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Bitcoin's Rise May Reflect a Monumental Transfer of Trust From Human Institutions Backed By Gov't To Systems Reliant on Well-Tested Code, Says Tim Wu (nytimes.com)
Tim Wu, a law professor at Columbia, writing for the New York Times: Yet as Bitcoin continues to grow, there's reason to think something deeper and more important is going on. Bitcoin's rise may reflect, for better or worse, a monumental transfer of social trust: away from human institutions backed by government and to systems reliant on well-tested computer code. It is a trend that transcends finance: In our fear of human error, we are putting an increasingly deep faith in technology (Editor's note: the link may be paywalled). What gives the Bitcoin bubble significance is that, like '90s tech, it is part of something much larger than itself. More and more we are losing faith in humans and depending instead on machines. The transformation is more obvious outside of finance. We trust in computers to fly airplanes, help surgeons cut into our bodies and simplify daily tasks, like finding our way home. In this respect, finance is actually behind: Where we no longer feel we can trust people, we let computer code take over. Bitcoin is part of this trend. It was, after all, a carnival of human errors and misfeasance that inspired the invention of Bitcoin in 2009, namely, the financial crisis. Banks backed by economically powerful nations had been the symbol of financial trustworthiness, the gold standard in the post-gold era. But they revealed themselves as reckless, drunk on other people's money, holding extraordinarily complex assets premised on a web of promises that were often mutually incompatible. To a computer programmer, the financial system still looks a lot like untested code with weak debugging that puts way too much faith in the idea that humans will behave properly. As with any bad software, it can be expected to crash when conditions change.
People are buying bitcoins because of the increase in price. However, bitcoin has a lot of similarities to a Ponzi scheme. When the value of bitcoins plummets, that trust will go away.
It simply shows that since 1637 nobody learned anything, and this was confirmed with the various pyramide scheme scandal from the last decade, with one of the most well kniown being bernard madoff. People never learn, what we are seeing is not a shift in trust , what we are seeing is sheer speculation on trying to invest and cash in before the others.
C. Sagan : A demon haunted world:
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More likely it's stupid rich people fighting amoung themselves to figure out who can lose the most money the fastest.
>Bitcoin's rise may reflect, for better or worse, a monumental transfer of social trust: away from human institutions backed by government and to systems reliant on well-tested computer code.
No. It represents the dreams of foolish cryptoanarchists, libertarians, gamblers, and scam artists. The mainstream financial involvement currently underway is the industry safely siphoning some money from the bubble.
Any techie who is a proponent of a cryptocurrency is one who should not be employed in any capacity beyond desktop support.
This has 1990s tech bubble written all over it.
In the 90s tech companies with no intrinsic value became extremely valuable. Bitcoin and its imitators seem to have exactly the same value as a tulip bulb, and at some point people will realize that paying $19,000 for a tulip is silly. That said, I wish I hadn't sat out Bitcoin's monumental rise. Would love to have some F.U. money right now...
If anything, it's a testament of how much money is accumulated on the supply side and cannot be invested in anything sensible because there is no demand due to a lack of purchasing power. If there was an actual economy still going on, investors would probably gladly invest into something more stable, but given the choice, what else can they pump their money into?
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
Why do you think you don't see people running through the halls of congress screaming and crying about the national debt? Because they know the Fed is going to inflate it away, given enough time.
That's why people are drawn to cryptocurrencies and other non-government backed forms of money. No artificial manipulation, no intrinsic loss of value over time, and no surveillance / tracking.
Of course, ultimately the government cannot allow this so something will need to be done. I have no idea what, it won't be an outright ban because that's not practical but somehow it will need to be controlled so that the system can remain under their control.
So, what will happen to this "trust" when the bubble bursts?
And that comparison of the financial system to untested code is rather cringe-worthy. Car analogies are much more insightful anyway.
Violence is the last refuge of the incompetent. Polar Scope Align for iOS
And this is why such "well respected" institutions are a joke.
The debate over hard-forking Etherium demonstrates that even technological currency systems rely on trust in human governance. Thus, I'd see this more as people putting trust in technocrats (i.e., a perceived meritocracy) versus elected officials (i.e., democratic populism).
it's great how fast it gets inflated.
Currency that is backed by the power of a government is far more reliable than an abstract currency like bitcoin.
When you are in the desert with a busted car, the local repair shop isn't likely to take bitcoin. Even if they had the technical ability to do so, there is no practical mechanism to exchange services for fractional coins.
Bitcoin is a curiosity for technical investors that has little practical value.
The exchange “failures,”unrestrained insider trading such as in Bitcoin cash, and unlimited mining fees hurting liquidity and ultimate collapse will demonstrate Bitcoin failure compared to fiat.
If his supposition is true then a lot of people are misguided given that massive thefts of bitcoins from supposedly secure wallets still occur as well a lot of bit coins being owned by a few holders.
