out of luck until you can find something that they do need, and in the exact quantity that they'd be needing.

Re:No surprises here

[Agent0013]

Monopoly money and Pokeman cards can be used to play the games they came from, so they have value on their own.

Bitcoin has absolutely no use other than as a fiat currency.

The fact that they took bitcoins in the first place puts serious doubts into my mind about the understanding of technology at the EFF. Typically its clear they have a clue, however this is one of those moves that makes you wonder. Well not this one, this one makes sense. It was the accepting them in the first place part that boggles my mind.

It's kind of like buying and selling stock. The only reason it has value, is because someone else is willing to buy it from you. The stock market makes no sense. The money you put into the stock does not go to that company in any way. It's like Monopoly money in that it is only usefull while playing that game.

Re:No surprises here

[diamondmagic]

The Federal Reserve branches disagree: http://research.stlouisfed.org/fred2/series/BASE

Re:No surprises here

[Omnifarious]

Scarcity and the fact that it's works well for 900,000,000 years...

Ridiculous exaggeration does not help your argument. Gold has worked as a currency for perhaps 10,000 to 20,000 years. Basically since we've had agriculture.

Re:No surprises here

[TheRaven64]

Bitcoin has absolutely no use other than as a fiat currency.

Bitcoins are not a fiat currency. A fiat currency, as should be obvious from its name, has its value set by fiat (decree). No one is decreeing that bitcoins have value, any more than anyone decrees that monopoly money has value. It's fashionable for libertarians to use the word 'fiat' to mean 'worthless', but the two words are not interchangeable.

Re:No surprises here

[MoldySpore]

I fail to understand, however, how government-issued money is a "fake currency"

Using the USD as an example, our money is not money. It is legal tender. It is loaned, AT INTEREST, to the government and the American people. Such is the scam that is the Federal Reserve. We don't have the actual gold or anything else to actually back up the paper money like we used to. And they made sure the average American didn't have any other valuable assets in the forms of gold during the This is also what contributes to the steady decline of the value of the dollar as the Fed continually prints more and more money (remember - loaned AT INTEREST) and puts it into circulation, whether through their normal printing or when the government asks for a massive amount of $ to bail out too-big-to-fail mega corps. So, every piece of paper you have in your wallet that says "One Dollar" is actually "One Dollar + Interest" as far as the Fed is concerned.

This is why the founding fathers were so against a central banking firm in America. They knew as soon as banking was privatized on a federal level (which, btw, the Federal Reserve is not. They are NOT a federal organization. They are only "federal" in name. They are a private bank) that our country was, quite simply, fucked. It took less than 100 years to screw the American economy this way (The Federal Reserve Act was issued in 1913).

Unless we get rid of the central banking system, there will never be such a thing as "debt free". It is a fantasy invented by corrupt politicians vying for office.

Re:No surprises here

[marcosdumay]

"it's works well for 900,000,000 years"

Funny, I didn't know that dinossaurs traded on gold.

Re:No surprises here

[diamondmagic]

Which by the way is exactly why we use money, i.e. secondary exchange, and not barter: Their trade value for goods commonly has the highest marginal utility, more than for another good, thus economizing exchanges, and making the economy as a whole more efficient. There's lots reasons to argue against a gold standard, but the only one that isn't fallacious is it's too useful a commodity (for aesthetic and electronic purposes) to waste as a money (counter-argument being we need a money that has such intrinsic value, so prices are tied to some useful, industrial purpose).

Re:No surprises here

[suomynonAyletamitlU]

What intrinsic value do precious metals have that makes them so valuable?

Scarcity and the fact that it's works well for 900,000,000 years... I'm guessing history puts more weight behind it. Plus history also shows how the fake money systems collapse... History is riddled with how Fiat Money systems fail over and over throughout time.

That's what makes them valuable as a currency, and especially what made them valuable as a currency when currency was new. Essentially, scarcity meant that you couldn't counterfeit coins, and that meant that value wasn't going to appear out of nowhere and ruin the economy as assholes made themselves rich without providing anything in trade.

To be honest, if the world ended tomorrow, gold wouldn't work as a currency because it CAN appear out of nowhere--there are such huge stocks of it worldwide that someone could be sitting on, or steal, so much gold that at any reasonable exchange rate, you could buy up enough food to starve small countries, without having done anything to earn that food (or more importantly, since it's a trade, without needing to use that food to produce more of value, by say, feeding farmers during a blight, so they can live to farm again). That's not what currency is for. Currency is a trade of value for value, which is why it's regulated by government--the same authority that provides the police to go after thieves, who regulate property ownership, who maintain military might, etc. The people who have gold today are not the ones who will be of value in the event of serious tumult. They don't farm, they don't manufacture (themselves/on the premises of their property), they don't maintain roads, health care, clean water, sewage, nothing. The people who have the most money are the people who are taking advantage of existing stability, and when that stability ends, so will their value. Any currency that might be used post-apocalypse will either be chosen with this in mind, or it will evolve naturally to take this into consideration. (For example, bottlecaps in Fallout. Rich people aren't going to stockpile them prior to destruction, they're ubiquitous, but limited in supply.)

So especially now, no, there really is no intrinsic value to gold, not if it's no longer suitable to be currency.

Re:No surprises here

[icebraining]

They're not paying for the Bitcoins, they were donated.

Re:No surprises here

[SniperJoe]

Wouldn't a better term be "monetary masturbation"?

Re:No surprises here

[icebraining]

You can easily make a webservice for that. Now, why would you trust the people who claim the money was stolen?

Re:No surprises here

[iluvcapra]

You can't stop a transaction in BitCoin, if the sending party sends his authorization the transfer is commited. Any refusal to accept from a certain endpoint, in order to preserve the decentralized system, would have to be a voluntary act.

When that guy got a huge number of BTC jacked from his wallet, all he revealed was the receiving endpoint, but from there everyone could see how much he'd lost and everyone knew that anyone using that endpoint to send money was (putatively) a thief. The thief could transfer from endpoint to endpoint to try to "launder" the money, but the chain of posession would always have that ill endpoint in it, in the publicly-visible tree, for anyone to inspect. The public tree is visible everywhere and for most purposes tamperproof.

Re:No surprises here

[Agent0013]

No, they are not similar. The Euro and the Dollar are backed by the countries that use it - the people, the industries, the services. Something that goldbugs fail to realize.

And Rome backed it's currency back in the day also. Any government can collapse. And no democracy has ever lasted as long as the US has before. So it could be just a matter of time.

Re:No surprises here

[icebraining]

Pay for pizza with bitcoins.

You were saying..?

Re:No surprises here

[arevos]

The statement by the EFF does not mention blackhats or criminal activity. If you're going to make wild claims, could you back them up with some evidence?

Re:No surprises here

[Anonymous Coward]

The idea is not to do something because it does no harm, the idea is to do something because it's of a positive nature.
It's basically wiping your ass, in this case.

Re:No surprises here

[wkcole]

Just because implementation sucked does not mean idea sucked too.

People have been saying that about Communism for a long time...

Bitcoin as an idea sucks because it incorporates features of a strain of economic delusion that worships the "hardness" of money. This does battle with centuries of macroeconomic theory and evidence, which demonstrates and explains the reality that a currency which holds its value (or worse, inherently gains in value over time like Bitcoin) will tend to move out of circulation wherever a weaker currency can be used. This means that BTC are doomed to be used for religious reasons (i.e. as an expression of devotion to St. Ayn) and in cases where using normal currencies is in some way difficult or risky. This is why the most prominent use of BTC is the drug trade. Since BTC will tend to get more valuable over time (even now!) people who have both BTC and inflatable money will lean towards their own best interest and tend to hoard the BTC while spending their "real" money. The only way vendors who accept both BTC and $ can get customers to pay in BTC is to contribute to the natural deflation by giving a relative discount for payment in BTC. That takes more religious devotion than just about any vendors have when it comes to their bottom lines.

Re:No surprises here

[rednip]

This is why the founding fathers were so against a central banking firm in America.

As George Washington created the First Bank of the United States, I think that you are wrong. Despite what you may hear for hours a day on reactionary talk radio, the founding fathers had varying opinions on the role of government.

Re:No surprises here

[Anonymous Coward]

>>Funny, I didn't know that dinossaurs traded on gold.

How do you think Dinosaur Gentlemen traded for hookers and blow?

You know, this guy:
http://geekofalltrades.files.wordpress.com/2010/06/gentlemanrex.jpg?w=600&h=800

Re:No surprises here

[Directrix1]

All of these things have absolutely nothing to do with Bitcoin itself. This is all in relation to a hacked website that helps people exchange Bitcoin for USD. Bitcoin is every bit as secure as it ever was.

Re:No surprises here

[ShakaUVM]

>>This is why the founding fathers were so against a central banking firm in America

The debate of Federalists vs. Anti-federalists is still going strong today. The Tea Party vs. Obamacare is a great example of this.

In the case of the national bank, it may interest you that Madison (who was firmly opposed to the First National Bank) became convinced of the necessity of it when the Second National Bank issue rolled around. Quite simply, it was too hard to run a nation without one. It was a pragmatic decision that went against his strict constitutionalist ideals. (http://en.wikipedia.org/wiki/James_Madison#Bank_of_the_United_States)

Re:No surprises here

[osu-neko]

Here is a fun fact.... the same can happen to the Euro and US dollar. All fake currency suffers from this potential.Hell the Federal Reserve is printing money so fast that the US dollar is going to go flat almost as fast...

GO back to coins made of real copper, nickel, silver and gold. suddenly the currency regains it's value and cant be destroyed...

You're making a common mistake made by people who don't really understand economics: you're confusing "currency" with "commodity". I suspect that, based on your limited understanding of the terms, you would in fact refer to any real currency as "fake currency", as the very thing that separates currency from a commodity used for barter is its nature as an abstraction. It should also be noted that using a commodity (e.g. gold, silver, salt, etc.) does not free you from its value becoming an abstract value not based on its "real" value, all it does it set a floor on how far it can drop (not a solid floor, either, just one that won't dip below the commodity value). In any case, your "solution" doesn't solve any actual problems, it just reintroduces old problems that we got away from years ago when we rejected this silly notion.

Re:No surprises here

[Bucky24]

The EFF is trying not to be him, is the point here. That's why they stopped accepting.

Re:No surprises here

[iluvcapra]

That's definitely the problem.

Don't get me wrong, I think BTCs are crank goods, mainly due to governance issues and institutional opacity -- just because you can see the source code doesn't mean the maintainers aren't going to change it tomorrow if it would make them a buck in the process, and all the major BTC trading firms are completely unaccountable and un-audited.

But the technology in principle would allow public repudiation of a transaction, though not actual rollback.

Re:No surprises here

[Bucky24]

Remember the EFF carries out legal battles. If they were associating with "criminals" then its possible cases they brought about could be dismissed (note, IANAL but even if the cases couldn't be dismissed, it destroys their credibility).

Re:No surprises here

[Timmmm]

But the thing with metals and government-backed currencies is that it is pretty certain that *someone* wants them. Metals because they are obviously useful, and government-backed currency because the government says "You will accept this currency. It is the law." At the end of the day I suppose you could say they are backed by force.

Bitcoins are literally backed by nothing.

Re:No surprises here

[quickOnTheUptake]

What is the declared value of a dollar? 1/36th of an oz of silver?

Re:No surprises here

[Anonymous Coward]

Incredible.

To assert that limited supply is a bad thing for a currency is to state ones ignorance of the very definition of currency. The whole point of economization requires a supply that is not trivial to acquire.

The other things that you assert are bad('count against it') are also not. Deflation and rising cost to produce more bitcoins are both desirable.

I cannot compare bitcoin in its entirety to other currencies because I am not fully familiar with it, but those specific qualities you describe as detrimental are in fact not.

Re:No surprises here

[x_IamSpartacus_x]

Hehe, it's funny, I actually live in Mozambique and one trillion Mozambican "Meticais" (the currency here) would be an ASSLOAD of money.

Re:No surprises here

[tqk]

Bitcoin has absolutely no use other than as a fiat currency.

It is astonishing to watch people such as yourself (utterly ignorant of knowledge in this area) pontificate about it (not bitcoin; basic understanding of money). *Dollars* have "absolutely no use other than as a fiat currency." Well, yeah, you can burn 'em to warm yourself up on a cold day (or trade 'em to the Chinese for trinkets), but that's about it.

Look into the hyperinflation that the German Deutchmark (sp?) suffered post WWI. *ANY* fiat currency is subject to the same problem. Bitcoin tries to make hyperinflation impossible, something *no* gov't issued currency wants for itself. You can't diddle with an economy if you can't futz with the value of its currency. Our gov'ts learned that last century and rectified that (to our detriment).

Do you not understand how tyranny works? First, you get 'em by the balls (the money supply). Now, the $IRS can get a handle on everything else.

Geez. Wake up and smell the coffee.

Re:No surprises here

[Miamicanes]

> Unless someone perfects alchemy and turns lead into gold or synthesizes gold.

I don't have a reference handy, but I recall one of my college professors telling us point blank that sometime in the 1950s or 1960s, scientists in both the US and Soviet Union DID successfully (and independently) synthesize gold (Sandia & Dubna, I believe). Unfortunately, as the byproduct of a nuclear fission, it was a) radioactive, and b) if done commercially, would have cost several orders of magnitude more to make (as an intentional byproduct of nuclear fission, then separate out the non-radioactive isotopes) than it was literally worth.

You know what's really interesting? If you read the bitcoin forums, you can read post after post by grumpy Americans who angrily swear the Dollar is going to collapse and be trampled upon by China... then read even MORE replies by people FROM China who tell them they're completely insane, and that Chinese investors view US Dollars as the safest stores of value you can buy. The fact is, if the Dollar goes down the toilet, it's going to take most of the world's economy with it. Why? Network effects and nearly infinite liquidity. You can spend US Dollars on real goods and services just about anywhere in the world. That ALONE adds staggering amounts of value, REGARDLESS of what the Fed might or might not do.

Somebody in Latin America doesn't really care whether the value of the Dollar changes by 1% or 5% relative to the Peso or whatever their local currency might be, because the exchange rate is largely *irrelevant*. When they want to buy a new imported top of the line Android phone, they're going to pay WAY less if they show up at the store with US dollars, or if they pay for it with a dollar-denominated credit card, than they'll pay if they insist on purchasing it with their own currency. Why? Because the store paid for it in Dollars. If customers pay in Pesos, the store has to factor the exchange rate and currency-conversion fees into the price and profit margin. If customers pay in Dollars, the accounting ends up being easier, and most of those Dollars can go right back to Asia to pay for the NEXT batch of high-end Android phones. The manufacturers in Asia put those dollars into the bank, so others can borrow them and buy oil from the Saudis (once again, for Dollars). The Saudis turn around, take the dollars, and buy skyscapers in Asia, and the cycle repeats. For businesses that import things like electronic goods, it's cheaper to just trade in Dollars as much as possible than to screw with currency conversions between arbitrary currencies.

Put another way, the value of the Dollar has very little to do with academic concepts of economic theory, and everything to do with the fact that you can pretty much spend them anywhere on anything, and buy things at a discount when you do. The dollar is genuinely (and almost universally) useful as a medium of exchange. If it loses 80% of its value against the Euro over the next decade or two, and it costs $10 to buy one Euro, people will still be walking around with pockets full of dollars... they'll just be carrying 5-10 times as many.

