Bitcoins As A Medium Of Exchange

[Naam]

As Nigel Farrell quite rightly said...

who or what is Nigel Farell?

[Naam]

I do take a bit of an offense at the "Nigerian scam".

suit yourself

[Naam]

But of course the detractors don't understand or bother to even to try to understand it. But thats ok because everytime there is a game changer technology it usually leaves alot of people in the dust.

How many of us here actually realized some of the big game changing technology in the past like search ads (google), facebook, digg, reddit etc (social), napster, bittorrent (digital distribution), mobile applications (apps!), Steam (gaming), VOIP, etc etc.

facebook et al did not leave me in the dust (last time i checked) and now i'm wondering who these "alot" [sic] people are who were left in the dust. did 'alot' of people who did not invest 'alot' of money in the afore-mentioned innovations lose 'alot' of money? if the answer is no, why were they left in the dust?

[Naam]

Are you buying any then Midas?

let me answer for Midas. no, he won't. Midas is too busy pursuing his noble crusade against those in power cheating us all. in a way he is right and his cause/intentions are indeed noble (neither meant in a derogatory nor sarcastic way). unfortunately his crusade or rather his hope that the system(s) change(s) are as hopeless as would be the attempt to get rid of all cockroaches on this planet.

cheating politicians, banksters and the like are here to stay as are cockroaches. best what one can do is trying to outsmart them for personal gain which in turn makes the outsmarting easier. acting like Don Quijote de la Mancha is a waste of time and mental resources.

:jap:

[monekyface]

"important is that using hawala or its "siblings" one deals with "tangible" natural persons on each end."

these are good points- that people are real, governments are real, banks are real. there are people to be held accountable in these instances. but when these institutions get so powerful that accountability has evaporated then where is the benefit? lots of people would like to wring Ben Bernanke's neck because his QE1, QE2, and possibly QE3 are pushing prices up and the value of the dollar down. he is doing this to save his @ss and other bankers and politicians. herein lies the crux of the situation- he is no longer responsible to the people on the ground, the working people, the average Joe.

[endure]

Can I use these bitcoins to buy a bacon sandwich and a cup of tea?

[RedFxTrade]

As Nigel Farrell quite rightly said...

who or what is Nigel Farell?

he has the spelling wrong. Its Nigel Farage. IMO one of the best speakers around today. He is hated in the EU for telling it how it is and he does does not hold back.

This is is greeting to Von Rompuy...hilarious....

http://www.youtube.com/watch?v=lqovTGjYjM4

[midas]

Are you buying any then Midas?

evidently other members on this forum have decided I'm not

Edited June 6, 2011 by midas

[midas]

Are you buying any then Midas?

let me answer for Midas. no, he won't. Midas is too busy pursuing his noble crusade against those in power cheating us all. in a way he is right and his cause/intentions are indeed noble (neither meant in a derogatory nor sarcastic way). unfortunately his crusade or rather his hope that the system(s) change(s) are as hopeless as would be the attempt to get rid of all cockroaches on this planet.

cheating politicians, banksters and the like are here to stay as are cockroaches. best what one can do is trying to outsmart them for personal gain which in turn makes the outsmarting easier. acting like Don Quijote de la Mancha is a waste of time and mental resources.

:jap:

This is not about a " noble crusade " Naam.

For me this is like déjà vu.

It has far more to do with confronting the same mentality and challenges that I faced

in Australia 30 years ago that gave me my fortune when I was up against some very powerful forces

indeed who desperately wanted keep things the way they were and used every trick

in the book to try and eliminate me. I regard Bitcoin

as more about recognising the status quo has failed miserably and needs to be changed.

Like Laurence J. Peter one said :-

" Bureaucracy defends the status quo long past the time when the quo has lost its status."

[Naam]

Naam: "important is that using hawala or its "siblings" one deals with "tangible" natural persons on each end."

monekyface, on 2011-06-06 15:53:13, said:

these are good points- that people are real, governments are real, banks are real. there are people to be held accountable in these instances. but when these institutions get so powerful that accountability has evaporated then where is the benefit?

there is a big difference between owning "bitcoins" and fiat money or fiat assets in the bank. if i'm so inclined i take my fiat cash and/or sell my fiat assets for fiat cash, take both out of the bank and buy tangible assets, e.g. clear out the gold shop around the corner from whatever goodies there are for sale or, if i please, dig a hole in my garden and bury the "useless" fiat money (deep enough that my dogs won't dig it out).

can i do the same with bitcoins?

[midas]

if i please, dig a hole in my garden and bury the "useless" fiat money (deep enough that my dogs won't dig it out).

can i do the same with bitcoins?

but the least we know there will only ever be 21 million bitcoins?

what is the limit to useless fiat money?

