5 ms·

As someone who used to work at Coinbase, hopefully I can shed some light on this. First of all, Bitcoin should not be seen primarily as a currency, but as a pr

As someone who used to work at Coinbase, hopefully I can shed some light on this. First of all, Bitcoin should not be seen primarily as a currency, but as a protocol. Therefore, bitcoin does not need to increase in value for it to be successful, and in the long term the price is irrelevant. Bitcoin can be used as a medium of exchange without regard to the price, and many people at Coinbase believe in this future (rather than bitcoin becoming a widely used currency held directly by end users, at least in the near future). Secondly, many people at Coinbase believe deeply in the decentralized (and potentially anonymous/privacy-focused) aspects of using bitcoin as a currency (myself included). However, bitcoin cannot be successful as a currency unless it is easy to exchange between bitcoin and your local currency, and bitcoin won't gain worldwide acceptance until it is easy to (a) exchange bitcoin and (b) spend bitcoin. Therefore, Coinbase's primary goal is to make buying and selling bitcoin as easy as possible, so that we can enable a future where financial privacy is optional (versus today, where it is basically inescapable).

pharrington 11y ago
This is the value proposition as far as I can see. If I'm not a speculator, but am using bitcoin to exchange goods, the only thing it adds are ways to be tracked.
mirimir 11y ago
> ... so that we can enable a future where financial privacy is optional (versus today, where it is basically inescapable). This is a typo, right? Financial privacy today is basically impossible, not inescapable. Tracking is basically inescapable, unless one uses cash. And using cash is becoming virtually illegal.
- s73v3r 11y ago
  "And using cash is becoming virtually illegal." No it is not. Not even close. Stop with the paranoid hyperbole.
  - grubles 11y ago
    I've tried to deposit cash into my brother's bank account (in LA) to which I was denied due to money laundering law and "Mexican cartels". It was only $200-$300. Perhaps they thought I was part of a cartel due to my freckled white skin.
  - mirimir 11y ago
    I'm thinking of civil asset forfeiture.
woah 11y ago
As a protocol, it's not great. There's a lot more flexibility in a lot of the new consensus protocols coming out that can run Turing-complete contracts etc. Look at all the hoops that need to be jumped through to do stuff like colored coins, payment channels, etc. in Bitcoin vs protocols with smart contracts. Anyway, that's irrelevant. If Bitcoin is for some reason the best protocol to be used, why would someone want to enrich the current holders of Bitcoin (of which I am one, by the way). Transferring value to Bitcoin necessitates buying Bitcoins from existing Bitcoin holders, enriching them for no reason. Why wouldn't a bank or other financial institution just start from a clean slate?
- adrianmacneil 11y ago
  > There's a lot more flexibility in a lot of the new consensus protocols coming out that can run Turing-complete contracts etc Agreed. But most open source protocols are/were not great. IPv4, SMTP, HTTPv1 all have massive flaws. Once open protocols start gaining momentum though, it's very hard to convince everyone to switch (and bitcoin has by far the most momentum behind it). That said, I'm very interested in Ethereum too. > necessitates buying Bitcoins from existing Bitcoin holders, enriching them for no reason If you use bitcoin purely as an intermediary, then you are buying and selling it at the same instant, so it really doesn't affect the price at all. The only thing that makes the price go up is more people hodling it.
- egd 11y ago
  Can you point me to some of the consensus protocol work? That's always seemed to be the more interesting aspect of BTC to me, but the other requirements of the currency have made that harder than just the smart contracts alone.
  - adrianmacneil 11y ago
    https://www.ethereum.org/ https://www.ethereum.org/ and https://www.stellar.org/ https://www.stellar.org/ are two interesting ones to check out.
    - 11y ago

pharrington 11y ago

This is the value proposition as far as I can see. If I'm not a speculator, but am using bitcoin to exchange goods, the only thing it adds are ways to be tracked.

mirimir 11y ago

> ... so that we can enable a future where financial privacy is optional (versus today, where it is basically inescapable). This is a typo, right? Financial privacy today is basically impossible, not inescapable. Tracking is basically inescapable, unless one uses cash. And using cash is becoming virtually illegal.

s73v3r 11y ago
"And using cash is becoming virtually illegal." No it is not. Not even close. Stop with the paranoid hyperbole.
- grubles 11y ago
  I've tried to deposit cash into my brother's bank account (in LA) to which I was denied due to money laundering law and "Mexican cartels". It was only $200-$300. Perhaps they thought I was part of a cartel due to my freckled white skin.
- mirimir 11y ago
  I'm thinking of civil asset forfeiture.

woah 11y ago

As a protocol, it's not great. There's a lot more flexibility in a lot of the new consensus protocols coming out that can run Turing-complete contracts etc. Look at all the hoops that need to be jumped through to do stuff like colored coins, payment channels, etc. in Bitcoin vs protocols with smart contracts. Anyway, that's irrelevant. If Bitcoin is for some reason the best protocol to be used, why would someone want to enrich the current holders of Bitcoin (of which I am one, by the way). Transferring value to Bitcoin necessitates buying Bitcoins from existing Bitcoin holders, enriching them for no reason. Why wouldn't a bank or other financial institution just start from a clean slate?

adrianmacneil 11y ago
> There's a lot more flexibility in a lot of the new consensus protocols coming out that can run Turing-complete contracts etc Agreed. But most open source protocols are/were not great. IPv4, SMTP, HTTPv1 all have massive flaws. Once open protocols start gaining momentum though, it's very hard to convince everyone to switch (and bitcoin has by far the most momentum behind it). That said, I'm very interested in Ethereum too. > necessitates buying Bitcoins from existing Bitcoin holders, enriching them for no reason If you use bitcoin purely as an intermediary, then you are buying and selling it at the same instant, so it really doesn't affect the price at all. The only thing that makes the price go up is more people hodling it.
egd 11y ago
Can you point me to some of the consensus protocol work? That's always seemed to be the more interesting aspect of BTC to me, but the other requirements of the currency have made that harder than just the smart contracts alone.
- adrianmacneil 11y ago
  https://www.ethereum.org/ https://www.ethereum.org/ and https://www.stellar.org/ https://www.stellar.org/ are two interesting ones to check out.
  - 11y ago