Bitcoin is gambling meets unregulated financial market.
Even with that, the total global trading volume of bitcoin is approximately 1% of the NYSE. Given the performance, that's crazy low trading volume getting extrapolated to total value. Because it's a complete crapshoot. It's economy by mob rule, and history has shown that as we got more connected, unregulated economic systems swing very far and wide, which is great when it goes up, impossibly devastating when it inevitably corrects if it is important.
XML is like violence. If it doesn't solve the problem, use more.
It's a combination of money laundering, drug money and speculation. Everybody knows this. Sorry folks, but Bitcoin isn't going to be destroying and power structures you're unhappy with. The govt will step in and regulate shortly. As they should. Unregulated speculation is what causes market crashes.
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all goes up in smoke, along with those cheap capacitors..
“He’s not deformed, he’s just drunk!”
This is an interesting angle on recent events. However, that faith in "technology" brings with it its own problems, and is in absolutely no way separate from "human institutions". Computer code is not some sort of magic entity that lives apart from human institutions. It seems like a bit of a false dichotomy.
Also: "Well-tested code" seems to be a bit leading. Is this a hedge against when things fall apart ("Well, it wasn't well-tested!" )? Or just simple leading?
It's a pump & dump scheme.
So MANY WHORES running /. now..
> Systems Reliant on Well-Tested Code, Says Tim Wu
Tell that to Ethereum, how many times have they had to hard-fork to fix bugs in 'well-tested code'
Your hair look like poop, Bob! - Wanker.
We have already been blindsided by the unexpected ability of computers to drive road vehicles, a task at which they are already doing better than human drivers on on-road beta testing. We can call this the big driving problem.
The small, simpler driving problem is automating the piloting of trains. Many city fixed-rail systems already use automated train operation. We can be certain that a computer wouldn't do anything as boneheaded as driving at 81 mph on a 30-mile curve.
Here is the argument for bitcoin: It is mathematically finite and thus cannot be externally inflated away in value. Thus it makes an ideal currency.
Arguments that the bitcoin has swung so high in cost to be impractical for daily transactions are met with - "But the bitcoin is infinitely divisible into small and useful chunks."
However, the same can be said of shares in Apple or Google- there is a single, finite corporate entity, which may be arbitrarily subdivided and then used as a mechanism of exchange. However, in the case of Apple or Google, the stock is phsyically productive, rather than destructive and wasteful. Bitcoin is superfluous.
The internet bubble came and burst. But look at what the internet is today. The bubble was just an exuberant expectation of something that builds value less slowly than expected..
I agree that trust in national currency, which are governed by forces beyond citizen concerns, and backed by corrupt governments like our own, managed by inept financial institutions, etc is no longer bedrock. In times like these people would move to gold. So think of having bitcoin like having gold. And think of its price as being set by the same mechanism.
When the day of financial reckoning comes, and it will with the next disruptive global event, which do you want to be holding: a bunch of dollars or a bunch of gold? Now think of bitcoin like that. Maybe overpriced, but idly not through exuberance but pessimissim!
Funny how the rise in value of Bitcon has suddenly taken on so many social meanings when it fact it's just another speculative rush, in a long list of speculative rushes throughout human history.
Is the current time so unquely bad when compared to the past or future? Was life better when Attila the Hun came sacking the former Roman empire? The Holy Church once was so afraid of human error they would kill any heretics and suspect witches. How about America's Wild West at its peak? Living under Stalin or Hitler?
Right now Bitcoins are like digital Beanie Babies. People are irrationally hoarding them in hopes that they will become gajillionaires. Very few people are buying them to use as a currency. Rather, they are being hoarding in hopes that some sucker will pay more than they did. At some people people will start dumping Bitcoin and cash out before it all comes crashing down. Bitcoin and cryptocurrencies will not go away, they will simply find the proper equilibrium once all the hype dies down. Within a year, it will once again becomes the domain of geeks, dweebs, drug dealers, and other die hards.
Bitcoin is growing almost entirely due to speculation and its utility for illicit transactions. This has nothing to do with some abstract confidence in computer code. This is people who are greedy looking to make a fast buck. The simplest explanation is the correct one here and that is greed.
RIght now, Paypal and even credit card processors block donations to charities in the middle east because they "might have" ties to terrorism. Even if the groups are not a formally reconginizted terorrist group by governments, businesses are free to block support for these groups. Blocking funds to these groups is a form of censorship. If they are not identified by a government agency as a terrorist organization, they should be allowed to operate and have due process.
Now you can donate directly to them with crypto currency, and bypass the censorship.
Cryptocurrency creates a way around both censorship and corruption.
I see it being evidence that people are greedy and stupid.
