9 ms·

Bitcoin, a service and the micro-micro-economy

58 points by spenvo 16y ago

noagendamarket 16y ago
Looks like the article made the author some bitcoin on witcoin too http://bitcoin.witcoin.com/p/862/The-story-behind-witcoin-and-other-projects-of-mizerydearia http://bitcoin.witcoin.com/p/862/The-story-behind-witcoin-an...
DiabloD3 16y ago
Now only if everyone would switch over to DiabloMiner for their Bitcoin mining needs. http://www.bitcoin.org/smf/index.php?topic=1721.0 http://www.bitcoin.org/smf/index.php?topic=1721.0 Disclaimer: I wrote DiabloMiner ;)
motters 16y ago
Unfortunately this model doesn't seem to work. If you look at what's getting votes it's things like pictures of girls and kittens.
- deleted 16y ago
  [deleted]
- spenvo 16y ago
  It may not work. It's still too early to tell. If you look at other content sites that have tried to pay out to contributors (think Mahalo), their models didn't work either. Huffington post finds more success by paying nothing.
  - noagendamarket 16y ago
    The difference is their money comes from ad revenue not from the users themselves. Didnt huffington post sell for quite a lot of money to AOL and the people who actually built it got nothing ?
  - motters 16y ago
    I think the problem here is that the introduction of payment changes the psychology from one of sharing information to one of maximizing income (gift Vs capital). In the latter mode of operation the quality of the information is a secondary concern.
    - spenvo 16y ago
      I had similar misgivings/feelings while using the product. However: Two observations: 1.) they did include user-selected charities lately in their distribution of "upvote" profits; 2.) The point is less about making money, more about adverse selection (keeping out trolls). Nobody could subsist off of this in any real kind of way. If they did--the value they would have to provide would be immense.
    - noagendamarket 16y ago
      Hopefully the small amounts we are dealing with makes it less worthwhile for spammers as well as not seem like a purely profit driven incentive. All things in moderation as they say.
- dublinclontarf 16y ago
  Well if that's what people are willing to pay for then let them have it. I don't see how it doesn't work. There is a cost if the articles isn't popular(which rules submitting any old crap) There is a cost of voting up articles, which rules out people with too much time(and not enough money) on their hands scewing the numbers. Perhaps it hasn't worked before, but then no one has tried doing this with bitcoin, that singular ingredient makes a lot of formerly impossible things very achievable.
  - motters 16y ago
    That's the same argument that the tabloid newspapers use, and it doesn't work for them either. What readers end up with is low quality information, popular conspiracy theories, sensationalism, voyeurism, etc. What's really needed is some kind of system which sets up a virtuous cycle rather than a downward spiral.
    - ppod 16y ago
      "What readers end up with is low quality information, popular conspiracy theories, sensationalism, voyeurism, etc." Readers end up with this because this is what readers want. We know this is what they want because it's what they pay for, which works just fine for tabloid newspapers.
mischa_u 16y ago
Your two cents worth literally; although at the current Bitcoin exchange rate [1] a typical post/comment/vote on witcoin.com costs USD 0.079. [1] http://www.bitcoincharts.com/markets/ http://www.bitcoincharts.com/markets/
- noagendamarket 16y ago
  http://sandbox.witcoin.com/p/327/GETTING-STARTED--Reply-to-this-and-Ill-send-to-you-0-0010-witcoins http://sandbox.witcoin.com/p/327/GETTING-STARTED--Reply-to-t... you can post on the witcoin sandbox and someone is offering .10 Thanks for linking the bitcoin charts site which is another worthy bitcoin service.
- mizerydearia 16y ago
  or USD 0.0079 Also, each category has its own prices. Some categories post/comment/vote costs at current Bitcoin exchange rate are USD 0.0000000079.
  - burke 16y ago
    This brings up a little facet of bitcoin that I'm /really/ not crazy about: The smallest possible unit is 0.00000001 BTC. With a fixed cap of 21M BTC, requiring that each transaction be for at least 4.8*10^-16 of the total possible amount in circulation seems like a questionable choice at best.
    - jakehow 16y ago
      If it becomes a runaway train towards this endpoint, this would give bitcoin >10x current M1, while retaining the ability to pay in $.01 increments. This should be sufficient for the near term ;)
dublinclontarf 16y ago
