Bitcoin Discussion Thread Part 2

Kettchxxii said:
So tradehill justed killed Dwolla completely off. I have been going the BTCguild > Tradehill > Dwolla > Bank account route and am wondering which route to take now...

I hear terrible things about paxum and really don't want to deal with setting everything up again. Looks like they will mail out checks for free. 5 Business days... Ideas?

also, 12.2 per coin makes my dual 6990s sad :( Think that the downward price is due to the changes at tradehill?
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MTGox>Dwolla>Bank is how I was doing it. I'm now just getting Amazon gift cards on spendbitcoin.
 
Well even though tradehill took away dwolla for withdraws, they will now mail you a check if you live in the US for free.
 
Wow it surprises me that the Gox exchange rate is so low when they are one of the only remaining sites to keep using dwolla. Would think people from TH would move over.

I was thinking about going further in, by $800. But at $11.5 I don't think it's worth it. I know it will probably come back but I'm going to have to watch it for a few more days and hope it levels back off at $13.5+.
 
The US has over 8,000 tons of gold in reserve. I find almost all of your comments useful and constructive and I find no fault with any of you for partaking in this bizarre hobby. I just don't understand how in the world something like this could ever be started and was hoping for a logical explanation. Since none can be found, I'm fine just calling it the next Beanie Baby as Parja pointed out. Kudos on your free cash, I think I'll stay out of the arena. Thanks to the helpful people and to those of you who would rather mock and scoff than contribute to an informational request, it's been nice meeting you.
 
kevineugenius said:
The US has over 8,000 tons of gold in reserve. I find almost all of your comments useful and constructive and I find no fault with any of you for partaking in this bizarre hobby. I just don't understand how in the world something like this could ever be started and was hoping for a logical explanation. Since none can be found, I'm fine just calling it the next Beanie Baby as Parja pointed out. Kudos on your free cash, I think I'll stay out of the arena. Thanks to the helpful people and to those of you who would rather mock and scoff than contribute to an informational request, it's been nice meeting you.
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Someone can correct me if I'm wrong, but just because the gov't (and I think the federal reserve has it actually) has gold doesn't mean our currency is backed by it. It's actual fact that it is not.

Tell me why gold has value then? It's the same question you ask about bitcoins. It has value because the people trading with it determine the value.

And I think if you wikipedia bitcoins you will get the supposed "origin story" as to why it was created. I believe it was something to do with creating a currency that was decentralized and had no one method or one entity in control of it. Something like that.
 
Bitcoins have value because of a perceived future value. If everyone knew that bitcoin would be worthless in 5 years, the value would plummet in short order. The value of bitcoin is based on the utility of it in the future. Every time some new entity starts dealing in BTC, the faith in the longevity of the currency improves. If the methods of keeping and transacting BTC is valuable to the market, then the currency will retain value.

Because there is no single entity that stands behind a bitcoin, it is sort of like cloud money. It is very analogous to the value of gold in ancient times. Gold had practical value then only for decorative purposes, but it retained value because it could be quantified. You could easily test gold and determine it's purity and authenticity, so it became the standard baseline for value.

I'd say there's a good chance that a bitcoin will have value in 10 years, but I'm not betting my retirement on it. It represents a way to make money with a hobby and at least get some shiny new computer parts even if the value flops by Christmas.
 
kevineugenius said:
The US has over 8,000 tons of gold in reserve.
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The US also has over 150 billion barrels of oil in reserve.

It does not back the dollar.

Nor does gold.

Do your homework, realize you don't have a fucking clue what you're talking about, and shut the hell up.
 
A couple quick points. Not trying to respond to the troll but just push the actual conversation along.

As I understand it currency has two primary functions; store of value and means of exchange.

I personally doubt that BTC are a very good store of value, I expect their exchange with other currencies to be quite volatile.

