Bitcoin, or Bitcon

[Grumpy John]

I just saw an article on ACA about Bitcoin. At the moment 1 Bitcoin costs you just under A$2300. Who gets my hard earned ozzie dollars if I buy a bitcoin, and what protection do I get to stop it crashing?

[Cal]

The guys at work are talking about them at the moment, figures they mentioned (and elsewhere on tv etc.) current value is around $11,000. If the market crashes you loose, just like the stock market.
It's all virtual too, no actual coins involved. There are bitcoin "coins" around but face value is not of that of the virtual bitcoins. The whole thing is Snake oil to me. Like any gambling, spend what you can afford to loose.


Sent from my iPhone using Tapatalk

[Grumpy John]

Bitcoin is a Ponzi scheme, and it will collapse like one | TheHill (http://thehill.com/opinion/finance/364306-bitcoin-is-a-ponzi-scheme-and-it-will-collapse-like-one)

[DavidG]

Anyone remember Poseidon shares.

[Chris Parks]

I just saw an article on ACA about Bitcoin. At the moment 1 Bitcoin costs you just under A$2300. Who gets my hard earned ozzie dollars if I buy a bitcoin, and what protection do I get to stop it crashing?

Life is a gamble, do you feel like gambling? If you buy shares to fund your retirement it is a gamble and those that have lost money (including me many years ago) ask the same questions. Bitcoin is driven by speculation exactly the same sentiment as is driving the share market at the present time and long may it continue says he hopefully. I reckon Mr Bond and his mates had then same guarantees as Bitcoin does, where is my money that went down the slot back then?

[Chris Parks]

Anyone remember Poseidon shares.

Oh yes, I remember waking up one morning and listening to the radio and everyone was buying them or trying to and reportedly the Queen lost a motza on them. Share clubs sprang up everywhere but I cannot recall ever getting any money back from my participation in them.

[Sawdust Maker]

today's tulips

[rrich]

Was it P. T. Barnum that said, "There is a sucker born every minute?"

If you had bought Bitcoins way back when, then my advice would be to SELL NOW. My advice also would be to not buy now. IMHO What you're buying is a computer algorithm. Then someone has declared a value on the algorithm. So in the words of PTB, you're buying smoke and mirrors. And, a Ponzi scheme of sorts? Probably?

So all of you time travellers out there, go back and buy a few thousand Bitcoin, sell them today and retire tomorrow. :)

[cava]

The guys at work are talking about them at the moment, figures they mentioned (and elsewhere on tv etc.) current value is around $11,000.

Sent from my iPhone using Tapatalk

Correction, the price today is circa $23,000A

https://www.cryptocompare.com/coins/btc/overview/AUD

[cava]

Bitcoin is a Ponzi scheme, and it will collapse like one | TheHill (http://thehill.com/opinion/finance/364306-bitcoin-is-a-ponzi-scheme-and-it-will-collapse-like-one)
If Bitcoin is a ponzi scheme, then by definition, so is Medicare, Social Security etal which rely on new participants to fund old and established benefits. Just saying...

[tonzeyd]

No protection what so ever, much like shares except extremely volatile. Similarly to Cal the advice I was given before getting into shares is whatever you invest be prepared to lose it. If you can't afford to lose it don't invest.

Investing is one of those things like the lottery, there are many more people who lose everything than those that actually win. So as tempting as it is to hear all the people who have cashed in their bitcoin I'm sure there are many others who have lost everything. The stories i have heard of those that have scored big is the typical "yep bought something forgot about it realised i had it then cashed in"

[Yanis]

First of all Bitcoin is not a ponzi scheme. Just because it shares an at-a-glance similarity in some superficial respects does not make it a ponzi scheme.

However Bitcoin is unlike a currency or shares in one significant and important detail. Both of the latter have intrinsic value that can be objectively calculated but Bitcoin does not. Yes, it is linked to the ability to generate the crypt that defines the coin but that more defines its limits rather than some inherent value.

A currency is valued against the country (or countries in the case of the Euro) economy, A stock or share is valued against the companies fundamentals which can be defined. There is no such fundamental value that can be attributed to Bitcoin. As such the Bitcoin is whatever people say it is.

In terms of who gets the money you pay for Bitcoin, it is the person selling that particular coin or portion of coin. the difference in what they paid for it and what you are paying goes into their pocket (or comes out if you are paying less than they paid). If the coin is sold by the person who mined it then the whole value of the sale is profit by the seller. Of course the cost of the computer and power used to generate the coin needs to be factored into it.

The premise of course is that the harder it is to generate Bitcoin the more valuable they become. But this is more perceived than actual intrinsic value.

My personal view is that the bubble will burst and there will be a lot of very disappointed people. My advice to people who ask me is that you should not spend any money on Bitcoin that you would not be upset to see disappear.

[matt_s]

My advice to people who ask me is that you should not spend any money on Bitcoin that you would not be upset to see disappear.

I have no skin in this game, I'm simply curious; are just another armchair Internet punter, or do you hold some financial qualifications?

[Grumpy John]

Just in case I gave the impression in my OP that I was contemplating purchasing Bitcion, no way would I touch it, not even with someone elses money.

[cava]

Bitcoin aside, which may or may not survive, the technology behind it is I am lead to believe impressive.

Whether we like it or not 'blockchain' technology is here to stay and part of the future.

Banks, Governments and businesses are looking to implement it with their own digital currencies. Its part of the touted cashless society that has been pushed on the global community for the last decade or so and I think that the next 12-24 months will be very interesting, especially with cryptocurrencies. We shall see...