Allow me to extol the virtues of bitcoin over the current credit-card/banking based payment system. 1)Hard money, once you receive payment in bitcoin it stays with you, meaning no chargebacks(Paypal, credit cards, looking at you). 2)Fast payment, you can recieve payment within minutes of it being made(sometimes faster, but more on this in a moment). 3) Low barriers of entry, to start accepting bitcoin you don't need a bank account, or even your own computer. You can use one of a number of free(or cheap) online services such as mybitcoin.com or just go ahead and install it on your machine. 4) No red tape, this is slightly related to the above but important enough to warrant it's own point. With bitcoin there are no forms, no regulations, no paperwork. You can send bitcoin to anyone, anywhere, anytime, any amount and no one will care or track you, or freeze your account or any of the other issues when dealing with the current banking system. 5)It's the most innovative financial ecosystem on the planet and evolving damn fast. Because there is no regulation, it's easy to start writing applications that use bitcoin. Services and goods are springing up at an astounding rate. Now you may say that payments take minutes, but creditcards are instantanious this is true (to a certain extent, at least with payment confirmation). However because of the flexibility of bitcoin, it's ease of development a technical solution to this issue will arrise in the near future(next two to three months). Right now bitcoin is small, but it's growing fast, real fast, and faster than the growth of bitcoins themselves or even it's users are the services and goods that are springing up around it. In a years time bitcoin is going to be so easy to use people like your grandmother are going to wonder why they ever bothered with credit-cards(or online banking) at all. Sexy no?
- deleted 16y ago
  [deleted]
- noagendamarket 16y ago
  Thanks to bitcoin it makes things possible that other microtransaction systems cant do. If anyone wants to listen to a great podcast about it I recently discovered this - http://omegataupodcast.net/2011/03/59-bitcoin-a-digital-decentralized-currency/ http://omegataupodcast.net/2011/03/59-bitcoin-a-digital-dece... It is well worth a listen.
- taken11 16y ago
eli 16y ago
Is this a legitimate attempt at a currency or a political statement? Also, what's the exchange rate between bitcoins and Flooz?
- noagendamarket 16y ago
  Start a bitcoin to flooz exchange and find out ? The difference is bitcoin is decentralized while every other internet currency has been reliant on a single entity to issue it.
- dublinclontarf 16y ago
  Depends what the exchange rate between USD and Flooz is, the current exchange rate is about $0.77 for 1Bitcoin.
trotsky 16y ago
People who grow interested in participating in the bitcoin market because of this or other articles about the currency should be aware that at its heart it is a very speculative market. The price of a bitcoin in USD has risen dramatically through most of its life while lacking economic fundamentals for why it should. Indeed, the money supply in the bitcoin market increases steadily over time, this should be inflationary, causing the value of BTC to fall. The fact that it doesn't speaks to how thinly traded the BTC markets are, and that there are simply more buyers than sellers interested in BTC - primarily due to articles about bitcoin that drum up interest, and due to speculators participating in the market. Bitcoin values are very loosely coupled to fundamentals - you can't buy food, energy or commodities with it. In general you need to transfer it back to a fiat currency to do anything classically useful with it. Currencies that either rapidly appreciate or rapidly depreciate are both ill suited for any kind of real commerce - people need relatively stable pricing to conduct any kind of direct business in fiat money. While there are certainly examples where fiat currency runs away in either inflationary or deflationary ways, central banks, charged with protecting their currencies often take dramatic steps at times to prevent moves either way. In these ways bitcoin currently resembles either a pump and dump scheme the tulip bubble. Which it is depends on whether you believe the people driving the rises in pricing are intentionally exploiting the press and thin nature of the market, or if most of the participants are simply along for the speculative ride. Of course, it is in the rational best interests of anyone who holds bitcoin to disagree with this assessment. That said, I do genuinely welcome any kind of informed debate on the issue.
- kiba 16y ago
  "More goods and services" is practically the catchphrase of the community. We are well aware of this fact. How can I help bitcoin out? Sell something on the market!
  - trotsky 16y ago
    To be clear, I don't have a fundamental issue with the concept of bitcoin or the technical implementation. I just see a lot of people who grow interested in obtaining it without knowing what they'll do with except for selling it to someone else. If people want to trade their USD/EUR/GBP/JPY for it as is often suggested by the bitcoin community, or decide that they want to consume electricity in order to obtain it well more power to them. I just think it's good for them to understand what a thin, speculative market it is. Rationally, people not wanting to speculate in the currency should hold off obtaining any until there is something they want to purchase with it right then.
deleted 16y ago
[deleted]

58 points by spenvo 16y ago

Looks like the article made the author some bitcoin on witcoin too http://bitcoin.witcoin.com/p/862/The-story-behind-witcoin-and-other-projects-of-mizerydearia http://bitcoin.witcoin.com/p/862/The-story-behind-witcoin-an...

