Steam now accepts Bitcoin for purchases
blog.bitpay.com
blog.bitpay.com
If I posted an article about Linux 4.1 or something, I wouldn't expect to see comments saying 'meanwhile, I used Windows yesterday, and played GTA5, and it was good'.
What gives? Are there forums in which people have this sort of reaction to, I dunno, HTML5?
From some of the posts here you would think that it's IED control software.
I can't explain the feelings or motivations of those who actively detract from the technology. It's probably similar to Apple "hate". Or inverse "fanboyism".
Bitcoin may or may not succeed, but something can't be un-invented.
Furthermore, it's interesting to see companies like Steam, and even Wall Street players, embracing this new technology.
Thats what people were saying in 2012, 2013
The network is working fine. This is success. What is your metric of success in this statement? I find it counterintuitive.
Bitcoin makes up a tiny portion of the market and is completely optional. I mean, it barely even exists.
Apple's activities (notably 'tivoization'), threaten general purpose computing.
Regardless I still try to come to peace with it (i think it's very important to have a positive mindset). As long as I can still buy my ARM SoC boards, x86 machines, etc, I'll be happy. If that starts looking dim, eh. We'll see.
Some of the vitriol is backlash against the zealots who feel that Bitcoin can/should enable elements of anarchy.
Regardless of correctness, that sort of attitude feels really stressful to me (to think about the ultimate endgame of anything that ever happens under some 'ideal' circumstances). I don't think it's healthy.
For the time being, we have a cool technology that lets me use asymmetric crypto to send people a tenner on the other side of the world. If it all fails or drops massively in value tomorrow, I lose the small amount I have in my wallet.
I'm sure some cypherpunks figured that GPG meant we would all plug ourselves into the wall and be anonymous and stateless and stuff. That probably won't happen, but does it make GPG useless, worthy of ranting about?
Of course, currency has a very strong network effect. Its value is tied very closely to the number of people who use it.
I am not trying to imply this is bad. The politics are intrinsically worthy of thought and discussion. I could wish for a higher level of discourse on political matters, but humans have been doing that for lo these many thousands of years and I doubt this is the year that's going to change. Our "political brains" are complicated, messy things, tied into tribal instincts, personal identity, and all sorts of other messy things that make it difficult.
The general quality of discourse on any thread seems to drop hugely whenever politics comes up.
We seem to be able to leave each other alone when it comes to using vi vs. emacs - the odd joke comes up, but that's about it.
But politics? There seems to be this attitude of conversion, missionaries, convincing, it's kind of frustrating. I think it's healthy to question one's views sometimes, but not to face a constant onslaught.
Looking a bit harder, the language people use here is quite clearly politicized and strange - people use past tense, which I find difficult to interpret as anything other than trolling. No-one would say 'Linux was a good OS', because it currently exists and is used daily...?
My inner statistician would be interested to see up & down totals as a metric of controversy.
FUD merchants, social media management, astroturf, superpacs, brigades, vendettas are common enough on Reddit and the Post-Snowden zeitgeist demands we consider Orwell's '84 where the mere possibilty of being observed is enough to bring general opinion & behaviour to heel.
I agree, but that doesn't mean we should silence people who bring up political issues.
> But I'd like to offer an indicator for when things inevitably become 'political'; when there's no provably correct answer and the use of force is involved.
That's a good indicator that pretty much everyone would agree.
However, what constitutes "use of force", however, changes from people to people. Some people believe that merely having a state is "use of force". Other people believe that having a billion dollars to bargain is "use of force". It gets crazier: other people believe it's neither. Or both. Etcetera.
Yeah, politics is the mindkiller.[0]
Dan Kahan's research could lead to some interesting suggestions about why this might be.[1] There are many questions we answer dispassionately about facts, but then there's this other series of questions about the world, where we really don't answer with reference to specific knowledge. They seem primarily to serve as litmus tests for measuring group identity.
As it happens, contradicting someone who is really just talking about their identity just makes everyone upset.
Certainly conversations can change some people's minds on some political topics[2]. I've had a few rare 'conversion' experiences when talking with friends. But it's usually in really specific situations with certain approaches to open discussion that are just really hard, sometimes it takes multiple discussions, none of which seem that monumental, but have a cumulative effect. Both conversants have to rely on a lot of care and patience. All of that is made much more difficult by the impersonal and ephemeral nature of conversations on the internet.
[0] http://lesswrong.com/lw/gw/politics_is_the_mindkiller/
[1] http://www.culturalcognition.net/blog/2014/4/23/what-you-bel...
[2] http://www.thisamericanlife.org/radio-archives/episode/584/f...
I'm not so sure about that, especially when compared to other forums. People here often cite specific laws, articles, and papers when making political points[citation needed].
Three factors come to mind:
1. There's a deep-rooted idea today that money comes from the government and that everything else is a scam. Bitcoin challenges that idea.
2. Bitcoin refuses to die despite the predictions of just about everyone who first learns about it.
3. The technical underpinnings of Bitcoin are counterintuitive to say the least. That makes Bitcoin hard to understand even for the technically-oriented.
The combination of longevity, casual disregard for convention, and counterintuitive nature gets annoying after awhile.
Nor are these factors restricted to those who can't stand Bitcoin, its users, or the idea of private money. Many of the most vocal Bitcoin advocates today went through a period of disbelief or outright hostility toward the idea.
That isn't a realistic model for how the world works and is really just an odd way of thinking.
I can play Quake 3 and have fun with it, and post blogs about it, without thinking it's going to destroy every other video game out there ever, without debating whether it even is a video game, etc. Hey, it has fast inverse square root, that's cool, but it's not going to result in the actual world being deleted and exchanged for CGI VR land.
Fundamentally it seems to be that there's some element of 'faith in the concept', that is turned off when it comes to money, perhaps as a protection mechanism. I don't know.
... Just chill out, you know? I might go out for a run soon. You can still walk, don't worry, it's not banned (I also walk, it's useful, maybe we can be friends?).
Any idea, good or bad, is vulnerable to being discredited by its most annoying public advocates. Bitcoin 'hate' is mostly a reaction by people who encountered this and got fed up with it.
Not to mention that Bitcoin is explicitly anti-environmentalist: it's built on vast amounts of wasted electricity.
This is true! You don't have to agree with them, though. The network still exists and is cool and useful regardless. You don't even need to use Reddit! I don't hang out on reddit.com/r/visa (does it even exist?)
>> Not to mention that Bitcoin is explicitly anti-environmentalist
I think it would be fairer to say that it's 'a-environmentalist'. The badness or goodness of energy use for PoW just wasn't really a concern.
When I play Quake 3, my computer uses more energy. I consider that an acceptable compromise. Perhaps there are people out there that don't, so they don't play it.
I would find it quite odd if they criticized my habits, though. We should be trying to get along, not looking for chances to grumble at each other, you know?
Ironically uses politically-charged language when discussing how bitcoin gets political.
How about: "I'm concerned with the amount of electricity devoted to mining."
Some of the bitcoin-is-going-to-take-over advocates could counter with, "That electricity cost is a lot better for the environment than the standing armies required to secure fiat money."
It's like, bitcoin started out with a pretty good-sounding idea: decentralized currency, like the old Gnutella network except for money! hey I like it!
Then people start talking about it and the first next step is "hey and bitcoin takes control over money and puts it into the hands of the PEOPLE" except it doesn't! It doesn't at all! Control over the money supply, there's at least some tenuous link between votes we regularly cast as citizens and the people making those decisions. Decisions over bitcoin's economics? Better start coding, except no one will accept your patches to bump up the 21 million bitcoin supply...not so democratic.
Then the conversation turns to pretty goofy new-world-order stuff, like "bitcoin will eliminate the need for nations to have standing armies!!" Except the reality is, look at how the bitcoin people themselves squabble like a bunch of old hens, in the face of what seem to be legitimate critiques. These are the people leading the way to a new world order? I don't think so.
And then we look at the environmental costs, and that's not good. Or the deflationary economics of the system itself, and those aren't good either. Or how it seems a lot more like an elaborate ponzi scheme, and that's not good either.
Basically, what bugs me about bitcoin is that legitimate critiques are always brushed off with really absurd replies. Kinda kills the whole thing for me.
As for monetary policy, I would look to the history of currency devaluations in the wake of wars and emphasize that bitcoin cannot be devalued in the same way. Not that a nation would use bitcoin as its currency, but it begins to look more like the gold that used to back fiat currencies.
Even Rome debased its currency to continue paying soldiers, while throwing the citizens under the bus.
Re environmental costs: a future protocol change could update the proof of work function if this gets out of control.
> deflationary economics of the system itself
Strictly speaking, bitcoin's monetary base is monotonically increasing and never actually shrinks, which would be monetary deflation. I would also challenge the conventional wisdom that says "Deflation bad! Inflation good!" Again, not that a nation's currency will be bitcoin. It exists alongside other systems, behaving more like gold.