[bueller]

Totally agree cava, I work in software development and blockchain tech isn’t going anywhere. It’s being adopted in the banking sector, e-commerce and a whole swag of other industries. Bitcoin might seem like a scam but it’s basically become the gold standard when purchasing crypto currencies, until someone else takes that crown it’s here to stay.

[damian]

There is one thing no one is talking about with bitcoin. Sure this last few weeks it's being snapped up by the usual late to the party wannabe speculators, but who was buying it for the last some years since it launched at 10c ?

Criminals.

Bitcoin is great for laundering money. It's virtually untraceable and until the authorities figure out how to counter moving money around the globe undetected demand will remain for it.

Apparently it's been used extensively on the "dark web", whatever that is, to buy drugs guns and other dodgy stuff but I reckon the real traffic is drug traffickers and such wanting to make their profits disappear.

Opinions worth what you paid for them...

[Yanis]

I have no skin in this game, I'm simply curious; are just another armchair Internet punter, or do you hold some financial qualifications?

Neither. I am a geek, nerd, or just plain curious person who accumulates a lot of useless knowledge. I have not bought BC (but my son has) but am now regretting not getting into it in its very early days. I have followed its progress from when no one but extreme nerds knew about it. I know of people who did mine it early on and sold it all. I also know of at least one person who just held onto it and is now (on paper at least) a very wealthy person but who still has has day job.

Right now I consider "investment" in BC to be a mugs game. Equivalent to investing in IT in the 1999 IT sector boom with one significant difference. In 1999 the IT stocks were clearly overvalued and heading for a bust. We are now in completely uncharted waters and what happens next is purely speculative, no one now has anything but raw instinct to fall back on.

But I agree that block chain technology is going nowhere. It is here to stay.

As for the criminal use of block chain currencies, absolutely correct. There is valid use for BC et al and also the dark web, it is not all criminal activity but these are the things exploited by criminals. Policing these things is problematic and is not easy and will not get any easier.

[rrich]

As for the criminal use of block chain currencies, absolutely correct. There is valid use for BC et al and also the dark web, it is not all criminal activity but these are the things exploited by criminals. Policing these things is problematic and is not easy and will not get any easier.

Isn't that why cash was originally invented? To be able to move money around anonymously?

[cava]

Isn't that why cash was originally invented? To be able to move money around anonymously?

Yes. Gold and silver were also used which coincidently, according to the Australian Constitution, is to be used for the payment of debts.

[Yanis]

Isn't that why cash was originally invented? To be able to move money around anonymously?

No. "Cash" or currency was invented to facilitate trade.

[Yanis]

Yes. Gold and silver were also used which coincidently, according to the Australian Constitution, is to be used for the payment of debts.


Common fallacy. It is taking one clause completely out of context.

[Dibbers]

No. "Cash" or currency was invented to facilitate trade.

One could argue that Bitcoin was invented to do the same. One of the benefits (or so i've heard) is that the transfer of bitcoin is instant and no currency conversion is required. So intead of paying a bank x% to convert AUD to USD or waiting 4 days for your money to transfer, bitcoin is instant... this also facilitates trade

I personally don't invest in anything because i have horrible luck with money, but thats my understanding...

[Fuzzie]

It should be called BitLotto. The more punters put in, the bigger the prize pool will be for the winners. The winners will be the ones who sold before the bubble bursts. It's only a matter of time. It has already demonstrated it can rise and fall irrationally in seconds and there's no way to analyze when the fall will come because it's just a global heard emotive thing.

The financial institutions with all their knowledge, acumen and computing power can't even correctly predict the direction international exchange rates are heading viz the AUS to US$ rate. This time last year they were predicting AUS$=45c US, but they have shown that cowboys on their trade desks can manipulate the rate.

FOMO. Are you felling lucky?

[cava]

Common fallacy. It is taking one clause completely out of context.

Thats an interesting concept, and certainly one I have not heard before.


115. States not to coin money. A State shall not coin money, nor make anything but gold and silver coin a legal tender in payment of debts

[ian]

115. States not to coin money. A State shall not coin money, nor make anything but gold and silver coin a legal tender in payment of debts.

Needs to be read in context.
The section is a prohibition on a State (NSW, Vic, WA, SA, etc) running their own State mint or note printing business independently of any Commonwealth mint or note printing unit. (Note that it was around 1964 that the RA Mint was established in Canberra.)
It is also a prohibition of on a State introducing or sanctioning a system of barter for payment of debts, or establishing it's own State currency.
Which leads to some fun thought explorations. Imagine if NSW had settled on super-fine wool as a currency. We would all be walking around with our pockets full of fluff. :wink:
"Debt" in this context needs to be read as legally enforceable.

[cava]

All true, however to throw a spanner in the works, I read in Quick and Garran sometime ago that the Commonwealth is (believe it or not) legally also a State.

If I find it, I will post the excerpt.

For those that are not familiar with Quick and Garran, they put out the Annotated Constitution of the Australian Commonwealth back in 1901 and is the word by word explanation of the Constitution which has been used and is accepted in the High Court in constitutional matters.

[damian]

I love the woodwork forum. You start talking about bitcoin and next your discussing the interpretation of the australian constitution. :D

Bitcoin was developed for altruistic reasons but like many things it's been turned to the dark side. The current speculative bubble is a sideshow. Good for the media, bad for punters, irrelevant for everyone else.

The things that differentiate bitcoin from say the tulip bubble is the fundamental limit on supply and the fundamental demand from criminals. With the price so high some are already turning to the alternatives, but I think that will drive a correction not an annihilation...

At the risk of opening another can of worms I pay far more attention to the property market and see terrible similarities between sydney/melbourne now and the crash of the 1890's, only this time the bubble is so much bigger...IF (!) I am correct there will be many many tears..