DiabloD3 16y ago

Now only if everyone would switch over to DiabloMiner for their Bitcoin mining needs. http://www.bitcoin.org/smf/index.php?topic=1721.0 http://www.bitcoin.org/smf/index.php?topic=1721.0 Disclaimer: I wrote DiabloMiner ;)

motters 16y ago

Unfortunately this model doesn't seem to work. If you look at what's getting votes it's things like pictures of girls and kittens.

deleted 16y ago
[deleted]
spenvo 16y ago
It may not work. It's still too early to tell. If you look at other content sites that have tried to pay out to contributors (think Mahalo), their models didn't work either. Huffington post finds more success by paying nothing.
- noagendamarket 16y ago
  The difference is their money comes from ad revenue not from the users themselves. Didnt huffington post sell for quite a lot of money to AOL and the people who actually built it got nothing ?
- motters 16y ago
  I think the problem here is that the introduction of payment changes the psychology from one of sharing information to one of maximizing income (gift Vs capital). In the latter mode of operation the quality of the information is a secondary concern.
  - spenvo 16y ago
    I had similar misgivings/feelings while using the product. However: Two observations: 1.) they did include user-selected charities lately in their distribution of "upvote" profits; 2.) The point is less about making money, more about adverse selection (keeping out trolls). Nobody could subsist off of this in any real kind of way. If they did--the value they would have to provide would be immense.
  - noagendamarket 16y ago
    Hopefully the small amounts we are dealing with makes it less worthwhile for spammers as well as not seem like a purely profit driven incentive. All things in moderation as they say.
dublinclontarf 16y ago
Well if that's what people are willing to pay for then let them have it. I don't see how it doesn't work. There is a cost if the articles isn't popular(which rules submitting any old crap) There is a cost of voting up articles, which rules out people with too much time(and not enough money) on their hands scewing the numbers. Perhaps it hasn't worked before, but then no one has tried doing this with bitcoin, that singular ingredient makes a lot of formerly impossible things very achievable.
- motters 16y ago
  That's the same argument that the tabloid newspapers use, and it doesn't work for them either. What readers end up with is low quality information, popular conspiracy theories, sensationalism, voyeurism, etc. What's really needed is some kind of system which sets up a virtuous cycle rather than a downward spiral.
  - ppod 16y ago
    "What readers end up with is low quality information, popular conspiracy theories, sensationalism, voyeurism, etc." Readers end up with this because this is what readers want. We know this is what they want because it's what they pay for, which works just fine for tabloid newspapers.

mischa_u 16y ago

Your two cents worth literally; although at the current Bitcoin exchange rate [1] a typical post/comment/vote on witcoin.com costs USD 0.079. [1] http://www.bitcoincharts.com/markets/ http://www.bitcoincharts.com/markets/

noagendamarket 16y ago
http://sandbox.witcoin.com/p/327/GETTING-STARTED--Reply-to-this-and-Ill-send-to-you-0-0010-witcoins http://sandbox.witcoin.com/p/327/GETTING-STARTED--Reply-to-t... you can post on the witcoin sandbox and someone is offering .10 Thanks for linking the bitcoin charts site which is another worthy bitcoin service.
mizerydearia 16y ago
or USD 0.0079 Also, each category has its own prices. Some categories post/comment/vote costs at current Bitcoin exchange rate are USD 0.0000000079.
- burke 16y ago
  This brings up a little facet of bitcoin that I'm /really/ not crazy about: The smallest possible unit is 0.00000001 BTC. With a fixed cap of 21M BTC, requiring that each transaction be for at least 4.8*10^-16 of the total possible amount in circulation seems like a questionable choice at best.
  - jakehow 16y ago
    If it becomes a runaway train towards this endpoint, this would give bitcoin >10x current M1, while retaining the ability to pay in $.01 increments. This should be sufficient for the near term ;)