Edited June 6, 2011 by midas

[Naam]

This is not about a " noble crusade " Naam. For me this is like déjà vu.

Midas,

you are intelligent enough to realise that neither you, nor me, nor both us combined with some millions of other pissed off citizens have the slightest chance against the established powers. but let's assume the concerted efforts would really initiate a change. what would we gain? even if we succeeded to hang all bastards high it wouldn't make any difference as the damage is already done. no way that piled up debt can ever be paid back. the successors would be corrupted in no time and we'd face a déjà vu of same old same old (perhaps slightly different) again.

[manarak]

fiat money is like democracy: worst system, but there isn't a working system that's better.

I have thought about a stable currency earlier and came up with a relatively simple solution.

A currency is used for trade, i.e. exchanging the value of wares for the value of the currency.

A stable currency would therefore be somehow tied to the value of wares.

Therefore I thought the best way to make a stable currency would be to tie it to a balanced basket of commodities (energy, agro and mining)

- coal

- oil

- gas

- iron

- aluminium

- copper

- silver

- gold

- wheat

- corn

- rice

- orange juice

- bananas

- coffee

- sugar

- pork bellies

- live hogs

etc.

Such a basket would reflect a real tangible value behind the currency.

[Naam]

if i please, dig a hole in my garden and bury the "useless" fiat money (deep enough that my dogs won't dig it out).

can i do the same with bitcoins?

but the least we know there will only ever be 21 million bitcoins? what is the limit to useless fiat money?

we don't know what "will be". the truth is we have no bloody <deleted> slightest idea what will be. but the fact remains that "useless" fiat money could and can be used presently to buy nearly everything except for a few things, e.g. health and eternal youth.

[churchill]

The Bitcoin Report May be of interest ? Looks like double dutch ?

top 100 rich list http://bitcoinreport.appspot.com/

[Naam]

fiat money is like democracy: worst system, but there isn't a working system that's better.

I have thought about a stable currency earlier and came up with a relatively simple solution.

A currency is used for trade, i.e. exchanging the value of wares for the value of the currency.

A stable currency would therefore be somehow tied to the value of wares.

Therefore I thought the best way to make a stable currency would be to tie it to a balanced basket of commodities (energy, agro and mining)

Such a basket would reflect a real tangible value behind the currency.

and who can check and verify that a basket of equivalent currency value does exist?

[Naam]

The Bitcoin Report May be of interest ? Looks like double dutch ?

top 100 rich list http://bitcoinreport.appspot.com/

extremely interesting report! reads like a bestseller. i liked especially the part BRsuF1RffggjrzFUjdfjwrSm3tAzrHMeW and wDDyepuyLk6hpffpkr82GFubweXYYfs whereas reading chapter 2f6kBLc2AjausvAhNTyywPm5UdXmk59 was quite boring.

[monekyface]

i think you can store bitcoins on a thumbdrive and bury that in your yard

[churchill]

The Bitcoin Report May be of interest ? Looks like double dutch ?

top 100 rich list http://bitcoinreport.appspot.com/

extremely interesting report! reads like a bestseller. i liked especially the part BRsuF1RffggjrzFUjdfjwrSm3tAzrHMeW and wDDyepuyLk6hpffpkr82GFubweXYYfs whereas reading chapter 2f6kBLc2AjausvAhNTyywPm5UdXmk59 was quite boring.

Agreed !

[midas]

This is not about a " noble crusade " Naam. For me this is like déjà vu.

Midas,

you are intelligent enough to realise that neither you, nor me, nor both us combined with some millions of other pissed off citizens have the slightest chance against the established powers. but let's assume the concerted efforts would really initiate a change. what would we gain? even if we succeeded to hang all bastards high it wouldn't make any difference as the damage is already done. no way that piled up debt can ever be paid back. the successors would be corrupted in no time and we'd face a déjà vu of same old same old (perhaps slightly different) again.

To boldly go where no man has gone before.....and all that

[Naam]

To boldly go where no man has gone before.....and all that

i hate to cross my property line if there is no pressing business to attend to such as... a pedicure at Jomtien Beach

[churchill]

Virtual money, from real central bank mistrust

http://ftalphaville.ft.com/blog/2011/06/06/585756/virtual-money-from-real-central-bank-mistrust/

[manarak]

fiat money is like democracy: worst system, but there isn't a working system that's better.

I have thought about a stable currency earlier and came up with a relatively simple solution.

A currency is used for trade, i.e. exchanging the value of wares for the value of the currency.

