People like fraud protection too, as well as small consumer loans, and the theft protection offered by savings accounts.
As I said, there is nothing that prevents insurance companies from offering fraud protection for people's bitcoin wallets, or managing people's bitcoin wallets for them and offering the same services.
Having a "bunch of dollars" is the very essence of "not investing".
You can look at it that way, but it is perfectly valid to view it as a low risk investment, low to negative return investment. This is just a semantic difference. Maybe there are better ways of investing in the dollar, but those ways have their disadvantages too. Un such disadvantage is traceability if you don't want to be traced.
In regards to money supply, let me clarify what I am talking about
The government has a few different ways of getting the things that it wants. It pays companies and individuals (e.g. contractors, employees, etc) money in exchange for goods and services. It can get this money in a few different ways. It can print (i.e. literally print or virtually "print" more money). It can collect taxes and sell treasury bonds in order to get some of the money (that it printed) back to spend again. and there are probably some methods I am neglecting.
The government spends X dollars on stuff (e.g. salaries, weapons, roads) every year. If we get to a state where the FDIC is required to cover the deposits of many failed banks simultaneously (and recent events show it is very possible for many banks to fail simultaneously), the government may decide to increase the money supply rather than actually diverting money away from the normal expenditures. If you suspect that this is how the government will "remedy" the situation, then it would make sense to pull your money out of your savings account and spend it before this happens, assuming you can (i.e. you are not one of the people waiting for FDIC because your bank failed).
I would like to point out that I am not talking about cash unless I say cash. I'm not an economist, and I probably am using some incorrect terminology.
Ahh, here's where we're talking past each other. My premise is that bitcoin will never be mainstream unless and until there are BTC savings accounts and credit cards - mainstream BTC using means most people using it with banks, just as with the dollar. It's just how people want to work with money.
There was a time when people weren't used to banks. There was a time when people weren't used to credit cards. There was a time when people weren't used to the internet and preferred to do their banking in person. I don't think people are used to bitcoin and other similar currencies, but that can change. People certainly like lower/less fees, maybe that will be enough to get them to try it.
If the government actually cared, and outlawed bitcoin, then any transaction or mining involving your IP address would mean guys with guns at your door. No, proxies won't help with that. Yes, Starbucks will have the legally-required firewall that blocks such traffic. And so on - I doubt the government will ever care, we do seem to still value freedom and especially free speech here, but they have the power to outlaw any internet traffic they don't like.
Mining doesn't even require you to have an internet connection. Only claiming the newly mined bitcoin does. You can have a computer mining for 2 years until it actually finds a bitcoin, and then you can claim it in a way that does not reveal your identity to the authorities.
Proxies will work just fine as long as the government doesn't sever the internet in the US from the rest of the world. As far as I know the government hasn't cracked RSA. If you send an RSA encrypted packet to someone in Russia, the government can block it, but they can't read it. You can make this packet look like an http response if you want to obscure the fact that it's an encrypted packet.
Yes we do care about freedom of speech, but for the government to actually enforce a ban against certain types of internet communication, they need to be able to distinguish between legitimate and illegitimate internet traffic, and this isn't easy at all.
You don't seem very familiar with investing, as this statement is "not even wrong".
I know exactly what this phrase means and in what context Wolfgang Pauli first used it, and I really don't see how anything I said would fall into this category. If you have a bunch of US dollars, you are essentially investing in the dollar. If there is reason to believe that this investment will depreciate, you want to invest in something else. This seems pretty straightforward to me.
Or are you talking about Zimbabwe-style hyper-inflation and social collapse, in which case you want bullets not bitcoins. Thus my allusion to bunker-builders.
I wasn't talking about this level of inflation with from the quote you referenced. I was more talking about something along the lines of doubling the money supply to cover everyone's deposits.
Just curious why you think the "war on drugs" has been unsuccessful. Do you believe that the actual goal is the stated goal? That seems an unlikely conclusion from the evidence.
Now who's the conspiracy theorist? I actually believe the war on drugs is just a giant fuck up, because the people who thought of it were misguided and the people who continue it know that it is not yet politically viable to end it. I tend to agree with Hanlon's Razor:
Never attribute to malice that which is adequately explained by stupidity.
You're conflating bank failure and currency issues.
There isn't really a bitcoin equivalent of a bank failure since everyone essentially becomes their own bank in terms of storing their own money. Obviously this is separate from the investment banking side of things.
If we are talking about runs on the bank that is not due to the dollar crashing, then bitcoin is not affected by this kind of run anyway. There is no institution holding your money with bitcoin.
Music "piracy" in the torrent sense isn't even criminal AFAIK.
I think it can be, even though it is usually litigated in civil trials.
http://en.wikipedia.org/wiki/NET_Act
This existing law says that it is a crime to pirate more than $1000 of copyrighted material in any 180 day period.
If the government cared to know every IP address in America involved in a BTC transaction, it could. If Alice and Bob are un the US, and need the Internet to validate the transaction (no double-spend), the government can know about that transaction. The various government agencies concerned with money-laundering aren't troubled by Bitcoin.
