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Why is it inherently a bad idea? Why is it a pyramid scheme?
by awt 15y ago
Why is it inherently a bad idea? Why is it a pyramid scheme?
- achompas 15y agoBecause Bitcoins are being suggested as an alternative to fiat money. However, given their current rate of appreciation, Bitcoins are actually an investment, not a currency. What is their inherent value, then? Commodities (whether precious or industrial) can be used in production or for luxury goods. Equities generate profits, which are subsequently shared with investors. What do Bitcoins do? Nothing.
- weavejester 15y agoWhat do Bitcoins do? Nothing. That's not true. Bitcoins can be securely transferred between accounts without the need for a centralized broker. That's not "nothing".
- achompas 15y agoSo their unique value comes from private transactions...but there's only a finite supply of bitcoins? How many of these transactions can actually occur in 2013-2014, when every bitcoin has been mined and their value is skyrocketing?
- weavejester 15y agoThe amount of transactions that can take place is unlimited, and even though there is a maximum of 2.1 million coins, each coin is divisible to 8 decimal places, giving 2.1 quadrillion units of currency. Also, mining won't be completed this century, although the rate at which coins are generated decreases over time.
- cube13 15y agoCash, delivered in person, does the same thing.
- weavejester 15y agoWhich has an obvious disadvantage over bitcoins: it has to be delivered in person.
- vladd 15y agoThat's not the value of the bitcoin, it's the value of the cryptographic code which has been open sourced. Anybody can fork it and create its own "Webcoin", but there's no intrinsic value in any forked instance coin, beyond the publicity that allows early adopters to cash in.