New York Department of Financial Services Bitcoin Hearing - Live
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It seems that it would be more fair that everyone just transfer their current personal value into bitcoin value to avoid the inflation effect.
There is no doubt that the current participants are creating incredible value for the rest of the world, and should be rewarded, but it's truly scary how much money they will have. I'd be interested to see someone do the math on how rich they would become, but I think it would be scary.
I feel that democracy is to politics as what bitcoin is to the economy, but our founding fathers were not turned into trillionaires.
My understanding is certainly limited, but I think the reality is plausible.
An on-going and updated analysis of the estimated wealth distribution of bitcoins shows up on the Bitcointalk.org forum[1].
[1] https://bitcointalk.org/index.php?topic=316297.msg4779800#ms...
As a rough order of magnitude estimate, if Bitcoin gets to be as big a thing as gold, then it will be worth about $10 trillion. Since there will be about 20 million BTC by then, those individuals will be worth about $50 billion. This is a lot of money to be sure, but there won't be many of those people, and this is not out of line with the world's very highest net worth individuals.
The people who got in after that peak will probably be worth at least an order of magnitude less. And if Bitcoin turns out to be a smaller deal than gold, it might "only" create fortunes worth 9 figures of USD.
[0] http://motherboard.vice.com/blog/bitcoin-mints-its-first-bil... [1] http://www.forbes.com/billionaires/list/
http://en.wikipedia.org/wiki/Satoshi_Nakamoto
http://en.wikipedia.org/wiki/Gavin_Andresen
https://github.com/gavinandresen
' This is quoted from the defunct Bruce Wagner Bitcoin podcast:
"Bruce Wagner : When was the last time you chatted to satoshi <laugh> Gavin Andresen: Um... I haven't had email from satoshi in a couple months actually. The last email I sent him I actually told him I was going to talk at the CIA. So it's possible , that.... that may have um had something to with his deciding " '
https://bitcointalk.org/index.php?topic=113609.0
My reading of that thread is that it's common knowledge/expected that they're not the same person, but I certainly wouldn't claim to be sure.
The basis of all wealth is trust. Gold has value because people have trust that it won't be duplicated easily. The worth of all gold in the world is ~ 10 Trilion.
The stock market has value because people trust that commerce will continue to happen regardless of much else on the world. The value of all the world's stock is around 600 Trillion - which means there is more faith in the continued operation of companies than there is in the demand for gold.
The REAL breakthrough of bitcoin has nothing to do with money; it's the blockchain - an indisputable public record. If people trust that system to continue - a system oriented around an irrevocable record - it could easily be worth some fraction of the stock market. What happens if btc market cap goes up to 100T?
It's a very interesting thought. Wealth distribution is a concern is it not? In the fiat economies ~80 people hold half of the worlds wealth. There's nothing wrong with thinking about the present distribution among BTC, and how do we think it will evolve?
Your second statement makes no sense from a practical standpoint as there would be no way to transfer all personal values into any system en masse. This implies an unresolved argument is forming.
Your third statement confirms your fears and the reason for the argument.
Decentralized crypto currency technologies can also conceivably eliminate the need for the current government structure. Your comparison excludes this and limits Bitcoin to just the economy. Our founding fathers were mostly wealthy to begin with and their involvement in forming our government helped build that wealth further.
This is conjecture, but based on the fact we're seeing an unprecedented amount of sharing and giving going on in the alt coin ecosystem, I think any Bitcoin trillionaire/billionaire is going to turn out to be quite liquid with their funds, especially where building the ecosystem is involved. There's something to being able to trust whoever you choose to give funds to actually gets the funds without an intermediary getting involved. Add contracts to that, and you get massive intent initiated on a global scale for a given effort.
This is one reason I'm somewhat more optimistic about Dogecoin. Dogecoin culture is explicitly centered around tipping, donations, and goods & services, which is what you need to get a new currency going.
It's also quite interesting that the whole progression of gold -> dollars -> Bitcoin -> Dogecoin follows Gresham's Law [1]. At each stage, currencies that are hoarded for their value are replaced by currencies that are intrinsically more worthless, because the lower value of those currencies means they can be held by a larger fraction of the population who has a demand for goods & services but no means of payment. This makes me wonder if in the absence of central regulation, currencies are subject to the same disruptive innovation forces as the tech industry, where the success of a currency sows the seeds of its eventual downfall.
And don't get me started with the obnoxious doge tips. If the tips are worth less than a penny keep them to yourself please.
While I understand your frustration with Dogecoin, I think it's power (other than not taking itself too seriously) is that it's extremely liquid. It means you see it move around a lot more and can be generally used in place of karma/upvotes (which aren't really worth anything).
Ultimately I encourage all of this experimentation. I feel that entirely new economic paradigms will emerge from all of this if we let it.
Who knows where it's all going to end up, hopefully somewhere none of us can predict.
Think of it not as a negative thing ("cheap bastards!") but as a cheap A/B test. Now we know how much in actual monetary value micropayments can be based on.
20 DOGE ~= $0.03 (or 3 cents).
Prior to cryptocurrencies, there was no way to test this out in a live setting because money transmission fees would have prevented this on a large scale. Pay walls have to charge enough to cover credit-card fees + operating + profit margin in monthly or yearly amounts (or per hefty per-article fees); perhaps now they can harvest real data to determine whether micropayments would work via cryptocurrencies,
Cheap, live, at-scale economic experiment in micropayments (or micro-tips if you want to be pedantic).
As usual, dogecoiners don't understand the first thing about their own currency. They think "more coinz is better because microtransactions". I can't believe so many people have trouble grasping the concept of decimals.
Logical fallacies that exist in people's heads are every bit as real as technical limitations, and much harder to work around. You can fix your product; you cannot fix a few hundred million peoples' inability to do math. So work around it and adapt your product (or currency) to the world as it actually exists rather than the world that you would like to see.