[Chris Parks]

I think that all currencies are not unlike Bitcoin when it is all said and done and are based on human sentiment to get it right back to basics. Who says an ounce of gold is worth more one day that the next? The traders who SPECULATE the price based on how they feel international commerce is going from day to day. There is no hard standard for gold and all national currencies have gold as the base of their valuation. Others might argue differently as I am just an observer with no formal education in all of this at all.

[Grumpy John]

Wow, I didn't expect all the different responses from my OP. It has been very educational for me to read all the comments. I have googled some of the terms mentioned such as "blockchain" "crypto currency", and must admit it has added to the confusion, rather than reduced it. I guess I'm a bit of a dinosaur and more of a bricks and mortar type of person. Old school, if you can't hold it in your hand it doesn't exist, except for electricity, don't try and hold that in your hand, DAMHIKT. :D:D:D

[Yanis]

I think that all currencies are not unlike Bitcoin when it is all said and done and are based on human sentiment to get it right back to basics. Who says an ounce of gold is worth more one day that the next? The traders who SPECULATE the price based on how they feel international commerce is going from day to day. There is no hard standard for gold and all national currencies have gold as the base of their valuation. Others might argue differently as I am just an observer with no formal education in all of this at all.

The gold standard has long been abandoned. If I recall Australia was rather lat to the party, sometime in the 80s.

The important and significant difference between a nation's currency and Bitcoin is that a currency has (in simplistic terms) the nation's fundamentals as its underlying value whereas Bitcoin has nothing.

Interesting reading for any one *really* interested. https://en.wikipedia.org/wiki/Gold_standard

[cava]

The gold standard has long been abandoned.
Care to comment why China, Russia and other countries are buying gold hand over fist?

[DavidG]

Because gold is essential in the production of modern electronic components.

[cava]

Because gold is essential in the production of modern electronic components.
That's interesting, I thought that Silver took over that role, in smart phones in particular.

[Chris Parks]

The gold standard has long been abandoned. If I recall Australia was rather lat to the party, sometime in the 80s.

The important and significant difference between a nation's currency and Bitcoin is that a currency has (in simplistic terms) the nation's fundamentals as its underlying value whereas Bitcoin has nothing.

Interesting reading for any one *really* interested. https://en.wikipedia.org/wiki/Gold_standard

To take currency and worth back to the basics it is only what we think it is worth and the value we put on anything at any given time, nothing more or less. I am listening to a book at the moment (The Flash Boys) based around trading on the US share market and it absolutely astounding to hear how the share holders on the stock market are or were (I haven't finished it yet) getting ripped off because some smart guys have arranged things to make money by working in milliseconds when trading.

[ian]

To take currency and worth back to the basics it is only what we think it is worth and the value we put on anything at any given time, nothing more or less. I am listening to a book at the moment (The Flash Boys) based around trading on the US share market and it absolutely astounding to hear how the share holders on the stock market are or were (I haven't finished it yet) getting ripped off because some smart guys have arranged things to make money by working in milliseconds when trading.it's still going on.

I recall a news item from a year or so ago where the flash traders in Sydney were upset about the ASX trading computers being relocated. The distance from a trading desk to the "market" computer being a relevant factor in a flash trader's profitabity.

[Yanis]

To take currency and worth back to the basics it is only what we think it is worth and the value we put on anything at any given time, nothing more or less.

Whilst there is an element of "randomness" to the value of a currency this is minor and not the fundamental value of a currency. This is why printing money (literally) can only lead to inflation since it devalues the currency. There are a lot of factors that contribute to the overall value of that currency its traded value is not purely random, it is based on those fundamentals.

This is how it differs from crypto-currency.

[Lappa]

Australian Stock Exchange is moving to a Blockchain style system early next year

https://www.businessinsider.com.au/the-asx-is-replacing-its-chess-share-clearing-system-with-blockchain-technology-2017-12

[Fuzzie]

Bubble, what bubble?
https://finance.yahoo.com/news/bitcoin-just-lost-almost-half-183500758.html

[rob streeper]

The characteristic of Bitcoin that hasn't been directly discussed here, or much if at all in the popular press, is sovereignty. I'm using the term in the context of state sovereignty, i.e. countries.

In my appreciation, all or the vast majority, of the various country currencies in circulation, are fiat currencies. Fiat currency is defined as currency that is declared legal tender by a sovereign government.

The word fiat derives from the latin verb facio or "do". A usage which is not too obscure is 'Caesar fuit' or 'Caesar wills it (to be done)'. Thus, Caesar said 'you do it' and in the instant case fiat currency came into existence.

In the old days most sovereigns were people, i.e. Caesar, the King, Tsar, Moghul, Pharaoh, Khan, Emperor, Fuhrer or whoever. If the Caesar said 'do it' and you didn't comply you could be pretty sure that Caesar would send some muscle to either make you 'do it' or truss you up to die more or less slowly as an example to anybody else who might have the inclination to question Caesars' will. Money wasn't the only thing created by imperial fiat of course, Peter the Great commanded the creation of the city of Saint Petersburg in 1703 and it got done.

Over time the concept of individuals as sovereigns evolved into the prevalent current practice of bureaucratic sovereign states. This system has some advantages over the systems based on single or small numbers of individuals. For instance, these systems are somewhat less susceptible to being taken over by tyrants. These systems don't die and lead to succession conflicts and so on. However, the bureaucratic sovereign governments still rely on the same old tools of fiat power. They create and assign value to their own currencies. They maintain military forces to bludgeon challengers and they use a variety of additional means such as economic, legal, propaganda, alliances and covert means to exert their will in the community of nations. The blunt instruments of national power IMO can be reduced to three essentials: Military Might, Capital and Energy. I know that there are many other supporting factors such as demographics, educational capital, intellectual capital, geography and so on that contribute to or support these three essentials but really these three are central to the maximum exercise of national sovereignty these days.