Money and wealth are very deceptive concepts, the concept of money itself is tied to a central organization that ensures the equivalences (worth) between money and the physicl items and services, Gouvernments are still managed like ancient empires and for that they will never be stable... It's 2017 and the world still faces the same problems than 3000 BC, the only thing that has changed is technology and science at some extent.
The common person doesn't even come close to understanding economics. Most, in fact, don't really understand what currency really is (yes they know is pays for stuff).
So, while it is nice to think there is some larger meaning behind the absurd growth of block-chain-currencies it has absolutely nothing to do with trust, or the lack thereof, in who/what is backing the value.
Indeed, no currency that is backed by a fully in charge government can possibly go wrong!
The problem with your theory is that while governments can indeed force people to do a lot of stuff, they cannot force value on a currency because in the end a currency is only as useful as the people that will accept it.
People all over the world accept bitcoin, so it has a much broader base of support than any state sanctioned currency, and is also immune to the inevitable gaffes all states make.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
It's rampant speculation, period.
Here is the argument for bitcoin: It is mathematically finite and thus cannot be externally inflated away in value. Thus it makes an ideal currency.
You can still have inflation with a fixed money supply. In fact you can even contract the money supply and still have inflation in some circumstances. Furthermore bitcoin is already experiencing fairly rapid deflation which is possibly worse if anything.
Another article justifying buying a bitcoin. No one sane trusts a coin that is that volatile. Whole idea behind mining is broken - producing something by running calculations. How are you certain that these calculations are even used for bitcoin and not for something else? If you didn't like big banks and the "system" now you are going towards money used for illegal activities - great trade off. Read about drug cartels and how much money they have to hide. Digital currency is perfect.
its idiots buying in a frenzy thinking they are going to get rich and penny stock/otc companies stating they are getting into the Cryptocurrency Industry.
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
Bitcoin's main service to humanity is avoiding capital controls, it does that well.
You seem to have forgotten that whenever we've tried poorly regulated currencies on any sort of meaningful scale the results have invariably been disastrous sooner or later. We have capital controls because not having them is worse. Read a history book sometime. Good economic policy requires good governance - not too much and not too little.
Fuck the governments.
What an eloquent argument.
Bitcoin is nothing more than Pork Bellies, except you can't make bacon out of them.
When Fascism comes to America, it will call itself Anti-Fascism, and tell you to give up your guns.
The thing is, bitcoins are without intrinsic value. Government issued money is, indeed, untrustworthy, but it has intrinsic value: the government promises to accept payoffs in its own currency for taxes so it won't confiscate your property, etc.
Now the government is untrustworthy, but it does have to power to enforce it's threats. Bitcoins are more trustworthy (not totally), but they have no intrinsic value. Their only value is whatever people are currently willing to exchange for them. I wan to call them bitcons rather than bitcoins.
Money is not just about trust and not just about intrinsic value. Things which only have intrinsic value make lousy currencies, and so do things without trust. This is why so many people are into gold, but most of them don't realize that folding paper promises of gold don't directly count. You need the actual metal. And it needs to be of a specific purity. And this is likely to get lost or stolen. But banks have also had their vaults pilfered.
There is noting in the world that has perfect trust. Looking for such is futile. But things that have value can be exchanged for other things with value, where things without intrinsic value can become totally worthless.
OTOH, how much was a Confederate dollar worth after the South lost? Value can be transitory. My old disk drive is worth more as a paperweight than as a disk drive. But it wasn't a bad investment, because I got use out of it for years.
And value is very personal. What is valuable to one person is valueless to another, and invaluable to a third. So it's difficult to use value as a currency. A currency needs to have an agreed value, which means it's own intrinsic value is only a floor to it's effective value. Bitcoin sure proves this, as it's current effective value is immense, but its intrinsic value is closer to nothing than to that of a piece of paper the size of a piece of government currency.
The closest stab I have to a reasonable "thing of constant value" is a bottle of whiskey. That would become more valuable if the government collapsed. Small amounts are easily packaged for portability. etc. Of course, some people would only value it for trade, except in cases of medical emergency and not medications. Wheat doesn't work because it doesn't store well and is too bulky. Also the value fluctuates too much during the course of a year.
Bitcoins, though.... their only value is that they are more trustworthy than governmental currency. But that's all, and it's not sufficient. At some point they will collapse, unless some major vendor of values turns them into a fiat currency. (Also they are vulnerable to centralized control if most of them are bought up by a small enough number of parties to from an oligarchy.)
I think we've pushed this "anyone can grow up to be president" thing too far.
It's just a bubble. Nothing more. All these straight line projector analysts are useless.
Currency that is backed by the power of a government is far more reliable than an abstract currency like bitcoin.
That's certainly true in recent history but not if you look back further back. For example, the Knights Templar had an international banking system which allowed pilgrims to deposit cash in their home country, carry a letter of credit and then withdraw the cash when they got to Jerusalem. This was replaced in the 16th century by private banks allowing merchants to purchase notes in a private currency called "ecu de marc" which they could then travel with and convert into the local currency wherever they were going.