Ponzi scheme is almost not worth mentioning as the allegation is obviously ridiculous.
Why would anyone willingly dilute their own money?
> legitimate critiques are always brushed off with really absurd replies
> And then we look at the environmental costs, and that's not good. Or the deflationary economics of the system itself, and those aren't good either. Or how it seems a lot more like an elaborate ponzi scheme, and that's not good either.
These are not legitimate critiques without real data to back them up. Without real data they are conjecture based on emotion.
That's a horrible change.
But it's a perfect example of the ultimate democracy. Everyone has the freedom to listen to you, they're choosing not to.
You've just demonstrated the breach with reality in Bitcoin-land that is most personally irritating to me--the conflation of democracy with consensus/mob rule.
Democracy isn't (and never was) just "majority preference that is inferred from behavior". It's the regular, structured process of checking in and putting the rules that affect people up to a group decision, i.e. voting on stuff on a regular basis, and exposing the rules of the system to that process.
Having a regular vote on the # of bitcoins? That'd give it an element of democracy. But bring that up, and you get the kind of nonsense you just gave us.
And it's funny, in bitcoin-land, the very idea of democracy seems really offensive, and I think I know why; I think that the hardcore bitcoin advocates look at bitcoin as a way to get into a system and come out on top. The actual levers of power in the world are closed off to most of us, and getting into them is a long, hard process that involves skills very few in the computer industry have (or want to develop). Bitcoin gives its adherents a way to feel like they're going to be kings in the new world order, and suggesting the democratizing of this system would of course threaten that.
No one in bitcoin-land ever comes back to me and says "Yeah, you're right, we should involve more people in the decisions behind how this thing is run." That power's seductive (well, that fictional, imagined power of being a king in bitcoin-land), I guess.
What should happen? Who calls for votes? Who counts them, and who forces everyone to change - or not? In a decentralized model how exactly do we add a central authority without centralizing everything?
And further, why would we want to? So that people who aren't involved can have a say? I don't setup a 1-800 number to let people vote on what I watch for movie night - it's only relevant to those who attend.
Similarly, if you don't like Bitcoin then rather than getting involved just to mess with it, why not get involved in something you do like?
You don't seem to understand that it's a P2P system. Which authority are you proposing counts the votes and enacts the policies?
And democracy isn't three wolves voting to eat a sheep. How are you a part of the community that you deserve a vote, even if such a silly thing was possible? Why should you get to vote on what other people are doing?
> Having a regular vote on the # of bitcoins? That'd give it an element of democracy. But bring that up, and you get the kind of nonsense you just gave us.
Because it's literally the worst idea you could have, short of replacing all keys with the number 7. The entire point of Bitcoin is a non-inflating currency. Even if you could change this, which thankfully you cannot, it wouldn't be fair to the people who joined in the beginning.
You're saying you'd rather ruin the system for everyone because you aren't a ruler. Which is precisely why the system was designed to keep people like you from getting any power, ever.
> And it's funny, in bitcoin-land, the very idea of democracy seems really offensive
No, the idea of your idea of a democracy being imposed on people who you're mad at because they don't listen to you is laughable.
You clearly just want to vote for ridiculous things - seemingly to punish people for not inviting you in the beginning.
> No one in bitcoin-land ever comes back to me and says "Yeah, you're right, we should involve more people in the decisions behind how this thing is run."
Of course they don't. And rather than think about this you've decided you're right.
If you want to vote, do it with your feet.
There are better alternatives to brute-forcing hashes and generating nothing but waste heat in order to mine cryptocurrency. At least those cycles could be put toward something useful, like the Berkeley Open Infrastructure for Network Computing (BOINC). Gridcoin uses proof-of-research in BOINC as the basis for compensation.
For them, the cost of attacking the network by mining on an orphaned chain is lower, because by definition the PoW has a useful by-product.
The more useful the byproduct, the less secure the coin.
Edit: to illustrate, imagine a PoW that computes cures for cancer. Somebody can now mine on whichever block of the chain he wants forever, since he's producing a cancer cure anyway. The incentive of a block reward (within the currency) is not primary. Thus there is diminished incentive for the network to create a linear blockchain, where everybody mines on the most recent block. Without that, you cannot order transactions.
A more apt analogy would be that each block would solve a protein folding or active site matching problem for cancer. Then each solution would be public, and useless to mine over again.
The PoW must only be useful for the coin you are mining and nothing rise.
Even then, as long as the coin value is larger you will have a consensus with the miners to to mine the latest block. Any sidechains will be neglected, which is why this "no value or nothing" attitude doesn't fit a blockchain network.
Well then they are doing useless work too, and the criticism of wasteful mining applies. You gain value from doing useful things.
You do understand how a blockchain works, right?
I can claim it's useless for miners and useful for researchers because I understand blockchains and proteonomics.
Do you understand either, VMG? Because it's fast becoming apparent otherwise.
See primecoin.io for an example of more useful PoW.
What stops me from attacking that network by mining on my private chain with a double spend? I have no opportunity cost.
Nothing stops you mining on a private chain, but since you have a small minority of the compute power, the network doesn't care about your private chain. The same is true in Bitcoin.
> I have no opportunity cost.
You could be mining blocks that generate useful byproducts and currency.
Right, this is not an issue for small miners. But if you have a significant part of mining power, it's important that there is a significant opportunity cost mining on the wrong chain. That can only be ensured by using a PoW that is wasteful outside the currency you're mining.
Network value is different from individual value.
More realistically, what if I privately know a fast algorithm for an obscure type of protein folding, and then I push for a new BOINC project to be accepted that focuses on the specific type of problem? I'll be the only one that can mine it efficiently for a long time. If I calculated my expected profits, I would probably see that it's worth it for me to pay a lot of money to lobby the people in charge of the BOINC-coin decision process to get my project accepted. Unless BOINC-coin only uses a fixed set of projects over all time, or is only worth negligible amounts, then lobbying like this is going to influence what projects it accepts.
Even if BOINC-coin uses a fixed set of projects, then there's a problem of what work units are given out. I imagine many projects work like SETI@Home where some data is given out to users to process. If processing the data is worth money, then it might make sense financially for me to artificially construct datasets that I've already solved, and bribe the SETI@Home administrators to insert my dataset into the worker queue, which I will then quickly "mine" for BOINC-coin.
A BOINC-coin isn't fully decentralized. It requires trusted people to be in control choosing which projects are worth it and to secure the authenticity of the data sets. Bitcoin is about minimizing the need for trust in administrative systems like this.
Even if you solve the above problems, the proof-of-work system needs to be hard to compute but cheap to verify. Many BOINC projects' work units aren't cheap to verify. They just have several users redundantly recalculate the same work units to check that they get the same answers.
Gold isn't as valuable as it is today for any other reason. You can dream about a theoretical currency with a proof of work that accomplishes something but it won't have the same properties of ideal money until it is more widely used, mined and attacked.
Also don't forget that space heaters _actually_ do nothing but generate 'waste heat' and no one seems worried about those.
That like saying Tesla's are anti-environmentalist, it's built to waste vast amounts electricity.
It's quite literally non-sense. Point at any other nations currency that consumes less energy than Bitcoin; you think printing bills and minting coins doesn't use energy? You think moving giants piles of cash around in big trucks between banks doesn't use energy? You think banks and guards and trucking don't use energy?
Bitcoin is the pro-environmentalist approach, it uses far less energy than a typical currency does.
If someone with, let's say a doctorate in cryptography and a preference in 'fiat' reads that, he's going to feel a bit insulted and double down on his position.
He may (and I'm just speculating a hypothetical here) start daydreaming about going around with a metaphorical hammer of wisdom trying to beat some ideas into every bc-daytraders' head. Like the idea that a majority of western societies actually support the general concept of democratically-elected governments wielding some power. Or that having some screws to adjust in regards to monetary policy may be preferable to not having them, some problems notwithstanding.
All this is not new, by the way. This discussion lines up pretty well with the conflict over libertarianism, both demographically as well as philosophical.
Those that understand the big picture and the threat central banks pose to a nations sovereignty, and the debt slavery of its citizens, are the ones who truly appreciate bitcoin
Stay with the facts and reality, a.k.a. the technology, statements like the above create a toxic environment in which the bitcoin community currently finds itself deeply mired in.
They are dragging the world into another great depression, destroying the lives of billions along the way.
At some point it gets tiresome to speak with those who have no understanding of economics nor history.
Can you defend the last 8 years of Central Bank policy, are you even schooled in this area of study? Your criticisms are naïve.
If you want bitcoin to succeed talk about the technology and adoption, this is a complex enough topic in of itself with many real issues. The success of bitcoin depends on this 100%.