Re:No surprises here

[icebraining]

Well, the devs can change the code, but it only affects anything if most people running the Bitcoin program actually accept the changes. Any bitcoins created with a different algorithm won't be accepted by existing nodes, so they can't simply make a 'personal branch' that creates 10x more bitcoins for them.

It may still be a pump-and-dump like many people claim. If the dump actually crashes the market or it just keeps going, that remains to be seen. Unlike normal P&D scams, there aren't fake profits: the system is completely transparent and people can decide if it's valuable or not.

all the major BTC trading firms are completely unaccountable and un-audited.

Yes, absolutely, but you don't have to use them to receive or send Bitcoins.

But the technology in principle would allow public repudiation of a transaction, though not actual rollback.

I don't quite get what you mean? What do you mean by allowing repudiation? My point is that it's impossible to prove that someone was robbed or just transferred them willingly. Of course, that's a problem with dollars too.

Re:No surprises here

[owski]

The First Bank of the United States was not a central bank, other banks still issued their own currency. Hamilton probably hoped that the bank would become a central bank, but that didn't happen until 1914 with the Federal Reserve.

Re:No surprises here

[bilbodh]

And what if your family doesnâ(TM)t like bread. They likeâ¦cigarettes? - Fat Tony

Re:No surprises here

[owski]

No, the other one.

Re:No surprises here

[tqk]

What is the declared value of a dollar? 1/36th of an oz of silver?

Today, dependent upon the exchange in which it's sold. Black markets may pay less (but with less accounting paperwork (paper-trail)).

This whole "BTC vs. fiat currency" phenom stuff strikes me as bizarre. "Ephemeral value (backed by gov't)" vs "ephemeral value (backed by [Ll]ibertarian computational complexity)" is interesting to /. pedestrians? Really?!? Why? I thought /. hated all that Ayn Rand Gold Standard crap. :-)

[Admitted: I'm a "[Ll]ibertarian/Objectivist" leaner (it's complicated). No apologies.].

Re:No surprises here

[MichaelKristopeit500]

the preference would be equally as irrelevant.

Re:No surprises here

[iluvcapra]

Well, the devs can change the code, but it only affects anything if most people running the Bitcoin program actually accept the changes. Any bitcoins created with a different algorithm won't be accepted by existing nodes, so they can't simply make a 'personal branch' that creates 10x more bitcoins for them.

Making more Bitcoins for themselves isn't the fear. There are many problems if the developers have short positions in BTCs, by holding options, or by playing silent partner in exchanges and bucketing BTCs on deposit, and then releasing negative news or taking action that puts the soundness of the protocol in question. It's not clear what sort of interest the developers, of which there is no complete list or real names, have in the various exchanges.

Also, are you conceding the point here that the developers are at liberty to promulgate changes to the protocol? How do they decide that? And if they decide never to change it, how did they decide that? What if 90% of the BTC market, by balance or body, want to extend the inflation calculation another 5 years, or want to stop it now, how is that decided? Are they just supposed to fork their currency through a (you admit basically unreliable) exchange process?

Bitcoin is basically whatever a majority of nodes says it is? Doesn't that make anybody who runs a block calculator a vote on a sort of Bitcoin FOMC?

you don't have to use them to receive or send Bitcoins

What a relief! Walled gardens aren't just for cellphones anymore!

But the technology in principle would allow public repudiation of a transaction, though not actual rollback.

It's possible to declare in public that you made a transaction and everyone else can witness it -- it's not like transfers are a he said/she said -- and it's possible to follow money through the system as it passes from endpoint to endpoint, and to see if any of the money in a particular incoming transaction was ever in the defamed endpoint. That would allow voluntary policing by people who agree to not accept transactions from "dirty" endpoints.

Re:No surprises here

[geekoid]

Communism is fine. We just can't implement it yet.

When robots start taking menial service jobs, what do you think will happen?

Re:No surprises here

[geekoid]

1200 cans of what?

Re:No surprises here

[Captain Nitpick]

What is the declared value of a dollar?

The value of a dollar is the ability to pay one dollar's worth of US Federal taxes.

Re:No surprises here

[Vegemeister]

My point is that the intrinsic value of gold is small in comparison to its trade value, and has no relevance to gold's suitability as a currency. There are but two attributes required of a currency:

1. It must be difficult to counterfeit.

2. People must widely accept it as payment.

Bitcoin possesses the first, but the second requires stable value (chicken and egg problem exists here), and is a complex social effect. I think the problem with bitcoin is that the initial mining difficulty was too low, and that it is adjusted for constant global rate of production instead of constant difficulty on current hardware. This created the huge advantage for early adopters, and caused the mining explosion and speculation, of which the current bubble is a result.

Re:No surprises here

[quickOnTheUptake]

And how precisely is the amount, in US dollars, of taxes that one owes calculated?
What I'm getting at is that there is no real declared value of the dollar.
What has been declared is that the dollar can be used as currency.
Even things like the minimum wage don't really set the value of the dollar since the minimum wage is supposed to be based on actual (market set) cost of living.

Re:No surprises here

[icebraining]

I don't know exactly what's the decision process. What I know is that developers can decide whatever they want, but they can't force people to accept those decisions. If people running the nodes and trading bitcoins don't like it, they won't upgrade (and probably a fork will appear).

Bitcoin is basically whatever a majority of nodes says it is?

Well, that's kind of obvious, no? Bitcoins are only worth what people are willing to give for them; if the majority of people using Bitcoins doesn't accept moving to the new Bitcoins v2.0 or whatever and keep using the current coins, the new ones are worthless.

Re:No surprises here

[Nursie]

That's down to individual opinion it seems.

Deflationary currency makes the credit/loans a much more difficult proposition. It encourages people to hold on to money as an investment instead of using it as a medium of exchange and keeping the economy liquid. This is (IMHO) a bad thing.

A strictly controlled supply that does not keep pace with the growth of the economy (or in fact change at all later on) is a sure-fire recipe for deflation, the aforementioned bad thing.

Factor in that it is thought likely that "Satoshi", whoever (s)he is very likely has a full quarter of the current supply of currency under his/her control, from the early days of the production curve... yeah, not buying in to that.

I understand that freedom-loving libertarians (or crazies as I like to think of most of them) don't like this logic and have decided that an expansible money supply is somehow theft from them. Fine, whatever. Join in with bitcoin, I won't stop you or try to subvert the system, but neither will I join in.

Re:No surprises here

[iluvcapra]

What I know is that developers can decide whatever they want, but they can't force people to accept those decisions.

If you have wealth in Bitcoins and the rules of Bitcoins change, regardless of who promulgated the change, your wealth is dragged along for the ride; same thing if one dev gets disgruntled and starts mouthing off on a forum and claims BTC is a "Ponzi scheme." Your wealth was were forced, with just as real a force as if your dollars were depreciated by inflation.

The Bitcoin developers are a monetary authority wether they want that or not. They can't just wish away the responsibility by taking no action and making no plans; BTC market failures, insecurity, bad information and unclear rules will hurt the credibility of BTC regardless of who in particular may be to blame and how they try to rationalize it with libertarian handwaving. Having no policies is still a policy.

Re:No surprises here

[Nursie]

Actually there are bitcoin laundries already in existence. The idea is that they take your money, and give you some random other money.

Of course with an audit trail like that you're most likely to get some other dirty money....

Re:No surprises here

[tftp]

When robots start taking menial service jobs, what do you think will happen?

The society will die. What do you think will happen when young people (between 5 and 30) realize that they can do whatever they want? They will do whatever they want, and you will not like a single bit of it.

It will take a great amount of [very unusual among humans] devotion to work. Such people exist even today, but what is the percentage of workaholics - 1% at best? The rest will be going crazy from having nothing to do and from knowing that whatever they do is pointless.

They used to say that labor made man out of ape. We can reverse this wisdom and say that lack of labor will make man back into ape.

You can preview this in ghettos. People there don't have to work to stay alive; but instead of educating themselves, learning crafts, creating art they tend to revert to basest instincts that we inherited from our animal predecessors. Welfare is a cancer of societies, and it doesn't matter who pays for it - some faraway countries or some robots.

Re:No surprises here

[ekhben]

Stock is part ownership in a company, and comes with voting rights and dividends. It has intrinsic value. If you stop trading, and merely hold onto your stock, you still retain the voting rights and still receive dividends.

Bitcoin, on the other hand, does have no intrinsic value, and is a fiat currency. Fiat currencies are based only on belief in the system issuing them. Consider the US dollar, and the effect of the economic condition of the US on the perceived value of the dollar; or the Euro and the situation in Greece coupled with the cooling attitude of Germany towards the currency. The Euro could collapse if Germany pulls out and other countries lose faith in it as a viable currency.

Bitcoins are based on faith in the system that operates the bitcoin economy.

The EFF has declared a lack of faith in that system, in particular, that the legal foundation for it has not been tested, and the potential risk of being a test case outweighs any other value bitcoins may have.

Re:No surprises here

[Kalriath]

The only reason anyone ever endorses moving to the gold standard is one of these: 1) they've been deluded by that whackjob Ron Paul or 2) they have holdings in gold (like that whackjob Ron Paul) and know that a shift to gold standard would vastly increase the value of gold overnight, resulting in a huge profit to them.

Re:No surprises here

[wkcole]

Communism is fine. We just can't implement it yet.

When robots start taking menial service jobs, what do you think will happen?

If you think that hasn't been happening, you're either too young or not paying attention.

A lot of Marx's and Engels' economic analysis has been vindicated by the events of the past century, but their political ideas have been thoroughly shredded by the attempts to apply them in the real world. Communism won't work until people are much smarter, more ethical, and more consistently rational than people have ever actually been. It would also help a great deal if the people claiming to attempt to implement Communism were not so consistently megalomaniacal sociopaths. That track record argues for a fatal flaw in the ideology.

Re:No surprises here

[tftp]

bitcoin is insanely attractive to people who sit at computers all day.

On the other hand, geeks have no weight in finances. People printing USD and other currencies have no interest in an ever-deflating currency that they don't control, and 60% of which is already in pockets of founders and early adopters. Soros and Buffett and Bernanke would have to be insane to play on someone else's terms.

With regard to your theory of geeks setting up farms at work, it is probably quite far from reality. The reason is that Bitcoin had no value until very recently, so there wasn't a good reason to bother. Now that it has (or had) some value it becomes more interesting, but very few bitcoins remain, and a herd of low end business PCs will not be of much use - you need quite specific GPUs.

Another problem is that the Bitcoin client (at least the official one) is an application; it can't be ran as a service, it can't be remotely controlled, etc. etc. In other words, it is not suitable for a massive deployment (nor it was meant to be.) So an admin can't easily hide the application on a business PC. If he is discovered, he won't just get a verbal reprimand (as for SETI @home) - he will get fired; there is no scientific or otherwise benign purpose here.

Re:No surprises here

[SharpFang]

I think this would be difficult to pull off. Do you declare every generated Bitcoin you created as income?

Re:No surprises here

[tftp]

(money laundering and dope dealing going on with it)

You mean exactly like with the real, traditional, cold hard cash?

There are laws and procedures to prevent using traditional cash for such things. Go to your bank and deposit $50,000 in small bills. If you are not a retailer, expect trouble. That's exactly why Bitcoin is taking off like a rocket among criminals - payments are anonymous.

Yet another example is taxation. Imagine that I designed a gizmo for you, and you paid me 100 bitcoins for that. As a contractor, I should include this revenue into my estimated taxes. But what is the value of those bitcoins, and at what time do we calculate them? That would be similar to getting paid in Canadian dollars, Yens, etc.

Alternatively, we can treat them as a security transaction, as if you paid me for my work with 100 shares of a certain company. Perhaps that's how it should be treated. But the catch is that this security is not registered! Even then you have to pay the tax on it, at its current value - which can't be determined because there is no established market for it. Your own pet exchange in the basement, where you dial whatever prices you want, doesn't count - that's why securities laws exist.

But on top of that, why would I want to pay taxes if I can get away with it? The bitcoins are tied to a number of my "account" that nobody can associate with me.

Government-issued currency has fewer problems of this sort. In essence, by using it you submit to a certain level of monitoring, but in return you are given certainty. For most people it's a trade they don't even think twice about. I'm not concerned that the government knows that my paycheck cleared. I will report it in my tax papers anyway. But the guy who sells drugs to homicidal maniacs ought to be concerned. An ideal libertarian currency - like Bitcoin - produces the same effects that humans discovered over the course of thousands of years that we know currencies. Bitcoin will also repeat all the mistakes of earlier currencies that it can technically do, just because there are always people who benefit from doing so and people who are just sheep ready for fleecing.

Re:No surprises here

[tftp]

you can read post after post by grumpy Americans who angrily swear the Dollar is going to collapse and be trampled upon by China... then read even MORE replies by people FROM China who tell them they're completely insane, and that Chinese investors view US Dollars as the safest stores of value you can buy.

Of course Chinese investors would be saying this, as long as they hold USD.

But those Americans know the truth - the country is going bankrupt in several directions at once. It loses the industry; it loses specialists; its infrastructure decays; its society is deeply polarized and ready to explode; its job market is sick and the numbers of unemployed rise, and the government spends trillions on pointless wars... This is not the happy, happy country anymore (if it ever was such.) It is not going to be even a viable country soon - see Mexico.

If the USD falls then indeed, as you say, the fallout will be global. But who will swim to the surface? Will it be China, with resources and factories? Will it be Russia, with resources and huge land? Will it be Europe, with [not much at all]? Will it be the USA, with angry mobs rioting in all major cities, and with armed ranchers shooting their 30-06 at anyone who shows up uninvited?

Re:No surprises here

[Bert64]

You will have extremely high unemployment as people's jobs are replaced by robots. Businesses will choose to employ robots because they are cheaper, can be turned off, won't join unions or go on strike etc.

Re:No surprises here

[x2A]

Spending? You mean printing, surely? The problem the Americans have got is that dollars aren't circulating, corps 'n financial institutions are hoarding trillians in dollars and other assets, and as wealth only adds to an economy when it changes hands, the more that gets hoarded, the less that can happen. That's why economically successful countries like Germany have high upper band tax rates, as it encourages investment as a means of tax evasion... without the high tax rate, people are more willing to pay themselves stupidly high rates, hoarding wealth and slowing down the economy.

Re:No surprises here

[diamondmagic]

There's more properties than that, but mostly common sense stuff: It must be homogeneous, divisible, it can't deteriorate or spoil, and the quantity of the money supply or the number on the money is meaningless except to the extent that it becomes impractical to use, which is why gold is preferred over silver for storage of wealth. Bitcoin has all the same intrinsic properties that the USD has, except that its supply is predefined. The apparent difference in its ability to store value isn't necessarily true, but just circumstantially, it's caused by the much broader market that the USD has for goods, than Bitcoin does.

The Bitcoin difficulty is adjusted for increased hardware, calculated so that blocks are calculated an average of one per ten minutes except for a minimum difficulty, and there was a minimum difficulty in effect for the first year or so. Your concern can't possibly be over the initial difficulty, but the fact that those payouts went to such a small group. But there's nothing wrong with this, they're also taking on massive risk. We thought it was a bubble at $0.06/Bitcoin! Initial investors are still holding onto their coin, there was no sell-off that caused a crash. The bubble happened when it broke $20 USD/Bitcoin, the value only fell to $15 before settling back at about $20. Why was there a mining explosion? Miners aren't stupid, some of the most serious software analysis I've seen is behind mining programs and deciding when to mine, and when it's too expensive, and how to maximize efficiency, and so forth. The amount of power put behind the network is proportional to the trading price within an order of magnitude -- By comparison, the actual network power has increased what, 3-4 orders of magnitude?