Alice and Bob can use a foreign proxy.
Alice and Bob can perform the transaction at a place with free public wifi, like a coffee shop or an airport.
You can mine bitcoins with minimal connection to the internet, and when bitcoins are actually found, they can be added to the block chain in a foreign country (proxy) or at starbucks.
The government will definitely know about the transaction, as it will be public information. I don't think they will be able to stop the transaction from happening, and I don't think they can know the identities of those involved if they are careful.
The various government agencies concerned with money-laundering aren't troubled by Bitcoin.
I would argue that the government agencies concerned with money laundering are more concerned with getting their cut from big banks, and bitcoin is still a fish too small to care about. The government also tends to be pretty slow to adapt to knew technologies.
Are you a bunker-builder preparing for complete societal collapse? If so, sure, the US government won't be important. But in today's society BTC won't be mainstream unless you can use it with the banking system, regardless of what happens with the dollar.
No I am not. I am a regular tax paying, dollar using person. I have not yet purchased any bitcoins, although I almost did back when it was $130. Now I am scared that it's in a bubble.
I think you can currently use bitcoin with the banking system just fine. Banks are perfectly willing to make payments to bitcoin exchanges and accept payments from them. I think if the government ever decides to prohibit banks from facilitating transactions with bitcoin exchanges, it will be scene as a sign of weakness in the dollar and more people will actually want to do it. If this happens, there is no doubt in my mind that black market bitcoin exchanges will pop up. The government has been pretty unsuccessful in prohibiting the exchange of money and drugs, I don't see why they would be more successful if you replace drugs with bitcoins. You don;t even need to smuggle bitcoins into the country.
If there is massive inflation, it will be in everyone's interest to dump their dollars anyway. What they decide to invest in instead is up to them. I do think that investing in bitcoin would be pretty attractive, as it is a currency that is pretty safe from inflation, although otherwise volatile currently, and it is easier to spend than gold, if people actually adopted it.
I'm sure we'll get some Carteresque inflation in the next decade, but that won't change the utility of the dollar. 10% inflation is just not a structural problem, and there's just no reason to expect hyper-inflation.
Sure, but you don't need physical currency to do that. It's irrelevant to the M1/M0 ratio. In fact, you really want to buy stuff on credit and borrow all the dollars you can, if you think the dollar is doomed. (And there's a non-trivial group of people in America doing just that.)
No you don't need physical dollars to do that. But you also don't need to physically run to the bank either. I would imagine that a modern run on the bank would involve people trying to buy euros or gold or bitcoins online, with banks freezing people's accounts until they get more virtual money from the FDIC/Fed, with prices of everything relative to the dollar going up while people are trying desperately to unfreeze their accounts and spend their money before prices increase further.
As a person selling things online, or a currency broker, I sure as hell would readjust my own valuation of the dollar if I knew the US government was about to drastically dilute their own currency to cover FDIC. I would raise my prices in dollars accordingly.
BS. If bitcoin stays some joke currency that a few geeks and criminals use, then it can be crushed without loss to society. If bitcoin becomes mainstream, then the government still controls the banks, and that's all they need in the modern world.
How would it be crushed? Why hasn't the government crushed similar things music piracy?
Yes the government still controls the banks. The government can not force people to want to store their money in US dollars if they decide to significantly devalue it.
If Alice wants to give Bob 1 bitcoin for a bushel of apples and Bobs wants to sell his bushel of apples for 1 bitcoin, what is the government going to do to stop it?
I'm not saying that bitcoin will takeover the dollar. I am saying that it is not in the power of the government to stop it, especially if people decide they don't trust US dollars anymore.
Cash is pretty untraceable, but we allow that to exist. It is used in the black market because of it's untraceability. Bitcoin is untraceable in the sense that you don;t know which accoutns belong to which people, but it is extremely traceable in the sense that every transaction that has ever taken place is stored in the blockchain that exists on the computer of everyone participating in bitcoin. You can trace every single bitcoin through every transaction it has ever been involved in back until it was first mined.
You could make a law against using bitcoin, but this law would be very hard to enforce. If this were possible, then why not just make it illegal to use for make transactions with anonymous bitcoin accounts. Then the government would have perfect transparency. They wouldn't even need to compel banks to provide this information. It would just be public.
I'm not sure what you mean by having the freedom to define our own currency. We are already free to invest in other currencies like the Euro, or forms of money like gold and silver.
While I don't doubt that you can make the adoption of new currencies illegal, I don't see how this could be objectively codified into a coherent law. If I wanted to use beanie babies as currency, but making my own currency was illegal, what's the difference between that and using my paychecks to buy beanie babies and selling beanie babies for cash everytime I want to buy food or pay rent. Everyone would still be using dollars for legal tender, but they would effectively be storing their money as beanie babies. As long as you never have your money in dollars for a lengthy period of time, you would be immune to value fluctuations of the dollar.