If you want to talk about economic saviorism cut the bullshit, it has a nagtive effect on bitcoin. Putting people down you don't know is a sure sign of immaturity that will get you no where and you have exemplified what is wrong with the bitcoin community 2x in this very thread.
http://cdn.tradingeconomics.com/embed/?s=cpi+yoy&v=201604202...
The never-ending adulation of bitcoin as the greatest invention since the internet, the hyperbolic claims that bitcoin will do things like revolutionize payments, end global war, eliminate the need for banks, liberate the people from bondage, the litany of bitcoin and blockchain companies making extraordinary claims while consistently under-delivering or outright scamming customers, the warped world-view where communities of impoverished people who can barely meet their daily needs and have markedly poor computer literacy and limited access to computers and internet will be lifted out of poverty by banking with bitcoin, the constant dismissal of bitcoin skeptics as "not understanding" bitcoin, the self-aggrandizing elevation of satoshi and bitcoin programmers as programming prodigies, the condescendingly absurd notion that detractors, the banks and the governments are afraid of bitcoin or afraid of the bitcoin money revolution, the tone-deaf advocacy of bitcoin as a safer method of payment than credit cards, the general refusal to acknowledge bitcoin's practical challenges as real problems (non-technical people being scammed or permanently losing their money due to data-loss, theft, misconfiguration of software, sending bitcoin to the wrong address, downloading a scam wallet), the oversaturation of the underwhelming "x but with bitcoin" formula that pops up every couple weeks... and much more.
As heated, vitriolic and personal as linux discussions can get, its taken for granted that everyone is at least operating in the same objective reality (systemd vs upstart, gnome vs unity, mir vs wayland, even windows vs linux), but a large swath of bitcoin enthusiasts look at bitcoin as something that eclipses every other technical topic in importance to the point where it comes off as quasi-religious.
https://www.reddit.com/r/OutOfTheLoop/comments/31xp48/why_di...
Providing more choices can often result in consumers simply giving up. At a former job we did an A/B test where we showed some visitors two options to buy our product and added a third option for other visitors. In the three option scenario, the bounce rate was about 10% higher.
Or, it could be that there are folks for whom bitcoin is linked with drugs, gambling, piracy, etc. Maybe seeing a bitcoin option makes the site look less reputable.
"Bitcoin! I've always wanted to try it. [Click.] 'Wallet address', what's that? Okay, I'll just Google Bitcoin. 'Buy viagra and pot online,' oh uhm... Okay, creating a wallet.. Wow, this isn't easy. Okay, now... Time to convert some cash to bitcoins! What the hell?!? Why does it need all of this info? 'For tax purposes bitcoins are not currency,' what the hell?!? Okay, um... What the hell is 'Magic the Gathering'? 'Fraud.' 'Japan.' 'Apologizes.' Hmmm... Ah, forget it."
My theory is that in the shadow of the bubble collapse, the desire for bitcoin to succeed has driven wishful thinking to the extreme, where some vocal bitcoin evangelists ignore or spin reality to reconcile it with their desire.
It's more akin to the old XBox vs Playstation flame wars, where a console fan could just admit the cons along with the pros, but then that wouldn't fully validate their decision to invest.
An example of some of the spin that I'm talking about: https://news.ycombinator.com/item?id=10959211
An example: you could never move money over the wire anonymously before crypto came in. Well, except if you had a fake identity, which is illegal. Now you can. Of course, you need to be a security expert in order to do it but ultimately UX will get there. I wasn't around at the early days of internet but I am pretty sure if my mother could access it back then she would have no idea what to do. And here she is calling me on Skype every other night.
Another example: There are millions of people who cannot afford buying a computer as you already said but possess low-cost mobile phones. There are already a bunch of bitcoin startups targeting that market. Apps and tools will eventually evolve up to the point where they will be accessible, easy-to-use, scam-free, safe. We just need to build them.
As obvious as it may seem that is a positive thing, keep in mind that a lot of people will not think so. Even more people can just don't appreciate it and could be convinced either way. If everyone thought anonymity was so good, fake identities wouldn't be illegal.
My point was that in discussing things like cryptocurrency (and other technical matters), many of its advocates go to arguments like yours with the silent assumption that certain aspects are obvious benefits. You forget that that's an opinion, and any argument based on it misses it mark with someone who doesn't share that opinion (or hasn't formed one). I think that's part of the reason "the oxygen in the room has been depleted".
Goldbugs, because of how bitcoin is "mined" and is inherently deflationary. And gold is the one true currency, m'kay.
Cypherpunks, because it is built around cryptographics. And cryptographics makes anything double plus good.
Never mind that both kinds have a strong anti-establishment streak.
That said, if they could get away form their anti-inflation fanaticism, and find some way to speed up the ledger processing, then the distributed ledger part of bitcoin may have a future.
This because while inflation can be bad when it runs riot (though money printing in itself is rarely if ever the cause) it is better in the long run than deflation, as that allows some entity or other to corner the market.
And in the end, all currencies are tokens of account. Meaning that they exist in the end to make sure nobody double spends. But to be effective in doing so, the token material must the worth less then the face value. If not, people will have an incentive to hoard. And that will drive an economy into the ground.
A consumerism-based, Earth-killing economy. But it will give raise to more sustainable economies.
People have finite lifespan, and so, they want to use their hoards to better these finite lives, which leads them to spend. This preference, known as the "time preference", strikes a balance with the tendency to hoard. It is impossible to predict where this balance is, though, because it's subjective to each participant.
Why do you buy cell phones or laptops today, knowing that future ones will be better or cheaper? Why buy some food today, when you know your purchasing power will be greater next month? Why pay for housing when prices are falling, knowing your contract will be cheaper in five years?
Direct practical utility.
> Why buy some food today, when you know your purchasing power will be greater next month?
I don't eat, i starve, i die.
> Why pay for housing when prices are falling, knowing your contract will be cheaper in five years?
Now there you get into something interesting. Though the five years view is comically long.
This dangerous idea has been used to justify all forms of crazy economic intervention since Keynes formalized it. The notion of a currency having to depreciate is a direct consequence of these policies, all based on a fallacy. No matter how counterproductive these policies are, they're still applied. Look to Japan and Switzerland as recent examples. Japan has massive stimulus, the Yen is dropping, are people spending more, no, they're saving for the future, knowing that their savings will be worth less, so they need more of them to get by - no spending on unnecessary items. Switzerland is paying negative interest rates on savings accounts, so people have to save more to offset that.
There are lots of things to dislike about Bitcoin, but its value increasing over time isn't one.
Anyways, why the Japanese is saving is that even 2 decades later they have a private debt overhang from the 80s boom.
Expect Europe and North America to follow much the same pattern (already a decade in shortly).
The deflationary spiral is not about consumption of non-durable goods. Thats why all of your examples don't really work as reasoning against this concept. It rather is about investment and consumption of durable goods: Cars, forklifts, the pick and place machines at foxconn.
Inflation would only really make sense in a model where everybody already have access to all the funds they need to purchase what they want, but where they postpone all purchases to see if the can get more, AND where it is these delays that hurt the market by making it hard for the makers of these goods to survive. And this effect has to be the single most dominant one.
Lots of goods tend to increase in value over time. Land, gold, stocks, etc. How is bitcoin any different? If people want to hoard, nothing is stopping them. They will just hoard, nothing has ever been stopping them.
And hoarding isn't a bad thing. If you aren't spending your money, then you aren't taking resources out of the economy. That means more resources for everyone else. Spending money, consumption, is what should be discouraged.
The main function of a currency is exchange, not storage.
Without a currency you are back at the barter stage, or move to IOUs (that may ironically turn into currency if allows to pass from person to person).
Hoarding in a mattress represents a lost opportunity cost. Most hoarders put their money into something that yields interest, that gets it circulating, and it is in fact, how our entire banking system works.
Also, let's call hoarding something else, namely "saving". In a healthy economy, you need saving and spending. Saving is a way of deferring spending to the future. When lots of people save, it means it's a good time to borrow money because it's cheap due to the nature of the banking system and lending and because it means that people have money to spend on whatever you're producing with the credit. You really can't have spending without saving and vice versa, otherwise you risk some kind of credit crunch or collapse of the currency. (The USD is in a scary place, BTW).
If you're trying to argue against Bitcoin as a currency because it's used as a store of value, then you have to be against the USD or Euro too. The ratio of saving to spending is different among these, and in Bitcoin-land the ratio is particularly skewed to saving due to the early adopter advantage, but there's still a healthy amount of churn for a currency that's so young, despite profound technical encumberance to its usability.
Second, even if people literally did fill vaults full of cash, it doesn't hurt anyone. It's not like all the currency is going to actually disappear and people will have to go back to bartering. The remaining currency just becomes worth more.
The bitcoin economy doesn't collapse everytime someone loses a wallet. It never will, because the remaining coins can always be divided further, and always increase in value further.