And I'm not aware of any current bubble, over-the-counter trading is holding between $13-$16 in the last few days.

Re:No surprises here

[perryizgr8]

your point being?

Re:No surprises here

[thomasdn]

It might be stolen property.

So might dollars? I do not see your point.

Re:No surprises here

[jokoon]

Well you can't always trust this particular human element, bitcoin is just a low level protocol, he should have also proposed ways to use this currency...

Re:No surprises here

[Anonymous Coward]

There's a time and place for a "why not" attitude ("why not" accept the bitcoin?), but there are times when it's better to err on the side of caution, and ask "why should I accept this (bitcoin)?"

Between having a lack of reason to accept the bitcoin, and possibly reasons NOT to accept them (as pointed out, there may be legal risks), the EFF made their judgment

Unlike govn't backed currency, there's no authority (the same authority some bitcoin proponents seem to loath) to force EFF or anybody to accept bitcoins as a method of donation/payment

Re:No surprises here

[Laxori666]

"How is this different than the paper money I have in my wallet?"

There is no difference, except that in a country with unbacked paper money, the government can steal from all its citizens by simply printing more dollars and spending them. They did that when there was still a 'gold standard', too - i.e. paper bills that were backed by gold - but they inflated so much that people started wanting to trade in their (worth less and less) dollars for gold, so the government put a stop to that by simply removing all backing, letting them inflate to their heart's content.

Re:No surprises here

[Lumpy]

Awesome an educated and smart reply!

"Essentially, scarcity meant that you couldn't counterfeit coins, and that meant that value wasn't going to appear out of nowhere and ruin the economy as assholes made themselves rich without providing anything in trade."

Exactly, except the invention of electroplating started that exact problem. Fake coins electroplated with gold LOOKS like a gold coin. it then became commonplace to have people bite coins to see if they were simply electroplated lead fakes, etc... and precious metals have been used a long time for trade. COINS were a recent (2800bc) addition but "money" has been around for a very long time, there has been evidence if this found in Cambay Ruins from 9500bc and Mohenjo-daro ruins.. And honestly any city or country state MUST have a currency as the king or leader can not collect taxes without a form of currency. How to you tax a Mason or Carpenter without currency.

Gold will continue for a while as a currency if the Apocalypse happens tomorrow because the big stashes of gold are not as large as you think they are. Also the federal reserve stockpile will not just open it's doors, you will have to fight to get to it. The scarcity will continue for quite a while until people realize that it's just shiny and the barter system retakes the landscape. In fact the "recession" we are in has created a market for barter to flourish. I have met a lot of people that are unemployed that will gladly work for cash, service, or items. The neighbor had his roof redone in trade for a car he had sitting in the garage.

Re:No surprises here

[Lumpy]

So you hate freedom then.. Got it. Foaming at the mouth freedom hater.

Re:No surprises here

[Anonymous Coward]

Communism won't work until people are much smarter, more ethical, and more consistently rational than people have ever actually been.

The corollary then would be what tyrants knew since ages past: keeping people stupid is the best way to prevent the communism ideal from happening (where the elite lose their privileges)

Re:No surprises here

[s73v3r]

Yes. Because I recognize your "barter" idea is retarded, which is why it was phased out thousands of years ago, apparently I hate freedom. /sarcasm

Maybe before you go after people who you think "hate freedom", you should actually examine those ideas for the huge glaring problems they have. Like, for instance, if the auto shop had no use for IT work.

Re:No surprises here

[Coren22]

http://maps.google.com/maps?q=4513+brittany+ct,+eau+claire,+wi+54701&hl=en&ll=44.770371,-91.470894&spn=0.001807,0.004128&sll=37.0625,-95.677068&sspn=64.664844,135.263672&t=h&z=19&layer=c&cbll=44.770572,-91.470889&panoid=Gd1KMMS2y0dslL8gli4I1g&cbp=12,81.65,,0,9.36

Looks empty. Cower some more feeb.

Re:No surprises here

[Coren22]

Funny how the bot attacks a compliment huh?

I always find the MK troll most hilarious to poke.

Re:No surprises here

[MichaelKristopeit502]

considering that picture is missing the flower garden my wife put in last spring, you're fairly foolish to trust the source for current information.

are you unable to knock on my door and confirm my existence? have i not given you everything you need to make an undeniable confirmation?

you're an cowardly, ignorant hypocrite.

you're completely pathetic.

Re:No surprises here

[Coren22]

are you unable to knock on my door and confirm my existence? have i not given you everything you need to make an undeniable confirmation?

Yes, you live way too far away for me to bother with as it would only be confronting someone who has no idea someone is using his name on the internet to act all high and mighty.

Re:No surprises here

[man_of_mr_e]

Really, and here I thought it was a lawyers job to associate with people alleged to be criminals ;)

Re:No surprises here

[MichaelKristopeit401]

ur mum's face live way too far away. you're ignorant hypocrisy is rivaled only by your cowardice and paranoia.

you perceive me as high and mighty? that is very telling.

cower in my shadow some more, feeb.

you're completely pathetic.

Re:No surprises here

[suomynonAyletamitlU]

Even if gold isn't as well-stocked as I think, I maintain that it's in the wrong hands. The sort of people that will be stocking precious metals instead of spending money on necessities and consumer goods are the ones who probably won't be of value in an emergency--or if they are, they'll have to prove it.

To be honest, though, it will likely not even be thought of immediately. Most places in the first world already have a disaster-recovery chain of command, which will become de facto authority until something better comes along, and it will only be after a while that people worry about currency; unless the local governments can secure enough gold to make their own currency (which, honestly, seems unlikely), they might just use old currency (especially coins) at different valuations, or else they may go straight to barter with contracts enforced by local authorities for large sums. Gold would have to be a step up from that in terms of practicality, and I'm not sure it is.

In any case, whatever happened after the apocalypse would be another dark age, and it'd be a lot of struggling and fighting and things we can't even predict. More than likely, a million different scenarios will play out in cities and townships, so we could only really talk about it statistically.

Re:No surprises here

[Bucky24]

Associate professionally, yes. Honestly, I don't see a problem with it, but someone might, and that might be the little edge their opposing side needs to get them discredited, ect. Lawyers are slimy.

Re:No surprises here

[bill_mcgonigle]

Communism is fine. We just can't implement it yet.

When robots start taking menial service jobs, what do you think will happen?

Just robots aren't enough - you need AI's and limitless energy (fusion or similar).

At that point, we don't need tools to allocate scarcity. Or, if the Socialists win, Star Trek-style death penalty for building AI's.

Re:No surprises here

[Coren22]

ACT, try learning the word. Yes, calling someone completely pathetic is exactly what I was talking about, that is ACTing high and mighty.

Re:No surprises here

[MichaelKristopeit408]

MISCONCEPTION, try not being the poster boy for the definition.

Yes, you think i'm ACTing. that is very telling. is the world not a stage?

i wasn't ACTing. i wrote words. you read them... or at least you ACTed like you read them. your subconscious betrays you. you are solely responsible for your ACT of perceiving my actions and motivations. you're an idiot.

you're also an ignorant hypocrite. being an ignorant hypocrite is pathetic. calling you completely pathetic is no more than stating a fact.

you have cowered from my invitation to obtain all of the information need to prove your suspicions as false. why? what are you afraid of?

cower some more, feeb.

you're completely pathetic for many reasons.

Re:No surprises here

[monkyyy]

"They used to say that labor made man out of ape. We can reverse this wisdom and say that lack of labor will make man back into ape."
says who? mindless labor makes people bitter and guess what, mindless.

ghettos dont have the chance of educating themselves, social classes are set in stone unless ur lucky, hard working, AND smart.

Re:No surprises here

[tftp]

ghettos dont have the chance of educating themselves

They have enough chances to do that. See "Affirmative action." See "Barack Obama" (whoever he is.)

social classes are set in stone unless ur lucky, hard working, AND smart.

Luck is something we all need. However "hard-working" and "smart" are qualities that a ghetto dweller can learn. Especially the "hard-working" part of it. The "smart" part is not even required to hold a good job and have a peaceful life.

But of course realities of the modern USA tell us that even a white, male graduate can't easily get a job outside of McD. A black ex-con has nearly zero chances of getting a job anywhere.

Regardless, hard work is the only salvation those people in ghettos have - because the gravy train is nearing the cliff, and if the welfare is not canceled by the government it will be canceled by devaluation of the dollar when it crashes. Working people, however, will be always selling their labor for the going rate, and that rate is not measured in dollars - it is measured in other goods that you need to live. It may be that you will be paid $100K per day, and you will be paid daily, and that will feed you. But welfare recipients will be left at their $300/head or whatever they are getting, and that won't even buy a newspaper. Then they will get really mad at "the man" for "keeping them down." As I believe, "the man" is indeed doing them a huge disservice by paying them welfare.

Re:No surprises here

[MichaelKristopeit350]

i always find ur mum's face most hilarious to poke.

you're an idiot.

19-year-old arrested in Sony hack

[Anonymous Coward]

A teenager has been arrested near London in connection with the hacking of Sony, London's Metropolitan Police said Tuesday.

They still take WOW gold though?

[Rogerborg]

Damn, I was just about to gift them enough for an Epic Mount.

Re:They still take WOW gold though?

[Dunbal]

I think anyone who has invested any substantial amount of money in bitcoin as an "investment" has already been on the receiving end of an "epic mount".

Re:They still take WOW gold though?

[Anonymous Coward]

This is +5 funny.

Re:They still take WOW gold though?

[Anonymous Coward]

...if you're twelve years old.

Re:They still take WOW gold though?

[Anonymous Coward]

Or +5 brain damage

Re:They still take WOW gold though?

[Anonymous Coward]

Gift me some and I'll give your mom an epic mount.

Re:They still take WOW gold though?

[Omnifarious]

So far, I've gotten more USD out of Bitcoin than I've put in by about 250%. And I still own a bunch of bitcoins. I will be using them to buy actual physical goods and not USD as much as possible. I think there are enough people like me that the currency will succeed.

It's certainly a heck of a lot more 'real' than WoW gold, which only exists on WoW servers and is completely controlled by the server you're on, which generally means Blizzard.

Re:They still take WOW gold though?

[shermo]

I 'cashed out' of wow a few months ago and got a nice gfx card for my gold from a guild member. Works as a currency for me.

Re:They still take WOW gold though?

[Omnifarious]

I agree that it has limited value as currency. But I can't ever see it really leaving the limited ecosystem of WoW and things that immediately surround it. I can buy silk pillows from someone in Chile with bitcoins. It has significantly more potential.

Re:They still take WOW gold though?

[tftp]

And I still own a bunch of bitcoins. I will be using them to buy actual physical goods and not USD as much as possible.

This is pretty contradictory. If you are bullish on Bitcoin then spending them as currency is the worst decision you can make. You need to hoard them.

But if you do spend them it means you are willing to take financial loss for the benefit of the currency. This moves Bitcoin from the category of currency (which is a fair trade in either direction) into the category of political agendas and personal sacrifices. Not many people will follow you there.

But if you are bearish on the Bitcoin (and that's why you are spending it) then it contradicts your hope that the Bitcoin succeeds.

In either case, if you are willing to spend Bitcoins then you shouldn't focus on conversion to USD - you should do what makes sense. If the company A offers the product Y for 1 bitcoin, the company B offers the product Y for $10, and the exchange rate is 1 bitcoin to $20, you will do well if you sell 0.5 bitcoins and use USD to buy the product from company B. Paying more to the company A is a political action, not a financial one.

Re:They still take WOW gold though?

[Omnifarious]

Hoarding is a counter-productive strategy. Hoarding makes my bitcoins worthless over time. What makes them worth something is people accepting them for payment for goods and services. While spending all of my bitcoins wouldn't be particularly wise, spending some of them on goods and services helps grow the economy and increases the value of all of them over time.

Your logic is very short-term gain focused. And it will ultimately lead to a collapse in the value of bitcoin. It is foolish to hoard them.

OTOH, I will be asking fair market value when I buy things. I would not pay what would effectively be double the price. I will pay slightly more for things if I pay with bitcoin, but that's because the total value of the transaction is higher for me if it's carried out in bitcoin.

Also, I have been approached for work in bitcoin by companies that are in random parts of the world. This simply would not have been possible in a more traditional currency. The ease with which bitcoin crosses borders is not something that is to be underestimated.

Re:They still take WOW gold though?

[Rogerborg]

Spending your bitcoins makes everyone else's worth more. If you can't identify the sucker at the table, it's you.

What's the total market cap for bitcoins now? $50 million USD after the crash? It's a statistically insignificant blip.

Re:They still take WOW gold though?

[Omnifarious]

It makes the bitcoins I have left worth more too.

Some people thought Henry Ford was a sucker for paying his workers more than he had to. But he knew that if they had money, they'd buy things, including the cars he was having them manufacture. Google pumps a ton of money every year into Open Source projects they may or may not ever use because they know that helping the ecosystem helps them in the long run.

Nobody calls Henry Ford a sucker now, nor does anybody think that of Google. My using bitcoins for actual commerce when I can is the same thing done for the same reasons.

You just want to continue to live in your world where bitcoins are unimportant, and so you and that tftp guy construct scenarios in which it's in nobody's interest to make them succeed. I think most people are smarter than you give them credit for.

I don't know why you don't want them to succeed. I can only conclude irrationality. From my perspective, bitcoin is a strictly better currency system than any anybody has yet devised. And while the distribution statistics are skewed towards early adopters (though not as much as you think), I think the distribution of bitcoins has been far more equitable than any other currency system I know of. Certainly more equitable than how USD are created.

I have also seen far more generosity and willingness to pay for useful work (as an example, someone gave me 0.3 BTC (when the exchange rate was at its peak) after the fact and with no obligation for a 20 minute lesson in how the crypto worked) in the bitcoin community than almost anywhere else. People there recognize that hoarding does nothing for the value of the currency in their wallets.

Re:They still take WOW gold though?

[tftp]

Your logic is very short-term gain focused.

In the long term we are all dead.

You personally (or me, sometimes) may have different logic, and occasionally out of pure philanthropy we may do something that is counter to our own interests. In statistics, however, such behavior is insignificant. The economy is driven by players who act in their own interests. Therefore bitcoins will be hoarded. We can already see that - the market of bitcoin goods and services is miniscule compared to the market of speculation.

I will pay slightly more for things if I pay with bitcoin, but that's because the total value of the transaction is higher for me if it's carried out in bitcoin.

The political ears are exposed again. This is something *you* do, and that's fine. Only don't expect any statistically significant number of players to do that too. Some people contribute to charities, but that doesn't turn "charities service" into a significant portion of the GDP.

Also, I have been approached for work in bitcoin by companies that are in random parts of the world. This simply would not have been possible in a more traditional currency.

But why is that? Any country that is not of likes of Sudan or Afghanistan can pay you in USD. Those companies act in their interest; most likely they came across some number of bitcoins, and now you will be working for something they got for free. From your point of view you shouldn't care if the customer pays you with money from a wallet he found in the street ... but since you are so much interested in the advancement of the humanity, this transaction is unfair (people paid you with wealth that they haven't created.)

Another, more sinister, explanation is that those companies want to pay you under the table, skipping the books. How will you report this income? There is no way to establish the value of goods that you received. Or perhaps this income will be conveniently forgotten?

Re:They still take WOW gold though?