The silk road actually did the same thing in reverse with bitcoins. People paid for drugs in bitcoins, but they were paying in amounts that followed the dollar. In other words they were still using the dollar as a unit of cost, even though they were not transacting in dollars. This allowed them to mitigate the effect of the volatility of bitcoin prices. A hundred dollars of drugs might be 10 bitcoins one month and 2 bitcoins the next, and 0.1 bitcoins the next
Historically, that was a result of several banks failing and everyone panicking - but there's no reason to worry about bank failures, no reason to rush to withdraw money, if you're guaranteed to get your money back.
If you suspected that the dollar was going to crash, being the first person to get your money out and buy things with it would mean that your dollar will go farther than someone else who is trying to spend their dollars after a lot of dollars have just been printed to cover FDIC. If everyone gets this same idea at about the same there would still be a rush to get your money before other people get theirs.
It's always about force. When the dollar was gold-based, and FDR was pissing in the pool, he simply outlawed private ownership of gold. In previous centuries, the King would just send the army to the banks and take all the gold from the vaults. If you can't extract money from your population by force then you're not a government, because you lack the (effective) power to tax.
You'll notice that FDR didn't to gold as the standard currency and simply take everyone's gold. With all their power, they are not able to magically make gold appear in their vaults the way they can magically make dollars appear in the computer or print more $100 bills.
Yes the government can probably go door to door ransacking people's houses and beating people up to get all the gold, but this itself comes with a cost. You need to pay people a lot of money to be willing to do this. Look at Egypt. They need to steal a huge chunk of the people's money to pay the army to keep the rest of the people under their thumb, and it is barely working.
Compared with dollars, which are easy to confiscate (through control of bank accoutns and devaluation through inflation), bitcoins are much much harder to confiscate. You need to resort to what dicatators did, going door to door beating people up, etc.
It's not that you can't control bitcoin. It's that you can't control it without turning your whole country into a shithole like egypt.
I'm sorry, I thought I was talking to the OP. My mistake.
It appears to me that our thread ancestor wasn't really saying that, either.
I was referring specifically to the idea that the OP found it laughable that bitcoin could not be stopped. I am not going to dispute or confirm any unnamed absolute claims referred to by the OP.
But I do think the idea that "bitcoin can't be stopped", albeit an "absolute", is approximately like saying "music piracy can't be stopped", which in my view is basically true, if we infer an implicit "without drastically changing society" (e.g. shutting down the internet, instituting a police state, etc)
You forgot "fraud protection", the gaping hole in BTC and the main reason people put up with the 2-3% Visa Tax on all transactions. But as soon as BTC is used in any way for consumer lending, the money supply increases by the amount of each loan.
Yes credit card companies do offer fraud protection, but I think this is more related to the "credit" part of the service (though I am not sure why). For example check cards don't typically offer the same level of protection. As I said, there is no reason someone couldn't offer you credit that needs to be repaid in bitcoin, just like how currently credit cards are repaid with dollars.
Bitcoin is supposed to work like cash. If someone steals your wallet in real life, you don't have any recourse. You do always have the option of buying your own insurance for just about anything like fraud or theft, and it would probably be something in the ball park of 2% or 3% as well. Maybe some people appreciate the security include with credit cards, but they are paying for it. Also, I think this security is more necessary with credit cards. Your credit card number is all a thief needs to make purchases. This is number is essentially public information. You give it to every store and worker you buy something from. With bitcoin you can authorize each individual purchase without giving anyone the information to make additional purchases.
Yes, it's useful for that (protection you don't have with a "Eurodollar" account - dollars deposited in a European bank). But it was created to prevent bank runs. The fact that you have that protection prevents the collapse of the entire banking system due to bank runs. That's kind of important.
I think the FDIC is very successful at prevent runs on a few individual banks. What would it do in a scenario if there was a run on ALL banks? There isn't enough money to cover all the loans due to fractional reserve banking. It could print more money to repay everyone, but this just distributes losses to everyone proportionally, and will dramatically inflate the dollar.
The government always finds a way. Funny what you can get away with when you have a monopoly on force.
It's not about force. You can't "print" bitcoins, because you can't solve hard math problems without actually doing the work. I'm sure the government could mine a shit ton of bitcoins (i.e. acquire them legitimately), but this would cost them money in used electricity. They don't have a way of instantly adding money to their own accounts with a keystroke, like they do with dollars. Part of the bitcoin protocol includes not excepting payment via bitcoins where there is no proof of work. I guess you could break the kneecaps of everyone in the world and force them to take bad bitcoins. But even that would be pretty costly.
You're supposed to be a skeptic. You're also supposed to be skeptical of your own understanding and learn about the things you don't understand.
I have a B.S. in CS and almost 10 years experience as a software engineer. I still use discrete math. I even recently wrote my own RSA encrypter/decrypter just to prove to myself that I understood RSA before instructing someone else how it worked.
Do I think bitcoin can be stopped? Technically yes, but I think you'd have to shutdown the internet to do it. I also don't think the government could shutdown the internet without causing a revolution in the US and wars with other countries.
This sort of thing is rather subjective. I could say that society "yawned" when beanie babies came out. And by "society yawned" I mean that the percent of people who bought beanie babies never even came close to the popularity of other goods like refrigerators and automobiles. This isn't wrong, but I think it would be misleading to a lot of people that didn't dig a little deeper to find out how my subjective assessment matches objective reality.