Military Might is of course the standing and reserve armed forces, their equipment and it's technical capabilities (smart weapons) but also of critical importance is 'The Bomb'. States possessing The Bomb throw their weight around in the world more freely than those states that lack it. Thus, Bomb owners (with the exception of Pakistan) are more sovereign than those states that lack The Bomb.

Capital IMO encompasses national wealth including fiat currency, the derivative intangible faith (Faith) of others in the value of that fiat currency, various tangibles such as national intellectual prowess, businesses, infrastructure, valuable natural resources (esp. fossil fuels) and so forth.

Energy is obvious. The more oil and gas that a present day sovereign state controls the more powerful it is because the baubles of modern life all are critically enabled by fossil fuels. Note the number of international conflicts going on just now, the vast majority of which exist because sovereign states are contending for access to or control of fossil fuels. For example, the government of Canada is developing corps of elite arctic fighters with stealth snowmobiles in anticipation of preserving control of the fuel deposits that are becoming accessible as the arctic sea ice recedes along it's northern border. The Russian navy recently used a submarine to plant a Russian flag on the sea bed at the North Pole. The Chinese government is building artificial islands/ fortresses to monopolize fossil fuel deposits. The United States and to a lesser extent other countries including Russia have their hands all over the less pliant countries of the Middle East. I remember reading a couple of years ago (don't remember the source ATM) that the United States Air Force is the single largest consumer of liquid hydrocarbon fuel on the planet.

At this point the United States of America has the most Capital in the world, it has the The Bomb, it contains within it's boundaries fairly large reserves of Energy and by dint of it's Military Might it's able to control at least enough additional Energy to satisfy national consumption. In consequence the US dollar has been considered the 'reserve currency' benchmark for many years. Each of these three essentials of national sovereignty serve to backstop and enhance the others. Capital pays for the Military Might and The Bomb. The Military Might guards the prerogatives of Capital with the implied threat of The Bomb. Energy enables Military Might and The Bomb because it creates Capital and they in turn ensure access to Energy to keep the wheels turning. These factors inspire and support a greater or lesser degree of Faith in the other countries of the world.

Getting back to Bitcoin, it has only Faith, that is the faith of those who've bought it. If that Faith wains it will cease to exist because it has no Capital, Military Might, Energy or Bombs.

Further, and perhaps most important among the liabilities of the cryptocurrencies, is the fact that sovereign states are jealous of their powers. Thus, if Bitcoin ever looks like it presents a threat to those entities possessing Capital, Military Might, The Bomb and Energy mere Faith doesn't stand a chance and it's easy to predict the outcome.

[cava]

Getting back to Bitcoin, it has only Faith, that is the faith of those who've bought it. If that Faith wains it will cease to exist because it has no Capital, Military Might, Energy or Bombs.

A reverse argument is that there is a growing swell of people who do not have faith in the de jur currency of the country - hence the rise in popularity of cryptocurrencies.

[rob streeper]

A reverse argument is that there is a growing swell of people who do not have faith in the de jur currency of the country - hence the rise in popularity of cryptocurrencies.
Indeed, but the people are not sovereigns, they're subjects. Subjects that cross the sovereign are in for a rough go. Mind I don't claim to have foresight but the power dynamics of the world today are what they are. Cryptocurrencies may well pootle along for some time but if they ever get big enough to matter they'll be crushed by the powers that be. If they become conduits for criminal activity they'll be regulated, taxed, outlawed or all of the above. I think that the only way forward for the cryptocurrencies lies in the direction of remaining irrelevant on the world or national scales.

[rrich]

What is hysterical is the recent big crash of BitCon. Oh, excuse me, BitCoin.

I had been thinking that maybe I missed out on the gain. Yeah, I did, partially. But I also missed out on the crash.

[woodPixel]

Robs description has been one of the very best I've read in a very long time.

I will be asking to use it elsewhere, for it needs to be re-posted.

The essential argument is, that, if people think that a country is going to let its currency be subverted they are severely mistaken. People who know me know my background and how wild I get over these kinds of things, but Governments argument against bitcoin (cryptos) is basic for them to make: Only tax evaders, criminals, pedos and drug dealers use it.

Not true, of course, but repeat it enough and it becomes truth.

It's going to be an ugly fight.

[rob streeper]

Just had another thought about this issue. All of the cryptocurrencies are tied to the Internet. There are 13 root-name servers supporting the operations of the Internet in the world, 10 are operated by companies or organizations located within the borders of the USA. The other three are located in states more or less allied to the USA. None of the countries hosting the non-US groups have The Bomb, Military Might, Energy or Capital that the US does. If the US government ever feels that cryptocurriences are a liability they're gone.

Also, consider what China did a few months ago when it closed the domestic crypto exchanges. Despite the fact that none of the rns's are on its' territory the price of Bitcoin took a hit. I'm sure that some intrepid individuals continue to trade crypto's in China but waving your little self-styled-sovereign digital finger in the face of the PRC can change one's life status to 'organ donor' with terrifying speed.

[rob streeper]

I will be asking to use it elsewhere, for it needs to be re-posted.


Go for it if you like. If you make anything break me off a piece.:2tsup:

[rob streeper]

...

[Kiwi75]

I suspect they are preparing themselves for the down fall of the petrodollar...

[rob streeper]

I think if petro goes away the dollar part won't matter, Bitcoin or not.

[cava]

If the Petrodollar falls, there is a very real chance that USA is going to suffer from hyperinflation due to billions/trillions $ going back to into the USA economy.