Indeed it seems that bitcoin is just the latest in a long line of private innovations which cover the one thing which individual governments are no good at: providing a currency which is trusted globally. For such a currency to work you cannot trust any one government because it is unlikely to protect the interests of non-citizens. So I don't see bitcoin as heralding any shift in trust it is just technology coming up with a new solution to an old problem. Indeed the advantage of such a global currency is that it is less prone to the power of any one government and we have seen this happen with people in Greece and Cyprus moving money into bitcoin to escape government imposed currency controls during financial crises there.
One thing is for sure: crypto is here to stay. The only question is which blockchains will fill which roles
Crypto may be inflated, it may not be. The economy is doing very well (see: all time market highs) and it's going to keep going better with tax reform that decreases the economic burden on the middle class and businesses, especially small businesses. This provides a very good opportunity to introduce crypto transactions to the general economy. If crypto finds footing in this growing economy, especially in small business, the market will not pop, it will blow up.
Anti-Bitcoin Sentiment on /. explained:
You have a bunch of "tech people" who had a major tech happening going on right under their noses and they missed out on it because they were afraid to try it, now they have to denigrate to feel better.
That's the thing about most "tech workers", they just do their job, they generally don't know anything at all about innovation or the ways of competition (the way of the world), but they like to give themselves credit for driving innovation and progress anyway.
So it stings them to see that they are proved wrong.
My karma was manually wiped by site staff https://slashdot.org/~slshdtisctrldbysjws 18 mod up, 10 mod down = bad karma
Someone is putting way too much effort into thinking about this. People haven't trusted the Government (US Govt) since Vietnam.
First of all, a small share of people own the majority of bitcoin - with the US Gov'T being the largest single wallet holder. In 2013 the FBI's wallet had 144,000 bitcoins- do the math.
na, this isn't a change in trust, it's a bubble. don't get popped.
I have come to the same tentative conclusion as an amateur.
Stagnating wages and rising cost of living. Risk-averse investors that does not direct funds towards productive investments. Hence the focus on speculation and real estate. I believe this is the result of the massive increase of the money supply. Forces a lot of folks to partake in speculation and investment indirectly, yet the winners are only the financial institutions which becomes indispensable.
And we are told that this is "good for us all". I don't buy it. But I still don't understand how money supply and investments play together either.
Lack of inflation is a bug, not a feature.
It costs money to maintain a monetary system. Why should this be a free service?
Also, why should economic activity that took place in the far past have the same "value" years later? Hoarding currency is not an economically neutral activity. Inflation "punishes" this in a fairly predictable and largely fair way.
An ideal currency is stable in purchasing power. Bitcoin is most certainly not.
Your ad here. Ask me how!
In our fear of human error
Can anyone remind me what is the latest estimate for the number of BTC lost by their users?
Holding a BTC is much more like having a bearer bond. It is easily lost, destroyed or stolen. And when it is, there is no one to go crying to or who can help you. There is no buyer protection. If ever there was something vulnerable to human error it would be a BTC stash.
politicians are like babies' nappies: they should both be changed regularly and for the same reasons
People are buying bitcoins because of the increase in price. However, bitcoin has a lot of similarities to a Ponzi scheme. When the value of bitcoins plummets, that trust will go away.
"To err is human, to really foul things up requires a computer"
Or their wallet gets lost or corrupted and they have no backup (we know how good people are at backups)
Or they forget their wallet passphrase.
These things are irrecoverable. There is no one to appeal to in order to recover your coins. Its not like you can take your ID and visit the bank manager or government agency to regain control of an account.
Or their exchange or online wallet provider gets hacked.
No too big to fail government bailouts. You wanted independence from governments, here is the downside.
Or a 51% attack occurs, one mining pool got to 50% a few years ago.
Or a government intervenes, 70% of miners are in a single country not known for a hands off approach.
Bitcoin has deviated from its design, its security compromised as a result. It assumed a large group of decentralized miners, we don't have that. Bitcoin must abandon its currently proof-of-work algorithm which is dominated by specialized and expensive ASIC hardware, it needs to switch to a GPU friendly ASIC resistant alrgorithm (repeat as necessary) or switch to proof-of-state as etherium will do. Only such changes can decentralize mining and get security back on the designed path.
You can lose faith or trust in humans, but who creates and maintains the technology you've decided to trust instead?
Look back up at my post, now look back down, you're on the Internet. Now look back up. I'm a signature.
Its not "ponzi", its "greater fool".
"The greater fool theory states that the price of an object is determined not by its intrinsic value, but rather by irrational beliefs and expectations of market participants. A price can be justified by a rational buyer under the belief that another party is willing to pay an even higher price. In other words, one may pay a price that seems "foolishly" high because one may rationally have the expectation that the item can be resold to a "greater fool" later." https://en.wikipedia.org/wiki/...
