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You don't appear to understand how Bitcoin works. Money does not shift from new investors to the creators of Bitcoin. I'm not quite sure what confusion of ideas

You don't appear to understand how Bitcoin works. Money does not shift from new investors to the creators of Bitcoin. I'm not quite sure what confusion of ideas lead you to believe this.

gammarator 15y ago
0) Bitcoins were easiest to mine at the beginning => the creators & early adopters have a large number of bitcoins 1) New investors demanding a finite supply of bitcoins are increasing the exchange rate of bitcoins/dollar. 2) Early holders of large volumes of bitcoins can therefore cash in their bitcoins for a great deal of real money from new investors desiring to enter the market. ergo, money shifts from new investors to the creators. (If the creators are smart enough to cash out. Which it seems they are, as Satoshi has disappeared. http://en.wikipedia.org/wiki/Satoshi_Nakamoto http://en.wikipedia.org/wiki/Satoshi_Nakamoto)
- weavejester 15y ago
  What you describe is a free market trading a limited resource; not a pyramid scheme. In a pyramid scheme the wealth always flows up to the creator of the scheme, but the creators of Bitcoin can only make money by selling their own bitcoins - they don't get a cut when anybody else does.
sorbus 15y ago
> Money does not shift from new investors to the creators of Bitcoin. I'm not quite sure what confusion of ideas lead you to believe this. Please explain how new investors obtain bitcoins, if not from the original members of the system (some of the early users have 1% of the total bitcoins, I recall hearing). Yes, there's mining, but that's not an effective way to transform money into bitcoins - I mean, say that I wanted 1000 bitcoins. Building an expensive new computer to mine and waiting for them to magically appear is not how I would go about it.
- weavejester 15y ago
  People obtain bitcoins by buying them from other people, who are typically miners or people who bought a lot of bitcoins early and want to cash out a proportion of their worth. However, the people responsible for creating the bitcoin protocol only benefit financially if they sell their own bitcoins, or if an increase in demand raises the price bitcoins are trading at. The Bitcoin economy is a free market; people can buy and sell bitcoins and will, and any profits they might make are entirely governed by supply and demand.

You don't appear to understand how Bitcoin works. Money does not shift from new investors to the creators of Bitcoin. I'm not quite sure what confusion of ideas lead you to believe this.

gammarator 15y ago

0) Bitcoins were easiest to mine at the beginning => the creators & early adopters have a large number of bitcoins 1) New investors demanding a finite supply of bitcoins are increasing the exchange rate of bitcoins/dollar. 2) Early holders of large volumes of bitcoins can therefore cash in their bitcoins for a great deal of real money from new investors desiring to enter the market. ergo, money shifts from new investors to the creators. (If the creators are smart enough to cash out. Which it seems they are, as Satoshi has disappeared. http://en.wikipedia.org/wiki/Satoshi_Nakamoto http://en.wikipedia.org/wiki/Satoshi_Nakamoto)

weavejester 15y ago
What you describe is a free market trading a limited resource; not a pyramid scheme. In a pyramid scheme the wealth always flows up to the creator of the scheme, but the creators of Bitcoin can only make money by selling their own bitcoins - they don't get a cut when anybody else does.

sorbus 15y ago

> Money does not shift from new investors to the creators of Bitcoin. I'm not quite sure what confusion of ideas lead you to believe this. Please explain how new investors obtain bitcoins, if not from the original members of the system (some of the early users have 1% of the total bitcoins, I recall hearing). Yes, there's mining, but that's not an effective way to transform money into bitcoins - I mean, say that I wanted 1000 bitcoins. Building an expensive new computer to mine and waiting for them to magically appear is not how I would go about it.

weavejester 15y ago
People obtain bitcoins by buying them from other people, who are typically miners or people who bought a lot of bitcoins early and want to cash out a proportion of their worth. However, the people responsible for creating the bitcoin protocol only benefit financially if they sell their own bitcoins, or if an increase in demand raises the price bitcoins are trading at. The Bitcoin economy is a free market; people can buy and sell bitcoins and will, and any profits they might make are entirely governed by supply and demand.