Study Shows 45% of Bitcoin Exchanges Fail

CommanderFrank

CommanderFrank

Cat Can't Scratch It
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A new study reported by Wired shows that almost half (45%) of all Bitcoin Exchanges fail from various causes and 30% fail after only one year of operation, often leaving Bitcoin owners holding the empty bag.

An exchange needs to maintain a transaction volume above a certain level to survive, but becoming large enough to survive also makes a hack of that exchange worthwhile for cyber attackers.
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Because it's full of idiots who think they can become Bitcoin bankers.
 
Meh, Bitcoins...there are so few people who use them for anything legal anyway that if an exchange fails, that just means fewer people can get illegal types of porn without being traced.
 
I can't help suspecting the whole Bitcoin business is a big scam that will eventually end up burning people who get involved.
 
News releases like this will be coming constantly while big $ speculators pump the market.

You can make money if the price goes down, or up. But you can't make money if the price is stable.

It's not a currency, it's a tulip bulb.
 
i always hear about bitcoin this and that in the news but still have no idea wtf it is.. lol
 
Techx said:
i always hear about bitcoin this and that in the news but still have no idea wtf it is.. lol
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Look it up... it's a virtual currency.

CreepyUncleGoogle said:
Meh, Bitcoins...there are so few people who use them for anything legal anyway that if an exchange fails, that just means fewer people can get illegal types of porn without being traced.
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I was under the impression the major use for bitcoins was mail order marijuana (or other illicit substances) operations.

michael.pa2 said:
I can't help suspecting the whole Bitcoin business is a big scam that will eventually end up burning people who get involved.
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Speaking of which (see above), I seem to recall the last virtual currency used for this type of stuff (I think it was called e-gold or something like that) went down in flames too. Think in that case, there was a single "bank" or controller of the currency, and they got caught up in a massive child porn sting if I recall correctly. Don't think they were actually involved in the business, but their currency was used in the trade.

I don't doubt the government will find a similar way to put pressure on the bitcoin exchanges, possibly shutting (some) of them down.
 
Techx said:
i always hear about bitcoin this and that in the news but still have no idea wtf it is.. lol
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As much as I'd like to think I have a pretty firm grasp on the concept and such, then I hear about mining and then I'm in the same boat as you brother.
 
Right now. Today. You can make big bucks on Bitcoin.

In 10 years, nobody will remember it.

Like the Pyramid Clubs.
 
eh -- scam or no scam - I've invested zero dollars into it when it comes to hardware or buying the coins themselves.

factor out electricity and I'm probably +2000 dollars over the past 1.5 years. Had I had perfect market knowledge I'd be sitting at about 100K if I'd have started mining Litecoin much much sooner.

People lose money when they do stupid things -- like take real money that could be used on your childs college, or to pay off your car or house and "invest" it in bitcoin. I've lost no money because I put none into it, just made the right decisions at the right time and you will profit in the long run. Thinking you are going to become some sort of millionaire in a few months is a pipe dream.

Just like the real world the only people making tons of cash are the people that already control large portions of said cash. All that being said I'm happy to have an extra 200 or so dollars a month for doing jack squat.
 
Phoenix333 said:
Virtual money is worthless money.
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All money is worth only what people say it's worth. Money is faith in value; it doesn't matter what form it takes even if the inherent value of the money such as bitcoin is 0. All you have to do is observe what brazil went though to end their days of hyperinflation to understand this. Money is faith in value problem with bitcoin there is no say like government or entity to assure people of it's value. And bitcoin doesn't have any inherent value at it's base so it's very hard to assure stability.
 
I have no love for competing currencies. The more popularity bitcoin gains, the swifter the US gov't will destroy it.
 
Money is backed by natural resources (commodities) like gold, oil etc. Tangible goods.
Digital Currency is worthless. If money totally disappeared this moment, we will trade gold, oil rice, wheat, cattle etc. as a form of money.
 