I think it's fair to say that there is a lot of interest in bitcoin, in the sense that an industry have formed to produce computer chips that specialize in bitcoin mining, that it's in the news (including financial news) a lot. I'm not saying it's going to replace the dollar, but the bitcoins that currently exist have a value of 12.3 billion dollars. It's survive several large crashes and recovered.
So you feel you don't need to know how bitcoin works in order to know whether specific aspects of bitcoin are bullshit? Are you a mathematician? or a software engineer? Do you understand public key cryptography? Do you understand discrete logarithms? Do you understand cryptographic hashes? When a layman says they know which things about bitcoin are true without understanding anything about how it works, that's when *my* bullshit detector goes off.
Not all debts get repaid... Some go unpaid. That's one of the reasons why loans charge interest. There is a risk inherent with lending that you may not be repaid if the borrower can't pay.
Under our current system we are supposed to be running a debt. If we paid back all the loans, all the money would disappear. Each dollar represents $1 of debt. Debt isn't bad as long as the people who incur the debt can pay it back. We have more people and more debt. I'm not saying our system is being run perfectly, but the fact that the debt is increasing isn't a problem per se.
You don't need the credit card with bitcoin if the reason you are using it is for the convenience (The card part). It is pretty easy to transfer funds with bitcoin. If you need the credit part of a credit card, then all you need is for someone to loan you bitcoins. If bitcoin is deflationary, all it means is that the interest rate of a loan to be repaid in botcoins will be lower compared with one repaid in dollars.
I don't think fractional reserve banking is unsustainable if you do it responsibly. If the banking system falls apart, I don't think FDIC is going to save anyone. If the dollar crashes, the FDIC isn't going to be able to give you anything but worthless US dollars. I think the FDIC is only useful if your particular bank goes under.
The government can;t piss in the bitcoin pool (well atleast not as much), because it doesn;t have the power to print bitcoins.
Well there are these 3 factors that make certain races have more success, and some races have it and are successful and some races that don't and are not.
OK so why do these races have these successful traits? Is it genetic?
No it turns out it probably isn't
Ok so we have established that successful people have traits which make them successful. I don't see how that could have been false.
So unless someone knows a way to make all the unsuccessful races feel the right kind of superiority, inadequacy, and impulse control, then even if this is true, I don;t see how this is even slightly useful
This is like saying the reason that some kids do better in math is because they have 3 traits. The are all good at algebra, geometry and trigonometry. And none of the kids who were bad at any of these were good at math, so it proves that being good in these areas causes you to be good in math.
I think it's more like if the FBI was using a mailbox as a hiding place for an undercover officer and you unknowingly put a letter into the mailbox, and now since you gave the letter to the FBI agent in the box, they have the right to open it and see what you wrote in case it's related to a crime.
I have a bullshit detector, I just don't depend on it for "knowing" new things. For that I use the part of my brain that can learn new things I don't already know.
Maybe you should try learning things? Or maybe not, if your bullshit detector says learning is bullshit because you already have a bullshit detector.
If the expression is lawless in itself, that counts, too
With this logic, you could make criticism of politicians illegal, and this country would still have free speech. After all anyone who criticizes a politician is committing a crime and their speech is no longer protected by the 1st amendment.
Currently you can still mine bitcoins (i.e. get them but not from other people). But it doesn't really matter if there is a finite number of gold or bitcoins or dollars, as long as it has enough granularity to facilitate small transfers, and seeing as how you can divide a bitcoin in to 100,000,000 bitcents, I think it's fine.
I don't know what you think "the market place is showing interest in bitcoin" would look like, but hopefully it would not require the complete replacement of the dollar to reach this threshold.
I suppose this would be true if you follow these rules in the most shallow way possible. When people mature past the point of trying to get away with getting paid for 0 work, and companies mature past the point of trying to get people to work for free, a mutually beneficial relationship can occur. As it turns out treating people like shit is not a good way to get them to enter into a mutually beneficial relationship.
In fact this is exactly how pretty much everyone acts.
Allow me to pose the following questions to illustrate my point:
1. If a company offered to pay you a higher salary than you expected them to offer, would you take it, or tell them you don't need that much money?
2. If a company told you that they only need you to work half the time (20 hours per week), but they'd pay you double the hourly rate you expected, would you take the job or tell them you didn't mind working the full 40 hours for the same pay (i.e. half the hourly rate)
3. If you are an employer and you really need someone to answer phones. Answering phones is something people are usually willing to work $15/hr for. Your team of engineers make the equivalent of $50/hr. You could probably afford to pay your receptionist $50/hr by lowering your own yearly profit by $70,000. Would you pay someone more than 3x their normal salary because you value them as a person and can afford to?
Slashdot Mirror
People like fraud protection too, as well as small consumer loans, and the theft protection offered by savings accounts.
As I said, there is nothing that prevents insurance companies from offering fraud protection for people's bitcoin wallets, or managing people's bitcoin wallets for them and offering the same services.
