Cryptocurrency -- Is anyone on-board?

[Ranayna]

I have not read the whole thread, and my knowledge of Bitcoin is very limited. But one thing occured to me.

I see the following premises, please correct me if i am wrong:
- The amount of Bitcoins is limited
- The difficulty of mining is regularly increased
That means, at some point no new Bitcoins can be produced anymore I would assume.

- The actual mining is used to confirm, or rather enable, any transaction
So, what happens when the last Bitcoin has been mined? No mining means no transactions?

[Gribo]

Transactions always incur costs, otherwise, no one will validate them.
It is the same as the commissions you currently pay to your bank.

[chicken]

When shoeshine boys hairdressers electronics bloggers are offering you investment advice, it's usually time to run for the hills. Another sign is, that email spammers start pushing bitcoin schemes rather than penny stocks.

Yeah, yeah, I know. It's different this time.

[MT]

Prof Steve Keens view on future economic crises and where BTC went wrong when designed.
He's leaving the stinking University environment and going crowdfunding!


And should engineers take over the destructive damage done by economicans!


M Hudson on why USA and the world is goooing dooown sloooowy!

[HighVoltage]

If we present the value of the BC on a logarithmic scale, we are only one loop away from 100k
And some serious reports state it it might go that way.

[sleemanj]

- The actual mining is used to confirm, or rather enable, any transaction
So, what happens when the last Bitcoin has been mined? No mining means no transactions

Thats why there are fees, if if the miner can no longer be rewarded with coins for the blocks they mine, they still get paid in fees.

Probably your question comes from a misconception, minors are not "creating coins" they are "creating blocks on the chain which include the transactions people want to put on the chain", they get some coin as a reward for doing that (and as a way to actually create bitcoin while that is necessary).

https://news.bitcoin.com/what-happens-bitcoin-miners-all-coins-mined/

[ebastler]

Probably your question comes from a misconception, minors are not "creating coins"

Sure hope so -- child labor is a disgrace! 

[EEVblog]

... if you want to be into crypto, then you have two options:
1) Buy and hold for the long term.
or
2) Day trade the volatility

It seems that the significant transaction costs, and hard-to-predict delays in getting a transaction processed, make option (2) less attractive in the case of Bitcoin?

No, it doesn't have to be.
Exchanges like Coinspot for example will trade instantly for you, but their fees are much higher.
You can also exploit arbitrage (the difference between prices on exchanges) and profit from buying on one exchange, transferring to another, and selling them instantly. This one does take time, but if the difference is big enough, it can be done. I've done it.

I am not sure whether these impediments on transactions are actually a good thing, because they serve as a "low pass filter" in a nervous market. On the other hand, a delay makes a feedback loop harder to stabilize -- which might apply also to the feedback loop of Bitcoin price vs. demand?
[/quote]

[nctnico]

If we present the value of the BC on a logarithmic scale, we are only one loop away from 100k
And some serious reports state it it might go that way.

That is hard to say. Maybe the ability to trade in Bitcoin futures with the blessing of the FTC has a stabilising effect on the price since people also have something to gain if the price goes down.

[Halcyon]

I just want to point out that I'm not specifically talking about Bitcoin, I think a lot of that is speculation and hype simply because it's been in the media. At it's current price, I'm staying away from Bitcoin completely.

My focus is on the other (technically better) currencies, Eretheum being the major one.

[CatalinaWOW]

One interesting thing about the Bitcoin phenomenon is how the bubble is developing based on enthusiasm by people who have no idea how it works, what it is about, what risks are or anything.

Other famous bubbles like real estate, tulips, gold and the like involved people who at least had some idea what they were buying.  They may not have known a lot, but they knew what the product was, had some idea on why it was rare or in short supply, and some clue about the intrinsic value (if any) of the product.

This forum includes people more likely to understand Bitcoin and it's issues than most others, and clearly it is no hotbed of understanding.  The people I find hyping Bitcoin on Facebook and other venues know exactly one thing - it has been going up, and they have been told it will keep doing so.  They have to do "research" to even find out how to buy it.  Have to do similar "research" to find how to sell it.  This is the purest form of speculation I have ever seen.

[ebastler]

If we present the value of the BC on a logarithmic scale, we are only one loop away from 100k
And some serious reports state it it might go that way.