Antisemitism
Just wants us all to go cashless so his Bitcoin skyrockets.
Ask GOX & NiceHash... it is a great way to transfer wealth from hard working miners to criminals...
Now you can donate directly to them with crypto currency, and bypass the censorship.
You could donate directly by mailing the "charity" a wad of $100 bills.
Cryptocurrencies offer nothing that cash cannot provide. With the exception of an opportunity to make (or lose) a spectacular amount in a very short time. That is the only attraction of BTC: greed. Any other suggested use is mere rationalisation.
politicians are like babies' nappies: they should both be changed regularly and for the same reasons
Yeah, deflation will be a problem along with the fact that once some one loses a wallet key, those coins are gone forever. And it's also far from an ideal currency due to the $20 transaction fees and the fact that it takes 40 minutes for the transaction to complete. An ideal currency would have zero transaction fee and complete almost instantly.
Gold is finite and yet we still saw massive speculative booms and busts in its value. Manipulating markets isn't necessarily a bad thing. China has manipulated its currency with massive positive repercussions for its economy. Greece has arguably been devastated by its inability to dictate the value of its currency.
Sometimes printing money and becoming an inexpensive exporter is what an economy needs.
Neither inflation nor deflation are inherently good or bad, but they will do very different things to your economy. Leaving that up to speculators not people who have the best interest of the citizens and country is not a wise choice IMO for a currency.
Such naivette, professor... Ask a random person on the street, whether they'd trust the government or a private corporation to do anything not immediately affecting him — and he will pick the government. Because KKKorporation$ are greedy and some such.
Yeah, right. And 20xx was the "Year of Linux on Desktop"...
In Soviet Washington the swamp drains you.
It has everything to do, with the fact that wall street are all running algorithms to buy and sell Bitcoin. The rise in value is distorted, and that's always the money men Fracking with the system to make a buck. When bitcoin goes through an insane a hyper fast death drop, it will be because all the algorithms have said sell at the same time.
Then all the finance guys will come out to the money TV shows and go "Hey we said it was gambling. Why didn't you listen to us ?"
The problem is, inflation isn't necessarily a bad thing. Having a LOT of inflation, or unpredictable inflation, is bad... but having small, consistent amounts of inflation basically ensures that people with lots of money are forced to actively invest it, instead of just locking it away in a safe and waiting for its value to go up. Inflation isn't good, but DEFLATION is DEATH to any modern economy.
With 2% annual inflation, an investment likely to pay 4%-6% dividends is attractive. With 2% annual deflation, the economy implodes because the best low-risk investment you can make is to hoard cash and do nothing at all with it. And with greater deflation, you end up at a point where nearly anything you could conceivably invest in is almost guaranteed to lose money relative to locking it in a safe. Think back & remember what it was like to go shopping at a store in 2009... everything was cheap and on sale, but stores started to literally RUN OUT of things to sell & DIDN'T replace them. Once they were sold out, you were fucked unless you could find it online... and even finding things online merely blunted the sting and spread it out slightly. Had the recession continued for longer, even Amazon would have started running out of things to sell.
Trying that transfer in MS-DOS:
C:\Users\bob>move trust elsewhere
The system cannot find the file specified.
Hmm, might be a platform issue...
bob@notreallyacomputer ~ % mv trust elsewhere
mv: cannot stat 'trust': No such file or directory
Nope, can't transfer what's not there...
There is no XUL, only WebExtensions...
I think the rise in bit coin has less to do with the government and more to do with human greed..
Everything you just said is wrong.
Go check it out for bitcoin. It's hilarious and anyone with investing knowledge, not even 101 level, like maybe kindergarten will see that the price is a house of cards built on stilts built on a decaying ocean cliff on an active fault line in California.
It's really pitiful this site has become part of the pump and dump scheme. Hope they make plenty of money off of other peoples tears.
Everyone on slashdot turns into the grumpiest old man when the bitcoin threads roll around. It's actually kind of cool to see the push back against unstoppable societal changes in real time.
And calling this a social m*f* moment? Classy, Slashdot. Stooped to a all time low.
You don't need to hold bitcoin long, to use them to get your money out.
Without arguing any particular case, capital controls usually exist for a reason and every country has them to some degree or another. To escape a repressive or incompetent regime (say Venezuela) I have no quarrel with someone using bitcoin to do what they need to do. But that is a tiny fraction of what is happening with bitcoin and its certainly a poor argument against governments in general.
_All_ currencies have invariably been disastrous 'sooner or later'. You just don't want the blame landing where it belongs.
Demonstrably untrue. Currencies that lack the mechanisms to adapt to changing needs are disastrous. Had the dollar stayed on the gold standard, that would have been a disaster. That's not a trivial distinction and it's unclear that bitcoin has any such flexibility baked in.