Semantics said:
All money is worth only what people say it's worth. Money is faith in value; it doesn't matter what form it takes even if the inherent value of the money such as bitcoin is 0. All you have to do is observe what brazil went though to end their days of hyperinflation to understand this. Money is faith in value problem with bitcoin there is no say like government or entity to assure people of it's value. And bitcoin doesn't have any inherent value at it's base so it's very hard to assure stability.
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At this point, you're just arguing semantics with the burning chicken.
 
WorldExclusive said:
Money is backed by natural resources (commodities) like gold, oil etc. Tangible goods.
Digital Currency is worthless. If money totally disappeared this moment, we will trade gold, oil rice, wheat, cattle etc. as a form of money.
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WAS backed by natural resources.

That hasn't been in quite some time to be honest.
 
The US dollar is not backed by gold.. but it is backed by the US economy and government. Which is more than nothing, and much more than bitcoin
 
WorldExclusive said:
Money is backed by natural resources (commodities) like gold, oil etc. Tangible goods.
Digital Currency is worthless. If money totally disappeared this moment, we will trade gold, oil rice, wheat, cattle etc. as a form of money.
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All of them are backed by the faith those commodities are worth something now and will be worth something in the future. I have zero bitcoins and have never gotten into it, but even so, I can see it's as much a currency as any other that is out there these days. Its backing is trust in the deterministic nature of its supply, decentralization, and electricity invested in the network. I don't expect it to be around for many years, but I also don't think it's as easily written off as you would make it.

Gold, oil, etc are all worthless in a famine. They have no more value than what people are willing to trade for them, and to say anything not backed by such commodities does not qualify as "money" is ... well, odd.
 
I think the US dollar is a great example of why bitcoin can work. The US dollar is now backed by nothing but the faith that the US government will not screw it up and the faith that the US economy and people will keep going as they have.

We have seen many of the worlds currencies fall or need to be heavily adjusted. Gold the "standard" is really no better than bitcoin, its actually use is only in small electronics etc... The reason people use it for jewelry is all completely phychological, in fact its so phsychological that in many developed nations are gold jewelry is nothing like pure gold now, lol we don't even think gold is attractive, we dope it with metals to make it while then coat it in rhodium. People just think its worth something because that's what other people tell them.

IMO bitcoin isn't that far off gold, it has a finite amount, it has a small use, in trading for illegal goods and services and it has a ton of speculators.


There is only 1 good argument I have ever heard against bitcoin, that is that because it is in finite supply and will always deflate, it is not good for economies because people are encouraged to always hold bitcoin rather than use it. And eventually it will come in too short of supply and competitors like litcoin will have to be used.

IMO oil is the only good commodity, maybe food but its temporary. You cant keep your house warm with gold, but with oil you can run a nation. Its energy and that has real value unlike almost any other product.
 
CreepyUncleGoogle said:
At this point, you're just arguing semantics with the burning chicken.
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I am not a chicken, nor am I always on fire. I only do that when I get old and need to die again. I must notice though that Semantics arguing semantics with a mythological creature is a great example of a completely irrational improbability. That's almost as good as a causality paradox, but not quite. :p
 
All money is a "shared delusion", as some bankers have described. As long as both sides of the transaction treat money as having a value, then it has a value. If you go to a country where no one accepts that currency, then in that specific instance, it has no value.
 
Phoenix333 said:
I am not a chicken, nor am I always on fire. I only do that when I get old and need to die again. I must notice though that Semantics arguing semantics with a mythological creature is a great example of a completely irrational improbability. That's almost as good as a causality paradox, but not quite. :p
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Your continuing efforts to deny that you'd make a great sammich is frustrating my desire to have a giant, self-grilled chicken sub. :(
 
ballistic90 said:
All money is a "shared delusion", as some bankers have described.
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The problem with bitcoins is, 1) it has surpassed dollars in shadiness (something people didn't think possible), corruption (handled by a few bankers that wont ever face criminal convictions probably puts it on the same level as a dollar, though bitcoin banks have had a bunch of trouble. Also on a similar note real banks can have their money stolen by a gunman and it's insured by the federal whatevers, and your money is safe, a bitcoin bank has its coins stolen and you're fucked) and instability (a dollar goes up and down a bit vs. other currencies, bitcoins are more stock market, which might be good for "investors" and short term, but it wouldn't be a good currency to have your savings in or your main money in "Hey I got 100 coinz the month, but my payments are $10000 and coinz are not worth $3...")..and 2) if the power goes, the whole scheme is gone.