Lastly it's not like people will literally never spend that money again. They of course intend to spend it at some point. At some point the number of people saving vs taking out of savings will stabilize and everything will be normal. And saving for the future isn't a bad thing. In fact it should be encouraged.
This is the key point that addresses why hoarding makes no difference to Bitcoin's utility as a currency.
I'm usually pretty good at detecting irony, so I apologize if I've been bested here. But are you honestly suggesting that reductions in consumption and spending are favorable to nation's economy?
If you are being ironic, I don't think I understand your message. Would you mind explaining it to me?
Yes absolutely. All the economy does is just allocate resources. If some area of the economy is consuming more, than that is coming at the expense of other areas of the economy. Likewise if spending in one area is cut, that leaves resources available for other things.
That's all supply and demand is. Prices increase or decrease with demand until the supply is stable.
If you want a large, fast, distributed ledger, go ahead and make one. If you want to anchor it in Bitcoin, go ahead. Why would bitcoin itself change heavily just to suit your proposed need?
It's a misconception that bitcoin the software, or the community as developers, are incapable of switching to larger and faster blocks. The system is working well, as designed.
> the one true currency
The only one here saying that, is you. Bitcoin doesn't have to be the one, or all things to everyone.
> if they could get away form their anti-inflation fanaticism
That's like going to a foreign film society and complaining that they're fanatical about foreign films. It says so on the door and you aren't forced to stay. There are inflationary crypto-currencies...
Obviously a lot of Bitcoin evangelists have large BTC holdings because it's entirely in keeping with their belief that it's a brilliant idea, and many if not most exchanges, altcoins and even blockchain based trading schemes weren't conceived as ways of persuading fools to part with their money. But many Bitcoiners are speculators and some of the schemes dreamed up around Bitcoin were scams or might as well have been, which hasn't really been the case for flavours of Linux. FOSS evangelists might have made similarly grandiose claims about their project and the philosophy behind it, but they weren't trying to pump the price of their commodity holdings at the time or running get rich quick schemes - they usually weren't even expecting to get paid!
Something of a tangent I know. I largely agree with you on the virtues of some inflation in an economy as a whole, but I think it's pretty evident now that Bitcoin is neither replacing currency as a whole nor representing a sufficiently stable store of value to encourage hoarding on any scale. Frankly Steam accepting BTC is no more economically destabilising than Steam deciding to accept inflationary-by-design Linden Dollars.
Both issues have been resolved in Ethereum, an alternative cryptocurrency with a market cap second only to Bitcoin itself.
So, it can be said that cryptocurrencies indeed solve many problems. What can't be said is which cryptocurrency will be the one that ends being used as cash in the long term.
Sometimes the economic winds favor different assets both liquid and long term stores of value.
Bitcoin adds a legitimate, scarce, immutable form of ownership of something that can be transferred with the least amount of friction of any other asset (including cash).
Hyperbole or not, where it is now compared to 2009-2012 is extremely impressive. It's an exciting space to watch develop over time, love it or hate it.
I think those that don't understand it but are quick to judge or regurgitate the opinions of their peers (it's a ponzi, tulip mania, etc) are just as hyperbolic and ignorant.
I don't see how anyone can argue that bitcoin and it's blockchain is not an impressive, elegant technological solution to a problem that needed solving.
Bitcoin solved a problem, whether that problem needed solving or will be extremely fruitful is for the future to determine.
The fact that a 4+ billion dollar stateless currency exists is pretty amazing to me.
Personally I think the anti Bitcoin crowd is also the pro government crowd. You know, the people who support torture of innocents, assassinations, genocide, etc etc, but I'm sure I'm just some nut -- yeah I'm the nut, not the people who talk about laws And justice while shrugging off torure.
Amazingly gross display of hypocracy.
Regardless of the extreme pros or cons, Bitcoin is revolutionary.
PS - Your middle paragraph is painfully hard to read (is it one, huge sentence?). This makes your post feel like it was purely an emotional, unedited response with little filtering...
People who are neutral might fail to realize the political implications of Bitcoin and immediately jump to "those people are mental, why do they hate us?"
That applies pretty much to any political discussion ever.
Being suspicious of cash is very dangerous. Historically, the poor rely on cash far more than the rich, so if we start demonizing it, really you're demonizing the poor. Politicians know this and often exploit it to help their rich friends.
Bitcoin has the capability to be the great equalizer, not just across economic bands but also across country borders. Your fear of it seems unfounded, though the paranoid part of me does wonder if you work for Visa or some other financial institution.
That's backwards. Bitcoin is directly controlled by the owners of property (miners), in proportion to how much they own.
But that it is more akin to controlling the post-office than controlling the bank. People can be inconvenienced but not stolen from (except in certain cases with confederates of the post-master) and those can be guarded against more easily than avoiding phishing email from "your bank".
What risk measure are you using there, and what ease measure? E.g. waiting for 6 blocks for transactions to settle (best practice AIUI) would be a serious inconvenience when e.g. paying at a restaurant.
Mostly, attacks on the protocol itself (instead of your android wallet, etc) require significant mining effort and usually waste it effort by making the block incompatible with the global network (the double spend). When the cost of the item, divided by the number of blocks the merchant waits, is greater than the block reward divided by your likelihood of finding enough consecutive blocks to cheat - it may be worth it to try.
Specifically for food - you're supposed to mention coupons and traveller's cheques at the start of the meal, giving the restaurant time to prepare. The confirmation time (one, or maybe two blocks) could be handled the same way - pay a bit early.
fwiw, I have paid btc in a restaurant and it was seamless because they didn't bother waiting for any confirmations because they had our faces on camera... Fraud is fraud so they weren't worried. Flash the QR, scan the QR, check the numbers, hit okay, done. 20s for me, and maybe another 20s for the merchant.
But yeah, some stores don't take credit, some don't take cash. All depends on their workflow if seconds matter.
I object to the claim that it's easier to guard against a hostile bitcoin network than against phishing emails. It may be possible to use bitcoin safely for some use cases, but it's more effort than avoiding phishing emails.
For a server, it's just like another card reader with a different UI, it's not some high-tech payment box they need a PhD to operate.
(Spear-)Phishing emails often include your boss's real info, fairly convincing text, proper formatting, etc... They've tricked trained CFOs out of millions.
Using BTC is like using Instagram, there's a ton of complexity behind the scenes but if you aren't a systems integrator it's essentially seamless.
There is a complete lack of acknowledgement of bitcoin's ineptitude as a replacement for current payment methods, what with its 2TX/s limit (on a good day) and the ridiculous size of the block-chain which effectively negates all the advantages of it being a distributed system since you have to rely on third-parties to use it on you phone or embedded devices for example. Not to mention the monopoly that chinese miners have on the network...it's a joke.
IMHO bitcoin is an interesting experiment, but that's all it is. It will be replaced by something better some day, another fact that evangelists refuse to concede.
Take the lighting network for example. The idea has been floating around for quite some time but in practice its still vaporware.
Yet, ask any bitcoin enthusiast what's being done to solve the scalability problem and the LN is trotted out as if it were already widely adopted. It's ridiculous.
Pay to publish is a feature. It's the rate-limiting mechanism we'd need anyways, but directly tied into PoW and reward.
Make your coin and ask people if they want to use it instead of bitcoin. It's so easy, and you can be proven right.
You don't need to trust third parties even with mobile devices, the Bitcoin Wallet app on Android uses the SPV protocol where a malicious miner has to outpace the rest of the miners to fool you. It uses the code library bitcoinj. Headers-first sync only made this easier to do with minimal resources.
Back in the 90's when there was more of a religious fervor around Linux the way there is around Bitcoin right now, yeah you would have.
The vitriol is no mystery, it's an obvious reaction to the way so many people have rapturously talked about Bitcoin as if it's going to make governments irrelevant.
We're at the beginning of Bitcoin being treated more like the novelty that it is, and possibly finding a niche where it can be useful over the long term. As it enters this phase where the hype around it dies down, the vitriol will as well.
I used it to buy a (horrible) game last night, and it worked beautifully. Contrast with PayPal, with which Steam is always confused about where I am and whether it should charge me in GBP or EUR. I'm never not using Bitcoin again.
It is done completely legitimately - you're just not getting money from steam
Bitcoin does have mixing services that would "launder" or obfuscate the link between bitcoin and your real identity, which does provide value for some users.
What is "valid payment data"? How do they validate this data?
>Bitpay is definitely subject to KYC / AML compliance.
Why is that relevant?
You need to have a valid payment method. I'm not sure how better to explain this... a credit card or paypal account etc. It's validated when the payment clears. Both of these have strong identity data linked to them.
KYC (Know your customer) / AML (Anti Money Laundering) compliance means validating the identities of those you do business with. That means, using Steam to launder money isn't possible. This should be pretty obvious.