[Anonymous Coward]

Some people thought Henry Ford was a sucker for paying his workers more than he had to. But he knew that if they had money, they'd buy things, including the cars he was having them manufacture. Google pumps a ton of money every year into Open Source projects they may or may not ever use because they know that helping the ecosystem helps them in the long run.

Nobody calls Henry Ford a sucker now, nor does anybody think that of Google. My using bitcoins for actual commerce when I can is the same thing done for the same reasons.

Unfortunately, there is no inductive method to success (if only it was that easy). Just because Henry Ford and Google made investments into ideas that were successful, doesn't mean every other investment or idea will be.

You say people are resisting bitcoin out of irrationality. I say it's the opposite: the rational thing to do is to be critical on what you invest in and what ideas you support. And because we can never be sure that an idea/investment is good, people can and will be skeptical of any idea

The fact that /. seems to have taken an interest to bitcoin stories should provide an opportunity for you to promote the bitcoin idea.

If you present a good argument, they might be persuaded. If you calling them irrational, my experience tells me that it will often have the opposite effect

EFF is not a defender of freedom

[brian0918]

Anyone who is surprised by this should have checked their premise that EFF is a defender of freedom. A simple glance at their position on net neutrality would have cleared that up.

Re:EFF is not a defender of freedom

[betterunixthanunix]

How is a scam like Bitcoin in any way related to "defending freedom?"

Re:EFF is not a defender of freedom

[Richard_at_work]

What does this have anything to do with being a "defender of freedom"? Why does the EFF have to support BitCoin?

Re:EFF is not a defender of freedom

[calmofthestorm]

I see what you did there.

Re:EFF is not a defender of freedom

[Anonymous Coward]

If not being a defender of freedom means not supporting a scam (BitTulips), I'm okay with that.

Re:EFF is not a defender of freedom

[brian0918]

In what way is mathematics (as realized in the form of bitcoin) a scam? Review the source code yourself.

Defending an unregulated alternative to government fiat currency is certainly defending freedom.

Re:EFF is not a defender of freedom

[Anonymous Coward]

What relevance does that link have to the EFF?

The page mentions them nowhere, and the author of that piece doesn't seem to have any clear link to them.

Re:EFF is not a defender of freedom

[gstoddart]

How is a scam like Bitcoin in any way related to "defending freedom?"

The same way 'capitalism' is -- the freedom to bilk people out of their money if they're willing/uninformed enough to participate.

To the strict free market folks, that's a transaction which is just part of the system, and is 'self correcting'. That's why regulation is considered bad.

And, sadly, I'm only being partly sarcastic.

Re:EFF is not a defender of freedom

[aBaldrich]

Not related, just an excuse to post trollish comments on how social darwinism is freedom and everything else is nazi-communislam.

Re:EFF is not a defender of freedom

[brian0918]

They don't have to support the bitcoin movement, but to claim they defend internet freedom when they purposely removing bitcoin transaction support in order to avoid appearing to support the bitcoin movement, is absurd.

Re:EFF is not a defender of freedom

[Charliemopps]

Not only is that article off topic, it completely misunderstands the premise of net neutrality. The EQUIPMENT that the "internet" resides on is not, the internet. "The internet" is like "speech" or "Writing" it's an intangible medium for relating information and it's owned by humanity as a whole. We've collectively decided that to connect to the internet, you need to do so in a neutral way. ISPs connecting you to something other than the internet do not have to do so in a neutral way. But if you want to provide INTERNET access you need to do it without prejudice against or for certain voices on the net.

Re:EFF is not a defender of freedom

[Anonymous Coward]

I'm assuming you mean freedom for corporations to throttle your bandwidth and shape traffic while selling you unlimited* data plans. In that case then yes, the EFF is downright loathsome.

Re:EFF is not a defender of freedom

[Kenja]

So if I print out some "money", you would defend my right to try and buy groceries with it?

Re:EFF is not a defender of freedom

[brian0918]

The EQUIPMENT that the "internet" resides on is not, the internet. "The internet" is like "speech" or "Writing" it's an intangible medium for relating information and it's owned by humanity as a whole.

Speech is made by a speaker. Writing is made by a writer. The fact that it is a concept does not mean it is not property. Property itself is an abstract concept. Investigate the source of that concept, and you will understand why intellectual property is property, and why "owned by humanity" is incoherent.

Re:EFF is not a defender of freedom

[cwebster]

More likely your right to promote your "money" as an alternative currency and encourage adoption by merchants and consumers, thus validating your "money".

Re:EFF is not a defender of freedom

[Lunix Nutcase]

For those who won't realize before clicking the link the story is to an objectivist periodical that was co-founded by Ayn Rand. Take that as you will.

Re:EFF is not a defender of freedom

[Lunix Nutcase]

Except you have no such right at least not in the US. Such is clearly stated in the constitution as being a power of the government.

Re:EFF is not a defender of freedom

[NeutronCowboy]

Do you know how you increase knowledge? By sharing it. Culture? Same way. Common bonds? By sharing events.

Notice the sharing? You might want to investigate this entire concept of "humanity" a bit further.

Re:EFF is not a defender of freedom

[ImaLamer]

Not related, just an excuse to post trollish comments on how social darwinism is freedom and everything else is nazi-communislam.

Is it me, or is that what 98% of the Neo-Neo-Libertarians advocate now, Social Darwinism... which is closer to Nazism (in ideology) than anything else I know.

Re:EFF is not a defender of freedom

[horza]

You are confused. Defending a currency is not the same as forcing somebody to accept it. Your grocer is not obliged to accept the notes printed by the government, as they are not obliged to accept Bitcoin.

Phillip.

Re:EFF is not a defender of freedom

[betterunixthanunix]

Actually, you do have a right to print private currency in the United States, as long as you guarantee that it can be redeemed for USD and as long as you report and pay the appropriate taxes on transactions made in that currency. You can't legally use your private currency to settle a debt or to pay your taxes, but you can pay workers with it and use it to purchase goods and services. See, for example, this:

http://www.berkshares.org/

Now, Bitcoin is different, in that there is no guarantee of being able to redeem it for anything at all. This muddies the legal situation surrounding Bitcoin.

Re:EFF is not a defender of freedom

[Dunbal]

There are several alternative currencies currently being used in the US. Look it up - google is your friend.

There's no problem printing money. The problem is getting people to see enough value in the money that you printed to accept it as a medium of exchange for goods and services. Now if you lie to people or somehow trick them into thinking that it has value (like saying, for example, that Collateralized Debt Obligations are "AAA" grade, cash equivalent investments when in fact you don't even have the signatures of the people whose fractional mortgages they represent on file somewhere) then it's a scam.

But going up to someone and saying "Hey, I printed up these cute pieces of plastic let's use them as currency" is not a scam. Otherwise cheques and credit cards would cease to exist overnight. What actually is the "value" of a big number on a piece of plastic in your wallet? The only good thing about it is that it's backed by a name like VISA or MASTERCARD or AMEX, and there's a perception of value. The merchant knows he's going to be paid. You have a feeling of security, and a monthly statement you can review. And that's it - a new currency is born.

Re:EFF is not a defender of freedom

[brian0918]

Alright, you're getting to the actual issue - cable companies provide crappy service. So why don't people switch to alternative cable companies? Because there aren't any. Why is that? Because local governments grant monopolies to these cable companies, and prohibit competitors from laying their own lines.

Attempting to band-aid one regulation with another does not lead to freedom.

Re:EFF is not a defender of freedom

[Richard_at_work]

Its not absurd at all, they don't have to support someones pet project...

Bitcoin has nothing at all to do with internet freedom - it is you that is trying to somehow link the two.

Re:EFF is not a defender of freedom

[timholman]

In what way is mathematics (as realized in the form of bitcoin) a scam?

The "scam" is in how the proponents of Bitcoin constantly try to promote artificial scarcity with a resource that, by definition, is infinite in size.

There are an infinite number of mathematical codes that could be arbitrarily called "money". They might not be called "bitcoins", but they will be completely equivalent to bitcoins in value. So what is so special about BTC, beyond the hype that its speculators keep promoting for their own benefit? By any rational mathematical definition, bitcoins are worthless.

Defending an unregulated alternative to government fiat currency is certainly defending freedom.

Not if that "alternative currency" is little more than a pump-and-dump scheme created to enrich its early adopters at the expense of latecomers.

The bitcoin concept might actually have a shred of respectability if anyone knew the true identity of its creator. For all we know, "Satoshi Nakamoto" is the front for a syndicate that has figured out the perfect crime: release the code for a worthless pseudo-currency after reserving a huge chunk of all possible "coins" for yourself and your cronies, hype said pseudo-currency to build a speculator's market, and then sell off your "coins" via dozens of anonymous proxies before the scam collapses.

Re:EFF is not a defender of freedom

[betterunixthanunix]

The source code has nothing to do with Bitcoin being a scam. The fact that Bitcoin was designed to generate tremendous returns for its developers and early adopters, and siphon other currencies away from late adopters, is what makes Bitcoin a scam. You are talking about a currency that is inherently deflationary, and which will only see inflation at the very end of its life when the last adopters find themselves holding worthless tokens. The value of Bitcoin is based on speculation about how many more people will buy into the system.

Re:EFF is not a defender of freedom

[king neckbeard]

That the US can coin money doesn't mean that others can't make their own currencies. Other private currencies do exist, but generally in more limited contexts. Wii, Xbox, Kool-Aid, and Pepsi all have or have had points systems which can be used as currency by those that accept them, and nobody has cracked down on them.

Re:EFF is not a defender of freedom

[zeroshade]

Except majority of that "property" that is being spoken of here (the cables, pipes, etc.) was paid for by the government subsidizing the ISPs in order to promote the building of infrastructure. Instead of continuing to build the infrastructure that they were given money for, they kept it. Instead of increasing capacity by building infrastructure they are overselling and shaping.

Let's give it by a different example, look at phone lines. Net neutrality is analogous to the common carrier law in respect to telephony. According to that article and your argument, you must believe that the common carrier designation in the telephone industry should never have happened. That it is wrong for the government to have regulated and told a private entity how to use "its property". The argument is absurd on the face of it, the Internet should be considered a utility, a public resource. ISPs provide access to this intangible thing over which data is sent not only over their "property" but over the "property" of others. The innovation of tools, technologies, utilities, and services has flourished for years due to Net Neutrality.

It's amusing, because many opponents actually agree that the problems that Net Neutrality seeks to prevent are valid problems that should be dealt with, they just don't believe those problems will actually occur and thus government regulation to prevent them is unnecessary. This is proven false by the multitude of situations where ISPs have violated Net Neutrality principles and by the number of ISPs who've publicly stated they'd be willing to make specific services faster if they paid for it.

The question is not about property, and if that's the only argument that is made then you have no argument. An electricity company can't charge you more for your electricity if you're running a pool or if you have a big screen tv. Your water company can't change the rate of water flowing to your house if you're using hot water vs cold water, using a tub vs a faucet. So why should your ISP be able to slow your web browser down vs streaming video? Why should your ISP be able to give preference to Hulu over Netflix just because Hulu paid them money?

You want a solution to the problem of bandwidth supplying? Build infrastructure, throttle a PERSON who is using too much bandwidth, not the protocol.

Re:EFF is not a defender of freedom

[nhaehnle]

Your grocer is not obliged to accept the notes printed by the government

This is false in many countries. Learn about legal tender laws. Not all countries have them, but many (most?) do.

Re:EFF is not a defender of freedom

[Anonymous Coward]

Actually, you are wrong, the grocer IS obliged to accept notes printed by the government as long as he/she has already provided you a good or service... note the text on a FRN, "this note is legal tender for all debts, public and private". Now, granted, TECHNICALLY the grocer doesn't have to accept the bills as payment, but in doing so, he would be cancelling your debt... so, either you succeed in paying with bills, or you don't have to pay at all.

Re:EFF is not a defender of freedom

[brian0918]

Do you know how you increase knowledge? By sharing it.

I increase my knowledge by learning. I don't believe I have ever increased my knowledge by regurgitating what I already know.

The fact that more people could learn certain information if it was provided for free doesn't justify the theft of that information. Do you think creators will continue to create if they know their products will simply be stolen and "shared"? By wanting the unearned, you undermine the whole system.

Re:EFF is not a defender of freedom

[betterunixthanunix]

The problem is getting people to see enough value in the money that you printed to accept it as a medium of exchange for goods and services

That is a problem that is easily solved: give people a fixed exchange rate, and back your private currency with the government's currency. Over time, people will accept the private currency, perhaps out of regional pride, or perhaps because it has some useful property (e.g. maybe you put more private-currency dispensing ATMs in the region than there are other ATMs, or you give merchants some special incentive, etc.).

Re:EFF is not a defender of freedom

[brian0918]

You don't increase freedom by adding regulations on top of past failed regulations. The monopolies that local governments have given to cable companies should be undone.

Re:EFF is not a defender of freedom

[Lunix Nutcase]

Yes and those monopolies were granted completely out of the blue without any lobbying on the part of the telecoms and cable companies. No, they clearly made huge public outcries against these monopoly grants that the local municipalities forced upon them. Are you fucking kidding us? Seriously, these telecoms and cable companies bought the people who are granting them those monopolies and are clearly colluding with each other so they don't have to actually compete. Hence why you never really see Time Warner or Comcast competing nor AT&T and Verizon when it comes to DSL.

Re:EFF is not a defender of freedom

[king neckbeard]

'Intellectual property' has many legal similarities to physical property, but it's nature is inherently quite different. Copyrights and patents are regulations that exist at least nominally for the benefit of the public. Assuming that you are part of the laissez faire crowd, you should oppose or at least hope to limit such heavy-handed government interference as the copyright and patent systems bring.

As for net neutrality, the current environment is toxic to any and all competition, so free market arguments don't apply. The linked article talks about new ISPs entering, but that doesn't happen because it generally can't. Also, the claim that ISPs are the same as other private property owners is hardly accurate. It's pretty bold to call the infrastructure THEIR private property when so much of it is located on the private property of others, likely without any consent given by the landowner. It's the local government that they generally do actual business with, and most of the agreements include at the very least the exclusion of direct competition.

Re:EFF is not a defender of freedom

[MindlessAutomata]

Actually, I believe they are.

Re:EFF is not a defender of freedom

[Lunix Nutcase]

The monopolies that local governments were paid by the cable companies to give out should be undone.

FTFY. They should also pay us back all public money given to them to build their infrastructure and they better remove their cables from public-owned land. "Their property" should also removed from public lands at their own cost or they better pay fair market value for the land they are using. It's amusing to listen to little Randtards like yourself whine all about how the government is doing all this bad stuff and should get out of their "private property" when they only way they would have been able to lay that "private property" was because the government gave them grants of money and land to do so.

It's amusing, because many opponents actually agree that the problems that Net Neutrality seeks to prevent are valid problems that should be dealt with, they just don't believe those problems will actually occur and thus government regulation to prevent them is unnecessary.

Except for the fact that those problems are occurring? Have you been living in a hole for some time now?

Re:EFF is not a defender of freedom

[brian0918]

"Their property" should also removed from public lands at their own cost or they better pay fair market value for the land they are using.

Public property should not exist. Do not punish people who have taken advantage of an unjust situation - blame the people who created the unjust situation: the local government politicians.

the only way they would have been able to lay that "private property" was because the government gave them grants of money and land to do so.

The status quo isn't justified by its own existence. The fact that the government prohibited people from owning land without first getting permission from the government does not imply that that original prohibition was just.