Right now, Chinese investors are legally trapped in the Chinese bubble (unless related to someone powerful), thank dog for bitcoin.
I think you have a more negative view of China than the reality of the situation for most people. It's a more complicated situation than you are framing it to be. Every major economy has capital controls to one degree or another. At least some of the reasons for China's currency controls actually aren't evil. I traveled to China during grad school to study this very issue. Without getting into the weeds it's safe to say it is a complicated issue. Bitcoin won't be the solution to them.
_All_ currencies have invariably been disastrous 'sooner or later'. You just don't want the blame landing where it belongs.
I'm not the one with a fixation on hating governments. Show me real evidence to believe that crypto-currencies will fix everything and I'll join the bandwagon enthusiastically. As it is I think bitcoin is hugely flawed and those promoting it are mostly doing so with absurd, ideological, and/or naive arguments.
There is no inherent reason that governments should issue currency.
There is also no inherent reason that governments shouldn't issue currency. What exactly is your point? Furthermore I can't think of any non-governmental entity I would trust with the responsibility of managing currency more than a government. (or in the case of the US the Fed which is overseen by the government) At least with a government we collectively get a say in matters and there are mechanisms of accountability. Not so with something like bitcoin. There is zero accountability in bitcoin or anything like it.
The point is to take away the printing press, not give one to every little stain of a government.
You seem to have a fixation with the premise that governments are inherently a bad thing. Frankly I don't buy that premise as any sort of general proposition. The ability to "print money" isn't inherently evil. It's just something to be cautious about but useful under some circumstances.
Mackay, Extraordinary Popular Delusions and the Madness of Crowds (PDF)
Planet Money did a great pieces on the intrinsic value of gold. It's intrinsic value is that it is an excellent metal for use as a store of value. It doesn't degrade. It doesn't react with anything. It's easily worked into coins. It's not poisonous. It's relatively easy to mine and extract from rock. It's common, but not too common. If you factor in all the requirements for a store of value / unit of trade, you end up with silver, gold, palladium... all the precious metals that are commonly used as stores of value.
It's almost as if thousands of years of economic activity figured out that these metals are valuable as a store of value.
My Other Computer Is A Data General Nova III.
I don't think it was a combination of errors and misfeasance. It was, almost exclusively, a few thousands of people that got unstoppably greedy. The sooner those repugnant morons are kept out of the loop, the better.
Coupled with non-understanding how things work. Anybody profiting from the current bubble is taking that money from those that will still be holding Bicoin when it crashes. This has absolutely nothing to do with trust.
Most ACs are not even worth the keystrokes to insult them. Be generically insulted by this and ignored otherwise.
DEC 17Former Botmaster, âDarkodeâ(TM) Founder is CTO of Hacked Bitcoin Mining Firm âNiceHashâ(TM)
On Dec. 6, 2017, approximately USD $52 million worth of Bitcoin mysteriously disappeared from the coffers ofÂNiceHash, a Slovenian company that lets users sell their computing power to help others mine virtual currencies. As the investigation into the heist nears the end of its second week, many Nice-Hash users have expressed surprise to learn that the companyâ(TM)s chief technology officer recently served several years in prison for operating and reselling a massive botnet, and for creating and running âDarkode,â until recently the worldâ(TM)s most bustling English-language cybercrime forum.
In December 2013, NiceHash CTOÂMatjaž ÅkorjancÂwas sentenced to four years, ten months in prison for creating the malware that powered the âMariposaâ botnet. Spanish for âoeButterfly,â Mariposa was a potent crime machine first spotted in 2008. Very soon after, Mariposa was estimated to have infected more than 1 million hacked computers â" making it one of the largest botnets ever created.
https://krebsonsecurity.com/2017/12/former-botmaster-darkode-founder-is-cto-of-hacked-bitcoin-mining-firm-nicehash/
BitCoin Miner from the Microsoft App Store was running on one of my PCs and it requested access to the Video Camera. ...But the camera access is very creepy...
It only popped up an error message in Windows 10 because the PC in question does not have a camera.
BitCoin Miner also spams the PC with tons of advertising and disgusting video commercials for Discover Card, of all things.
And finally, even with a top GPU, it pays less than $2 USD per day in BitCoin.
Value is dragged down by the constant inflation of printing more paper money & the US Dollar has to contend with National Debt & actions by the Fed and unstable politicians.
I can't help to think that Bitcoin as one cryptocurrency is an excellent response to the unlimited growth of government
You have to hide wealth from greedy government or they will take it all. Banks and governments become less relevant.