There might be a need for a better currency, but the bitcoin thing is worse than what is already here. If people didn't make money off it they'd probably be more willing to see how crap it really was.. :p
 
DeathPrincess said:
The problem with bitcoins is, 1) it has surpassed dollars in shadiness (something people didn't think possible), corruption (handled by a few bankers that wont ever face criminal convictions probably puts it on the same level as a dollar, though bitcoin banks have had a bunch of trouble. Also on a similar note real banks can have their money stolen by a gunman and it's insured by the federal whatevers, and your money is safe, a bitcoin bank has its coins stolen and you're fucked) and instability (a dollar goes up and down a bit vs. other currencies, bitcoins are more stock market, which might be good for "investors" and short term, but it wouldn't be a good currency to have your savings in or your main money in "Hey I got 100 coinz the month, but my payments are $10000 and coinz are not worth $3...")..and 2) if the power goes, the whole scheme is gone.

There might be a need for a better currency, but the bitcoin thing is worse than what is already here. If people didn't make money off it they'd probably be more willing to see how crap it really was.. :p
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But in many countries nothing is backing your money in a bank, and even then you have all sorts of issues, you cant back millions of dollars. Even in the USA not all banks are backed, and some claim to be but are not. The US dollar and Japanese yen all waver in value, but as more people use the currency it matters less, if a USD is worth 1 snickers bar today it probably will be tomorrow, now if you switch your USD out for yen today then try to switch them back and buy a snickers bar tomorrow it might not work. Internal stability is not the same as external stability. Plus as more people get into BTC then it becomes more stable as speculators and lone individuals can have less of an effect, same with exchanges, if one gets hacked and there are many others that are fine the swings are less pronounced.
 
rudy said:
But in many countries nothing is backing your money in a bank, and even then you have all sorts of issues, you cant back millions of dollars. Even in the USA not all banks are backed, and some claim to be but are not. The US dollar and Japanese yen all waver in value, but as more people use the currency it matters less, if a USD is worth 1 snickers bar today it probably will be tomorrow, now if you switch your USD out for yen today then try to switch them back and buy a snickers bar tomorrow it might not work. Internal stability is not the same as external stability. Plus as more people get into BTC then it becomes more stable as speculators and lone individuals can have less of an effect, same with exchanges, if one gets hacked and there are many others that are fine the swings are less pronounced.
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So you are suggesting swapping one broken currency for another more broken currency that might possibly become almost as broken as the current system in the future? Pretty much swapping a crappy universally accepted unbacked insured (if stolen) fairly stable currency with an even more crappy unbacked uninsured (if stolen or whatever) unstable currency accepted by a few things, that's currently run by a few (often shady) people with no legal accountability.

What is my motivation in this next scene unless I'm making money from it?
 
Had to use bitcoin for a payment...

oh.....my......hell.....what a freaking nightmare. The loops I had to go through in order to buy just ONE bitcoin was absurd.

Two exchanges, five payments, two "reversals", a few phone calls, dozens of emails because the exchange f'd up.

If I can pay through another method, I will.
 
DogChainX said:
Had to use bitcoin for a payment...

oh.....my......hell.....what a freaking nightmare. The loops I had to go through in order to buy just ONE bitcoin was absurd.

Two exchanges, five payments, two "reversals", a few phone calls, dozens of emails because the exchange f'd up.