Re:EFF is not a defender of freedom

[Americano]

So me reciting a bunch of memorized facts "increases knowledge"? Me performing bad Youtube covers of Lady Gaga songs "increases culture"? Me inviting everybody into my bedroom to watch me have sex with my girlfriend "increases common bonds"?

Notice that none of what you've said makes any sense? You might want to investigate this entire concept of "rational coherence" a bit further.

Re:EFF is not a defender of freedom

[Anonymous Coward]

And your argumentum ad hominem is relevant to whether or not the arguments presented by the linked article are valid in what way, exactly?

Oh that's right, it's Slashdot... "LOLAYNRANDLOL" is considered a valid counterpoint here.

Re:EFF is not a defender of freedom

[Anonymous Coward]

So.... Where was the ad hominem? "objectivist", "periodical", or "Ayn Rand"?
Ah yes, LOL indeed.

Re:EFF is not a defender of freedom

[blueg3]

A fee for a service, even if charged after the service is rendered, is not the same as a debt.

Private businesses aren't required to accept US Dollars in exchange for goods or services. Even the Treasury says so:
http://www.treasury.gov/resource-center/faqs/Currency/Pages/legal-tender.aspx

Re:EFF is not a defender of freedom

[arth1]

"This note is legal tender for all debts. Public and private"

The only way you around this in most countries is to use a barter economy and not accept money at all. If your grocer says that a dozen eggs will cost you a sack of birch wood, that's fine. But once he starts accepting money, he can't turn down government printed notes.

Re:EFF is not a defender of freedom

[Anonymous Coward]

To begin with, I'm pretty sure the reasons they cite for Bitcoin to be illegal would make every other form of digital currency also illegal (Liberty Reserve USD, Linden Dollars, PayPal USD, c-gold, Webmoney, etc.): sounds kinda dumb.

And the thing is.. either the reasons they cite for them dropping Bitcoin donations are correct (i.e. Bitcoin use is illegal) and, in that case, they are BAD LAWYERS for having accepted Bitcoin donations in the first place.

Or they are not. And in that case, they're just a bunch of pussies that are rejecting donations freely given by others (since Bitcoins do have a non-zero nominal market value, today), besides being BAD LAWYERS.

After this, I sure won't send them any more donations to these incompetents/pussies (strike what doesn't apply).

Re:EFF is not a defender of freedom

[Hatta]

Property itself is an abstract concept. Investigate the source of that concept

That's easy enough. The source of the property concept is the fact that some goods are rivalrous. That is, use of the good by one party makes use of the good by another party impossible. Obviously we need a mechanism to manage who gets to use what good.

you will understand why intellectual property is property

I'm not following. Intellectual "property" is not rivalrous, and so it should not be considered property.

Re:EFF is not a defender of freedom

[Unordained]

As much as we would defend your right to *try* to buy groceries by trading anything you have (legally) for merchandise from the grocer, sure. That doesn't mean we'll fight until you succeed. We'll merely defend your right to try to negotiate a mutually-agreeable deal with the grocer. We've always had the right to trade with each other. There's no good reason for a government to prevent that, saying you *can't* trade pigs for beer if you want to. So it's a liberty that should be defended. And the only entity you fight when defending liberties is the government -- not individual grocers, etc., as they're not the ones imposing a lack of freedom. Maybe a lack of choice (by all agreeing that bitcoins suck), but not of freedom.

Re:EFF is not a defender of freedom

[s73v3r]

And so you would be denying their freedom to take donations in the form of their choice by demanding they take your volatile, fly-by-night currency?

Re:EFF is not a defender of freedom

[s73v3r]

Actually, I think it's no longer legal to pay your employees in alternative currencies either, unless they agree to it. It also cannot be a stipulation of employment that you accept it.

Re:EFF is not a defender of freedom

[SuricouRaven]

It's internet debate. You're not supposed to know the meanings of words before you use them.

Re:EFF is not a defender of freedom

[s73v3r]

But going up to someone and saying "Hey, I printed up these cute pieces of plastic let's use them as currency" is not a scam. Otherwise cheques and credit cards would cease to exist overnight. What actually is the "value" of a big number on a piece of plastic in your wallet? The only good thing about it is that it's backed by a name like VISA or MASTERCARD or AMEX, and there's a perception of value. The merchant knows he's going to be paid. You have a feeling of security, and a monthly statement you can review. And that's it - a new currency is born.

That's not really a new currency, just a different exchange medium. It's still using US Dollars as the currency, just electronic representations of them.

Re:EFF is not a defender of freedom

[s73v3r]

No it's not. They don't support BitCoin themselves. They would probably defend someone using it, if said case aligned with their mission, but that doesn't mean they have to accept them.

Re:EFF is not a defender of freedom

[s73v3r]

That only works if you consider property rights to be the be-all, end-all of rights. Many of us don't.

Re:EFF is not a defender of freedom

[s73v3r]

Depends on who you're talking about. Personally, I value my freedom far more than I value an ISP's freedom. And my freedom includes being able to access the content on the internet I want without being hindered by the ISP for not going with their "preferred partners".

Re:EFF is not a defender of freedom

[s73v3r]

Public property should not exist.

Why not? Why should every square inch of the world be owned by someone? Why should public parks and nature reserves not exist?

Do not punish people who have taken advantage of an unjust situation

Why not? They knew exactly what they were getting into.

Re:EFF is not a defender of freedom

[s73v3r]

And if a location can only support one company? Should they just be beholden to whatever that company wants?

Re:EFF is not a defender of freedom

[s73v3r]

So wait, considering the bias present in an article is an ad hominem now?

Re:EFF is not a defender of freedom

[SuricouRaven]

Even if there was no government involvement, telecommunications would still tend towards a natural monopoly. It's a common issue in any area with a very high capital cost to enter a market, which certainly includes digging up roads and laying cable. Once one company has gotten established, it just isn't viable for another to enter - not only do they have to compete against an incumbant that has a head start on customer loyalty, but there is the risk said incumbent would just drop prices sharply to drive competitors out.

The same thing applies to things like water, gas, sewage... anything that needs infrastructure built. It's only a reliable profit-maker if no-one else is providing the service already.

Re:EFF is not a defender of freedom

[brit74]

Yup. People will post libertarian anti-copyright arguments to defend piracy, but those same people will dismiss anti-net-neutrality arguments written by the same libertarians. Personally, I think the libertarians have got it all wrong. I haven't read an anti-copyright argument or an anti-net-neutrality argument I actually agree with. (Just to see what they have to say, I've read partway through the article, and there are some obvious flaws.)

Re:EFF is not a defender of freedom

[zeroshade]

It's amusing, because many opponents actually agree that the problems that Net Neutrality seeks to prevent are valid problems that should be dealt with, they just don't believe those problems will actually occur and thus government regulation to prevent them is unnecessary.

Except for the fact that those problems are occurring? Have you been living in a hole for some time now?

Read the very next sentence after that

This is proven false by the multitude of situations where ISPs have violated Net Neutrality principles and by the number of ISPs who've publicly stated they'd be willing to make specific services faster if they paid for it.

I know it's already happening and specifically said so.

Re:EFF is not a defender of freedom

[NeutronCowboy]

Do you think creators will continue to create if they know their products will simply be stolen and "shared"?

Yes, they will. Just like they have for the last thousands of years. The only thing wrong with Randians is that their theories fail 100% when tested against reality.

I increase my knowledge by learning. I don't believe I have ever increased my knowledge by regurgitating what I already know.

Of course. You never learned anything from anybody. You just learned on your own. Everything you know was either paid for at a fair market price, or was discovered on your own. The only thing scary about Randians is how deluded they are about their own capabilities, and their control over their position in life.

Re:EFF is not a defender of freedom

[Lunix Nutcase]

I'm sorry, but I wasn't making any sort of argumentum ad hominem at all because I wasn't making any argument. I was just letting people know that the article is written by an objectivist in an objectivist periodical. What exactly is the issue?

Re:EFF is not a defender of freedom

[zeroshade]

Do not punish people who have taken advantage of an unjust situation - blame the people who created the unjust situation: the local government politicians

How about we blame both? Though, according to most conservatives, it is perfectly fine for the local governments to create the monopolies just not for the federal government to do it. What should happen is that the monopolies given to local companies should be eliminated so that some competition can start to form. In addition, Net Neutrality needs to be enforced to protect consumers and innovation. Maybe when there's enough competition we won't need to enforce Net Neutrality and a "free market" may actually work, but right now there is no "free market" with ISPs. Telecommunications companies should be divested from content producing companies. ISPs should be a utility selling a dumb pipe.

Public property should not exist

So, public parks, nature reserves, etc. should all be privately owned? Gimme a break. The only reason why parks and such still exist is because governments use public property to prevent corporations from bulldozing it and building on it.

Re:EFF is not a defender of freedom

[Anonymous Coward]

I agree it's not absurd.

Currency Exchange

[Rhacman]

This, following the somewhat late realization that Hasbro lets you print your own Monopoly money...

Currency not accepted is currency no more?

[PC and Sony Fanboy]

Bitcoins are quite similar to most forms of fiat money. If enough people don't endorse it, use it or accept it, it's worthless.

Re:Currency not accepted is currency no more?

[King_TJ]

Precisely ... but IMO, at least in concept, a virtual fiat currency like this could work well for items in a virtual "fiat world", no?

Re:Currency not accepted is currency no more?

[Anonymous Coward]

Except it's not backed up by anything, it can literally lose value overnight, good luck finding a sucker to pay for it after that.

Re:Currency not accepted is currency no more?

[PC and Sony Fanboy]

Except it's not backed up by anything, it can literally lose value overnight, good luck finding a sucker to pay for it after that.

You mean, like every other fiat currency? USD? Euro? Etc. Etc.

Re:Currency not accepted is currency no more?

[betterunixthanunix]

Bitcoins are quite similar to most forms of fiat money.

Except that Bitcoin cannot be used to pay taxes or any government fees or tariffs. Nor can Bitcoin be used to legally settle debts in some places (like the United States). In fact, Bitcoin is about as similar to fiat currency as a Chuck-e-Cheese token would be. Most fiat currencies are designed to defend against deflation, whereas Bitcoin is designed to encourage it. Most fiat currencies are useful for money lending; only a fool would lend or borrow Bitcoin.

Bitcoin was a superficially nice idea, but spend more than 5 minutes thinking about its implications and fundamental architecture and one is forced to conclude that it was either designed by people with a high-school level understanding of economics or it is a scam designed to yield big profits for the developers and early adopters, while screwing over late adopters.

Re:Currency not accepted is currency no more?

[Anonymous Coward]

Unlike actual fiat money, it can't be printed in an inflationary manner when the central bank feels like it. The rate is defined through until about 2140 when all blocks have been created.

Bitcoin will never have tax-by-inflation, but instead will perhaps have elements of Ponzi if large institutional investors start to dick with the system - buy big, sell big.. just like any other market.

Re:Currency not accepted is currency no more?

[PC and Sony Fanboy]

Precisely ... but IMO, at least in concept, a virtual fiat currency like this could work well for items in a virtual "fiat world", no?

Look to EVE online for how it works for them.

Re:Currency not accepted is currency no more?

[Anonymous Coward]

Your examples won't lose all of its value overnight.
That's the difference.

Re:Currency not accepted is currency no more?

[betterunixthanunix]

Fiat currencies are backed by faith in a government. That is to say, faith that the government will continue to provide essential services, or more pessimistically faith that the government will arrest people who do not pay their taxes. Fiat currency derives its value from its utility as a means of paying taxes and government fees, and legally settling debts.

Re:Currency not accepted is currency no more?

[jfengel]

In fact, Bitcoin is about as similar to fiat currency as a Chuck-e-Cheese token would be.

At least a token lets me play Skee-ball. Are there any skee-ball machines that take bitcoins?

I guess not, since nobody makes Skee-ball machines with continuous, high-speed Internet connections. I'm taking all of my money out of bitcoin and putting it into Chuck E Cheese tokens. (Well, if I had any, which I sure as hell don't.)

Re:Currency not accepted is currency no more?

[Dunbal]

Yes and it's quite interesting to observe that once again human greed provided fuel for a bubble. As the perceived value of bitcoin increased, greed also increased - until a single trigger event, the "theft" of $500,000 worth (I wonder what today's value is) of bitcoin popped the bubble. Of course it's funny to watch the bitcoin "exchanges" today saying they will do things like reverse the transactions leading up to the crash, etc. This changes nothing. Confidence has been destroyed, bitcoin is not a "safe" storehouse of value, and anyone with any sense will immediately sell their bitcoins as soon as they can to try to avoid losing everything.

Greedy individuals will prop up the market for a while, until all the non-greedy people are out (at a loss). Then when there are no more buyers, the market will finally collapse again. I guess what is poetic is that the ones who will lose most are the greediest. Fool, money, soon parted.

I'm sure the commission-earning bitcoin exchanges will have made a tidy sum, though. They will be the first targets in the coming lawsuits, however.

Re:Currency not accepted is currency no more?

[blueg3]

Actually, there's nothing stopping people from creating a fractional-reserve banking system based on Bitcoin. Most inflationary pressure is done by using fractional-reserve banking to increase the money supply beyond the actual amount of currency in circulation. Works just as well with Bitcoin.

Re:Currency not accepted is currency no more?

[horza]

I have no idea whether Bitcoin will work or not, but you spend more than 5 minutes thinking about it then you see it appears as good as any other currency. You can use Bitcoin to pay taxes or government fees, just the exchange rate is dependent on the intermediary currency your government accepts. I've paid French taxes using British sterling, just the bank exchanged currency behind the scenes. Same with Bitcoin.

The dollar seems more like Chuck-e-Cheese tokens than Bitcoin, as the government or Chuck-e-Cheese can print off as many notes as they want. Bitcoin is different in that there is no single issuing body that can manipulate the currency.

I also don't see a problem with lending or borrowing Bitcoins. It's just another currency. If I had spare Bitcoins and a friend wanted to borrow some, I would have no problem lending them and I would expect him to pay me the same number back later.

Hence I think your conclusions are wrong, both logically and empirically. On the first alternative, your arguments appear naive and mostly provably wrong. If I have $500 of Bitcoin at current rates, and a $500 tax bill, I will be able to pay my bill as there are currently enough people trading Bitcoins to ensure my tax bill gets paid. Looking at the structure of currency issuing it can be seen the dollar is more similar to Chuck-e-cheese tokens than Bitcoin. Bitcoin doesn't encourage deflation compared to fiat currencies as can be seen from the historic values to date, and it is not inevitable it will do so thanks to the micro-cents that can be traded (others have argued this in similar threads). Finally borrowing or lending money is foolish in any currency if you can avoid it.

The second half of your conclusion is also wrong in that it is a scam designed to reward early adopters, any more than the housing market is a scam or in fact any commodity than increases in value over time. I don't see the rich list full of Bitcoin millionares. The early adopters that saw their Bitcoins shoot from a couple of cents to $1 sold thinking they had made a killing. Those that bought at $1 and sold at $10 thought the same. See a lot of previous posts in threads with early adopters saying, "If only I'd kept a few coins back". But it's good they didn't, as hoarding hinders a currency. You are viewing Bitcoin as an investment vehicle instead of the currency it was designed to be. Sure I'd liked to have bought a house for £5,000 that my parents could have, instead of the £500,000 it will cost me today, but I get on with my life rather than being bitter at the "early adopters". If enough people want to use the currency it will work. If everybody is obsessed with trying to game it and nobody uses it then it won't.