A stable currency would therefore be somehow tied to the value of wares.

Therefore I thought the best way to make a stable currency would be to tie it to a balanced basket of commodities (energy, agro and mining)

Such a basket would reflect a real tangible value behind the currency.

and who can check and verify that a basket of equivalent currency value does exist?

err... that would be by definition.

Let's call the currency the... ummm Zorglon and let's make a basket of 2 commodities: sugar and salt.

Everyone would know that for 1000 Zorglon you get 10 Kg of Salt and 10 Kg of Sugar on world markets - these are BY DEFINITION equivalent.

Now, if Sugar becomes harder to get, and another product like butter stays stable, the relative value of one Zorglon vs. one Kg of butter rises.

So if one Kg of butter was 180 Zorglon before, it would for example change to 176 Zorglon after the price change, because Sugar got more expensive.

The world commodity prices in Zorglon define the value of the Zorglon.

[Darvil]

But of course the detractors don't understand or bother to even to try to understand it. But thats ok because everytime there is a game changer technology it usually leaves alot of people in the dust.

How many of us here actually realized some of the big game changing technology in the past like search ads (google), facebook, digg, reddit etc (social), napster, bittorrent (digital distribution), mobile applications (apps!), Steam (gaming), VOIP, etc etc.

facebook et al did not leave me in the dust (last time i checked) and now i'm wondering who these "alot" [sic] people are who were left in the dust. did 'alot' of people who did not invest 'alot' of money in the afore-mentioned innovations lose 'alot' of money? if the answer is no, why were they left in the dust?

Nam,

What I meant was for the "established" institutions that are being left in the dust. In the example of something like netflix, you see how hurt the brick and mortar businesses are affected. Fact is, innovation from the net has taken out alot of the old institutions and will continue to do so. Bitcoin is just the beginning that is finally and rightfully taking on the currency system. You think it has no chance against the system and you may be right on that; at least the initial version. I for one think it was a good chance even if the global governments tries to ban it. If you compare it to bittorrent, even when the powerful lobbies in the US try to kill it people come up with innovation around these. Decentralization, encryption, local ports and private trackers (where you need invitations). Even in oppressive/censor friendly countries like China people are finding ways to go around all these through the web. China already has quite a thriving community on trading virtual goods. This sort of invention is just going to accelerate everything towards something like bitcoin.

Fact is now anyone can use the same ideas to create similar systems as bitcoin (there is one out there already called namecoin). We could create a TVcoin system if we want and exchange services among ourselves. This of course isn't a new idea as some cities in the US already do it with voucher (look at http://en.wikipedia.org/wiki/Ithaca_Hours). This new protocol just makes it easier for people to start and adopt it as its now viral and certain anti-cheat protections are built in (such as double spending).

[Darvil]

Naam: "important is that using hawala or its "siblings" one deals with "tangible" natural persons on each end."

monekyface, on 2011-06-06 15:53:13, said:

these are good points- that people are real, governments are real, banks are real. there are people to be held accountable in these instances. but when these institutions get so powerful that accountability has evaporated then where is the benefit?

there is a big difference between owning "bitcoins" and fiat money or fiat assets in the bank. if i'm so inclined i take my fiat cash and/or sell my fiat assets for fiat cash, take both out of the bank and buy tangible assets, e.g. clear out the gold shop around the corner from whatever goodies there are for sale or, if i please, dig a hole in my garden and bury the "useless" fiat money (deep enough that my dogs won't dig it out).

can i do the same with bitcoins?

You can convert your bitcoins into money just like how you'd convert USD to baht and use that to purchase the gold shop. You can even do better then just digging a hole and storing your paper money. Its much easier now to do it through bitcoin. Just save the wallet.dat (which will contains bitcoins equivalent to millions of baht), put it in usb and bury it. Why not go the extra mile? Create an encrypted partition using trucrypt and put your wallet.dat file in there. Then send the partition thru email to your cousin in another country and he/she can bury another copy of all your money in their backyard. How about split the money into different wallets and email all your relatives around the world and they can all bury the money in their backyard. Fact is you can do alot of different things with bitcoin such as cutting up a coin into millions of pieces, make unlimited amount of copies, easily move your money, has the potential to be anon, etc.

[monekyface]

"You can convert your bitcoins into money just like how you'd convert USD to baht and use that to purchase the gold shop. You can even do better then just digging a hole and storing your paper money. Its much easier now to do it through bitcoin. Just save the wallet.dat (which will contains bitcoins equivalent to millions of baht), put it in usb and bury it. Why not go the extra mile? Create an encrypted partition using trucrypt and put your wallet.dat file in there. Then send the partition thru email to your cousin in another country and he/she can bury another copy of all your money in their backyard. How about split the money into different wallets and email all your relatives around the world and they can all bury the money in their backyard. Fact is you can do alot of different things with bitcoin such as cutting up a coin into millions of pieces, make unlimited amount of copies, easily move your money, has the potential to be anon, etc."

