Besides, illicit transactions are still transactions.
And.. you are just plain wrong. Bitcoin is also useful for buying many completely legal things. Including a VPN that can't be linked to your identity. (Illicit you say? What about a journalist in a repressive regime).
Also, just because some people do something doesn't mean that there aren't strong incentives against doing that thing, and doesn't make a statement such as "people don't do that" false. It just means that there are exceptions, but when the exceptions don't affect the point it is common to ignore the exceptions in general conversation.
Regrettably, it's still super common for people to turn up their noses in disgust, claiming "Bitcoin Boogey Man, oh noezzz"!
I'm sorry, does the USD somehow not come with a Boogey Man? Because last I checked HSBC was caught with their pants down directly funding terrorism through shady business practices, Bernie Madoff is still in prison for running a giant Ponzi, the illegal narcotics trade is done mostly in USD, plus you have money laundering, and just about every crime conceivable being carried out in USD.
But wait, the Bitcoin Boogeyman!!!
Everyone come to look!
The USD is dirtier than Bitcoin by several orders of magnitude. It's been taking a full out mudbath every day of its life for the past several decades. It's just that the USD is all people know, so they assume it's squeaky clean, because how could it not be squeaky clean??
Why would I buy a cheeseburger with Bitcoins? Say the cheeseburger costs 0.1 Bitcoins (today). Tomorrow, who knows what those (fractional) Bitcoins will be worth!
Dollars (or whatever) on the other hand are generally pretty stable. Currency fluctuations, on a day-to-day basis, are very, very small. Sure, there's the occasional hyper-inflationary episode (several South American countries have experienced these somewhat regularly), but that's the exception.
The problem is that Bitcoin is, at least at this point, more of a commodity that people trade when they can't (or don't want to) use traditional money. It is not a "currency" in that sense.
But fortunately bitcoin has great use even today in its current state. It is great for sending or accepting money internationaly, quickly and without ridiculous transaction fees. This is something you can't do with official curencies and is IMO big part of the success bitcoin is experiencing.
There is no proof that the 2007 financial crises was not orchestrated on purpose. There is also no proof that that 2007 financial crises was orchestrated on purpose.
But we do know that Goldman Sachs sold financial instruments to their clients which they betted against. When the clients lost that money the profiteers was Goldman Sachs.
1. If you assume that the Rot Schild banks owned the entire English economy since June, 1815 and, If you assume that the Rot Schild bank had a value of USD 1,000,000 at that time, growing at 5% per annum for 200 years it's value would be USD 17.2 Trillion.
If you also consider that the Federal Reserve has been leaking money into the shareholders of the FED at 6% of interest on bonds raised since 1913, and if Rot Schild banks were all part share holders in the founding banks of the Federal reserve this profit has been going to them.
If the Rot Schild banks were the major investors in Goldman Sachs, it would make sense for Goldman to loose their investors money and transfer it to their biggest investors directly through dividend.
We know from 1. above that the Rot Schild holdings should easily be USD 17 trillion + and that the valuations of the banks that went under was about USD 800 billion. Hence it is highly possible that the biggest investor in Goldman is bigger than all the rest combined.
The bitcoins are there for a reason much much more important I think.
However This site : http://www.ukpublicspending.co.uk has the UK GDP and national debt from at least 1750
In 1816, the GDP was 0.32 billion pounds. If you assume from 1816 the lending to UK govt bonds was the Rot Schild bank, the starting point of the Rot Schild base moeny that I took will be far more than USD 1 million. So I think you will arrive at a trillion any which ways.
The reason for this is that from that year going forward, the Rot Schild would have bought bonds from the govt (effectively lending them money) every year going ahead, giving them (the Rot Schilds) a passive income stream from then to now.
Each year a new income stream would have been added by loaning additional bonds, which was independent of the previous years income.
I don't know what numbers to plug in, perhaps that is left to someone more knowledgeable than me.
Here are their recent financial reports if you're interested: http://www.rothschild.com/about_rothschild/financial_reports...