Phillip.

Re:Currency not accepted is currency no more?

[Miamicanes]

> At least a token lets me play Skee-ball. Are there any skee-ball machines that take bitcoins?

There's probably one somewhere in Silicon Valley, existing mainly for the amusement and satisfaction of a dotcom billionaire, but you can only play it if you have an Android phone with the proper app installed, already spent a week getting funds from your checking account to Dwolla to MtGox to buy the bitcoins, and you're willing to wait 20-40 minutes for the transaction to be published and verified before the machine releases the balls and allows you to actually play ;-)

Re:Currency not accepted is currency no more?

[Sir_Sri]

More like faith that the government in question will honour it's obligations at roughly the purchasing parity value of the money and not rapidly deflate their currency (by printing money). Their ability to repay is backed by not just gold but the whole assets of the country (since the government can tax anything theoretically).

Much of its value comes from the fact that you can't 'run out of cash' with fiat money, which was a problem after 1800 when the population wordwide started to explode but gold and silver production didn't quite line up. It dodges wacky inflation and deflation caused by local supply of gold and silver or other precious metals and so on. And with constant, small inflation (because deflation is really bad, you're better to err on the side of inflation), you can decrease the value of debt over time both personal and government.

You're absolutely spot on that it assumes a trust in the government to collect fees to pay debts. The problem we're seeing in greece right now is that a country with 140% of GDP debt is running ~15% of GDP deficits (this is a sort of odd statistic, because different countries have different levels of government that can acquire debt, so it's hard to compare to anyone else), and a parliament that seems unwilling to go along with raising tax revenue, or cutting spending, they can't deflate the currency (being part of the Euro, it would be like maryland or indiana teetering on bankrupcy, all 3 of which represent about 2% of the bigger monetary union), and with a shrinking economy it's not clear how they'll pay back the money. Of course it's a bit like a person with credit card debt. If someone would lend them money at 1% interest they can probably sort themselves out, but if they have to pay 16 -20% they simply cannot manage 160, 170% of GDP debt (that would be like the ENTIRE US federal budget going to pay off interest on debt). It's also not clear how exactly greece can default on it's debt, because it's all in euros. Which creates even more uncertainty, and makes it harder for them to borrow money. Oh, and the government isn't agreeing to the terms the people offering them money at low interest want... so ya. Though I suppose from the perspective of greece the Euro isn't really fiat, since they can't really change its value (it would be like one of the Caribbean islands that uses US dollars, sure, it's Fiat for the US, and the Euro is for France/Ger/ITA/SPA but greece.. they don't have much say or influence).

Re:Currency not accepted is currency no more?

[darkshadow88]

You have a misunderstanding of what deflation is. Deflation means that prices for goods in the currency go down (due to the increasing value of the currency). This is the opposite of inflation, where prices go up because the currency loses value. So yes, the fact that the value of a Bitcoin has increased by several orders of magnitude is indeed evidence that it's deflationary, thus encouraging hoarding.

If enough people want to use the currency it will work. If everybody is obsessed with trying to game it and nobody uses it then it won't.

The greed of the speculators will kill it. It's easy to say "don't try to game it", but that's just what people will do. This is similar to the classic Prisoner's Dilemma. If everyone plays nice and tries to use the currency, everyone will collectively be better off, but an individual will always be better off playing the market (given the deflationary nature of Bitcoin).

Re:Currency not accepted is currency no more?

[betterunixthanunix]

You can use Bitcoin to pay taxes or government fees

Prove it. Find me a country that accepts Bitcoin as payment for taxes.

I've paid French taxes using British sterling, just the bank exchanged currency behind the scenes.

Emphasis mine. You did not pay your taxes using British currency, you exchanged your British currency. Likewise with Bitcoin, except that unlike British currency, nobody is going to exchange a different currency for Bitcoin when they pay their taxes. This creates something of an imbalance in the demand for Bitcoin.

The dollar seems more like Chuck-e-Cheese tokens than Bitcoin, as the government or Chuck-e-Cheese can print off as many notes as they want. Bitcoin is different in that there is no single issuing body that can manipulate the currency.

Yet unlike the dollar, nobody will lose their property if they fail to have enough Chuck-e-Cheese tokens. Nor will anyone lose their property if they fail to have enough Bitcoins. Property owners in the United States pay taxes on their property, and those taxes are both compulsory and must be paid in dollars. Hence, a US property owner could lose their property for not having enough dollars.

I also don't see a problem with lending or borrowing Bitcoins

You don't see a problem with borrowing an inherently deflationary currency? Deflation makes it harder to repay a loan. That means that the borrower would be in a tough situation, and the lender would be issuing a loan that is not likely to be repaid. That is one of the reasons that modern economic policies are inflation oriented, and why deflation is considered to be disastrous.

If I have $500 of Bitcoin at current rates, and a $500 tax bill, I will be able to pay my bill as there are currently enough people trading Bitcoins to ensure my tax bill gets paid.

Hence eroding the demand for Bitcoin, since nobody is likely to find themselves in the reverse situation, where they are forced to exchange dollars for Bitcoin tokens. This is one of the failure scenarios for Bitcoin: people keep finding themselves forced to dump their Bitcoins for other currencies, and demand is eroded until Bitcoin's value collapses. Such devaluation is fairly likely to happen, since most of Bitcoin's value (practically all of it) is derived from speculation about the exchange rate and about the number of new people who will buy into the system.

The second half of your conclusion is also wrong in that it is a scam designed to reward early adopters

Let's see...early adopters got their Bitcoin tokens at almost no cost, since they could get them by spending a few CPU cycles, and late adopters find it harder to compute new Bitcoin tokens and thus buy into the system (e.g. by buying already generated tokens from the early adopters). The late adopters are only going to realize a profit as long as even more late adopters arrive to the system, and as long as Bitcoin continues to see deflation. This leads to another failure scenario for Bitcoin: when there are no more late adopters to be found, all the speculation about Bitcoin will dry up, and those who were last to enter the system will be stuck with nearly worthless Bitcoin tokens. This is related to the previously described failure scenario, in that it is worsened by the way demand for Bitcoin will ultimately be eroded.

The executive summary is this: Bitcoin is very likely to fail, and the last people to buy into the system will find themselves totally screwed by it.

Re:Currency not accepted is currency no more?

[Anonymous Coward]

Nor can Bitcoin be used to legally settle debts in some places (like the United States)

That's a bit misleading. In the U.S. at least, private debts can be settled in anything of value that is commonly agreed-upon by the lender and the debtor. When debt satisfaction is done through a "legal tender substitute" (as opposed to, for example, by barter), such "non-legal-tender" currency is commonly referred to as "scrip."

Re:Currency not accepted is currency no more?

[Anonymous Coward]

Bitcoins are quite similar to most forms of fiat money. If enough people don't endorse it, use it or accept it, it's worthless.

Funny, that's just how I feel about gold. ;)

Re:Currency not accepted is currency no more?

[Anonymous Coward]

Yes, there is. Post-Depression, fractional reserve banking works because of the FDIC: if your bank's customers start cashing in all their loans at once and the bank can't cover them, that's okay because the FDIC will pay out the depositors' accounts. If every bank does this at once, the FDIC always has enough money to pay out because it's run by the same organization that issues the currency.

MagicTheGatheringOnlineExchange (MtGox) just had a run on the bank, but there's no FDIC for Bitcoin, it's impossible by design. So the value of the currency crashed, and when MtGox comes back online, it will crash again.

Re:Currency not accepted is currency no more?

[petermgreen]

Actually, there's nothing stopping people from creating a fractional-reserve banking system based on Bitcoin.

Fractional reserve banking relies on a bank keeping a portion of deposits (the reserve) and lending out the rest.

If the value of bitcoins suddenly goes up by a factor of 10 (which is far from implausable given bitcoin's fixed money supply and still relatively small community) and you took out a sigificant bitcoin denominated loan you are likely to have BIG problems repaying it. That means only an idiot would take out a bitcoin denominated loan and if bitcoin prices rise significantly said idiots are very likely to default on a bitcoin denominated loan all at once (a massive systemic risk).

A bank that took deposits in bitcoins but made loans in other currencies would have even worse problems if the value of bitcoin rose significantly.

Re:Currency not accepted is currency no more?

[diamondmagic]

Anyone with more than a high school understanding of economics also knows that the rate of price inflation is built into the interest rate. Inflation or deflation is not a problem when you know how it's going to affect prices, it only becomes a problem when it's monetary inflation or deflation (as is the case for recessions in fractional reserve economies) and is unplanned, and then prices rise or fall on you when you didn't expect them to.

Re:Currency not accepted is currency no more?

[diamondmagic]

That bubble fell long before there was any "theft" of Bitcoin, actually. I'm watching the price ticker right now, they're still exchanging for 13-16 USD. By comparison, I started following it when the first markets were formed and traded at $0.05.

No one ever thought Bitcoin was a safe long-term store of value, that's what precious metals are for, or stocks and bonds if you're willing to take risk to grow money even more. But no one would go into a store with gold coin in their pocket and try and weigh it, nevermind an online store or website, that's ridiculous too, that's what Bitcoin was invented for.

Being greedy doesn't do anything for you, the wonderful thing about profit is it necessarily must benefit two people, because it's voluntary. (Even if later someone decides the trade was a mistake, that's a decision made in hindsight.)

Re:Currency not accepted is currency no more?

[Anonymous Coward]

I think that you are wrong you can always use them to buy a FIAT car

Re:Currency not accepted is currency no more?

[marcosdumay]

How do you know?

Re:Currency not accepted is currency no more?

[marcosdumay]

Yet, Bitcoin is fiat money. It was created by fiat (of the person that published the algorithms), and has only the value that people assign to it.

The fact that it lacks other characteristics that are correlated with fiat money doesn't make it less so.

Re:Currency not accepted is currency no more?

[marcosdumay]

Just this one: "You don't see a problem with borrowing an inherently deflationary currency? Deflation makes it harder to repay a loan." Deflation makes interest rate go down, as inflation makes it go up. Unless the deflation is so severe that interest would go negative to compensate, there is no problem. People also aren't able to lend/borrow in a hightly inflationary currency. Also, being able to borrow in a currency isn't a requisite for that currency to be used on transactions.

The other problems are quite real.

Re:Currency not accepted is currency no more?

[david_thornley]

Fractional reserve banking worked before the FDIC, it was just riskier. How do you think a bank can make money? They accept my deposit, and they lend some of it out at a higher interest rate than they're paying me. That's been the way it works for a long time, well before the FDIC (although the FDIC stabilizes the system). The alternative is full-reserve banking, in which the bank is simply storing my money for me, and in that case they'll have to charge me for the storage to make money.

Re:Currency not accepted is currency no more?

[Anonymous Coward]

I can't pay my taxes in USD either.

Re:Currency not accepted is currency no more?

[thunderclap]

all fiat currency including physical ones are inherently worthless. That's the point. You get enough people to believe in it. Problem is, it only works with a tangible asset. hell, even Lindens worked better because it was tangible in their server environment.

Re:Currency not accepted is currency no more?

[Miamicanes]

The interest rates might be low, but if costs -- including wages -- are following deflation, your own salary will be decreasing in bitcoins-per-year as well. Buying a 50,000 bitcoin house you can barely afford at 30 is semi sane if there's a reasonable expectation that you'll be making at least as much money 20 years later. Buying a 50,000-bitcoin house you can barely afford at 30 would be financial suicide if you were likely to be making half as many bitcoins per year when you're 50 as you are now. Even if a meal at McDonalds that costs .5 bitcoin today costs .1 bitcoin then, you'd still be paying off a 50,000-bitcoin debt.

That's the big reason why deflation is so deadly -- it utterly destroys the financial viability of anything that involves long-term financing. Taking on any kind of debt that extends more than a year or two into the future borders upon financial suicide. If the dollar were to inflate 50% over the next 10 years, and wages generally kept pace (not an unreasonable expectation, at least among middle-class employees with college degrees), that would be awesome for quite a few people, because it would mean the homes that are hopelessly underwater now would be affordable at their original mortgaged prices (restoring mobility to America's labor force... if you can't sell your house because it's underwater, you're less likely to relocate regardless of promised benefit), and their student loan payments would go from consuming 20% of net income to 10% or 5% (since student loan interest rates are fixed after refinancing, and usually pretty low).

It sounds nice to cry for poor, thrifty savers who struggle to save, but the fact is, just about everyone in America who isn't a multi- multi- millionaire (or living in a cardboard box) owes way more money on things like student loans, a mortgage, and and car loan than they'll earn in several years. The loss in value to a few thousand dollars in savings is nothing compared to the net reduction in debt they'd enjoy if their income doubled while their debt payments remained relatively constant (of course, anyone whose debt was primarily infinitely-variable credit card debt would be screwed, but they're screwed under just about any scenario, anyway). And those who DO save can still come out OK, as long as they make smart investments instead of sticking their life savings in a coffee can in the kitchen or under the mattress.

High inflation is bad, if only because it forces people to spend unproductive time managing their money and endlessly banking, but even small amounts of deflation are dangerous, and significant amounts are absolutely deadly to any modern economy. When the most profitable thing you can do with a million dollars is lock it in a safe and forget about it for a year, because anything you could possibly invest in today will be worth less money a year from now, economies collapse.

Re:Currency not accepted is currency no more?

[Tim C]

The same is true of everything though, from gold and precious stones to seashells, leaves, and hours of hard labour. If no one wants it then it's worthless.

Comment removed

[account_deleted]

Comment removed based on user account deletion

If we don't talk about it...

[Anonymous Coward]

the currency/stunt will ceace to exist. Each time Slashdot talks about Bitcoins, they get a spike of interest. I implore the editors/publishers to stop publishing any stories about bitcoins. What started out as a $20 coin is (as I understand) now worth about $0.03 US dollars.

Re:If we don't talk about it...

[Miamicanes]

Well... actually, it's anybody's guess what it's worth right now, or what they'll be worth 24 hours after MtGox is back online. My guess is that they'll end up somewhere around $5-10. The only reason the price dropped to 1c was because someone basically stole a half-million bitcoins and dumped them all simultaneously on a market that normally would only have enough buyers (at its recent trading prices) to buy a tiny fraction of that amount.

If you showed up at a flea market (far from the nearest ATM), set up a table, and proceeded to liquidate a million $1 bills at whatever price people were willing and able to pay in order to liquidate every single one of them within 20 minutes, with a rule that people could only buy them with crisp $20 bills that were devoid of external markings, tears, folds, or other signs of use (roughly simulating the difficulty of getting funds into and out of MtGox, starting with the week it takes to get your checking account verified with Dwolla and for the funds to make the trip from your checkign account to Dwolla to Mtgox), after a while THEIR price would probably fall to a penny or two per dollar bill, too. You'd have lots of people who WANTED to buy them at 80 or 90 cents apiece, but because you were determined to sell them instantly, at any price, and only to buyers able to pay immediately with money they had on hand in a specific form, the price would crash to almost nothing.

There's nothing inherently fraudulent about Bitcoins themselves. If I sold you 10 Bitcoins on the premise that they were the cash equivalent of $200, it would be fraud, because there's no guarantee you could convert them into $200, $100, or even a penny at any specific moment in time. On the other hand, if you think a bitcoin is a fair exchange for a large pizza, and you're happy to accept one from me in exchange for it, that's a private matter entirely between two consenting adults.

