BitCoin - A Decentralized Currency

What do you guys think?

added this to op.

Last Edited by Nyarlathotep on 01/18/2013 10:50 PM

Its value is driven by people's desire to trade drugs on the silk road. Without the silk road, bitcoins have little reason to exist.

However, the idea of a decentralized currency is on the right track. The more correct way to do it is to have city, state and national banks that create and destroy currency in a decentralized fashion by way of fractional reserve lending.

BTW, if you haven't watched it already, you should see the money masters:

same shit with blackmarket you can buy drugs, guns, and other illegal shit with bitcoin...

I've never had the inclination to look into BitCoin and how it works, but the idea is awesome - a peer to peer currency. Zero banking system involvement. Payments can't be shut down by oppressive regimes. It's attractive to the right wing and to the left wing. It's easy to set up and use. Looks good on screen.

When I do go and research it - and I will - there are a couple of key questions I will have in mind...

1. What determines the value of BitCoin? what is it backed by? Obviously not gold because there's no central issuing authority for BitCoin. If it's backed by the USD, Euro, GBP or Yuan then it's as susceptible to manipulation as those currencies are. And if that's the case, then why bother?

2. How do you redeem your BitCoins for hard physical currency? If it can't be redeemed for cash then it's not attractive to online retailers and service providers and it becomes little more than a barter token with no concrete value.

If the above questions can be answered satisfactorily, then there is a possibility that BitCoin, as a distributed currency, could be successfully used as the basis of a "shadow economy" operating in tandem with the traditional exploitative economy we have now, but unlike the traditional economy, profit is not the currency's reason for existing. It is for fair exchange between agreeing parties. No money market roulette and no interest accrued or payable - there's no need for that horseshit because there's no middleman to pay. This would be seriously limit the opportunities for TPTB to suck us dry.

Isn't that the same thing as the dollar? The dollar has no real backing. It rides on the peoples belief that is actually has worth. It USED to have worth when it was backed by gold/silver. So #1 makes no sense as we already see that currently.
The real kicker here is it can't be manipulated like our current system.

As for #2, there are digital currency exchanges. They even say it at the end of the video if you had watched it all the way through.

Last Edited by Nyarlathotep on 01/18/2013 08:28 PM

Maybe for now, but just wait until all the capital controls come down and massive sales taxes for anything on line. Bit coin or another alternative system like it will act as the blood for the black market system. Black market meaning even a damn loaf of bread mate.

.

I would use another word other than black market. I would say "alternative" market as that is exactly what it is.

People say over and over that the dollar 'has no backing' but it's a complete lie.

The dollar is backed by the fact that the govt can demand taxes be paid **in dollar terms**. This is what creates a demand for it.

Drug dealers on the silk road demand that you pay them in bitcoins. This is what creates the demand for bitcoins.

It's as black of a market as you can get. Why pussyfoot around the wording?

The basic kicker here is that this currency cannot be manipulated by governments or financial institutions.

I asked about bitcoins in here once and was banned!

Ok, I just wanted to get the idea across that what most of us take for granted today, being able to buy pretty much whatever we need or want at a store or online may one day not exist. Or at least not exist in the form of paying low taxes on the transaction.

The world is swimming in debt, it is only getting worse, they will print more debt keep their toxic system alive and in an attempt to justify their madness they will try to collect more taxes for just about everything we do. In that environment having a currency or medium of exchange that is not traceable is as valuable as well, gold.

.

That's odd. Hrm, any mods have a reason for this?

Could be before, but now I hear people talk of bitcoin in academic circles. Word is getting out.

"A black market or underground economy is the market in which illegal goods are traded". While this is true, we also see legal goods being purchased with bitcoins all the time. I think I was just trying to point out that the term black market tends to shadow the good intentions of the currency itself. People buy and sell illegal items all the time with USD all the time... it just doesn't fit the criteria of underground

Untrue. Fractional reserve lending can be used to manipulate the prices of anything. It's just that there isn't any significant FRL of bitcoins right now.

Bitcoins are more sound than most fiat currencies including the USD. Why you ask because the rate of inflation is fixed from the start and they use strong encryption which cannot be counterfeited.

Bitcoin is an actively traded currency on many markets along side other currencies of the world.

see [link to bitcoincharts.com]

see [link to mtgox.com]

Int._Vol.BTC____Vol.USD_______Weighted Price 1BTC
30d 863,119.17 12,067,746.43 13.9816
1y 18,244,369.03 145,270,137.48 7.9625

Hopefully we will see a ramping up of this. I have always preached that to centralize power is to invite centralized corruption and poisoning of the well so to speak.

By that thinking there are no black markets anywhere since any black market will also have some white market items floating around in it too.

I have a feeling you've never even been to the silk road and that's why you basically don't know what you're talking about.

Thanks for the the info AC :)

The real power of fractional reserve lending lies in legal tender laws. Via those laws the banks get implicit government backing for deposits and loans they have made (now investments in securities).

I am a hard core sound money enthusiast, but I see no problem whatsover with FRB as long as banks don't have backstopping by our government, that leads to massive fraud and racketeering sort of like our current financial system at large.

.

Assuming makes an ass out of you and me ;) You act as if I have never been on the Tor network and I apparently don't have any chance of knowing the url to the HiddenWiki. :)

What I was trying to say is, it isn't the intention of the currency and to label it a black market currency is false. Sure, its used by a black market but its also used in the surface web as well. I can give you numerous websites that use it.

for further conversation

I think in the near future we will see bitcoins in use for buying and selling precious metals, as there is no paper trail. Maybe a large percentage of PMs already sell in bitcoins, I don't know for sure but I think its coming.

.

Enthusiastic

Bitcoin For Dummies:

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

Bitcoin works by an emergent synergy of cryptography, peer-to-peer, anonymity, anarchism, libertarianism, wasting stupendous quantities of electricity, the marketing department at NVidia, the enduring exchange value of tulip bulbs and doing all of this instead of Folding@Home.

Bitcoin successfully harnesses a hitherto-unexploited Internet resource: the vast reserves of unexamined privilege amongst computer programmers. Coins are "mined" by stealing them from people who are able to comprehend this level of computer science but still keep their Bitcoin wallet in plain text on a Windows machine.

The Bitcoin system is robustly designed to continue past the collapse of the US dollar and the world economy, as the Internet, fast computers and reliable electricity are all expected to be readily available when barbarian hordes are wandering the burnt-out post-apocalyptic remnants of civilisation.

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

Many common products are still inexplicably not purchasable with Bitcoins. "It's as if they don't understand the revolutionary wonder of Bitcoin," says Debian developer Hiram Nerdboy, 17. "I can't get chicks with Bitcoins either. Even with my slickest Pick-Up Artist techniques! It's as if my knowledge of economics and game theory didn't apply to real life. But that's impossible, of course. They're probably just theists. Hold on, I just gotta post to Slashdot about this."

Bitcoin was invented by Internet libertarians, in the spirit of freely-chosen individual interpersonal interactions that will bring about the utter collapse of the oppressive taint of the dead hand of government, in order to make money at your expense.

Shill.

/

?

What's the problem, slave?