Darvil is making some really good points that show how you can protect this medium of exchange (like a virtual vault) and also you can do things like duplicate your "money" which have no traditional cash equivalent. i think the flexibility of virtual currency is valuable and may mean a potential to out-maneuver traditional currency. when the 8-track tape did not meet our needs as well as the cassette tape it faded. now we have hardware-free music in mp3 torrent downloads, much like bitcoin is free of a physical form.

people don't say "this isn't music- there is no tape!!!!!!!!", but they do say "this isn't money- i can't bury it!!!!!!!!" that is odd since you can buy a virtual credit card with electronic funds and buy a book that is delivered to your door. bitcoin might not be a quantum leap, it may be only a single new step that started with electronic funds transfers between banks. digital money is not new.

[Naam]

fiat money is like democracy: worst system, but there isn't a working system that's better.

I have thought about a stable currency earlier and came up with a relatively simple solution.

A currency is used for trade, i.e. exchanging the value of wares for the value of the currency.

A stable currency would therefore be somehow tied to the value of wares.

Therefore I thought the best way to make a stable currency would be to tie it to a balanced basket of commodities (energy, agro and mining)

Such a basket would reflect a real tangible value behind the currency.

and who can check and verify that a basket of equivalent currency value does exist?

err... that would be by definition.

Let's call the currency the... ummm Zorglon and let's make a basket of 2 commodities: sugar and salt.

Everyone would know that for 1000 Zorglon you get 10 Kg of Salt and 10 Kg of Sugar on world markets - these are BY DEFINITION equivalent.

Now, if Sugar becomes harder to get, and another product like butter stays stable, the relative value of one Zorglon vs. one Kg of butter rises.

So if one Kg of butter was 180 Zorglon before, it would for example change to 176 Zorglon after the price change, because Sugar got more expensive.

The world commodity prices in Zorglon define the value of the Zorglon.

then what happened to the "stable" currency? take a look how commodity prices fared during the last few decades.

[manarak]

fiat money is like democracy: worst system, but there isn't a working system that's better.

I have thought about a stable currency earlier and came up with a relatively simple solution.

A currency is used for trade, i.e. exchanging the value of wares for the value of the currency.

A stable currency would therefore be somehow tied to the value of wares.

Therefore I thought the best way to make a stable currency would be to tie it to a balanced basket of commodities (energy, agro and mining)

Such a basket would reflect a real tangible value behind the currency.

and who can check and verify that a basket of equivalent currency value does exist?

err... that would be by definition.

Let's call the currency the... ummm Zorglon and let's make a basket of 2 commodities: sugar and salt.

Everyone would know that for 1000 Zorglon you get 10 Kg of Salt and 10 Kg of Sugar on world markets - these are BY DEFINITION equivalent.

Now, if Sugar becomes harder to get, and another product like butter stays stable, the relative value of one Zorglon vs. one Kg of butter rises.

So if one Kg of butter was 180 Zorglon before, it would for example change to 176 Zorglon after the price change, because Sugar got more expensive.

The world commodity prices in Zorglon define the value of the Zorglon.

then what happened to the "stable" currency? take a look how commodity prices fared during the last few decades.

For me, a currency is stable if for the same amount of currency, the same amount of wares can be obtained over time - provided the effort of wares/commodity production remains the same and the demand remains the same.

[Naam]

Darvil is making some really good points that show how you can protect this medium of exchange (like a virtual vault) and also you can do things like duplicate your "money" which have no traditional cash equivalent.

i don't deny that some of his points are good. what i'm saying is that "bitcoins" will be limited to "bits" of this planets population who will invest "bits" of their money in exchange for virtual "bits" on a thumbdrive or where ever. what lacks in the equation is that 78% of the worlds population don't have and will never have access to virtual bits and/or thumbdrives and if they had they wouldn't trust bitcoins but prefer tangible fiat money in their pockets. the latter is not limited to those without virtual access to "bits". even the lion share of those who are used to buy and pay virtually using online services will never participate in a scheme that can't be controlled by conventional means such as a court of law if and when fraudulent procedures surface. and nobody can convince me that fraud is not possible.

moreover, when i hear "maximum 21mm" i feel like "Enterprise! one to beam up. too many virtual tulip speculators down here."

[endure]

No-one has yet answered my question. Can I use bitcoins to buy my breakfast?