No, paypal doesn't do ANY identity verification for customers beyond fraud scoring and AVS.
For cards, you can just get a prepaid. And most cards outside of the US don't even support AVS, so there's no way for valve to validate any of the information you give them besides the PAN and CVV.
>KYC (Know your customer) / AML (Anti Money Laundering) compliance means validating the identities of those you do business with. That means, using Steam to launder money isn't possible. This should be pretty obvious.
I don't think Valve is covered (or considers themselves to be covered) by either of those, and they certainly don't appear to be doing any of the typical KYC stuff.
there are good ways, this isn't one of them. Stick with Shapeshift.io
It seems that BitPay (the payment provider used Steam and many other merchants who accept Bitcoins) gets a dollar valued refund amount from the merchant (so you can do partial refunds). Then they calculate the Bitcoin value of the refund amount at the current exchange rate and send that much bitcoin back to the user. There's an extra Bitcoin transaction fee involved. I'm sure BitPay keeps a few thousand dollars worth of Bitcoin on hand to pay refunds, and I'm sure refunds are rare enough that any frictional costs are much smaller than what they bring in through their own fees.
So basically the user is taking on the exchange rate risk -- if you buy a game, Bitcoins go up 20% overnight and then you request a refund, your refund amount will be less Bitcoins than you originally paid. If they did it any other way then it would be subject to abuses that would allow users and merchants to collude to extract money from BitPay (BitPay would essentially be writing options which would allow users to buy back bitcoins that were sold on their behalf in the past at the same price they were sold, even if that's substantially different from the current market price).
Go look at USD/YEN movement, 1-3% movements occur daily, if you were to purchase YEN with USd and later refund to USd you could end up significantly up or down.
But the wealth YEN represents is many many magnitudes greater than Bitcoin. When YEN appreciates by 2% that influences hundreds of millions of people and business, and guess who is pulling that lever, a small cabal of corrupt bankers.
And for what it's worth, I find the bitcoin payment process immensely superior to credit cards: Just pull out the phone and scan the QR code on the screen. Screen updates to show payment was made. Love it. (Now, acquiring the bitcoins in the first place though...)
I can pay with Dogecoin with one additional step.
>It makes bitcoin more fungible and thus viable as a currency.
Isn't using Bitpay just a way of exchanging bitcoin for dollars, while kidding yourself that's not what you're doing?
> And for what it's worth, I find the bitcoin payment process immensely superior to credit cards: Just pull out the phone and scan the QR code on the screen. Screen updates to show payment was made.
All that's left is to wait countless tedious hours for the funds to appear in the, for example, Namesilo account. It is easy (so is using a credit card), but it's almost uselessly slow (unlike credit cards).
Edit: maybe this explains anti-Bitcoin sentiment. The fundamentalists can't handle any factual comments that aren't entirely about how game changing it is.
This is not a bitcoin problem.
Actually, scratch that, because it doesn't even matter. Wherever you want to lay the blame (anywhere but bitcoin) it's a problem for anyone using bitcoin, making it more useless than (not "immensely superior" to, as claimed) using a credit card or Paypal, which makes it a problem for bitcoin.
Because some people insist on waiting for the payment to settle before actually providing the services, although it's not nearly as common as it used to be.
This is just completely unrealistic with credit cards where settlement times are far longer than with bitcoin, days or months.
>Wherever you want to lay the blame (anywhere but bitcoin) it's a problem for anyone using bitcoin, making it more useless than (not "immensely superior" to, as claimed) using a credit card or Paypal, which makes it a problem for bitcoin.
I don't know, I use bitcoins to pay for things regularly and pretty much everyone accepts zero-confirmation transactions nowadays (which is pretty much the same as accepting credit card payments, except the settlement will most likely take less than an hour).
The first phase of the process - authorization, when successful not only makes sure the customer has enough credit on their account, it also reduces their buying power by the grand total of the auth thus guaranteeing the funds to the merchant. And it takes 2-4 seconds.
You authorize (sign) a transaction, broadcast it and the network confirms it.
Signing a transaction takes only a fractions of a second, and to the merchant it's a significantly stronger guarantee of settlement than a credit card authorization.
Tx confirmation times are a known problem with BTC in terms of the payment acceptance flow, this is one of the hurdles preventing wider merchant adoption of BTC acceptance.
It absolutely does not. Even if the customer isn't actively trying to screw you it's still possible for the hold to expire before settlement.
>Signing a bitcoin transaction and broadcasting it to the blockchain does not.
With a reasonable fee it's a far stronger guarantee of settlement than a cc authorization as it's way harder for the customer to reliably cheat you.
>Successful confirmation of the tx on the blockchain does, and to be on the safe side the rule of thumb is to wait for 6 confs on the bitcoin blockchain before considering the funds to be guaranteed.
6 confirmations makes sense if you're selling a house, surely you wouldn't just rely on a cc auth if you were doing that.
For digital goods (and POS) this is a non-issue since the capture request is combined with the auth request. For physical goods - well if I'm a customer and the merchant hasn't shipped in 2+ weeks it's fair to me to get the hold removed from the funds my bank GUARANTEED to the merchant.
6 conf is a rule of thumb bitpay (and other bitcoin payment processors that I'm aware of) are following before GUARANTEEING the funds to the merchant. sure, if this is a P2P transaction and I was personally selling you $10 worth of merchandise I'd be ok with 1 conf, when talking 'industrial' scale payment acceptance things work just a little bit different.
So now in this particular case - steam can revoke the license if the payment eventually fails which is precisely why I think this sort of market is perfect for BTC (I commented on this in this thread).
And finally since you're claiming high tx fees are 'a far stronger guarantee of settlement than a cc authorization as it's way harder for the customer to reliably cheat you' - how would you cheat the merchant after the auth (let alone auth/capture) went through?
That's a pretty shitty guarantee when the bank can deny settlement anyways, and FWIW mine seem to expire in 5 days.
>6 conf is a rule of thumb bitpay (and other bitcoin payment processors that I'm aware of) are following before GUARANTEEING the funds to the merchant. sure, if this is a P2P transaction and I was personally selling you $10 worth of merchandise I'd be ok with 1 conf, when talking 'industrial' scale payment acceptance things work just a little bit different.
Unless you're talking about transactions worth tens of thousands of dollars it's simply not worth it for an attacker to even attempt such an attack (not that it'd be very likely work anyway).
And last I checked bitpay is just fine with 1 conf transactions and will happily tank the risk for you. I'd assume the risk is quite small since I haven't ever heard of such an attack actually happening.
>And finally since you're claiming high tx fees are 'a far stronger guarantee of settlement than a cc authorization as it's way harder for the customer to reliably cheat you' - how would you cheat the merchant after the auth (let alone auth/capture) went through?
I could just claim that the transaction was fraudulent. I could contact my bank and forward them a fake email from you claiming that the auth was an accident (done this before, although not with a fake email).
Oh, and most shockingly... I could just use a stolen card!
bitpay - even if they were happy with 1 conf it would still mean 10 or so minutes before you are guaranteed your funds as a merchant. They are not, however - "When an invoice is complete, it means that BitPay.com has credited the merchant’s account for the invoice. Currently, 6 confirmation blocks on the bitcoin network are required for an invoice to be complete." (https://bitpay.com/docs/invoice-states) Although the merchants can take the risk of course, and if they are controlling the product after the sale (which is the case with Steam) - they are free to dispatch the goods when they please.
Fraud - sure, you're talking good ol' chargebacks and yes not having to deal with chargebacks is a good selling point for btc payment acceptance. These happen AFTER the settlement however. If the customer convinced their bank to remove the auth hold, then the capture the merchant performs before shipping would fail so you know that the guarantee the issuing bank provided is no longer there.
Again, bitcoin does have it's strengths in terms of being attractive to both the merchant and the buyer, transaction confirmation times is probably the single biggest weakness here especially compared to the way CC processing works.
That's fungibility. That's liquidity. A big marker of stability and legitimacy for a normal currency is that it's freely convertible.
A parallel example: you can pay for stuff "in euros" on Paypal, but Steam likely only gets dollars. That's still good for the viability of the euro as a currency, because it can be easily exchanged for goods and services, even with a middleman.
> That's still good for the viability of the euro as a currency, because it can be easily exchanged for goods and services, even with a middleman.
So it's good for Bitcoin in exactly the same way that it's good for Dogecoin, and other popular alts.
And that's why it's a bit silly to have ideological positions about currencies :-P I'm just arguing that it is actually good for Bitcoin the currency, not that it's good for the bitcoiner ideology.
> So it's good for Bitcoin in exactly the same way that it's good for Dogecoin, and other popular alts.
Oh yeah, totally. It's good for the viability of blockchain currencies in general.