That said, I've become less enthused about them over the past couple of weeks. Originally, I thought they were a cool way for anyone with a web site to accept micropayments without the cost and ceremony of dealing with credit cards, but now I'm inclined to say most people would be better off just using Dwolla and skipping the Bitcoins. In fact, Dwolla is likely to end up as the big Bitcoin winner, simply BECAUSE lots of people are going to use them to get dollars into and out of MtGox, and realize at some point along the way that Dwolla itself is a perfectly good alternative to Paypal that solves most of the complaints people have had about Paypal that motivated them to look at Bitcoins in the first place.

Re:If we don't talk about it...

[Anonymous Coward]

They're actively trading for about $14 on the other exchanges. Mt.Gox isn't Bitcoin, but the market did take a hit from the Mt.Gox incident.

Re:If we don't talk about it...

[dingen]

What started out as a $20 coin is (as I understand) now worth about $0.03 US dollars.

It's exactly the other way around. Before Bitcoin hit major news websites like this one, the value was relatively stable at a very low value. Ever since the word is out that money can be made by trading BTC, the value went up to over $30 per Bitcoin, but also became increasingly instable as more speculators entered the market. This all came to an abrupt end when Mt. Gox (by far the largest Bitcoin exchange) was hacked and stopped all activity. The exchange rate for Bitcoin has since then been relatively stable between $10 and $15 (almost $14 at Tradehill.com right now for example). Trade volumes have dropped greatly because of Mt. Gox's temporary suspension. I think most people are waiting now to see what happens next. But all in all, the value of Bitcoin has increased greatly since its exposure on major websites, but also introduced a lot of instability, which doesn't help the Bitcoin economy in the long run.

On the other hand,

[Anonymous Coward]

EFF's explanation made sense and was perfectly reasonable, while yours managed to hold almost as many misunderstandings of bitcoin as words. Bitcoin is not mtgox, and the Liberty Dollar lawsuit with the US Government should have clued anybody in on the fact that the gov is not gonna let anybody compete with the dollar.

Good. /. should follow suit.

[Psyko]

& stop accepting bitcoin articles to be greenlit for the front page. Nothing to see here. Move along.

Re:Good. /. should follow suit.

[Lieutenant_Dan]

Agree 100%.

You are clueless.

[Anonymous Coward]

It would be like accepting Monopoly play money

BitCoins cannot simply be created (or printed) at will and without cost, unlike dollars and Monopoly money. Hence, your entire argument is flat-out wrong. Currency is valued based on whether people are willing to trade it. If people stop trading in dollars, all those bills in your pocket will become worthless.

Please stop posting Bitcoin stories

[Anonymous Coward]

Please stop posting Bitcoin stories. No one cares about Bitcoin. We don't give a rat's ass about Bitcoin. We could not care less about Bitcoin. We have no interest in Bitcoin. Bitcoin does not concern us.

Re:Please stop posting Bitcoin stories

[sqrt(2)]

I care about Bitcoin, I like seeing some news about it. I find it interesting.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

You mad bro?

Slashdot is how I got involved with Bitcoin in the first place and I'm loving it. Stop presenting your personal opinion as representative of everyone else.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

I also care about bitcoin, its a fascinating idea and a truely new (if not unique) technology. Remember technology isn't just new gadgets or software, its new ideas and processes that change or create new ways of doing or thinking about things.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

>We have no interest in Bitcoin.

But a few Slashdot higher-ups have *financial* interests in Bitcoin. That's the only logical explanation for the stupid thing suddenly having articles all over /. and for it having its own goddamned icon.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

Please stop posting Bitcoin stories. No one cares about Bitcoin. We don't give a rat's ass about Bitcoin. We could not care less about Bitcoin. We have no interest in Bitcoin. Bitcoin does not concern us.

I completely disagree. Bitcoin is an interesting experiment in cryptocurrency. I am very interested in hearing how it turns out and learning about the strengths and flaws of the Bitcoin approach and cryptocurrency in general. It sounds like "news for nerds" to me.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

Who the fuck are you to tell me what I do and don't like? If you don't like reading about Bitcoin, then how about you stop reading about Bitcoin?

Personally I quite like reading about Bitcoin, far more than a lot of other shit that gets posted to this site on an almost daily basis. Guess what I do when I encounter a headline/summary that doesn't interest me? That's right, I don't fucking read it.

Re:Please stop posting Bitcoin stories

[Larryish]

You are a twit.

Re:Please stop posting Bitcoin stories

[ActionDesignStudios]

I enjoy stories about stupid crap that fails (e.g. Sony) so the Bitcoin stories are great.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

Everyone knows you are irrational though.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

Please stop posting Bitcoin stories. No one cares about Bitcoin. We don't give a rat's ass about Bitcoin. We could not care less about Bitcoin. We have no interest in Bitcoin. Bitcoin does not concern us.

I am also interested in this. How self centered are you that you think every Slashdotter thinks exactly the way you do. Think before you post.

Re:Please stop posting Bitcoin stories

[cffrost]

PRO TIP: Instead of reading articles that don't interest you, try reading articles that interest you.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

Please stop posting Bitcoin stories. No one cares about Bitcoin. We don't give a rat's ass about Bitcoin. We could not care less about Bitcoin. We have no interest in Bitcoin. Bitcoin does not concern us.

You could, you know, not click on articles about bitcoin.

Re:Please stop posting Bitcoin stories

[sqrt(2)]

No, I just listen to Twit :)

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

And yet you posted in a bitcoin story, making the story that much more read and interesting. And you caused me to post as well.

Maybe if you don't care about "something" then you should stop clicking on links that talk about "something".?

Just a thought.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

I'd harvest rat's asses if I could trade them for bitcoin.

Re:Please stop posting Bitcoin stories

[Anonymous Coward]

Yeah, but you're just irrational.

Re:Please stop posting Bitcoin stories

[Larryish]

Is that a band?

Bitcoin ended up as a pyramid scheme

[Animats]

The Bitcoin thing has gone off in a different direction than its promoters anticipated. They were thinking "payment system", like gift cards. The idea was that most Bitcoins would be tied up in people's "wallets", and spent slowly. All that static value would anchor the currency.

That's not what happened. Bitcoins turned into a speculative vehicle, with "miners" grinding away solving hashes and generating more Bitcoins, and flaky "exchanges" offering on-line trading. The exchanges are tiny; today's worldwide Bitcoin trading volume is comparable to the sales of one supermarket. The daily volatility is huge, even on days when there isn't a break-in. So no major retailer can accept Bitcoins; they don't know what they will be worth at the end of the day, let alone the end of the month.

In a speculator-dominated system, Bitcoins are a pyramid scheme. The scheme by which it becomes harder over time to generate Bitcoins favored early adopters by a huge margin.

It's already too late to get in. The difficulty level has reached the point where buying and powering the new hardware is not cost-effective. And that was before the price of Bitcoins crashed. (The current price is around $13.)

Then there's the flaky exchange problem. Mt. Gox (formerly Magic, the Gathering Online Exchange) turns out to be two people in Tokyo. Tradehill is some company in Chile. All the other exchanges are too dinky to matter. Not one of them has the organization and resources of a typical small-town bank. Worse, they're not just "exchanges". They're depositary institutions, holding customer balances. Mt. Gox customers are now very aware of this, because they can't get at their money while Mt. Gox is down. Some people are worried over whether the money will be there when Mt. Gox comes back up.

The "exchanges" represent a mis-design of Bitcoin. There should have been a way to do an exchange in a distributed way, without the exchange holding customer assets. The NYSE and NASDAQ don't hold customer balances. Brokers do, but you can have your cash swept from a brokerage into a bank daily, or more often if the numbers get big. The Bitcoin exchanges are slow at delivering money - Mt. Gox has a daily transfer limit, and even when they were up, many users reported delays.

The EFF was right to bail.

Re:Bitcoin ended up as a pyramid scheme

[Anonymous Coward]

It is completely incorrect to call Bitcoin a "pyramid scheme." Technically, it's a "pump-and-dump."

Re:Bitcoin ended up as a pyramid scheme

[Anonymous Coward]

It's already too late to get in. The difficulty level has reached the point where buying and powering the new hardware is not cost-effective. And that was before the price of Bitcoins crashed. (The current price is around $13.)

While I do have an interest in others believing this (the fewer miners, the better it is for existing miners), at the current rate, it would take ~3 months for a brand-new ATI 6990 to pay for itself. If the price continues to go down, or if difficulty levels skyrocket, it might end up actually being too late, but while this does hurt miners, it's certainly not too late to get in on that front.

And that's assuming your only interest is mining. It's certainly not too late to simply buy some bitcoins and use them to buy some stuff.

Not one of them has the organization and resources of a typical small-town bank.

While I do wish they had more resources, perhaps they don't need that much?

The "exchanges" represent a mis-design of Bitcoin. There should have been a way to do an exchange in a distributed way, without the exchange holding customer assets. The NYSE and NASDAQ don't hold customer balances. Brokers do, but you can have your cash swept from a brokerage into a bank daily...

And you could do that with Mt Gox and the other exchanges. I'm not sure why a brokerage is better.

The EFF was right to bail.

Indeed they were, but not for a single reason you outlined.

Re:Bitcoin ended up as a pyramid scheme

[TeknoHog]

The "exchanges" represent a mis-design of Bitcoin. There should have been a way to do an exchange in a distributed way, without the exchange holding customer assets. The NYSE and NASDAQ don't hold customer balances. Brokers do, but you can have your cash swept from a brokerage into a bank daily, or more often if the numbers get big. The Bitcoin exchanges are slow at delivering money - Mt. Gox has a daily transfer limit, and even when they were up, many users reported delays.

There are other exchanges that work more in the way you describe, for example I have personally used bitcoinmarket.eu. Too bad about the MtGox episode, but it has nothing to do with the rest of the Bitcoin-using world. Of course, USD becomes a pyramid scheme the minute somebody hacks into a forex site.

Also, let's not forget that Bitcoin is a geek thing, something that could make the world a little better place, and not just something to make you rich. For example, I learned to program FPGAs because of Bitcoin. I now have a new hobby with tons of interesting prospects, no matter how well Bitcoin fares in the future.

Re:Bitcoin ended up as a pyramid scheme

[HikingStick]

They would have been better off staying as a Magic the Gathering exchange. I finished entering my collection into Deckbox.org last night and found I'm sitting on a fair penny of MTG cards. If I can sell a handful of cards for even half what they've gone for recently, I'll be able to support some of my other habits and diversions for a few months.

Re:Bitcoin ended up as a pyramid scheme

[Anonymous Coward]

Actually, making your own machine is still cost effective, so I'm not sure what the idiot above is talking about.

Re:Bitcoin ended up as a pyramid scheme

[rmstar]

Haha, good one.

Bitcoin is a decentralised computer currency designed by self-righteous Ayn Rand-reading nerds who despise looters and parasites like, er, you. It is used to purchase Internet services, illegal drugs and pictures of naked women holding video cards.

...and it only gets better!

Re:Bitcoin ended up as a pyramid scheme

[Anonymous Coward]

How exactly can a transaction system that broadcasts all of your transactions to the network "make the world a little better place".

Re:Bitcoin ended up as a pyramid scheme

[TeknoHog]

How exactly can a transaction system that broadcasts all of your transactions to the network "make the world a little better place".

Because it's not Paypal ;)

Seriously though, I'm not saying that Bitcoin is perfect. That's kind of the point of geek things, we're trying to break some new ground here. But the specific point of broadcast transaction seems quite essential if you want to keep things distributed, so that other peers will verify your transaction.

Re:Bitcoin ended up as a pyramid scheme

[Anonymous Coward]

In a speculator-dominated system, Bitcoins are a pyramid scheme. The scheme by which it becomes harder over time to generate Bitcoins favored early adopters by a huge margin.

I wonder if this should be taken as a warning about the possible fate of the Dollar in our speculator-dominated system.

Re:Bitcoin ended up as a pyramid scheme

[woolpert]

I'm not sure why a brokerage is better.

OP isn't saying a brokerage is better, OP is saying that MtGox and the other exchanges were acting as exchange and brokerages.

Customers are better served when exchange and brokerage are separated and it's a structural weakness of BiitCoin that no method of doing a balanceless exchange appears possible, thus exchange and brokerage functions must be joined.

Re:Bitcoin ended up as a pyramid scheme

[Anonymous Coward]

While it may be risky to buy new hardware for bitcoin mining, it's more than likely profitable at $10/bitcoin.

Re:Bitcoin ended up as a pyramid scheme

[ArsonSmith]

haha, stupid things like freedom of interaction.

Bitcoin was invented by Internet libertarians, in the spirit of freely-chosen individual interpersonal interactions

Re:Bitcoin ended up as a pyramid scheme

[arevos]

The Bitcoin thing has gone off in a different direction than its promoters anticipated. They were thinking "payment system", like gift cards. The idea was that most Bitcoins would be tied up in people's "wallets", and spent slowly. All that static value would anchor the currency.

Citation?

That's not what happened. Bitcoins turned into a speculative vehicle, with "miners" grinding away solving hashes and generating more Bitcoins,

Which in general is good. The more miners there are, the more secure the currency is against double-spending.

The exchanges are tiny; today's worldwide Bitcoin trading volume is comparable to the sales of one supermarket. The daily volatility is huge, even on days when there isn't a break-in. So no major retailer can accept Bitcoins; they don't know what they will be worth at the end of the day, let alone the end of the month.

There's no reason retailers have to wait until the end of the month or even the end of the day before cashing out their bitcoins. A retailer could cash out their bitcoins immediately, or after the first confirmation block. The volatility of Bitcoin is only a problem for speculators.

The difficulty level has reached the point where buying and powering the new hardware is not cost-effective. And that was before the price of Bitcoins crashed. (The current price is around $13.)

No it isn't. An average ATI graphics card will still net you $100 per month profit, even at the current difficulty.

Worse, they're not just "exchanges". They're depositary institutions, holding customer balances. Mt. Gox customers are now very aware of this, because they can't get at their money while Mt. Gox is down. Some people are worried over whether the money will be there when Mt. Gox comes back up.

Why anyone would store money in Mt. Gox and not immediately take it out after a trade is beyond me. Clearly some people do, but that seems like asking for trouble.

The "exchanges" represent a mis-design of Bitcoin. There should have been a way to do an exchange in a distributed way, without the exchange holding customer assets.

It's not a "mis-design". Acting as an exchange is beyond the scope of the Bitcoin protocol. If you want a distributed exchange, that's an entirely separate project.

However, I can't see how a distributed exchange would work, unless it was just some manner of trust network and actually making the trades was up to the individuals. That doesn't seem particularly user-friendly to me, so I suspect that exchanges will have to be centralized websites.

That said, it would be better if (a) people used alternative exchanges more, and (b) the exchange source code was open sourced.

The EFF was right to bail.

The EFF bailed for entirely different reasons. If the future legality of bitcoin is contested, they want to be able to fight without also being the one of the ones being prosecuted.

Re:Bitcoin ended up as a pyramid scheme

[complete loony]

BitCoin has a quite elegant solution to the problem of double spending a digital currency. But as you rightly point out it fails completely as a means of exchange with existing currencies. I'd say that most of the issues stem from the way coins are created out of nothing as you can only sell those coins for the amount that someone else is willing to buy them.

The best alternative I've come up with so far (and that's not saying much..) would be something like a Promissory Note or Bond. For example a trusted "bank" might create an initial stock of coins denominated in an existing currency, with a legal liability to always honor anyone who wishes to exchange them for that currency. Some external accounting and auditing rules would need to be enforced to ensure that the "bank" always holds onto sufficient assets to cover the value of the coins they have issued. From that point onwards, a system like BitCoin could be used to anonymously track the current owner of each bundle of coins and enforce that they cannot be duplicated.