Having a "bunch of dollars" is the very essence of "not investing".
You can look at it that way, but it is perfectly valid to view it as a low risk investment, low to negative return investment. This is just a semantic difference. Maybe there are better ways of investing in the dollar, but those ways have their disadvantages too. Un such disadvantage is traceability if you don't want to be traced.
In regards to money supply, let me clarify what I am talking about
The government has a few different ways of getting the things that it wants. It pays companies and individuals (e.g. contractors, employees, etc) money in exchange for goods and services. It can get this money in a few different ways. It can print (i.e. literally print or virtually "print" more money). It can collect taxes and sell treasury bonds in order to get some of the money (that it printed) back to spend again. and there are probably some methods I am neglecting.
The government spends X dollars on stuff (e.g. salaries, weapons, roads) every year. If we get to a state where the FDIC is required to cover the deposits of many failed banks simultaneously (and recent events show it is very possible for many banks to fail simultaneously), the government may decide to increase the money supply rather than actually diverting money away from the normal expenditures. If you suspect that this is how the government will "remedy" the situation, then it would make sense to pull your money out of your savings account and spend it before this happens, assuming you can (i.e. you are not one of the people waiting for FDIC because your bank failed).
I would like to point out that I am not talking about cash unless I say cash. I'm not an economist, and I probably am using some incorrect terminology.
Ahh, here's where we're talking past each other. My premise is that bitcoin will never be mainstream unless and until there are BTC savings accounts and credit cards - mainstream BTC using means most people using it with banks, just as with the dollar. It's just how people want to work with money.
There was a time when people weren't used to banks. There was a time when people weren't used to credit cards. There was a time when people weren't used to the internet and preferred to do their banking in person. I don't think people are used to bitcoin and other similar currencies, but that can change. People certainly like lower/less fees, maybe that will be enough to get them to try it.
If the government actually cared, and outlawed bitcoin, then any transaction or mining involving your IP address would mean guys with guns at your door. No, proxies won't help with that. Yes, Starbucks will have the legally-required firewall that blocks such traffic. And so on - I doubt the government will ever care, we do seem to still value freedom and especially free speech here, but they have the power to outlaw any internet traffic they don't like.
Mining doesn't even require you to have an internet connection. Only claiming the newly mined bitcoin does. You can have a computer mining for 2 years until it actually finds a bitcoin, and then you can claim it in a way that does not reveal your identity to the authorities.
Proxies will work just fine as long as the government doesn't sever the internet in the US from the rest of the world. As far as I know the government hasn't cracked RSA. If you send an RSA encrypted packet to someone in Russia, the government can block it, but they can't read it. You can make this packet look like an http response if you want to obscure the fact that it's an encrypted packet.
Yes we do care about freedom of speech, but for the government to actually enforce a ban against certain types of internet communication, they need to be able to distinguish between legitimate and illegitimate internet traffic, and this isn't easy at all.
You don't seem very familiar with investing, as this statement is "not even wrong".
I know exactly what this phrase means and in what context Wolfgang Pauli first used it, and I really don't see how anything I said would fall into this category. If you have a bunch of US dollars, you are essentially investing in the dollar. If there is reason to believe that this investment will depreciate, you want to invest in something else. This seems pretty straightforward to me.
Or are you talking about Zimbabwe-style hyper-inflation and social collapse, in which case you want bullets not bitcoins. Thus my allusion to bunker-builders.
I wasn't talking about this level of inflation with from the quote you referenced. I was more talking about something along the lines of doubling the money supply to cover everyone's deposits.
Just curious why you think the "war on drugs" has been unsuccessful. Do you believe that the actual goal is the stated goal? That seems an unlikely conclusion from the evidence.
Now who's the conspiracy theorist? I actually believe the war on drugs is just a giant fuck up, because the people who thought of it were misguided and the people who continue it know that it is not yet politically viable to end it. I tend to agree with Hanlon's Razor:
Never attribute to malice that which is adequately explained by stupidity.
You're conflating bank failure and currency issues.
There isn't really a bitcoin equivalent of a bank failure since everyone essentially becomes their own bank in terms of storing their own money. Obviously this is separate from the investment banking side of things.
If we are talking about runs on the bank that is not due to the dollar crashing, then bitcoin is not affected by this kind of run anyway. There is no institution holding your money with bitcoin.
Music "piracy" in the torrent sense isn't even criminal AFAIK.
I think it can be, even though it is usually litigated in civil trials.
http://en.wikipedia.org/wiki/NET_Act
This existing law says that it is a crime to pirate more than $1000 of copyrighted material in any 180 day period.
If the government cared to know every IP address in America involved in a BTC transaction, it could. If Alice and Bob are un the US, and need the Internet to validate the transaction (no double-spend), the government can know about that transaction. The various government agencies concerned with money-laundering aren't troubled by Bitcoin.
Alice and Bob can use a foreign proxy.
Alice and Bob can perform the transaction at a place with free public wifi, like a coffee shop or an airport.