As a means of exchange however...a fully digital open source currency whose supply is not controlled by a government or corporation and is secured by the largest distributed computing project ever? What, exactly, is not to like?
 
jojo69 said:
As a means of exchange however...a fully digital open source currency whose supply is not controlled by a government or corporation and is secured by the largest distributed computing project ever? What, exactly, is not to like?
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The fact that so many people don't understand it?
 
kevineugenius said:
The US has over 8,000 tons of gold in reserve. I find almost all of your comments useful and constructive and I find no fault with any of you for partaking in this bizarre hobby. I just don't understand how in the world something like this could ever be started and was hoping for a logical explanation. Since none can be found, I'm fine just calling it the next Beanie Baby as Parja pointed out. Kudos on your free cash, I think I'll stay out of the arena. Thanks to the helpful people and to those of you who would rather mock and scoff than contribute to an informational request, it's been nice meeting you.
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If you really want to know how paper money works, why it's a screwed up system, and why people would want to move toward a different method of exchange then watch
Money as Debt.
 
jojo69 said:
As a means of exchange however...a fully digital open source currency whose supply is not controlled by a government or corporation and is secured by the largest distributed computing project ever? What, exactly, is not to like?
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Explain to me how I would pay a street vendor to buy a hotdog from him with bitcoins?
 
danman said:
Explain to me how I would pay a street vendor to buy a hotdog from him with bitcoins?
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Ok, exchange a bitcoin fraction into your local currency and go buy your hotdog.

Anything else? Same way you don't go to a street vendor in, lets say, the US with a Yen, you do not go to one with a bitcoin.
 
danman said:
Explain to me how I would pay a street vendor to buy a hotdog from him with bitcoins?
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Using your mobile phone?
I can buy stuff out in the middle of the woods from people with an android/iphone and a bluetooth credit card reader.
 
Cant quite figure out why its so hard for people to grasp the concept of a non-physical currency.
Its no different than any other way you buy stuff on line..

bitcoin just sometimes require 1 extra step to convert to cash before you can spend it unless the seller accepts BTC directly.

Would this make you feel better?
Physical coins?
http://cgi.ebay.com/ws/eBayISAPI.dl...ory=3361&_trksid=p5197.c0.m619#ht_1207wt_1076
 
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You don't even need to convert bitcoins to any fiat currency. I have sold and bought many things using nothing but bitcoins. My triple monitor stand should be coming in before the end of the week (bought with bitcoins), a trio of HD6950s(bought with bitcoins), then I re-sold them all for bitcoins. I did cash out initially 'cause I was very paranoid about them losing value (not to mention getting extremely lucky being at the right time during the ~$30 peak), but every coin that I've mined since cashing out $1k (about a month or so ago) has been put to work as if it were currency.
 
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Lorien said:
You don't even need to convert bitcoins to any fiat currency. I have sold and bought many things using nothing but bitcoins. My triple monitor stand should be coming in before the end of the week (bought with bitcoins), a trio of HD6950s(bought with bitcoins), then I re-sold them all for bitcoins.
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Where are you buying from? Bitcoin forums? BTC just fell to 11.8 :(, hopefully they hit $17 or so sometime soon so I can sell.
 
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Spendbitcoins.com uses a 24 hour weighted average to buy bitcoins from you. If the market starts dropping I can quickly sell em there and not lose as much. I technically haven't really lost anything since my initial costs were literally $0, all I've had to pay is the electricity to run the hardware I already had since I started.

Right this minute they are paying $12.32 per coin and the best price at mtgox is 11.82, it doesn't take a genius to figure out the rest, and Amazon gift cards never expire.
 
Lorien said:
Spendbitcoins.com uses a 24 hour weighted average to buy bitcoins from you. If the market starts dropping I can quickly sell em there and not lose as much. I technically haven't really lost anything since my initial costs were literally $0, all I've had to pay is the electricity to run the hardware I already had since I started.

Right this minute they are paying $12.32 per coin and the best price at mtgox is 11.82, it doesn't take a genius to figure out the rest, and Amazon gift cards never expire.
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So are you saying we should Sell Sell Sell :D

I honestly doubt that they will get back up to $17+ since we haven't seen that for around 2 months. It has stayed level in the 13s for a good 3 weeks so I'm just hoping to stay there. Any more is a perk.