If I can pay through another method, I will.
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People said/say the same thing about paypal.
 
rudy said:
People said/say the same thing about paypal.
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Comparing my use of paypal and bitcoins...I'd say bitcoin exchange was definitely a LOT more hassle than paypal.

Paypal was a few steps. Bitcoin was a couple dozen (with lots of problems along the way).
 
Phoenix333 said:
Virtual money is worthless money.
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all money is virtual until it comes out of an ATM... banks money is pretty much all virtual, numbers going all over the inter tubes.. this is why banks would crap themselves if every person went to withdraw all of their money from banks.
 
It's not functioning very well as a currency because too many people think hoarding them until the price goes up is the best strategy. rofl
 
CreepyUncleGoogle said:
I don't seen a best if used by date on you anywhere so I'm okay with panini chicken. :D
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Well let's see... if you can get past my 8" razor sharp talons, beak that can crush a 4x4 wooden post, lightning fast avian reflexes, 10x visual acuity of a human, ability to turn completely invisible and to disguise myself in other forms, ability to haul a human up to about 10,000 feet with ease and drop him if I like, fire I can summon at will that can incinerate just about anything, not to mention the fact that I'm immortal and pretty much invulnerable to harm until it's time to burn and regenerate myself... Did I mention I stand about 5' tall at the shoulder when standing level? I'm not a small, dainty little bird you know.

Of course... that's assuming you don't run into a few very loyal human friends, one of which is armed with military-grade weapons, has three different forms of martial arts training, and is a superb marksman. Another is a tax expert. I'm not really quite sure which one is more dangerous.

Anyway... get through all that, then you might have a shot at a Phoenix sandwich. Others have certainly tried, but I'm still here. You might want to stick to actual chicken. Don't say I didn't warn you. ;)
 
DogChainX said:
Comparing my use of paypal and bitcoins...I'd say bitcoin exchange was definitely a LOT more hassle than paypal.

Paypal was a few steps. Bitcoin was a couple dozen (with lots of problems along the way).
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My point is that when services are young and not widely accepted they are more difficult. Who can forget the early days of paypal where you had to set up an account, link it to your bank account, send in money, wait days for it to be in your account etc... Then there were all sorts of things most people did not understand like getting verified etc... Didn't they even run a money market account where they lost money once and took our money away.
 
rudy said:
My point is that when services are young and not widely accepted they are more difficult. Who can forget the early days of paypal where you had to set up an account, link it to your bank account, send in money, wait days for it to be in your account etc... Then there were all sorts of things most people did not understand like getting verified etc... Didn't they even run a money market account where they lost money once and took our money away.
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Good point. Paypal wasn't easy to use at first. Bitcoin wasn't easy either, but with so many varied ways to get bitcoins and the complicated steps to get one, its going to have to restructure/standardize in order to compete with payment services like Paypal/Amazon/etc.
 
Phoenix333 said:
Well let's see... if you can get past my 8" razor sharp talons, beak that can crush a 4x4 wooden post, lightning fast avian reflexes, 10x visual acuity of a human, ability to turn completely invisible and to disguise myself in other forms, ability to haul a human up to about 10,000 feet with ease and drop him if I like, fire I can summon at will that can incinerate just about anything, not to mention the fact that I'm immortal and pretty much invulnerable to harm until it's time to burn and regenerate myself... Did I mention I stand about 5' tall at the shoulder when standing level? I'm not a small, dainty little bird you know.
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See I'd just drug some birdseed and scatter it around...
 
Qinsp said:
Right now. Today. You can make big bucks on Bitcoin.

In 10 years, nobody will remember it.

Like the Pyramid Clubs.
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Nothing new.

If you want to see a real ponzi scheme in operation check he federal reserve and fiat currency.

Paper money is "virtual currency" in the same sense because it is NOT backed up by really money like gold or other precious metals. It's only value is what the reserve says it has.
The entire world runs on it.
Like all Ponzi schemes there will eventually be a collapse then the currency will be worthless.
 
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