Bitcoin is a scheme for separating money from fools. So is most of what banks and other financial institutions do, almost entirely on or with computers. Banks are in the business of creating money - that's what happens when, in the simplest transaction, they take in deposits then immediately lend them out at higher interest than they're paying on the deposits. They created the loan principal more or less out of thin air, because those deposits theoretically are still there and might have to be paid. Things have gotten a lot more complicated than that over the years. Bitcoin does much the same thing, requiring the expenditure of (surprisingly huge energy to create some kind of value, then trading the value around to make a profit - mostly from the rubes who buy high and end up selling low. And financial services in general *are* mostly run on and by computers; there's really no other way to do things quickly enough and handle the complexities being created.
One of the side effects of the internet is that it's becoming ever harder for governments to hide their true nature from their citizenry. As citizens increasingly wake up to the fact that they are, in fact, no more than "copper tops" and that their governments are, really, not a "social contract" at all but rather a self-serving mafia and both the governments and their currencies can be expected to lose legitimacy with increasing volatility. In the US, because of our longer history with rule of law (at least to some extent) we've got a choice -- or our government does. The US government can begin to lock up the thousands of insiders who have been illegally milking the system and selectively enforcing the rules, or it can face rapid collapse in the years pretty immediately ahead. Armstrong has written extensively about this as have the folks behind "The Fourth Turning". Of course, their are still a fair number of copper tops and agents who are happy with their role in the mafia organization for now. Time will tell. With regard to currency and banking specifically, there is no legitimate reason why the government is borrowing money from private banks and giving some connected people net zero interest loans and bailouts while other people are being reamed. Yes, their is a Ponzi scheme in play: it is a government sanctioned and led Ponzi scheme and it will end soon, one way or another.
Bitcoin's Rise May Reflect a Monumental Transfer of Trust From Human Institutions Backed By Gov't To Systems Reliant on Programmer Competence.
Doesn't that make you feel better?
putting the 'B' in LGBTQ+
Also, why should economic activity that took place in the far past have the same "value" years later?
Because during that time you've been refraining from consuming and thus allowing others to benefit from the product of your labor. You did useful work, and received money in return—the overall supply of goods increased. You saved the money rather than spending it—so other people received those goods, not you. Assuming a stable money supply, if deflation has occurred that means that the difference between your production and your consumption has contributed to capital investment and more efficient production. That is why your money is now worth more. The deflation is your reward for refraining from entering the market and competing with others for scarce goods and services. Similarly, inflation, when it occurs naturally, reflects capital consumption and less efficient production, and the resulting decrease in the value of savings is a penalty for leaving the market to others who have failed to cultivate it.
The natural, unforced rate of deflation reflects how good the average investor is at turning a profit and bringing value to society. If you can do better than the average investor, great—you will receive a return higher than the rate of deflation. If not, everyone will be better off if you just "hoard" your money and refrain from diverting resources away from those who know what they're doing.
If the money supply is manipulated to force inflation, however, that makes the market look worse than it actually is, which encourages investment in below-average ventures—ventures which will not pay enough of a return to exceed the deflation which would otherwise have occurred. The result is capital consumption and a lower rate of growth. This presumes that the inflation occurs evenly; if the new money all goes to one place (such as the Treasury, banks, government contractors...) the distortion in the market becomes even worse.
Of course, forcing deflation causes the opposite problem, inhibiting useful investments which would have payed better than the natural rate of deflation. It's only a good thing when it occurs naturally, without manipulation of the money supply. Sometimes inflation can be a force for good—but only when it isn't forced.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
Speaking as someone who is probably one of those foolish cryptoanarchists and libertarians.. (though I don't hold any bitcoin)
This is less about a faith in technology than a faith in transparency.
Do you really understand all the myriad details of dollars? Do you watch every fucking move the federal reserve makes, and have you read every bit of the law that governs it? For some reason Slashdot has to have a story every time the bitcoin-dollar excahnge rate changes, but do you follow every moment when the euro-to-dollar rate changes, and know why it changed the way that it did?
It's nearly impossible. Dollars and the related laws are more opaque and unknowable than Cthulhu. Anything can be hiding in the overall system, and plenty of people make their living by forming expertise in some limited area of it, and exploiting the weirdness.
Similarly.. you may have recently heard about a big new tax bill happening in the US. Whether or not you agree with the main idea of a "tax cut" (as we'll charitably call it) you damn well know it's going to be at least a hundred pages, and they had to add little things here and there to get certain senators and reps to vote yes. I guarantee you, when you get down to the little details, there's all kinds of unprincipled things in it.
I don't say this to indict Republicans (wait, that's a good idea! j/k) because, after all, the existing tax code is already like that: an accretion of a hundred years of corruption. The new bill will be corrupt, but it cannot possibly be more corrupt.
This is always how it has been. Law is corrupt, and more importantly: nonsensical. The arbitrariness and complexity is how the corruption tries to hide. And no matter who you are, you can probably pick some random part of the tax code and it's nearly guaranteed you wouldn't be able to explain WHY the law should be the way it is.