[rob streeper]

And who's going to pay the lectric bill to keep the Internets on?

[woodPixel]

If in doubt that Bitcoin is completely subverted, watch this.


https://youtu.be/UYHFrf5ci_g

[Kiwi75]

I think if petro goes away the dollar part won't matter, Bitcoin or not. Sorry, my post was in reply to someone who asked why Russia and China are buying up gold and silver like it's going out of fashion. I know a guy who posted on Facebook, "If you don't buy Bitcoin you don't like money" I say if you buy bitcoin you don't like the money you have...

[onetrack]

Lo and Behold, there is nothing new under the Sun when it comes to methods of storing and exchanging wealth in eventually useless forms ...

How Chinese mulberry bark paved the way for paper money - BBC News (http://www.bbc.com/news/business-40879028)

For me? - as a previous, full-time gold miner and gold mine owner - give me gold, silver, and copper any day, as a method of unassailable and difficult-to manipulate, wealth storage.

[rob streeper]

The sovereign says 'no' and it means NO. https://www.theguardian.com/technology/2017/dec/28/bitcoin-falls-south-korea-crackdown-trading

[rob streeper]

Lo and Behold, there is nothing new under the Sun when it comes to methods of storing and exchanging wealth in eventually useless forms ...

How Chinese mulberry bark paved the way for paper money - BBC News (http://www.bbc.com/news/business-40879028)

For me? - as a previous, full-time gold miner and gold mine owner - give me gold, silver, and copper any day, as a method of unassailable and difficult-to manipulate, wealth storage.
I'd take clean water, safe food and a sound roof to sleep under.

[kiwigeo]

Life is a gamble, do you feel like gambling? If you buy shares to fund your retirement it is a gamble and those that have lost money (including me many years ago) ask the same questions.

A share is just that..it's a share in a company. If the company is poorly run or a complete sham then there will be appropriate risk associated with your shares holding their value. Shares that pay dividends on which company tax has been paid are a valuable asset within a super fund..especially a self managed fund. The tax credits help offset the fund's tax bill and once the fund goes into pension phase they're of even more use as you then you receive dividends _plus_ any tax credits. If you buy shares in a company without first looking at the company you're buying into then yes it can be a gamble. However buying shares in a company after careful examination of the company and appropriate risk assessment is investing.

[kiwigeo]

Isn't that why cash was originally invented? To be able to move money around anonymously?

'
I thought it was invented so you dont have to drag a cow down to the supermarket every week to pay for your groceries. It's also difficult to fit a cow into your wallet :)

[woodPixel]

Hmmm... Bitcoin tensions rise as investors claim banks freezing their accounts (http://www.smh.com.au/business/bitcoin-tensions-rise-as-investors-claim-banks-freezing-their-accounts-20171229-p4yy3z.html)

[Junkie]

Everyone knows that XRP is where it's @...
:cool:

[woodPixel]

Everyone knows that XRP is where it's @...
:cool:

Way back when I was on the desk, this was called pump-and-dump ;)

[Dareen]

This is explained beautifully.





An opinion on Bitcoin that resonates alarm bells. Get out before all the Monkeys have gone.




*BITCOIN*


A lot of monkeys lived near a village.https://mail.google.com/mail/e/1f412

One day a merchant came to the village to buy these monkeys!

He announced that he will buy the monkeys @ $100 each.

The villagers thought that this man is mad.

They thought how can somebody buy stray monkeys at $100 each?

Still, some people caught some monkeys and gave it to this merchant and he gave $100 for each monkey.

This news spread like wildfire and people caught monkeys and sold it to the merchant.

After a few days, the merchant announced that he will buy monkeys @ 200 each.

The lazy villagers also ran around to catch the remaining monkeys!

They sold the remaining monkeys @ 200 each.

Then the merchant announced that he will buy monkeys @ 500 each!

The villagers start to lose sleep! ... They caught six or seven monkeys, which was all that was left and got 500 each.

The villagers were waiting anxiously for the next announcement.

Then the merchant announced that he is going home for a week. And when he returns, he will buy monkeys @ 1000 each!

He asked his employee to take care of the monkeys he bought. He was alone taking care of all the monkeys in a cage.��

The merchant went home.

The villagers were very sad as there were no more monkeys left for them to sell it at $1000 each.☹️

Then the employee told them that he will sell some monkeys @ 700 each secretly.

This news spread like fire. Since the merchant buys monkey @ 1000 each, there is a 300 profit for each monkey.

The next day, villagers made a queue near the monkey cage.

The employee sold all the monkeys at 700 each. The rich bought monkeys in big lots. The poor borrowed money from money lenders and also bought monkeys!


The villagers took care of their monkeys & waited for the merchant to return.

But nobody came! ... Then they ran to the employee...��

But he has already left too !

The villagers then realised that they have bought the useless stray monkeys @ 700 each and unable to sell them!
The Bitcoin will be the next monkey business


It will make a lot of people bankrupt and a few people filthy rich in this monkey business.

That' how it will work��

[Kiwi75]

Iran, Russia and China are doing their utmost de-dollarise the US petro-dollar and it seems likely bit-coin is part of that. And we all know what actions the US will take to defend their US world currency...things are about to get dicey as.
https://www.youtube.com/watch?v=JC7QEqxZCIs

[Kiwi75]

https://www.youtube.com/watch?v=FkhUn7nh33Q James Corbett explains the bitcoin/blockchain/cryptocurrency agenda.

[rob streeper]

With the recent valuation decline news I was thinking about this thread. Just as I was saying above, when the sovereign states decide Bitcoin is a threat it is going to crash and burn.

