I'm starting to get interested in Bitcoin.
That is all.
I had 10BTC quite some time ago that I got for about $3 each, and lost it when the site my wallet was on was "hacked". Now I can't remember the name of the site. It was just a curiosity at the time. A few months ago, when the mining reward halved, I thought it might be a good idea to get back in, and bought a few dozen through http://coinbase.com at ~$13. That worked out to be a good investment. I'm uncertain about the future of bitcoin. However, IMO when the Chinese pick it up in earnest, it could get crazy. The ability to move money without government oversight is a real need for a lot of people. For that reason alone I decided it was worth having some. BTW, I don't think it matters if it is a currency. EDIT: If you look at blockchain.info, about 70% of the transactions are SatoshiDice. Gambling has been the biggest shot in the arm to Bitcoin yet. However, it's not just SatoshiDice bringing growth.
Bitcoin is nice, but a certain point, I don't see how it can scale. Let's just poke at one of the problems: loss of currency and the ability to inflate. Currently, if I have 100฿ in my wallet and that is lost to technical error (I misplace my USB drive, my computer melts down, etc), it's gone from the system for good. While the blocks were being filled out in the past to generate the initial pool of money, now that it is almost all assigned, they can't "print" more without overwriting blocks that are already owned. On a long enough timeline, bitcoins can only deflate in value and the pool can only shrink, assuming its value against other currencies does not change. Additionally, I know hacktivists like to hate on any form of central control over a money base. But I was under the impression that all the micromanagement the federal reserve has over printing money and setting lending rates is beneficial to a functional national economy. Bitcoins might work fine for black markets, but what points do they have going for them in a normal economy?
I've never used BTC, but is there not ... cloud storage, or a remote backup, or some sort of failsafe? The situation you describe just seems to obvious for there not to be a workaround.Let's just poke at one of the problems: loss of currency and the ability to inflate. Currently, if I have 100฿ in my wallet and that is lost to technical error (I misplace my USB drive, my computer melts down, etc)
There are a number of approaches. You can actually even have a paper wallet. Putting it in a safe deposit would be pretty secure. But, real security would be someone that insures wallets. Not there yet, as far as I know.
Compared to other stores of value, you have at least as many ways to protect your assets: Paper currency in your wallet : a paper wallet Gold bars in a bank vault : magnetic, optical, or (better: and) flash memory storage in a bank vault Trusting a third party to hold your dollars : trusting a third party to hold your BTC It's true that lost fiat currency can be replaced by printing more. But that is the chief distinction that makes bitcoin appealing -- its value cannot be diluted by creating more. Just like authentic Picassos, you are guaranteed that the supply will never be inflated.one of the problems: loss of currency and the ability to inflate
How big a problem is that? People lose money and goods all the time, often irretrievably.I don't see how it can scale
There will ultimately be 21 million units in circulation, less those which are irretrievably lost. Even if an awful lot are carelessly lost, those that remain can be subdivided as necessary to cover as many transactions among as many people as desired.On a long enough timeline, bitcoins can only deflate in value
"Deflation" means bitcoins will tend to increase in value, as the supply is capped and will eventually only erode due to accidental loss, as with authentic Picassos. There is concern that this will lead to hoarding, but I don't see the problem. If it's a Picasso, all you can do is store it or sell it. But if the value of your BTC holdings increases by 3%, you can trade just that increase, or trade a part of it.
Sure, but the treasury can always print more. In the grand scheme of things, it's probably not that big a problem (Clearly hasn't stopped its growth thus far). I haven't the faintest clue in the world what is the rate of deletion versus the rate of influx of bitcoins to the market... This is what I get for commenting on an article without the most basic grasp of economics. Ignore that transmission. >_<How big a problem is that? People lose money and goods all the time, often irretrievably.
"Deflation" means bitcoins will tend to increase in value
I think there is going to be a correction. It just jumped up to $66 today. I just sold 10% of mine for 1/2 of my initial investment. I'll hold onto that, and reinvest after the bubble pops. If you are interested in buying some, I'd wait a few weeks. I'd be very surprised if it doesn't get down below $40 again. It could easily go as low as $20, I think. The value is climbing much faster than any developments suggest it should.
I'm not at all interested in buying any at the moment. Bitcoin seems to be the mother of all volatile commodities, especially as it's untraceable and already a favorite of the illicit crowd. I'm interested in learning more, but not in a "get rich quick" sort of way but more in a "this appears to be an inflection point to the world financial markets if done right" kind of way.