You can mine bitcoins with minimal connection to the internet, and when bitcoins are actually found, they can be added to the block chain in a foreign country (proxy) or at starbucks.
The government will definitely know about the transaction, as it will be public information. I don't think they will be able to stop the transaction from happening, and I don't think they can know the identities of those involved if they are careful.
The various government agencies concerned with money-laundering aren't troubled by Bitcoin.
I would argue that the government agencies concerned with money laundering are more concerned with getting their cut from big banks, and bitcoin is still a fish too small to care about. The government also tends to be pretty slow to adapt to knew technologies.
Are you a bunker-builder preparing for complete societal collapse? If so, sure, the US government won't be important. But in today's society BTC won't be mainstream unless you can use it with the banking system, regardless of what happens with the dollar.
No I am not. I am a regular tax paying, dollar using person. I have not yet purchased any bitcoins, although I almost did back when it was $130. Now I am scared that it's in a bubble.
I think you can currently use bitcoin with the banking system just fine. Banks are perfectly willing to make payments to bitcoin exchanges and accept payments from them. I think if the government ever decides to prohibit banks from facilitating transactions with bitcoin exchanges, it will be scene as a sign of weakness in the dollar and more people will actually want to do it. If this happens, there is no doubt in my mind that black market bitcoin exchanges will pop up. The government has been pretty unsuccessful in prohibiting the exchange of money and drugs, I don't see why they would be more successful if you replace drugs with bitcoins. You don;t even need to smuggle bitcoins into the country.
If there is massive inflation, it will be in everyone's interest to dump their dollars anyway. What they decide to invest in instead is up to them. I do think that investing in bitcoin would be pretty attractive, as it is a currency that is pretty safe from inflation, although otherwise volatile currently, and it is easier to spend than gold, if people actually adopted it.
I'm sure we'll get some Carteresque inflation in the next decade, but that won't change the utility of the dollar. 10% inflation is just not a structural problem, and there's just no reason to expect hyper-inflation.
I agree. I don't think our
Sure, but you don't need physical currency to do that. It's irrelevant to the M1/M0 ratio. In fact, you really want to buy stuff on credit and borrow all the dollars you can, if you think the dollar is doomed. (And there's a non-trivial group of people in America doing just that.)
No you don't need physical dollars to do that. But you also don't need to physically run to the bank either. I would imagine that a modern run on the bank would involve people trying to buy euros or gold or bitcoins online, with banks freezing people's accounts until they get more virtual money from the FDIC/Fed, with prices of everything relative to the dollar going up while people are trying desperately to unfreeze their accounts and spend their money before prices increase further.
As a person selling things online, or a currency broker, I sure as hell would readjust my own valuation of the dollar if I knew the US government was about to drastically dilute their own currency to cover FDIC. I would raise my prices in dollars accordingly.
BS. If bitcoin stays some joke currency that a few geeks and criminals use, then it can be crushed without loss to society. If bitcoin becomes mainstream, then the government still controls the banks, and that's all they need in the modern world.
How would it be crushed? Why hasn't the government crushed similar things music piracy?
Yes the government still controls the banks. The government can not force people to want to store their money in US dollars if they decide to significantly devalue it.
If Alice wants to give Bob 1 bitcoin for a bushel of apples and Bobs wants to sell his bushel of apples for 1 bitcoin, what is the government going to do to stop it?
I'm not saying that bitcoin will takeover the dollar. I am saying that it is not in the power of the government to stop it, especially if people decide they don't trust US dollars anymore.
Cash is pretty untraceable, but we allow that to exist. It is used in the black market because of it's untraceability. Bitcoin is untraceable in the sense that you don;t know which accoutns belong to which people, but it is extremely traceable in the sense that every transaction that has ever taken place is stored in the blockchain that exists on the computer of everyone participating in bitcoin. You can trace every single bitcoin through every transaction it has ever been involved in back until it was first mined.
You could make a law against using bitcoin, but this law would be very hard to enforce. If this were possible, then why not just make it illegal to use for make transactions with anonymous bitcoin accounts. Then the government would have perfect transparency. They wouldn't even need to compel banks to provide this information. It would just be public.
I'm not sure what you mean by having the freedom to define our own currency. We are already free to invest in other currencies like the Euro, or forms of money like gold and silver.
While I don't doubt that you can make the adoption of new currencies illegal, I don't see how this could be objectively codified into a coherent law. If I wanted to use beanie babies as currency, but making my own currency was illegal, what's the difference between that and using my paychecks to buy beanie babies and selling beanie babies for cash everytime I want to buy food or pay rent. Everyone would still be using dollars for legal tender, but they would effectively be storing their money as beanie babies. As long as you never have your money in dollars for a lengthy period of time, you would be immune to value fluctuations of the dollar.
The silk road actually did the same thing in reverse with bitcoins. People paid for drugs in bitcoins, but they were paying in amounts that followed the dollar. In other words they were still using the dollar as a unit of cost, even though they were not transacting in dollars. This allowed them to mitigate the effect of the volatility of bitcoin prices. A hundred dollars of drugs might be 10 bitcoins one month and 2 bitcoins the next, and 0.1 bitcoins the next
Historically, that was a result of several banks failing and everyone panicking - but there's no reason to worry about bank failures, no reason to rush to withdraw money, if you're guaranteed to get your money back.