[Kiwi75]

I suffer from child abuse specific brain damage with means I have huge gaps in understanding/memory etc, so I really struggled to understand the above link. On one hand he was saying the bitcoin platform will take the power from the banks(A good thing?) on the other it is a psyop which is a bad thing. Can someone please explain the gist of what he was saying, the obvious contradiction thing just did my head in.

[rob streeper]

Bitcoin = expectant (soon to die)


“Policymakers and regulators are getting worried. Pretty much every G20 policymaker is talking about a crackdown,” Roubini told Bloomberg Television. “We can’t allow it to become the next Swiss bank account for use by criminals and people evading tax.”

[Chris Parks]

Bitcoin = expectant (soon to die)

“Policymakers and regulators are getting worried. Pretty much every G20 policymaker is talking about a crackdown,” Roubini told Bloomberg Television. “We can’t allow it to become the next Swiss bank account for use by criminals and people evading tax.”



From all reports they missed the boat on that one, it has already sailed loaded with money from the criminal element. Typical politician, five years behind the accident.

[woodPixel]

What is hysterical is the recent big crash of BitCon. Oh, excuse me, BitCoin.

I had been thinking that maybe I missed out on the gain. Yeah, I did, partially. But I also missed out on the crash.

Not yet... you avoided being pushed under a train! - https://xe.com/currencycharts/?from=XBT&to=USD&view=1M

[onetrack]

There is one thing that is common to all these financial rorts - a general lack of transparency. There's no central records, no ability to see who is trading what and where, no over-arching authority controlling or regulating the system, to ensure it is not being scammed.
With our dollar monetary system, there are some fairly substantial checks and balances in place, to preserve the value of our regular currency. Not so with BitCon .. err, BitCoin, or any of the other "crypto-currencies".

It's interesting to see Dr Doom (Nouriel Roubini) claiming that there is no place for either Blockchain, or cryptocurrencies, anywhere.
He claims that BlockChain is only useful for cryptocurrencies and nothing else - and that cryptocurrencies are "purely a scam".
Meantime, local banks are saying that BlockChain is a wonderful IT invention, because it is basically an incorruptible ledger, and could be used for delivery of a thousand different services, where incorruptible forms of record-keeping are required.

Of course, Roubini is a world-renowned economist, and we all know how good economists are with their predictions and forecasts.
It has also been said, that "300 of the worlds greatest economists state that Gold is nothing but a barbarous relic of a bygone era, and has no place in creating or storing wealth".
As one wag commented, those 300 economists merely have to convince 6 billion people in the world, that they are right.

Bitcoin whipsaws investors as 'mother of all bubbles' shows signs of bursting (http://www.watoday.com.au/business/bitcoin-whipsaws-investors-as-mother-of-all-bubbles-shows-sings-of-bursting-20180202-h0t246.html)

https://cointelegraph.com/news/why-banks-are-adopting-the-blockchain

[cava]

I am not an economist, or have any formal financial training. So take what I write with a grain of salt.

Here is my prediction - within 6-12 months Bitcoin will eclipse it's all time highs of A$24,000 and be around for at least another few years. The ride will be a rollercoaster, with massive gains and equally massive losses - it will not be like the stockmarket which slowly goes up or down in value.

Will it survive indefinitely? Doubtful, but I suspect another Cryptocurrency will replace it and be embraced by a much greater number of people.

Just my 2 cents worth.

[onetrack]

It can be very embarrassing to make predictions - particularly when your highly erroneous predictions stay in readily-readable form for decades afterwards - and other people have a good laugh, at just how wrong your predictions were.

I have a 1975 copy of a book called the American Almanac. I bought it many years ago in a secondhand bookshop for a couple of bucks.
It's full of amazing true stories, biographies, unbelievable events, records of disasters, plus a mountain of trivia. It also contains multiple pages of predictions - from seers, psychics, scientists, economists, and experts in their field.

One thing stands out in all those predictions. 99.9% of them were completely and utterly wrong - in fact, laughably wrong. The .01% who were nearly right, are a surprise.
One person did predict immediate person-to-person communication world-wide. Not a single one of the predictions predicted the Internet. Not a single one predicted the 1987 stockmarket crash or the 2008 GFC.
Not a single person predicted the rise of militant Islam and world terrorism and vastly-increased anti-terrorism security measures. No-one predicted AI or iris-reading technology. No-one predicted the rise of robot manufacturing.
No-one predicted 9-11, nor the various Wars that happened between 1975 and now. There was a lot of predictions of Major Wars between Russia and the U.S., or the U.S. and China - that never happened.

There's three things that affect speculative trading values and predictions. One thing is the cutely-named (by an economist, no less), "irrational exuberance".
That, simply, is people piling on the bandwagon when they see others making a motza, without any real effort. Money for jam, essentially.

The second thing is unforeseen and totally unpredicted events appearing suddenly out of left field - that have a major impact on the speculative trading.
There are many of these "left-field" events in the history of speculative trading, that have caught hundreds of millions of "smart investors", by total surprise.

The third thing is "profit taking". That is, when "investors" see an investment falling in value, they sell out, grab their remnant money, and bolt for the door.
Many of these people are quite likely selling at a moderate loss. They see that as a better option than a total loss.
Two of these events (irrational exuberance and profit taking) are currently in train with Bitcoin, and the second one is in action, right now - and it can only accelerate.

[cava]

It can be very embarrassing to make predictions - particularly when your highly erroneous predictions stay in readily-readable form for decades afterwards - and other people have a good laugh, at just how wrong your predictions were.

As a husband and father, I am used to being embarrassed and wrong. :rolleyes:

Regarding the prediction, well, we shall just have to wait and see. If I am wrong, then I am wrong and will wear it. But if I am right, well, collectively we are all in a big mess ......