But also, as Richard Feynman said (on a totally unrelated subject  ):
"There's plenty of room at the bottom."

http://calteches.library.caltech.edu/47/2/1960Bottom.pdf

[WastelandTek]

It's just a permissionless, censorship resistant payments layer for the internet, I mean, what could it really be worth?

[ebastler]

It's just a permissionless, censorship resistant payments layer for the internet, I mean, what could it really be worth?

Are you mixing up the value of the transaction system vs. the value of the tokens it acts on?
Even if bitcoins and blockchains are a great idea, how would that justify the inflated value of a bitcoin?

[WastelandTek]

"inflated"?

we shall see

[ebastler]

"inflated"?
we shall see

Yes, we shall.

You are missing the main point of my prior post, however: The mixup between the value of the concept, and the value of the particular token or currency. Way back when, the concept of "money" or "cash" was a great idea -- so much more convenient than directly exchanging goods, having to find a trading partner who had just what you wanted, and wanted just what you had... Revolutionary!

But did the value of that general idea and concept define (or even affect) the exchange value of the first coins that were introduced? Of course not. So I think your argument regarding the value of Bitcoin as a concept does not have merit in the discussion of the value (inflated or not) of a Bitcoin as a currency.

[paulca]

anyone can create a Cryptocurrency, whether it has any long-term viability is a different story.

Similar to Linux distros.

Individual Linux distributions maybe.  However the likes of Red Hat have been around for 20+ years and probably run on more systems outside of the desktop space than any other operating system.

Linux itself has been around for 25 years and is advancing rapidly each year.  Hold the vast majority out side of the desktop sector.  Practically runs the Internet.  It's ancestry (Unix) dates back to the 60s and pre-dates Windows considerably.

Besides, distro's are just like pre-rolled packaged cigarettes, there are ways with will and energy to break free from distros all together and roll-your-own. 

Personally I ran my own distro based on Linux From Scratch ( http://www.linuxfromscratch.org/ ) but while it is a great learning experience it becomes hard to maintain with regards to upgrades etc.  So after about 5 years I moved to a more managed version called "Gentoo".  I'm still there.  Still running the same install I did some 10 years ago just routinely tweaked and upgraded.

[sleemanj]

So legit question to those here who have some cryptocurrency, when did you last spend some on (not blackmarket) goods/services, indeed if you havn't, would you even spend some on goods/services or is that something you would regard as "selling an appreciating investment" and you would rather pay with your normal currency.

Is it worth your average online retailer of goods / services going to much trouble to accept cryptos, which ones, Bitcoin, Bitcoin Cash, Litecoin, Etherium.

Obviously using a gateway like coinpayments.net, gourl.io, bitpay.com etc makes the development effort and acceptance costs pretty minimal, but there is a load of accounting consideration and business logic that goes along with it if you want to be legal and at least try and keep a correct tax position about it so it's not necessarily just a "flick the switch" endeavour.

[CatalinaWOW]

Other famous bubbles like real estate, tulips, gold and the like involved people who at least had some idea what they were buying.  They may not have known a lot, but they knew what the product was, had some idea on why it was rare or in short supply, and some clue about the intrinsic value (if any) of the product.

That might be true. Instead I think they had both a fear of missing out and an unrealistic belief that someone just like them, but richer, will buy when they wish to sell.

Totally agree.  The difference I am pointing out is that in many other bubbles they had rational sounding arguments for why they were doing it.  Most jumping on the Bitcoin wagon are pure plays on what you describe.

[R005T3r]

Being a naturally conservative person, especially when it comes to money, I've been very sceptical of Crypto in the past but have recently moved over to the "believers" and indeed the "investors" camp, now that I can see the potential it has (if implemented correctly).

I don't own any Bitcoin, but I have just started investing in others (mostly Ripple, Ethereum and Litecoin).

I'd love to hear from those who have had a more experience than I do with Crypto, what lessons have you learnt so far? I mean, we'd all love to go back and invest in some Bitcoin a few years back, but that ship has sailed.

You use bitcoins to mask yourself in order to avoid questions, and disguise your transactions, not as an investment/speculation tool, it's insane to invest in such a volatile thing!

[mtdoc]

Don’t miss out. Even Australian pole dancers are on-board.

[NiHaoMike]

Don’t miss out. Even Australian pole dancers are on-board.