If you look at what the USD did today on the stock exchange, the graph looks almost identical to the mtgox 24 hour graph. Thought it kind of interesting since BTC is supposed to be a new form of currency, unrelated to USD.

I'm $0 in, other than the electricity, So whatever comes in is pretty much free spending money. If it all crashes down right now I would be really sad :( but it doesn't really effect me that much. I'm now in a dilemma where I want to bring more online but not sure if it's worth it.
 
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I, for one, welcome a shakeout. I pay quite low power rates in my location, lower prices and higher difficulty will push more marginal operators out of mining.

The only threat I can really see to bitcoins' continued existence is a similar but corporate sponsored currency...sad would not be the word...heartbreakingly tragic...

I suppose It could be supplanted by a similar open source project that incorporates further refinements identified by bitcoins' run, that would be OK, but I think the real threat is the former. Typical coporate MO once they determine they can't crush something is to co-opt it.
 
Lorien said:
You don't even need to convert bitcoins to any fiat currency. I have sold and bought many things using nothing but bitcoins. My triple monitor stand should be coming in before the end of the week (bought with bitcoins), a trio of HD6950s(bought with bitcoins), then I re-sold them all for bitcoins. I did cash out initially 'cause I was very paranoid about them losing value (not to mention getting extremely lucky being at the right time during the ~$30 peak), but every coin that I've mined since cashing out $1k (about a month or so ago) has been put to work as if it were currency.
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So you exchanged your bitcoins to another person who cashed them in for US dollars who then gave you a gift card in return? That's not buying physical goods with bitcoins.

Today - I lose my wallet in the street. It gets stolen - I cancel all my accounts and move on. I'm not liable for anything.

With Bitcoin- I lose my wallet / hacked and it gets stolen and I'm screwed. No recourse at all. I just complain on a forum. Like the dude who got hacked out of a thousand or so.
 
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danman said:
Today - I lose my wallet in the street. It gets stolen - I cancel all my accounts and move on. I'm not liable for anything.
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Wrong, you lose all the cash in it. That's the equivalent to losing your bitcoin wallet. There is no equivalent to a bank account for bitcoins except from services offered by third parties.

With Bitcoin- I lose my wallet / hacked and it gets stolen and I'm screwed. No recourse at all. I just complain on a forum. Like the dude who got hacked out of a thousand or so.
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The only way to lose your personal wallet is if your PC gets hacked and that's your own fault for not protecting it properly. It's like leaving a post-it note with the combination of your safe deposit box taped to the door and blaming the manufacturer for losing all that was inside of it. And if you entrust your coins to a third party wallet service and it gets hacked it is also your fault for not being aware of the risks. It's like handing all your cash to a gasoline station and thinking that money would be safe from robbers.

As for the liability part, well no shit, bitcoins are not a federally regulated currency so there is no insurance whatsoever nor there was any for the USD until the last great depression.
 
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danman said:
Uhh, you'd be in Mexico so just use your cash?
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Danman are you really this thick headed? I used the same exact concept as you. You just need to exchange one form of currency for another. CAD for USD. Same exact freaking thing...geez.

Edit: I think we may be feeding a troll tbh.
 
EdGaRRRRR said:
Danman are you really this thick headed? I used the same exact concept as you. You just need to exchange one form of currency for another. CAD for USD. Same exact freaking thing...geez.

Edit: I think we may be feeding a troll tbh.
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Someone needs to feed em a hotdog paid for by Bitcoin so he'll shut up, lol

As proof of concept.. I will accept 1 bitcoin and I will ship you 1 package of hot dogs and buns..
 
danman said:
Today - I lose my wallet in the street. It gets stolen - I cancel all my accounts and move on. I'm not liable for anything.
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Today - If you lose your wallet, you're opening yourself to identify theft. Feeding the troll my 2 cents.
 
traderj said:
So are you saying we should Sell Sell Sell :D

I honestly doubt that they will get back up to $17+ since we haven't seen that for around 2 months. It has stayed level in the 13s for a good 3 weeks so I'm just hoping to stay there. Any more is a perk.