[Fuzzie]

{edit} Decided I didn't really want to go back there. I just like making things out of wood now.

[onetrack]

Regarding the prediction, well, we shall just have to wait and see. If I am wrong, then I am wrong and will wear it. But if I am right, well, collectively we are all in a big mess ......
The worrying part is when BitCoin crashes (and it will, because it's totally unregulated), it takes real money with it.
Just like gambling, there will be the odd winner out of the crash - but a lot of losers, who will have to sell their house and go back to renting, to pay back the loans they got, to "invest" in big swags of BitCoin.

[rob streeper]

The point of my post was not to highlight the words of Roubini (economists are wrong in their predictions far more often than not) but rather to point to the opinions of the G20 heads. If they think Bitcoin is a problem then it is. They will take substantive steps to kill it and the other cryptocurrencies because it threatens their, and their patrons (sovereign states), hold on power.

Economics is, IMO, a weak kind of history that is made weaker by attempts to apply mathematics, derived from or based on past economic events, in making predictions. Mathiness is a term that has been used recently to describe the inappropriate use of mathematics as a mechanism of bamboozling the ignorant and I think it apt to describe predictions in economics.

[AlexS]

There's three things that affect speculative trading values and predictions. One thing is the cutely-named (by an economist, no less), "irrational exuberance".
That, simply, is people piling on the bandwagon when they see others making a motza, without any real effort. Money for jam, essentially.

The second thing is unforeseen and totally unpredicted events appearing suddenly out of left field - that have a major impact on the speculative trading.
There are many of these "left-field" events in the history of speculative trading, that have caught hundreds of millions of "smart investors", by total surprise.

The third thing is "profit taking". That is, when "investors" see an investment falling in value, they sell out, grab their remnant money, and bolt for the door.
Many of these people are quite likely selling at a moderate loss. They see that as a better option than a total loss.
Two of these events (irrational exuberance and profit taking) are currently in train with Bitcoin, and the second one is in action, right now - and it can only accelerate.

Don't these boil down to the "bigger fool" theory of investing?

[rrich]

not yet... You avoided being pushed under a train! - https://xe.com/currencycharts/?from=xbt&to=usd&view=1m

lol!

[onetrack]

Oh, Dear! Now the Banks have suddenly woken up to the following facts, with regard to crypto-currencies ...

1. People are using their credit cards to buy crypto-currencies. Someone with a few working brain cells inside a Bank, has obviously pointed out, that if the crypto-currency purchased with a CC goes into free-fall, the CC owner has a high likelihood of becoming insolvent.
As CC's are a high-risk, unsecured line of credit, Banks could very likely get their collective bums burnt - Big Time. So the Banks have started to crack down on using CC's to buy crypto-currencies.
The message is simple - "Use your money to gamble with crypto-currencies, not ours!!"

The big four banks aren't planning a bitcoin crackdown ... yet - ABC News (Australian Broadcasting Corporation) (http://www.abc.net.au/news/2018-02-05/big-four-banks-not-planning-bitcoin-clampdown-yet/9398234)

2. The potential for fraud and criminality when dealing in crypto-currencies is huge. We've just seen the huge cryptocurrency hack and theft in Japan. Every crypto-currency supporter keeps on about the security of Blockchain - but this is computers and servers and hard drives, we're talking about here, isn't it? - and no-one has ever hacked into them, destroyed them, diverted transactions, or held computer owners to ransom, have they?? :sad1:

Funny how those Banks keep bringing up that awkward word again, too, about crypto-currencies - unregulated .... :sad1:

[woodPixel]

Who, ever, buys an investment on their credit card.

Since when have the banks ever worried for a single second about their clients making a loss on a purchase?

Are they protecting their customers interests, or their own?

It feels to me that "the banks" have had a word from the RBA and told to shut it down. This will be a cosmic level battle that will leave scorched earth and rubble in its wake.

Fiat currencies are in for the very last gasping fight for their existence. Governments will do anything to support them - for without freely created fiat debt (currency) the whole ponzi scheme collapses.

[MAPLEMAN]

American Express,Bank of America using blockchain ripple net
Trading in flat and crypto currency
Anyone know much about 'ripple'?...MM

[onetrack]

Since when have the banks ever worried for a single second about their clients making a loss on a purchase?
When it appears the Banks may end up wearing the loss. :D

Despite one thinking that Banks never lose - they do, and more frequently than one would imagine. It's just that they make the rest of us mugs pay for their losses and bad judgement.

Remember the old saying? "You owe the banks $1M, and can't pay them - you've got a problem. You owe the banks $100M, and can't pay them - they've got a problem".

[rob streeper]

Who, ever, buys an investment on their credit card.

Well, practically everybody in the plutocrat stratum does. Not credit cards per se but rather by using debt financing.

It was debt financing in the housing market that helped precipitate our 2007/8 market crash. This is happening again, residential property in our area has been valuating at ~10% per year for the past few years. I understand that certain Australian housing markets are doing similar crazy things.

[ian]

Mathiness is a term that has been used recently to describe the inappropriate use of mathematics as a mechanism of bamboozling the ignorant and I think it apt to describe predictions in economics.
love it !

[rrich]

Credit Cards and Bitcoin

Look at it this way, somebody with nothing uses their Master Card or Visa to buy Bitcoin.

Bitcoin tanks as we've seen recently.

Somebody with nothing is now in panic mode to pay the credit card bill.

Somebody with nothing defaults on the credit card payment.

The bank tries to get their money back but because somebody with nothing has nothing and Bitcoin tanked, the banks have nothing to attach or seize. Somebody who has nothing declares bankruptcy. All debts are rescinded, somebody with nothing has zero credit for 10 years before bankruptcy is erased in the credit files.