I think what you meant to say is that bitcoins don't make a good general-purpose day-to-day currency (yet). For example paying your hairdresser, paying at the supermarket, etc.
https://en.bitcoin.it/wiki/Trade#Restaurants_and_cafes
I don't have an Android+Wallet App (I think you need that), so if anyone with such a phone wants to go with me there, I'm up for it :)
Google Wallet is just an easy way to manage your credit cards and, sometimes, pay using NFC.
Yes, I meant https://play.google.com/store/apps/details?id=de.schildbach....
You should ask yourself from where currency originates. What is its predecessor and was its acceptance ubiquitous. And take note that there was a period not long ago where saffron was used as "currency".
Also, though you may be intelligent, it would good to take a note from Socrates and consider that perhaps you don't know everything about every field.
This isn't clear to me at all.
There are a finite number of possible bitcoins, and once the last one is mined no new ones can be created. While it might be true that putting more USD into circulation causes the value of each individual dollar to go down, that's actually an incentive to spend money and create economic activity, instead of hoarding it hoping the price goes up.
You may say that's just a baseless speculation, but not any less than yours.
In fact, if we're completely honest, paying for a VPN with bitcoins doesn't mean your identity is hidden anyway. All it would take is one connection record in one log file and you're exposed.
The "can't be linked to your identity" part depends entirely on how you get your BTC in the first place.
If you buy them with cash from a guy on the street who has no idea who you are, fair enough.
If you buy them from an exchange by making a deposit from your bank account, the level of anonymity you enjoy depends entirely on how much you trust the exchange. They know your real name and the wallet you used to receive the BTC. If they share this information with anyone, a sufficiently motivated attacker can trace the BTC to their ultimate destination (the wallet of the VPN firm). If you launder the BTC through a few intermediary wallets first, I suppose you might have some plausible deniability, but if you're a journalist in a repressive regime how much is plausible deniability worth?
On the other hand, i don't know what "astronomical currency risk" are you talking about. Merchants accepting bitcoin are not forced to keep their balance in bitcoins. They can exchange it for dollars or other official currency every hour if they wish so. They are not affected by the volatility of the bitcoin exchange rate as you probably asume.
These factors substantially reduce the cost of selling goods and services with Bitcoin.
"and 0% risk of fraud" This is completely untrue, because it assumes the motives of both sides of a transaction.
The act of conducting a transaction posts the wallet id's of the participants to the global ledger, and associating wallet id's to real identities is far from impossible.
(This article may help in understanding the chart: http://codinginmysleep.com/measuring-bitcoin-speculation/)
The chart shows that the rise is not due to an insane rise in speculation.
I'd never spend my bitcoins on drugs or gambling. That's what the rapidly devaluing dollar is for. Recall that the US dollar is Narco Currency #1 on the planet.
Bitcoins are useful as leverage due to their rapidly expanding (and sometimes deflating) value. I bought my first bitcoins for ~$3 two years ago and held them, even through the first spike and afterwards. I bought more btc at $5-12 as they were floating along last year.
I recently traded some of my btc for hard assets, gold and silver. I then sold some of the gold to a friend and bought more bitcoins.
Useless? No, Bitcoin is a very useful tool. It's the email of money.
I hope not because email should have been replaced a decade ago (no native end-to-end nor encryption. Node-to-node encryption (eg SSL) isn't standard let along the default, no native support for binary objects and base64 MIME increases files sizes by ~30%, and the mess of plain text and half supported HTML across the plethora of clients make designing mailshots a complete nightmare so there should be some sub-standard of HTML that is both secure and universally supported.
> What exactly would be the point of native end-to-end encryption over PGP?
It's a bit how you could have all your important Word documents in a password protected compressed archive. But having password protection and zip compression native in OOXML is more convenient for users and guarantees than anyone with an OOXML compatible office suite has support to open the same documents (baring authentication of course).
> The problem with email encryption is solving the authentication part, not the encryption itself.
Like HTTP should have been replaced by AOL, right?
The e-mail protocol (and I'm talking about the entire stack, from SMTP to the client's handling) is old and really not best suited for the modern way we send documents and modern security concerns. Which was the crux of my point.
So I'm not talking about replacing the paradigm nor ownership, just it's the implementation.
I have been wishing for my bank to give me this kind of service for a long time, but still no sign of it happening.
Sure, holding bitcoins is a risky proposition - like holding gold, or anything else of similar volatility.