If you suspected that the dollar was going to crash, being the first person to get your money out and buy things with it would mean that your dollar will go farther than someone else who is trying to spend their dollars after a lot of dollars have just been printed to cover FDIC. If everyone gets this same idea at about the same there would still be a rush to get your money before other people get theirs.
It's always about force. When the dollar was gold-based, and FDR was pissing in the pool, he simply outlawed private ownership of gold. In previous centuries, the King would just send the army to the banks and take all the gold from the vaults. If you can't extract money from your population by force then you're not a government, because you lack the (effective) power to tax.
You'll notice that FDR didn't to gold as the standard currency and simply take everyone's gold. With all their power, they are not able to magically make gold appear in their vaults the way they can magically make dollars appear in the computer or print more $100 bills.
Yes the government can probably go door to door ransacking people's houses and beating people up to get all the gold, but this itself comes with a cost. You need to pay people a lot of money to be willing to do this. Look at Egypt. They need to steal a huge chunk of the people's money to pay the army to keep the rest of the people under their thumb, and it is barely working.
Compared with dollars, which are easy to confiscate (through control of bank accoutns and devaluation through inflation), bitcoins are much much harder to confiscate. You need to resort to what dicatators did, going door to door beating people up, etc.
It's not that you can't control bitcoin. It's that you can't control it without turning your whole country into a shithole like egypt.
I don't know which shaky governmental and societal principles you are referring to.
It appears to me that our thread ancestor wasn't really saying that, either.
I was referring specifically to the idea that the OP found it laughable that bitcoin could not be stopped. I am not going to dispute or confirm any unnamed absolute claims referred to by the OP.
But I do think the idea that "bitcoin can't be stopped", albeit an "absolute", is approximately like saying "music piracy can't be stopped", which in my view is basically true, if we infer an implicit "without drastically changing society" (e.g. shutting down the internet, instituting a police state, etc)
You forgot "fraud protection", the gaping hole in BTC and the main reason people put up with the 2-3% Visa Tax on all transactions. But as soon as BTC is used in any way for consumer lending, the money supply increases by the amount of each loan.
Yes credit card companies do offer fraud protection, but I think this is more related to the "credit" part of the service (though I am not sure why). For example check cards don't typically offer the same level of protection. As I said, there is no reason someone couldn't offer you credit that needs to be repaid in bitcoin, just like how currently credit cards are repaid with dollars.
Bitcoin is supposed to work like cash. If someone steals your wallet in real life, you don't have any recourse. You do always have the option of buying your own insurance for just about anything like fraud or theft, and it would probably be something in the ball park of 2% or 3% as well. Maybe some people appreciate the security include with credit cards, but they are paying for it. Also, I think this security is more necessary with credit cards. Your credit card number is all a thief needs to make purchases. This is number is essentially public information. You give it to every store and worker you buy something from. With bitcoin you can authorize each individual purchase without giving anyone the information to make additional purchases.
Yes, it's useful for that (protection you don't have with a "Eurodollar" account - dollars deposited in a European bank). But it was created to prevent bank runs. The fact that you have that protection prevents the collapse of the entire banking system due to bank runs. That's kind of important.
I think the FDIC is very successful at prevent runs on a few individual banks. What would it do in a scenario if there was a run on ALL banks? There isn't enough money to cover all the loans due to fractional reserve banking. It could print more money to repay everyone, but this just distributes losses to everyone proportionally, and will dramatically inflate the dollar.
The government always finds a way. Funny what you can get away with when you have a monopoly on force.
It's not about force. You can't "print" bitcoins, because you can't solve hard math problems without actually doing the work. I'm sure the government could mine a shit ton of bitcoins (i.e. acquire them legitimately), but this would cost them money in used electricity. They don't have a way of instantly adding money to their own accounts with a keystroke, like they do with dollars. Part of the bitcoin protocol includes not excepting payment via bitcoins where there is no proof of work. I guess you could break the kneecaps of everyone in the world and force them to take bad bitcoins. But even that would be pretty costly.
You're supposed to be a skeptic. You're also supposed to be skeptical of your own understanding and learn about the things you don't understand.
I have a B.S. in CS and almost 10 years experience as a software engineer. I still use discrete math. I even recently wrote my own RSA encrypter/decrypter just to prove to myself that I understood RSA before instructing someone else how it worked.
Do I think bitcoin can be stopped? Technically yes, but I think you'd have to shutdown the internet to do it. I also don't think the government could shutdown the internet without causing a revolution in the US and wars with other countries.
How do you think bitcoin can be stopped?
This sort of thing is rather subjective. I could say that society "yawned" when beanie babies came out. And by "society yawned" I mean that the percent of people who bought beanie babies never even came close to the popularity of other goods like refrigerators and automobiles. This isn't wrong, but I think it would be misleading to a lot of people that didn't dig a little deeper to find out how my subjective assessment matches objective reality.