In effect, the bank has been speculating in Bitcoin, which is something that banks do not want to do. All banks care about is their money.

[cava]

All banks care about is their money.
Not sure exactly how it works, but banks use fractional reserve banking, and effectively 'create' money out of thin air to loan out.

The credit card debt of a customer/client is then on sold to another entity - the result is that the bank is not at risk.

[rob streeper]

Economics is, IMO, a weak kind of history that is made weaker by attempts to apply mathematics, derived from or based on past economic events, in making predictions. Mathiness is a term that has been used recently to describe the inappropriate use of mathematics as a mechanism of bamboozling the ignorant and I think it apt to describe predictions in economics.

Timely: https://aeon.co/ideas/few-things-are-as-dangerous-as-economists-with-physics-envy

[NathanaelBC]

It's way too volatile for me to want to actually invest in it, however I bought some bitcoin over a year ago just to learn how it works and understand it better ... forgot about it, logged in a year later and had earned $600 ... which I cashed out immediately!

[cava]

As a side issue, I was listening to ABC radio yesterday when the usual market/gold/finance news comes on - you know the one that comes on after the news every hour.

And the Bitcoin price was stated - it appears that Bitcoin is becoming a tad more mainstream than naysayers believe.

[onetrack]

There are plenty of things working against BitCoin becoming an accepted mainstream currency. Here are just some of them -

1. Quote from Quora - "Bitcoin is not being bought as a store of value or a currency by most people; for most people, Bitcoin is a speculative investment, hoping to make a fortune on something they really don’t know much about."

2. While hackers can get into my computer, and other computers, and try to harness the power of unwitting computer owners to mine BitCoins, there won't be much future for it as a mainstream currency.

3. While there are still substantial BitCoin transaction charges (up to $20 a transaction) for making BitCoin transactions, there won't be any future for it as a mainstream currency.

4. While there is still no regulatory control or other trusted authority in charge of BitCoin, there won't be any future for it as a mainstream currency.

5. While the pure electrical costs associated with mining BitCoin are still huge, there won't be any future for it as a mainstream currency.

6. While there is still modest computing power ability, BitCoin may survive. The advent of Quantum Computing will change the mining rate of BitCoin so much, it will become useless.

https://techcrunch.com/2018/03/05/googles-new-bristlecone-processor-brings-it-one-step-closer-to-quantum-supremacy/

7. There is a limited number of BitCoins - 20999999.9769 BitCoins, to be precise. Every politician and economist worth his salt knows that the only thing that makes fiat currencies worthwhile, is the ability to inflate the amount of currency available.

The ability to print fiat currencies at whim, is what gives Govts and Politicians of all persuasions, the power and control over people (and economies) that they crave.

The days of restricting the amount of currency in circulation to only the value of gold or silver held in store, is long gone.
It ended when Tricky Dicky floated the U.S. Dollar, on 15th Aug 1971 - and he did it off his own back, without any agreement or authorisation by anyone else in his Govt, who may have stopped him.

[woodPixel]

Point 6 on the quantum computing is by far the most interesting.

For a while I was very interested in cryptography as the businesses I was CTO for wanted it implemented "everywhere". People think its easy to implement - it isn't. One simply doesnt "encrypt everything". One of the risk profiles I kept coming up against was the spectre of QC. With a decent QC processor it seemed that even highly encrypted things might be an open book.

What I find humorous is how people keep yammering about Bitcoin et.al. as if its a currency. It bears none of the hallmarks of currency. None.

What a pointless exercise is speculating upon Bitcoin. Modern tulips.... Sooo many tears. The losses, fraud, ripoffs and outright robberies (https://www.zerohedge.com/news/2018-03-05/thieves-steal-600-computers-used-mine-bitcoin) are going to be staggering. Why not speculate on Frozen Concentrated Orange Juice or Lean Hogs.... then at least there is underlying value. https://finviz.com/futures.ashx

[rustynail]

It,s a bit like horse racing - A bit of a flurry at the start and little more than a pile of s*#t at the end of it.

[justonething]

It must be said that during the gold rush days, the one business that made the most money is not the gold miners themselves but rather the mining supplies companies. The same is true for this bitcoin mania. https://www.cnbc.com/2018/02/23/secretive-chinese-bitcoin-mining-company-may-have-made-as-much-money-as-nvidia-last-year.html

[ProTooling]

Yeah I've heard that gold rush analogy a few times...

"Better to sell the spade, than dig the hole"

[woodPixel]

Yeah I've heard that gold rush analogy a few times...

"Better to sell the spade, than dig the hole"

https://www.zerohedge.com/news/2018-03-06/worlds-largest-crypto-exchanges-are-raking-3m-day

[cava]

Looks as if at least one retailer (Boost Juices) is getting on the Bitcoin bandwagon.

Bitcoin Boom or Bust! (http://bitcoinboom.boostjuice.com.au/#/)

[Junkie]

Looks as if at least one retailer (Boost Juices) is getting on the Bitcoin bandwagon.
Those early adopters... :cool:

[cava]

A couple of years down the track and Bitcoin is ~A$28,000.

Seems it is a reflection of the times we are all living in.

[woodPixel]

There are exactly three reasons to use bitcoin: buying drugs, paying extortions and speculation.

It has zero fundamental base to it value. It is easily replicated and infinitely dividable.

It cannot be used in the real world - for anything.

By definition it is neither and asset nor currency.

Want to buy some Tulips?

[Lappa]

Apparently you can buy houses with it

NSW property to go to auction in world first bitcoin auction (https://thenewdaily.com.au/finance/property/2019/03/19/australian-house-auction-bitcoin/)