dublinclontarf 16y ago

Allow me to extol the virtues of bitcoin over the current credit-card/banking based payment system. 1)Hard money, once you receive payment in bitcoin it stays with you, meaning no chargebacks(Paypal, credit cards, looking at you). 2)Fast payment, you can recieve payment within minutes of it being made(sometimes faster, but more on this in a moment). 3) Low barriers of entry, to start accepting bitcoin you don't need a bank account, or even your own computer. You can use one of a number of free(or cheap) online services such as mybitcoin.com or just go ahead and install it on your machine. 4) No red tape, this is slightly related to the above but important enough to warrant it's own point. With bitcoin there are no forms, no regulations, no paperwork. You can send bitcoin to anyone, anywhere, anytime, any amount and no one will care or track you, or freeze your account or any of the other issues when dealing with the current banking system. 5)It's the most innovative financial ecosystem on the planet and evolving damn fast. Because there is no regulation, it's easy to start writing applications that use bitcoin. Services and goods are springing up at an astounding rate. Now you may say that payments take minutes, but creditcards are instantanious this is true (to a certain extent, at least with payment confirmation). However because of the flexibility of bitcoin, it's ease of development a technical solution to this issue will arrise in the near future(next two to three months). Right now bitcoin is small, but it's growing fast, real fast, and faster than the growth of bitcoins themselves or even it's users are the services and goods that are springing up around it. In a years time bitcoin is going to be so easy to use people like your grandmother are going to wonder why they ever bothered with credit-cards(or online banking) at all. Sexy no?

deleted 16y ago
[deleted]
noagendamarket 16y ago
Thanks to bitcoin it makes things possible that other microtransaction systems cant do. If anyone wants to listen to a great podcast about it I recently discovered this - http://omegataupodcast.net/2011/03/59-bitcoin-a-digital-decentralized-currency/ http://omegataupodcast.net/2011/03/59-bitcoin-a-digital-dece... It is well worth a listen.
taken11 16y ago

eli 16y ago

Is this a legitimate attempt at a currency or a political statement? Also, what's the exchange rate between bitcoins and Flooz?

noagendamarket 16y ago
Start a bitcoin to flooz exchange and find out ? The difference is bitcoin is decentralized while every other internet currency has been reliant on a single entity to issue it.
dublinclontarf 16y ago
Depends what the exchange rate between USD and Flooz is, the current exchange rate is about $0.77 for 1Bitcoin.

trotsky 16y ago

People who grow interested in participating in the bitcoin market because of this or other articles about the currency should be aware that at its heart it is a very speculative market. The price of a bitcoin in USD has risen dramatically through most of its life while lacking economic fundamentals for why it should. Indeed, the money supply in the bitcoin market increases steadily over time, this should be inflationary, causing the value of BTC to fall. The fact that it doesn't speaks to how thinly traded the BTC markets are, and that there are simply more buyers than sellers interested in BTC - primarily due to articles about bitcoin that drum up interest, and due to speculators participating in the market. Bitcoin values are very loosely coupled to fundamentals - you can't buy food, energy or commodities with it. In general you need to transfer it back to a fiat currency to do anything classically useful with it. Currencies that either rapidly appreciate or rapidly depreciate are both ill suited for any kind of real commerce - people need relatively stable pricing to conduct any kind of direct business in fiat money. While there are certainly examples where fiat currency runs away in either inflationary or deflationary ways, central banks, charged with protecting their currencies often take dramatic steps at times to prevent moves either way. In these ways bitcoin currently resembles either a pump and dump scheme the tulip bubble. Which it is depends on whether you believe the people driving the rises in pricing are intentionally exploiting the press and thin nature of the market, or if most of the participants are simply along for the speculative ride. Of course, it is in the rational best interests of anyone who holds bitcoin to disagree with this assessment. That said, I do genuinely welcome any kind of informed debate on the issue.

kiba 16y ago
"More goods and services" is practically the catchphrase of the community. We are well aware of this fact. How can I help bitcoin out? Sell something on the market!
- trotsky 16y ago
  To be clear, I don't have a fundamental issue with the concept of bitcoin or the technical implementation. I just see a lot of people who grow interested in obtaining it without knowing what they'll do with except for selling it to someone else. If people want to trade their USD/EUR/GBP/JPY for it as is often suggested by the bitcoin community, or decide that they want to consume electricity in order to obtain it well more power to them. I just think it's good for them to understand what a thin, speculative market it is. Rationally, people not wanting to speculate in the currency should hold off obtaining any until there is something they want to purchase with it right then.

deleted 16y ago

[deleted]