If you look at what the USD did today on the stock exchange, the graph looks almost identical to the mtgox 24 hour graph. Thought it kind of interesting since BTC is supposed to be a new form of currency, unrelated to USD.

I'm $0 in, other than the electricity, So whatever comes in is pretty much free spending money. If it all crashes down right now I would be really sad :( but it doesn't really effect me that much. I'm now in a dilemma where I want to bring more online but not sure if it's worth it.
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I like to sell at least 1 BTC/ day (just averaging out and make sure I am pulling some money out regularly.) Tried to sell over the past hour and it was scary. Prices are not doing that well today.

Edit: BTW does anyone else foresee Lorien writing a book or PhD thesis on currencies in the near future?
 
pjkenned said:
Edit: BTW does anyone else foresee Lorien writing a book or PhD thesis on currencies in the near future?
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hardly.. its econ 101 stuff.

The problem with what Lorien is saying (in my mind) is that right now the only reason people have bitcoins is an arbitrary mining process and an arbitrary guy who wrote some arbitrary program is sending out these random hashes and people are basically getting paid for it. Right, so compare that to what the government does: arbitrary printing of pieces of paper right? wrong: the government is powerful enough that if shit really hit the fan, they'd send in tanks and fix the problem. Thats what "faith" in a government currency is: that they're powerful enough to fix problems that would undermine their ability to pay debts and protect the assets of those who hold their currency. So how does that apply to bitcoins? well, it doesn't. Someone DDoS a bitcoin exchange and nobody does anything, somebody DDoS' the NYSE and takes it down there'd be hell to pay.
Also, I understand that theres little exchanges that will do BTC to USD and allow you to buy stuff from big name retailers.. but that money is still going to them as USD and until retailers are willing to do transactions in BTC, BTC is depending very very heavily on a market supported by a few markets that are unregulated. Its still susceptible to people dumping reserves on the market very fast... its probably doubly true because most producers are cashing out directly, so the exchanges or a few individuals are hoarding btc
 
Activate: AMD said:
hardly.. its econ 101 stuff.

The problem with what Lorien is saying (in my mind) is that right now the only reason people have bitcoins is an arbitrary mining process and an arbitrary guy who wrote some arbitrary program is sending out these random hashes and people are basically getting paid for it. Right, so compare that to what the government does: arbitrary printing of pieces of paper right? wrong: the government is powerful enough that if shit really hit the fan, they'd send in tanks and fix the problem. Thats what "faith" in a government currency is: that they're powerful enough to fix problems that would undermine their ability to pay debts and protect the assets of those who hold their currency. So how does that apply to bitcoins? well, it doesn't. Someone DDoS a bitcoin exchange and nobody does anything, somebody DDoS' the NYSE and takes it down there'd be hell to pay.
Also, I understand that theres little exchanges that will do BTC to USD and allow you to buy stuff from big name retailers.. but that money is still going to them as USD and until retailers are willing to do transactions in BTC, BTC is depending very very heavily on a market supported by a few markets that are unregulated. Its still susceptible to people dumping reserves on the market very fast... its probably doubly true because most producers are cashing out directly, so the exchanges or a few individuals are hoarding btc
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TL;DR, but skimmed
But just wait till the day the Gov figures out a way to tax BTC.. Then you will have your "Tank" coverage, lol
 
Anyone know what's with the massive drop.. Sunday morning we hit 14.70, now in the single digits.. what gives?
 
Yeah I saw the prices. I havent mined in a while, but Ive got 9 or 10 bitcoins I've been holding onto waiting on the right price. I was a bit disappointed, though not surprised, to see the big drop. I only put about $10 into mining all told so I'd still be up about $70-$80 if I sold right now. Better than nothing.
 
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