Interesting because my friend who sold me her Bitcoin miner (because she graduated and no longer had a use for it) used to do pole dancing and "live streams" as a job in college! (No, I didn't see any of that. I didn't even know she did it until I was looking for a Bitcoin miner because my cousin wanted one.) What's unusual about her is that she is not an engineer or mathematician like most Bitcoiners - she was a medical student.

[ebastler]

... my friend who sold me her Bitcoin miner (because she graduated and no longer had a use for it) ...

Because she had to pay for her electricity after moving out of the dorm? 

[NiHaoMike]

Because she had to pay for her electricity after moving out of the dorm? 

She was actually sharing a house with someone who turns the A/C way too low.  The Bitcoin miner kept her room warm enough for her to "live stream" in the evening and get more Bitcoin doing that. I think that's a very smart move because medical school (well, any college level education in general) is expensive.

[TerraHertz]

I'm not on-board with bitcoin or any other cryptocurrency. But not for the usual reasons.

I'd learned long ago that the existing national currency systems are entirely faith-based, the difference between specie-based currency vs fiat paper schemes, the long history of fiat currencies always eventually crashing to zero value, how the fractional reserve banking system is a wealth-theft scam run by the global elites, and so on. Basically we the people don't have anything that serves as a reliable, allodial (owned by holding it in your hand) store of wealth. Something that can't be taken away from you by the stroke of a government pen. (Which includes by inflation, that results from excessive creation of fiat currency, and is a deliberate, calculated form of asset theft from the people.)
Also the data tracking measures being built into the existing financial structure, the anti-cash push, and so on, pose a severe threat to individual privacy and freedom. Elimination of which is the deliberate underlying intent of the anti-cash push by many governments world wide.
Gold and silver can be used to convert fiat currency to a value store that can be kept and hidden long term, but they are still subject to a rigged-market price suppression scheme, in which large amounts of paper 'gold certificates' can be created out of nothing and dumped on the bullion markets to knock the spot price down as required by the banks. (Which is what happens all the time.)

Theoretically, cryptocurrency could solve many of the problems inherent in government-mandated fiat currencies. The intrinsic ceiling on the total number of bitcoins gives the currency some of the benefits of a true gold-backed paper currency (ie physical gold can't be created out of nothing in vast amounts, thus smashed in hyper-inflating worthlessness deliberately or otherwise.)
Cryptocurrency strengthens privacy and freedom, by allowing hidden yet reliable stores of value, and anonymous transactions.

In general I think cryptocurrency is a great idea. Not sure about the specific implementation though. The complexity and reliance on fragile computing/data stores is a definite handicap. Another severe problem is that virtually all existing computing platforms are riddled with back door access means installed by intelligence agencies in cooperation with the manufacturers, not to mention unintentional security holes.

In the early days of bitcoin I paid it some attention, considering whether to jump into it.

I decided not to, because:
* There were continual instances of large scale theft, scams and failures, demonstrating that it wasn't as 'secure' as claimed.
* I knew it could take off, and rise greatly in value. But also knew I'd never be able to predict the cycles, and so 'buy low sell high' isn't as easy as it sounds. (I already proved to myself I couldn't predict such things with gold and silver.)
* Cryptocurrency will definitely be fought against tooth and nail by governments. It is a direct threat to their power base, and to the Elites that operate governments as a control facade. There's no predicting how extreme official suppression measures may become. And I don't want to find myself a target of such measures.
* Most important reason: I already have a primary project, that deserves all my attention. I already don't have enough time and energy to give that. So I at least try to minimize side track projects. Bitcoin would easily consume a lot of time. Not just setting up a miner, but following the technical and political developments - several hours a day to stay in touch.

So I dropped my interest in it. Now rarely pay any attention. Take the current price spike with a shrug, much the same as with my mistake in not buying an Apple I board when they came out (currently would be worth about a million bucks.)

So today I will be working on building a side awning on a workshop, to get some large stuff out of a space that I need free, to set up a big old lathe I recently bought, to make some components for a vacuum system, that is part of 'that project'.
The recent bitcoin developments are interesting. But they are just one of dozens of fascinating and significant ongoing world developments, virtually none of which get any mention here in eevblog.

Edit:
Oh, ha ha, I popped into this thread to post this link, then forgot:
  http://www.zerohedge.com/news/2017-12-03/three-economic-eras-bitcoin
  The Three Economic Eras Of Bitcoin