I think it's fair to say that there is a lot of interest in bitcoin, in the sense that an industry have formed to produce computer chips that specialize in bitcoin mining, that it's in the news (including financial news) a lot. I'm not saying it's going to replace the dollar, but the bitcoins that currently exist have a value of 12.3 billion dollars. It's survive several large crashes and recovered.
So you feel you don't need to know how bitcoin works in order to know whether specific aspects of bitcoin are bullshit? Are you a mathematician? or a software engineer? Do you understand public key cryptography? Do you understand discrete logarithms? Do you understand cryptographic hashes? When a layman says they know which things about bitcoin are true without understanding anything about how it works, that's when *my* bullshit detector goes off.
Not all debts get repaid... Some go unpaid. That's one of the reasons why loans charge interest. There is a risk inherent with lending that you may not be repaid if the borrower can't pay.
Under our current system we are supposed to be running a debt. If we paid back all the loans, all the money would disappear. Each dollar represents $1 of debt. Debt isn't bad as long as the people who incur the debt can pay it back. We have more people and more debt. I'm not saying our system is being run perfectly, but the fact that the debt is increasing isn't a problem per se.
You don't need the credit card with bitcoin if the reason you are using it is for the convenience (The card part). It is pretty easy to transfer funds with bitcoin. If you need the credit part of a credit card, then all you need is for someone to loan you bitcoins. If bitcoin is deflationary, all it means is that the interest rate of a loan to be repaid in botcoins will be lower compared with one repaid in dollars.
I don't think fractional reserve banking is unsustainable if you do it responsibly. If the banking system falls apart, I don't think FDIC is going to save anyone. If the dollar crashes, the FDIC isn't going to be able to give you anything but worthless US dollars. I think the FDIC is only useful if your particular bank goes under.
The government can;t piss in the bitcoin pool (well atleast not as much), because it doesn;t have the power to print bitcoins.
Why do some races have more success?
Well there are these 3 factors that make certain races have more success, and some races have it and are successful and some races that don't and are not.
OK so why do these races have these successful traits? Is it genetic?
No it turns out it probably isn't
Ok so we have established that successful people have traits which make them successful. I don't see how that could have been false.
So unless someone knows a way to make all the unsuccessful races feel the right kind of superiority, inadequacy, and impulse control, then even if this is true, I don;t see how this is even slightly useful
This is like saying the reason that some kids do better in math is because they have 3 traits. The are all good at algebra, geometry and trigonometry. And none of the kids who were bad at any of these were good at math, so it proves that being good in these areas causes you to be good in math.
What the Navajo codetalkers would not know is what the fuck a "wind talker" is.
I think it's more like if the FBI was using a mailbox as a hiding place for an undercover officer and you unknowingly put a letter into the mailbox, and now since you gave the letter to the FBI agent in the box, they have the right to open it and see what you wrote in case it's related to a crime.
We can't know what these sickos are thinking about (until the machine that does this is invented), we can only assume it's very perverse.
So to you , "showing interest" is basically wholesale adoption by every big institution.
I have a bullshit detector, I just don't depend on it for "knowing" new things. For that I use the part of my brain that can learn new things I don't already know.
Maybe you should try learning things? Or maybe not, if your bullshit detector says learning is bullshit because you already have a bullshit detector.
If the expression is lawless in itself, that counts, too
With this logic, you could make criticism of politicians illegal, and this country would still have free speech. After all anyone who criticizes a politician is committing a crime and their speech is no longer protected by the 1st amendment.
Currently you can still mine bitcoins (i.e. get them but not from other people). But it doesn't really matter if there is a finite number of gold or bitcoins or dollars, as long as it has enough granularity to facilitate small transfers, and seeing as how you can divide a bitcoin in to 100,000,000 bitcents, I think it's fine.
I don't know what you think "the market place is showing interest in bitcoin" would look like, but hopefully it would not require the complete replacement of the dollar to reach this threshold.
I guess there is no point in actually knowing anything when you have a bullshit detector. Nothing in life is ever counter-intuitive.
I suppose this would be true if you follow these rules in the most shallow way possible. When people mature past the point of trying to get away with getting paid for 0 work, and companies mature past the point of trying to get people to work for free, a mutually beneficial relationship can occur. As it turns out treating people like shit is not a good way to get them to enter into a mutually beneficial relationship.
In fact this is exactly how pretty much everyone acts.
Allow me to pose the following questions to illustrate my point:
1. If a company offered to pay you a higher salary than you expected them to offer, would you take it, or tell them you don't need that much money?
2. If a company told you that they only need you to work half the time (20 hours per week), but they'd pay you double the hourly rate you expected, would you take the job or tell them you didn't mind working the full 40 hours for the same pay (i.e. half the hourly rate)
3. If you are an employer and you really need someone to answer phones. Answering phones is something people are usually willing to work $15/hr for. Your team of engineers make the equivalent of $50/hr. You could probably afford to pay your receptionist $50/hr by lowering your own yearly profit by $70,000. Would you pay someone more than 3x their normal salary because you value them as a person and can afford to?