A slight modification to the above scheme, would be using BitCoins to track the current owner of units in a mutual fund or perhaps the shareholders of a listed company.

Re:Bitcoin ended up as a pyramid scheme

[xenopain]

It's already too late to get in. The difficulty level has reached the point where buying and powering the new hardware is not cost-effective. And that was before the price of Bitcoins crashed. (The current price is around $13.)

While I do have an interest in others believing this (the fewer miners, the better it is for existing miners), at the current rate, it would take ~3 months for a brand-new ATI 6990 to pay for itself. If the price continues to go down, or if difficulty levels skyrocket, it might end up actually being too late, but while this does hurt miners, it's certainly not too late to get in on that front.

And that's assuming your only interest is mining. It's certainly not too late to simply buy some bitcoins and use them to buy some stuff.

does that include the power consumption, i.e. electricity bill? or you are assuming you can run the gear in a college dorm or office space where you wont have to pay for the electricity?

Re:The bitcoin faucet is already empty?

[Richard_at_work]

If you had read the articles linked, you would have seen that yes, they are slowly releasing them so they aren't flooding the market.

Endorsing bitcoin

[Permutation Citizen]

When accepting bitcoin, EFF gave credibility to this money and as any fiat money credibility is what it needs. Now EFF doesn't accept anymore, they take back this credibility.

I think in both case, this was on purpose by EFF. They did the first move because they though bitcoin was an interesting experiment. They do the second move because bitcoin is now an ugly mess.

Re:Endorsing bitcoin

[Anonymous Coward]

If you weren't an ignorant idiot and actually read the article, you would see that it has absolutely nothing to do with what you just pulled out of your ass.

Re:Endorsing bitcoin

[Anonymous Coward]

Bitcoin is no different. An website for A Bitcoin market got hacked. This does not reflect on Bitcoin in the slightest.

Re:Endorsing bitcoin

[Anonymous Coward]

I think they did it because they thought it was an interesting experiment. They took it back because "people" thought it was an ugly mess. First was genuine, second was political. I don't like it one bit.

Re:Endorsing bitcoin

[thunderclap]

it had credibility?

Re:Endorsing bitcoin

[Anonymous Coward]

That's part of the problem. Bitcoin supporters shot themselves in the foot because they figured if they got the EFF on board they could use their acceptance of bitcoins as proof the currency is legitimate. Now the EFF is rejecting the currency precisely because of this as one of the many reasons.

Some Actual Text From The Announcement

[trappa]

1. We don't fully understand the complex legal issues involved with creating a new currency system.

2.We don't want to mislead our donors. When people make a donation to a nonprofit like EFF, they expect us to use their donation to support our work. Because the legal territory around exchanging Bitcoins into cash is still uncertain, we are not comfortable spending the many Bitcoins we have accumulated.

3. People were misconstruing our acceptance of Bitcoins as an endorsement of Bitcoin. We were concerned that some people may have participated in the Bitcoin project specifically because EFF accepted Bitcoins, and perhaps they therefore believed the investment in Bitcoins was secure and risk-free. While we’ve been following the Bitcoin movement with a great degree of interest, EFF has never endorsed Bitcoin. In fact, we generally don’t endorse any type of product or service – and Bitcoin is no exception.

Re:The bitcoin faucet is already empty?

[jdavidb]

The coins haven't made it into the faucet yet. The faucet founder, Gavin Andresen (one of the core bitcoin developers), is still trying to determine when and how he will bring the donations in. http://forum.bitcoin.org/index.php?topic=20185.0 Meanwhile, the faucet funding has been pretty flaky, at least in the last 24 hours. Yesterday morning (US time), it was dry, yesterday evening it had some small funding, and now apparently it is dry again. I'm curious how big the EFF donation will really be.

There's also the fact that...

[Anonymous Coward]

...bitcoin forum members have been tracing the stolen bitcoins from the recent thefts, including the 25,000 bitcoins stolen from "allinvain" (which /. covered). Some of them appear to have been donated to the address the EFF listed for donations. There's no way to know what the motive was behind those transfers -- Actual support for the EFF? Trying to throw people off? -- but it sure doesn't make the EFF look good. Those bitcoins might be the ones that the EFF is trying to leak back into the "economy" little by little via the bitcoin faucet.

"Buy when there's blood on the streets."

[Anonymous Coward]

I'm thinking of buying into Bitcoin for the first time because of all the negative news lately. The best time to buy is when everybody else is selling.

Re:"Buy when there's blood on the streets."

[Issarlk]

No, no, don't buy. Bitcoin is worthless, you hear? worthless! (*look into buying some himself*)

Re:"Buy when there's blood on the streets."

[Americano]

People also could be selling because the item is fundamentally flawed and destined for failure. Hope you're confident that's not the case here.

Not pyramid, run on the bank

[tacokill]

What you describe is not a pyramid scheme, it is a run on the bank. That is precisely what Bitcoin is going through.

I am not saying it's good or bad. I am merely pointing out that this is nothing new for any type of currency. Liquidity is always a consideration and every currency; past, present, and future has had to deal with runs on the bank at various times.

The real "tell" will be if Bitcoin survives the run.

Re:Not pyramid, run on the bank

[Animats]

What you describe is not a pyramid scheme, it is a run on the bank. That is precisely what Bitcoin is going through.

No, that's what Mt. Gox will go through when they come back on line, and there's a scramble to get money out. We're about to find out if Mt. Gox really has all the funds on deposit with them.

Mt. Gox customers are screaming on forums about getting a message from Mt. Gox that says "The password for this account is invalid, or this account is not currently under claim process."

e-Gold was shut down in 2009, and the claims process still hasn't released funds.

Comment removed

[account_deleted]

Comment removed based on user account deletion

Helloooooo Godwin!

[Anonymous Coward]

Nice to see you old chap. Care for a spot of tea? I daresay it must be tiring to goosestep through all the forums on /. today, but it sure is nice to see you come through here.

Re:Helloooooo Godwin!

[Xtifr]

Technically, stating that other people are comparing something to the Nazis is not the same as comparing something to Nazis. In fact, it sounded more like he was invoking Godwin's law on the Bitcoin defenders* rather than taking an action that would justify calling it on him.

* I would have preferred to see some evidence to back up his claim; without that, it seems like a bit of an ad hominem. Unfortunately, there's enough crazies on both sides of the debate that Godwin's law is likely to come up somehow even sooner than usual.

That's pretty much the definition of money

[Colin Smith]

The most liquid commodity.
 

Oh! It's just a Soap Opera...

[psydeshow]

I just figured this out: spoiler alert.

This whole BitCoin thing is fiction. An over-zealous Slashdot editor got the idea to produce original episodic content for the site, and signed up some hardware vendors and electric utilities to sponsor it. BitCoin doesn't actually exist, and anyone who claims it does is obviously part of the production team. Or one of the sponsors.

Now I can sit back and enjoy the daily BitCoin story, secure in the knowledge that it is all just entertainment, and not actually a Glenn Beck-style ploy to involve gullible Slashdot readers in an elaborate Ponzi scheme. I was starting to get worried about unnecessary power consumption and the misapplication of scientific computing clusters, but it's all just CGI, isn't it? Bravo!

Anyway, good luck guys, it's been a great series so far. Hope you win that Emmy!

bitcoin just gettting more popular

[z_gringo]

Soon we'll see guys standing on streetcorners with signs.

Homeless. Hungry. 11 kids to feed. Please help. 1BYjEs25Eo2Bz7MS4wnN81EkEjD5S2KXPV

Re:bitcoin just gettting more popular

[Anonymous Coward]

I think a QR code or similar would be more appropriate than a bitcoin address

Re:bitcoin just gettting more popular

[Anonymous Coward]

I hope that was your address, I just sent you a little tip for the funny.

Re:bitcoin just gettting more popular

[Kalriath]

Sounds like a job for QR codes!

Stop posting BitCoin news

[Anonymous Coward]

Bitcoin is a currency used to buy and sell drugs, nothing more. The Bitcoin people keep pushing stories to keep it in the news.

At least in this case the EFF did the right thing and didn't want donations based on on drug money.

Re:Stop posting BitCoin news

[luther349]

so is every other form of money.

The promoters knew - it's in the design

[Anonymous Coward]

Everything you say is basically right, with one exception: The promoters must have known all along (or should have known - point 1 however suggests they knew or were very very lucky in their choice of algorithm)

1. The growth curve for bitcoins was chosen to be increasing in exponential difficulty. Even if they wanted a maximum number of bitcoins (which they argue for dubious economic reasons) They could have chosen any curve - straight line, S-curved, etc., they deliberately chose a growth function which maximizes the return for early investors.

2. The bitcoin software is nearly useless for actual commerce. It's just about good enough for a speculation market place - but would break if any significant amount of goods were being bought or sold in bitcoin. But the promoters don't care!

(i) Transactions take hours to complete - and no solution is proposed for this

(ii) Every client records every transaction in the network. This is a huge file already, barely practical to download with no real commerce just speculation -- and this file would grow proportionally to actual usage. There is supposedly a proposed solution which reduces this file size somewhat, but it's still huge, and it still grows in proportion to usage. So that's no solution - especially since this proposed solution is not actually being implemented anyway.

3. The size of the bitcoin economy is always quoted as being the number of bitcoins multiplied by the price of the last bitcoin sold.

That's not how you calculate an economy's size!

That's how you calculate the value of an asset, such as gold, or pork bellys.

Nobody would calculate the size of the US economy for example this way - the number of USDs in circulation, etc. You can calculate a real economy's size by looking at goods bought and sold.... but bitcoin promoters don't care about that, especially since virtually nothing is bought or sold in bitcoin..

just how it goes

[luther349]

with the last few brake ins and one mass selling crashing the currency it was only a matter of time before the few people accepting them would say this is a bad idea. as someone said hear aruldy it cost more to power the systems to mine them then its worth now. not to metion working the gpus that hard all the time just is a bad idea so facter in replacing those in a few month and the cost is way to high. being the horders have relised this and started dumping there stock of coins the value has crashed. it was ment to increse the value as they got harder to mine but thats just not how money works people just turn to other currencys or even the barter system.

I'm enjoying the schadenfreude.

[LordRobin]

I disagree. These Bitcoin stories are great comedy. This is like watching a train wreck in slow motion, made all the more amusing by the people riding the train shouting out the windows at those jumping off, calling them fools and insisting that the train will somehow swerve around the obstacle and keep going.

I love how the only consistent defense of Bitcoin is that "ordinary" currency suffers from all the same problems. First off, that's not true, but even if it was, Bitcoin's problems are on steroids. That defense is like refusing to leave a burning house because it's uncomfortably hot outside.

------RM

Re:I'm enjoying the schadenfreude.

[elewton]

I'm shocked by the number of people who take pleasure in Bitcoiners' recent misfortune. A lot of people are putting effort into something they care about, and snide little shits on the internet lol it up.

I don't hold a significant number of Bitcoins (50+change), but I have found them utterly fascinating for the last year, and will read anything published about them. The concept of a low-friction trading platform could revolutionise many industries, and change a lot of people's lives for the better.

It's entirely possible that the spread of Bitcoin will make a few millionaires or billionaires (in USD), but that doesn't seem especially important. All paradigm shifts have moved wealth from those who profit from inefficiencies to those who introduce the more efficient system. Like every single human on the planet, I had the opportunity to mine Bitcoins from the beginning, to buy and hold when they were extremely cheap, but I was too stupid to do so.

If you haven't made a few 10s of thousands of USD from Bitcoin, you were also too stupid to invest in the new technology.

I'm still too stupid to make significant amounts of money from trading, so I voluntarily use Bitcoin as a tool, not expecting my coins to increase in value. It works extremely well.

Would you like to watch a train wreck in slow motion? Would that much human suffering excite you? Do you watch WWII documentaries before lovemaking?

Re:I'm enjoying the schadenfreude.

[tftp]

I'm shocked by the number of people who take pleasure in Bitcoiners' recent misfortune. A lot of people are putting effort into something they care about, and snide little shits on the internet lol it up.

Founders and early adopters control 60% of all possible bitcoins, as reported. People who are not early adopters (just about 6 billion) don't want this currency to succeed because that would give those early adopters 2/3 of the planet's wealth for ... literally nothing, besides a few CPU cycles and some math ideas.

It's entirely possible that the spread of Bitcoin will make a few millionaires or billionaires (in USD), but that doesn't seem especially important.

I guess the concept of fairness is obsolete. Bill Gates at least was working hard and taking risks; his money was earned. We can debate whether he deserves his billions or not, but his contribution to the human civilization is obvious.

However Bitcoin doesn't solve any problem that is worth solving. It doesn't cure cancer. It doesn't teach children. It doesn't even make your smartphone any smarter. It's just another currency. Its inventors took no risks, they invested nothing except little time. Any money that they get will be taken from someone else's pockets. I don't want them to take money from me.

I had the opportunity to mine Bitcoins from the beginning, to buy and hold when they were extremely cheap, but I was too stupid to do so.

Don't torture yourself - most of bitcoins have been mined by founders before the rest of the world knew about it. You had no chance to become a billionaire. You probably could make a few hundred $K on it, but that would be not any different from playing the stock market right now. You can do it at any time, but you will lose.

the EFF is giving away donations - wtf?

[Hazel Bergeron]

Wait a fucking second. If I donate something to a US non-profit with clear mission statement/statement of incorporation/whatever and the charity decides to just give away my donation to the first person to visit a web page, aren't they behaving fraudulently?

Of course a donor doesn't get to say exactly how his donation is used, but it surely must fall within the stated purpose for which donations are accepted? Or are US charities entirely caveat donor?

Re:the EFF is giving away donations - wtf?

[Anonymous Coward]

If I donate the EFF some chicken skin and used muffin wrappers, they are within their rights to throw them in the garbage.

What market collapse?

[Anonymous Coward]

Bitcoin is still traded at 14$ a piece. Granted, the volume went down from millions to a tenth of that, since the biggest exchange has locked the accounts. Don't you guys have the moral need to check facts before posting?

Wife, children and creditors

[Anonymous Coward]

Well, this guy already had 3 serious problems...

I came to a similar conclusion(Adv of BTC Dwol)

[Anonymous Coward]

At this stage, the only advantage that accepting Bitcoin over Dwolla payments is that in the Dwolla case both merchant and customer need Dwolla accounts, whereas accepting Bitcoin would allow adhoc purchases (similar to how you can just enter your credit card details to pay without necessarily "signing up").

Of course, that one advantage isn't enough to outweigh the disadvantages. Somebody above said that with Bitcoin they got the crypto right, but forgot about the economics. To that I'd add that in deliberately distancing themselves from Government controlled currency, they couldn't also take advantage of regulations which protect market participants against manipulators. (Not that the regulators do a stellar job mind you, but that's more a matter of resourcing and will, not ability).

I care about Bitcoin

[Crag]

I don't expect it to succeed, but I'm favor the concept. We need decentralization in all areas, especially commerce.

Everything is a pyramid scheme

[Anonymous Coward]

More specifically, the whole global financial system is a pyramid, at least as far back as countries moved away from money backed by gold reserves. Now countries get rich based upon market performance or how much investors trust that the country will be able to repay its debts.

Bitcoin seems less good than eGold

[sesshomaru]

Remember eGold? Of course you do.