Indeed. I think Bitcoin would be given the time of day by a lot more people if there was a lot less political whackjobbery surrounding it, and more sane, informed discussion from people such as yourself.
This is a pointless distinction.
Also, I imagine CNY -> USD conversion is probably done on an exchange instead of through a company like BitPay, so the comparison might not be very accurate.
There is no such thing as a Forex exchange, it is done through banks who hedge their exposure to other market participants over-the-counter and take a cut just the same.
There is absolutely no reason (in the long term) that Bitcoin would cost more to exchange for merchants than any foreign fiat currency does today.
And even today, a ~1% Bitcoin processing fee is approximately 1/3 to 1/2 of what credit cards cost to process.
1. worldwide - which gives them large customer base without access to other methods of payments (unlike US where it's really hard to convince customers to use BTC instead of Credit Cards);
2. Digital goods with licenses that can be revoked - so the merchant doesn't have to worry (too much) about confirmations/double spends and is able to "ship the goods" instantly. They obv have to factor the potential case of tx not going through into their flow to catch these but it can be done without impacting their users whose txs do get confirmed.
So yes, as a merchant it's up to you if you want to wait until the funds are there (invoice status == 'Complete') or ship as soon as the payment is detected ('Paid' status).
Bitpay will obv guarantee for the funds to be there when status moves to 'Complete' otherwise they are risking to get hit with a double spend.
In addition to double spends there are also things like volatile mainnet confirmation times etc.
Which is why bitpay won't fund the merchant until 6 confs on the bitcon network.
Me too. That's basically the mission of yours.network btw. Best way to keep in touch is the slack channel https://yours-slackin.herokuapp.com/
The "omg futurist" brownie points are just a side-effect. Steam/Valve isn't terribly progressive. Heck, its only recently that they put in a refund policy and started putting in common sense limitations on trading to stop fraud. Someone did a cost/benefit analysis here and it simply worked out. I guessing this is part of a larger anti-fraud initiative at Valve.
Are there any other kind?
Besides, the fact that among the top 3 exchanges were the crap fests of "a man-week of amateur PHP code" and the like that were taken down speaks volumes about the kind of crap the bitcoin crowd can't see through.
(1) There are people who think it's a pure speculative bubble or pyramid scheme. (I disagree because it has utility.)
(2) There are also people who point out that it's a deflationary currency and therefore broken. (I sympathize a bit with this view but it's not enough to make me dismiss it completely. I think this might be a solvable problem.)
(3) There seem to be some who just take a contrarian position against things that have received a ton of hype or that are too fashionable.
What exactly is the news here? Some company accepts some new form of payment that hardly anyone uses.
When it comes to "money", Bitcoin proponents seem massively misinformed on how it actually works. The blockchain technology is interesting, but a new currency isn't as exciting as they want you to believe. I don't care that my dollar has no inherent value, as long as people accept it in exchange, that's all I care about. And they do, everywhere.
Well that's a bit short-sighted then.
Plenty of people care about a lot more than that in a currency, namely that is it responsibly and equitably managed. Bitcoin is not this, of course, but it's a giant step in the right direction compared to the Federal Reserve.
That and the vast majority of bitcoins are held for speculation instead of used as a currency.
Then why should I care about it?
>"It's a giant step in the right direction compared to the Federal Reserve.
The Fed system is far from perfect, but despite what the conspiracy theorists think, it didn't spring out of some sinister idea; it's the evolution of a complex financial system that has generated more wealth, for more people, faster, than at any point in history. Those are facts that you're up against when promoting Bitcoin, a system where some early adopters think they are going to hoard the currency until they get rich from it, because other people can't obtain it. Why would any outsiders buy into that system? That's the thing that some people can't grasp; there is no reason whatsoever for your currency to be scarce. It should grow to match demand.
I also believed that. Recently I've come to realize I'm skewed because I'm in an eastern country with little financial controls. Bitcoin has real traction in places like Brazil or China. That has real value, and it is enough to make BTC gain critical mass.
Had you asked me two months ago, I'd say bitcoin as a currency was doomed. Today? Not so sure anymore.
But, again, the core innovation about cryptocurrencies/blockchain (I risk a lot of HN karma using the later word!) is strong and has long term implications beyond the current issues on PoW, miners, etc.
Aside for people excited by the tech (and its potential applications to other fields), the core of bitcoin believes are either get-rich-quick types who buy into the pyramid scheme, tin-foil crackpots (similar to gold hoarders), and stick-it-to-the-man true believers (with a freeman-of-the-land [1] mentality) naive enough to believe it can trump regulation and disrupt "the system".
In areas of high corruption, a networked, global currency could be rather freeing.
My home country Tunisia for example has very strict currency controls in place, which means that it is impossible to purchase any goods from outside the country or even transfer money overseas.
The government now provides rechargeable card with a 1000 TND (~500 USD) limit that can be used for online purchases. However, these are only issued to software developers and entrepreneurs to allow them to subscribe to online services, such as hosting, domain names, etc.
Bitcoin provides a quick and easy way to circumvent that: convert your TND to BTC, and use that to purchase online goods or to transfer money outside the country.
I'm actually thinking of setting up a MVP to test out this idea, but I'm struggling to come up with a solution that is completely transparent for the end-user. In other words, I don't want the user to have to understand Bitcoin or buy/sell it manually. I'd prefer instead for the system to use BTC under the hood.
Another example I read about recently is Argentina. People are using Bitcoin there for daily transactions and for their savings due to high fluctuations in the local currency.
Is that reality as of today, or is that a hope for the future?
Well, perhaps, but
(a) these people are a very small amount compared to "first world" bitcoin champions
(b) they would be better off pushing for actual policy change regarding their problems, instead of using a technological workaround who (depending on the whims of those in power) can land them in jail/money loss at any time...
Yes, your second point is true, but sometimes the country itself is struggling to stabilize its currency. Thankfully, that's not (yet) the case in Tunisia.
I can certifiably tell you that I AM better off because I started using bitcoin. And it's not because of the exchange rate, but because of the freedom to do what I please with my money.
But the overwhelming majority of bitcoin investment, marketing and ownership isn't coming from Tunisia. It's coming from the West (and China), where most people have no problems spending or obtaining currency (maybe China does).
Why are Westerners so eager to make money off of people's inability to move money around poor countries, and why is it supported?
I've used BTC in an emergency situation, to transfer money when I would otherwise have needed to wait for several days for an international bank transfer (and then would also have hit my bank's foreign ATM withdrawal limit).
Your third paragraph is a veiled insult based on a notion that if applied consistently would deem the international banking system at least as immoral as Bitcoin.
As for why it's big in more developed countries, I guess it's because people are using it either as an investment device, or for purchasing goods anonymously.
A common issue in Tunisia especially is sending money to relatives in France. I want to give them the end-to-end experience in one place: you send me TND, I send your relative EUR. But everything I've thought of to accomplish that is just too complex.
So right now my idea is just to give users BTC in an online wallet and let them do whatever they want with it. That means I'll need to effectively educate users about the basics of Bitcoin at the very least.
In that case you end up holding TND and need to purchase the bitcoin to give to your customers in another currency. You would have an easier result if you just directly exchanged TND to EUR without putting BTC in between. Likely that's about as legal as your solution. Just because at some point the value is hold in BTC doesn't mean currency controls cease to exist.
I don't see the value Bitcoin provides here at all except for the fact that the government agency that should enforce currency controls is likely not competent enough yet to spot what you are doing. I'd place a bet that as soon as you start advertising your transparent TND-EUR conversion scheme that they'll shut you down as fast as if you wouldn't use BTC.
The key selling point for BTC is that it is completely digital. Think of it this way: if I have TND and would like to buy some EUR, how do I "store" the EUR I get? I only have a Tunisian bank account, so the EUR I receive from say a German account will still be stuck inside Tunisia. And if I receive cash, it won't do me much good. Not to mention the inherent risk involved in doing bank transfers.
But if I use my TND to buy BTC, I can store that BTC in an online wallet, or completely offline. I can easily transfer it to anyone anywhere in the world, or use it buy goods online. The simple act of getting your hands on BTC means that currency controls, transfer fees, etc. are completely circumvented. As for security and accountability, it becomes much easier to control given Bitcoin's digital nature.
That is leaving out the point that both the operators and the clients are willfully circumventing the law, which most governments don't appreciate.
One way is to simply buy BTC from local sellers who perhaps bring BTC from outside the country. They take a cut and I add a markup before selling it back.
But there's another advantage I have. I'm currently residing outside the country, and if I do setup the business it will be funded using outside money. Because the company is funded externally, I can actually transfer any revenue it generates outside of the country.
As for your last point, that is in fact my biggest concern. The government could easily close down the company and its bank accounts at its pleasure. To avoid this, I think the safest option is to go with a purely decentralized market that simply connects buyers with sellers, but that will make it much harder to take a cut.