Now compare all that to Bitcoin. Is Bitcoin good? People debate that. Is it simple and is there a reason (even if that reason is "bad") for everything? Fuck yes. You can write your own Bitcoin implementation, if you wanted to. It has no secrets.
Whether Bitcoin ends up being "it" or not, we need a transparent money system -- a formal in the mathematical sense, rather than the social sense, way for money to work. Cryptocurrency can be "trustworthy" in certain ways that Congress' system can never hope to be.
You can't insult it by calling it a scam, because everyone knows it's less of a scam than what it's competing with. It's the old "I don't have to outrun the bear, I just have to outrun you" joke.
Robert does a nice job debunking Tim Wu's editorial. http://blog.erratasec.com/2017...
the tit is long gone. I've had family go through tough times due to illness and try to snuggle up to it only to find it's just a rock with a nipple painted on. But hey, you got yours, right? So fuck everyone else. You've got to look down on them somehow or empathy might kick in and you'd have to acknowledge what you're doing is wrong.
The best part? Your defensive stance and right wing talking points tell me you know you're in the wrong, but you can't help your selfishness. Anyway, good luck. When you're 65 only the rich will have health care, maybe you'll be one of them. Or maybe you'll die in pain of a completely preventable disease. Maybe your wife will instead. Who knows. When that time comes, and she's dying in your arms and somewhere in your head you knew you could have stopped it if only you weren't such a selfish jerk, maybe you'll repent then. Or maybe that won't happen because the rest of the country will stop listening to you. We'll know in 20-40 years (judging by the age of your talking points).
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Just another bubble folks. This isn't new, the only change is to the words used to sell the scam
I disagree.
Deflation is terrible. Deflation means you can take money, put it under a mattress and have it worth more years down the line. That is a terrible idea for many reasons' not least that it discourages spending or even investment.
It discourages spending now because you will get more for your money later.
It discourages investing because it allows you to increase your wealth without risk taking.
Risk taking is key to economic activity. Yes, some ventures will be loss making, but in aggregate, investment is broadly a positive. If there was certainty of a positive return, then investors wouldn't need to be rewarded by high returns at all.
cause of the huge rush to transfer up to 50% of all worldwide wealth to cryptocurrency in the past year. got it.
you want an investment that has intrinsic value, do what my cousin did: he bought a shrinkwrapped iron plow. even the collapse of civilization will not affect its value.everyone needs food. this is how you grow plants enough to feed a family. i would add: anvils, sledgehammers, axeheads, large sawblades, manual water pumps, posthole drivers, logsplitting wedges.
Another case of (wealthy) nerds talking to each other in their echo chamber. It wouldn't be practical, anyway. Believe it or not, there are billions of other people on earth that do not necessarily value what you value.
A basic tenet of economics is the time value of money. A few bucks gathered long ago can be valuable today because you took part in the distant history of our economy when relatively small contributions had a large effect on the future. All crypto coin has value. It is the time value of computation. The key is to make sure he root computation is valuable. This is why ethereum is the best concept.
I think this one is a delusion though. I mean it can be split into 100 million "Satoshi"s, which are low value enough for arbitrarily small transactions, and will remain so at least unless bitcoin rises past the million dollar mark, but given the cost of transfer, small values aren't worth having.
It will only be worthwhile if banks decide to start offering bitcoin accounts.
Over here, mailing money is illegal. And I'm glad it is, because what happens when it's not is that people will open mail boxes, looking for birthday cards in which grandma has folded a 10 euro note, and throw the rest of the mail in the mud.
Code is mostly crap and is written by humans, often for corporations with goals that are not necessarily in line with those of the users of the code.
So what this is saying is that users trust more Google, Facebook, Microsoft, Apple rather than their government. Not very uplifting, but it seems it is going to be Zuckerberg for president next time around.
If you want mine your own cryptocurrency, you need a motherboard with 19 PCIe 1X slots to plug in 19 GPUs and a couple of 1200W PSUs.
Bitcoin is an asset bubble on an asset with less intrinsic value then collectible baseball cards. Anybody with a basic knowledge of monetary systems knows this.
The only thing this shows is the trust people have in each others greed of money for nothing.
Maybe the crying won't start until the last coin is mined and people wake up to the fact that it is not a currency and will never be.
You can't trust a machine without trusting the people that built it. I also doubt that the analysis is correct. What Bitcoiners want is the opposite of safety. They want either a get rich quick scheme or a system for moneylaundering and illegal transactions. Obviously a system that promises huge profits and no oversight cannot be safe.
Bitcoin's rise reflects human beings' inability to learn from history.
What does the future look like for a currency that requires a 1.21 gigawatt lightning strike to process a single transaction?
Manipulating markets isn't necessarily a bad thing.
Manipulating markets is precisely the thing that makes all modern economies actually function. Without it, as we see very often in unregulated markets, catastrophic cycles of boom and bust are the norm. With too little, those cycles still dominate.