Anyways, I'm still thinking about the whole thing, and as you noted, it's not that straightforward.
The question was why Bitcoin gets negative responses on places like HackerNews, and that question was answered.
If you want a hedge against a catastrophic collapse of the dollar (or whatever your local currency happens to be), there are innumerable other, better alternatives.
Besides, if there was such a collapse, who's to say that Bitcoin won't get dragged down with it? After all, more than likely you're using bitcoins to buy things that cost dollars.
Bitcoin is far from the only case where catastrophic data losses or leaks are very costly. It's something that's certainely worth thinking about carefully, but it's not a fatal flaw for the system's usability - if it were all digital data use cases would be fatally flawed.
1) I'm still bitter I threw all mine away. I had a few hundred in the early days and thought, "this isnt going anywhere"....
2) I'm one of HN's resident conspiracy theorists, for lack of a better term, and bitcoin can be seen as a threat to freedom because for all the awesome things it is, it is not anonymous. This may seem innocuous at first, but if you subscribe to the globalist conspiracy view, one of the primary tenants of "their plan" involves cashless, digital only currecy easily tied to your personhood. In essence, I fear the future will be more totalitarian and dystopian than people realize, and digital currencies like bt seem ripe for abuse and use in such a system.
3) Along the same lines as 2, I feel like once banks start getting into bitcoin heavily, despite its theoretical mechanisms to prevent it, the banks will find a way to corrupt and control the system. The community has already experienced the first attempts in the form of the huge first price inflation.
4) Another problem with bitcoin is that it requires good cybersecurity, which we all know is much more rare than anyone wants to admit. It's ripe for mass thefts. Once that wallet is gone, not much can be done.
Ok, thats most of it, now I have to say that I understand there are many "ifs" in what I am saying, but to me the threats are real. I still will use bitcoin for the time being anyway, and there are many good things about it and other *coins, but you didnt ask what I liked, you asked what I dont like.
On that note, blockchain technology independent of bitcoin I expect to be a huuge hit. Blockchain all the things!
Like I said, Bitcoin will scale like the internet scaled which is in direct proportion to demand. Blocks aren't often full and if you are in a hurry then you need to pay 10 or 20 cents to prioritize your transaction.
But it's hard to get and hard to use. It's useful for a pseudo-anonymous transfer for value.
Unless I'm doing something illegal, Visa is a better option.
There's always one situation where one currency is more convenient than the others.
Is this attitude a remnant of the religious wars in Europe?
There can be only one?
One interesting thing is there is an optimal fee based on the size of the block of transactions.
If you re read my comment you can see I explicitly said getting money out of those countries, which have been infamous for capital controls.
Also - Magic Beans - accepted at 48 locations in Athens https://coinmap.org/#/map/37.99873292/23.73853683/12
Look up the ideal properties of money and you might understand the big picture better, but it may mean challenging your deeply held beliefs and not everyone is ready for that.
But even without game theoretic arguments involving civil disobedience, Bitcoin is still interesting. It offers cryptographic protections that have never existed before in real fintech applications (e.g. programmable signatures), and radical transparency and configurable trust that can patch the sort of vulnerabilities that led to the 2007 financial crisis.
[1]: https://www.reddit.com/r/btc/comments/49osb4/examples_of_rbi...
[2]: https://medium.com/@octskyward/the-resolution-of-the-bitcoin...
On the other hand a global payment system would require a currency which is at the very least stable (and not increasing in value). But a stable value might not be enough to cover the expenses of most of the miners. Mining is already dominated by Chinese miners which happen to have access to the cheapest electricity - which incidentally completely undermines the aspect of decentralization.
In summary it seems that at this point a decentralized payment system just appears to be too expensive (computationally) to be any serious competition for currencies in countries with a well established, trusted payment system. It still might be of use in the developing world.
It works in the other direction too. Lowered value lowers mining competition which LOWERS difficulty. It stabilizes itself automatically.
Until these things are fixed, I don't think I will ever use or invest in Bitcoin.
I hate this "Linux of the desktop" analogy because people really fail to realize that it has already happened and that they have missed it. I blogged about this a couple of months back: https://blog.r3bl.me/en/year-of-linux/
If it gets doublespent, they tell Steam that, and Steam simply revokes the sale, because it is digital and linked to the account.
Did it blow over because the block size limit was increased?
The blocksize hasn't been increased yet. It blew over due to wallets improving their fee support. If you are in a hurry and need quick confirmations you increase your fee by 10 cents, but if the transaction doesn't need priority you may wait for quite a while.
The modern wallet softwares all calculate and offer different fees based on the expediency of the transaction.
"The fastest and cheapest transaction fee is currently 60 satoshis/byte, shown in green at the top. For the median transaction size of 226 bytes, this results in a fee of 13,560 satoshis (0.06$)."
That's not a problem for Steam, since the fees are still much lower than credit card processing fees for larger transactions (as in at least several dollars). It is a big problem for people who have dreams of micro-transactions via bitcoins.
A lot of people don't have debit cards. A lot of kids can't own debit cards legally. For them Bitcoin might be the only option.
The guy who made the reddit announcement had to wait 1day+ because his txn didn't get the 6 confirmations. Compared to that, my visa txn took approximately.. 10 seconds? While I was in Lahore, Pakistan.
> No exchange rates are involved in any meaningful way.
That's a dishonest statement to make.
> A lot of people don't have debit cards.
That's what you think. Its trivial for anyone who wants to get one (and doesn't have a criminal background) to get one.
If you mean people who don't know how to open a bank account, they're even less likely to know how private / public key encryption works and use bitcoin.
> A lot of kids
Gift cards.
Card payments take far longer to process than bitcoin payments
> exchange rates
Just as much as with bitcoin.
> getting scammed
Why?
I can't remember the last time I stood in line at the supermarket for an hour because VISA was clogged with "dust" transactions. Hmm.
And this is meant to be a good thing?
You don't have to buy bitcoins directly, you can mine them.
And that's before they even learn about the deep security issues, how hard it is to protect, how most Bitcoin services cannot be trusted, etc.
"Be your own bank" implies "be your own security division", which very few people are qualified to do.
You implied there were deep fundamental flaws in BTC security, but your response shows nothing of the sort. Your 'deep flaw' is 'you have to protect your private keys'. You are describing a UX flaw, and I would agree with that. Objectively, you have exposed no 'deep security issues'.
Bitcoin's non-physical nature (as compared to paper and coin currencies), I think, makes it more of a metaphor to a bank account or debit/credit card than a currency. This likely is a UX flaw, as you state, but it's a pretty big flaw.
And credit cards, in most jurisdictions, have lots of protections against theft and fraud, as well as consumer protections like chargebacks and transactions are reversible, of course.
Bitcoins are a form of digital cash.
You store Bitcoins in a wallet. If you lose your Bitcoin wallet you lose your bitcoins. In a similar sense, if you lose your wallet containing notes/coins, you lose your notes/coins. The security risk is the same.
Because of this, it's better to compare Bitcoin to other forms of "digital/virtual representations of currency", like debit cards and credit cards. And that's where Bitcoin's mass-adoption-type use-cases tend to fall apart.
Exactly. This is why, where there are trusted and easy to access alternatives, people generally don't possess and carry around large amounts of cash.
That means that any security breach is catastrophic. Whereas the routine security breaches of credit and debit cards, and online banking systems, are not catastrophic.
Physical cash is of course not subject to instant theft from anywhere in the world - the theif has to be in the same place as the cash. Whereas it's basically not safe to use bitcoin on any computer connected to the internet - to do so is equivalent to leaving it in the street - rendering it hilariously unsuited to ecommerce.
Not to mention that the most convenient ways of actually getting money in and out of the bitcoin system, the exchanges, tend to have frequent security breaches and exit scams of their own.
(I should just point out that in this discussion generally the anti-bitcoin side uses 'bitcoin' to refer to 'the totality of systems needed to do normal useful things with bitcoin', while the pro-bitcoin side limits it to only the protocol and possibly the reference client implementation.)
This is simply incorrect. I fail to understand why so many people believe bitcoin transactions are untraceable, we are talking about a public ledger.
I understand the gap between how supporters and non-supporters discuss bitcoin. It's just that if you give all your USD to a scammer, we don't say there is a fundamental flaw with the USD.
However, even with this difficulty, it's still easier than tracing cash payments to a particular entity. If I pay someone in cash, under the table, good luck proving the cash was ever mine. I would wager the government would prefer criminals conduct their business in bitcoin.
If you don't like cryptocurrencies, thats fine, don't use them. I'm just asking that you do not misrepresent them with half truths in some fruitless attempt to show they are flawed when compared to cash.
https://stratechery.com/2015/21-inc-and-the-future-of-bitcoi...
There are not many people specifically acquiring bitcoin just to pay for steam games with it, where it will be converted right back. Maybe some to test. Questioning the value as a result of the "usd -> btc -> usd" transfer isn't really applicable because it just generally doesn't apply anymore.
No, that's your only measure of success. In order for Bitcoin to succeed as a viable payment platform, businesses also need to adopt it wholly, which means actually conducting business in Bitcoin rather than converting it to a "real" currency as soon as possible.
Basically, if they are treating it as hot potato, that means they see it as too unstable and risky.
I don't understand the need to require a business to hold the bitcoin in order to consider bitcoin a "success". In this scenario bitcoin has succeeded as being a cheap method of transferring value.
Eh, I'm not so sure. You are probably right, but at the same time they probably want USD for the same reason they get USD from Paypal or their merchant bank when someone pays in a different currency.
Is Paypal not a viable payment platform?
There are two parts to Bitcoin - some folks think it's a great store of value. I do not. I think it's an amazing decentralized transaction system that can replace VISA/MC - not replace the US Treasury.
Why is that so hard for Americans to understand?
I live in Pakistan, and happily and easily use a visa debit card for buying steam games.
You may even use Visa, still doesn't mean that you are dealing with US dollars. Why do you think is it completely normal to have Visa as being a global country dealing with the cross-country transactions, but not Bitpay?
If you have access to the international banking system, great. It is not a bad thing. Just like it is not a bad thing to have bitcoin as an alternative.
The one thing that I don't get, anytime that Bitcoin comes here, is that people seem to think that it is an either/or proposition. That for Bitcoin to be usable it needs to completely replace the Almighty US Dollar or any other sovereign currency.
Cryptocurrencies and the blockchain are just tools that are being explored and developed as a way to bring trust to transactions and accounting without a central authority. What is bad about that?
We don't need to have Central Banks. "Us non-Americans" don't need to use American Institutions to participate in a global economy.
This idea of "I can pay with Visa, therefore Bitcoin is useless" is short-sighted.
You framed it as "I can pay with Visa..."
I think you may have projected your argument onto his statement with no real correlation.
First, it's not the country that is being used as an argument. So the point is moot.
Second, this is not about "Developed/Underdeveloped Countries". That would be incredibly backwards. It was to show that not everywhere has unrestricted access to international trade, and that cryptocurrencies can help with that.
Just as an example: despite the crisis, Greece is a developed country, yet (because of the crisis) they are also applying very strict capital controls.
So, despite being "able to pay with Visa in his/her country", a Greek could also benefit from something like Bitpay.
The point still stands. The point is that by accepting bitcoin, even if through a broker, Steam (an American company) now can reach a good number of people who are have nothing to do with the American Financial system.
The US may be the center of the world, but it is not the whole world. Bitcoin (or any thing that can be fungible and free of control by one central institution) can be used by anyone outside of this.
Is that really an issue?
A better system would be direct payment, but thats a problem that society hasn't figured out yet. How to easy transfer money, without a middle man, in a safe, private respecting, and cost-free way.
Translation: cheap publicity in tech media and goodwill from some geek sites with no impact whatsoever on its actual revenues and 99.999% of payments.
> Valve reached out to us because they were looking for a fast, international payment method for Steam users in emerging gaming markets in countries like India, China, and Brazil. While more users are coming online in in these countries, traditional payment options like credit cards often aren't available.
Yeah, there's always that, too.
But there are 3rd party sites where you can sell your items for real money.
Tho you should only bother if you have valuable items.
I can only assume that the number of buyers using both Bitcoin and a VPN to buy cheaper games is too small to worry about.
Worst part is that it continues eating it's own children, as long as bitcoin is there, no other crypto currency will gain widespread adoption.
But each of those payment provider you pick holds your assets and can restrict your transactions any time. With Bitcoin that is not possible.
We already see this with the banking institutions that grow like barnacles on the side of the blockchain - they track where their customers spend coins, and blacklist the customer if they go to e.g. DNMs. If bitcoin gained wide enough adoption that people could cut out these middle men, the government would have much more incentive to inject itself into the mining process. There is already ample evidence they are doing various things on-chain to track the spending of large/active users, see e.g. https://reddit.com/r/DarkNetMarkets/comments/4fov8h/i_regula...
Edit: FWIW, Bitpay is one of these institutions. Steam doens't accept bitcoin, they accept fiat paid by Bitpay on behalf of someone with bitcoin.
From a certain legal standpoint (IANAL) the miner is facilitating all of the transactions which he creates a block for. This might make him liable if any of those transactions involve blackmail / extortion / money laundering.
[1], Prevention of access - e.g. Nationwide Bank unserved queues & capped withdrawl in the UK on the days sub-prime hit is often the case in recession or bank runs.
[2], Censorship of payee - e.g. the inability to donate to Wikileaks by any means except Bitcoin when 'collatoral damage' incited US Senators to successfully pressure payment processors worldwide.
[3], Censorship of product: cash allows monetary civil disobedience like purchasing medical cannabis under prohibition.
The idea that you can be prevented spending your money makes money fallible (& as [1] just when you need it most).
If money has more power than ones vote this is wholly undemocratic.
Under Capitalism markets are unfree without freedom to spend one's wealth.
[1] Bitcoin is very difficult to keep safe, so most people will store it on sites like Coinbase / MtGox. These sites will inevitably lend other people money, which will lead to the same issues, in exchange for interest.
[2/3] Censorship of payee / Censorship of product. The perceived anonymity in bitcoin is largely fictional - you can extract the details of who paid who for what, and you can prevent someone exchanging bitcoin for fiat currency / goods. At the moment authorities simply don't care because the value of the transactions is insignificant in relation to hard currency.
None of these 'problems' (and society in general doesn't care about these issues) are to do with the currency. The first one is endemic to the concept of a bank which can lend more money than it has, no matter what currency it deals in. The second two are social / regulatory problems which won't be fixed by some new crypto-anarchist dream.
I see the complete transparency of Bitcoin as a strength, it is certainly an antidote to the opacity of offshore / shell companies & tax dodging.
[2] & [3] they can't prevent payment using Bitcoins but one could be arrested after the fact and detained without computer access.
[3] This is why I said civil disobedience for [3]. Bitcoins are a public act.
National Currencies like sterling are not implicity bad and actual cash notes can be used for [2] but electronically Sterling et al. lack a lot of freedom.
[4] could be fees which currently dissallow national currency micro transactions, which have great utility for instance in a post advertising models & the micro-services revolution to come.
Snarky to say 'crypto-anarchist dream', crypto means something other than an abbreviation for cryptography in that context e.g. crypto-fascism - which many fear democracies are secretly becoming.
Bitcoin is not a dream it is a working implementation, usefully used daily.
With Open Bazaar now running, a free global market is enabled - without freedom markets are unfair and not proper capitalism. Adam Smith best points out the issues with crony capitalism & regulatory monopolies.
Bitcoin seems like healthy competition to me, national money is overly regulated in some ways and under regulated in others. Arguably to the benefit of the rich and powerful as most governments seem weak in the face of corruption by lobbying these days. Electronic (national currency) transactions are innefficient & overly costly, Bitcoin profoundly highlights this.
[1] Bitcoin is provably safe, the safety of ones possessions and computer is the current issue of the day. The UK & US government are promoting breaking encryption and making everyone unsafe.
It is good to have alternatives to help ensure regulatory over-reach can't happen as easily as it recently has.
https://en.wikipedia.org/wiki/Crypto-anarchism
'The "crypto" in crypto-anarchism should not be confused with the use of the prefix "crypto-" to indicate an ideology or system with an intentionally concealed or obfuscated "true nature". For example, some would use the term "crypto-fascist" to describe an individual or organization that holds fascist views and subscribes to fascist doctrine but conceals their agenda so long as these doctrines remain socially unacceptable.'
The crypto in crypto-anarchism is intended to signal a link with cryptography.
Using cash locally when buying/selling stuff in person is in most cases superior to all other ways of using money.
OTOH, sending cash abroad is risky and problematic. SEPA and similar agreements exists but you still have to wait at least a day until the money arrives.
For a worldwide available paying network, bitcoin is not that unattractive. It's not the best option for all possible use cases, but what other paying option is?
I think the centralization problem is not as problematic as it may seem. It all depends on how much the miners are going to use their centralization power. But you have the same problem with central banks. Maybe even more because the bitcoin miners have something to lose if they act unreasonable.
It doesn't matter if it dies or not while the users of these technologies [slowly] grow and new innovations appear. Currently Bitcoin is the leader but the core concepts around cryptocurrencies/blockchain are the most important part.
Bitcoin doesn't have widespread adoption, and it is arguably the only chance for cryptocurrency to gain widespread adoption in any reasonable timeframe.
Saying that bitcoin is getting in the way of the widespread adoption of cryptocurrency is somewhat like saying that the cart could go faster if only that slow horse weren't in the way.