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Providing stability? I don't know how you can begin to do that for an asset whose fundamental value no one knows, not even remotely. My recommendation: set up

Providing stability? I don't know how you can begin to do that for an asset whose fundamental value no one knows, not even remotely. My recommendation: set up an order on Mt. Gox for some amount you'd be willing to pay, like $12 or $13, and leave it there. The way things are going, odds are the price will come back down to that range sooner or later. Of course, I could be wrong. On the other hand, it could drop even further than that; the $12 or $13 number is just based on the recent history.

hugh3 15y ago
I don't know how you can begin to do that for an asset whose fundamental value no one knows, not even remotely. Actually the fundamental value is well known. It's zero.
- weavejester 15y ago
  Only if you see no value to being able to transfer wealth electronically without the need for a centralized broker.
  - hugh3 15y ago
    We're not talking about the value of the idea, we're talking about the value of an individual bitcoin: http://en.wikipedia.org/wiki/Intrinsic_value_%28finance%29 http://en.wikipedia.org/wiki/Intrinsic_value_%28finance%29 which is zero -- an owned bitcoin can't produce any income, nor keep you warm at night, nor feed you nor be hammered into jewellery.
    - weavejester 15y ago
      I have a hard time believing the intrinsic value of anything is zero. A bitcoin is list of signed transactions that is encoded within a chain of blocks verified by a proof of work. A list of transactions is only considered a valid bitcoin if it is accepted by the largest existing block chain. So a bitcoin must follow certain rules if it is to be considered to be valid, and this means it has certain intrinsic properties. For instance: if you have the private key that signed the last transaction for the bitcoin, you can extend the bitcoin with a new transaction, and that bitcoin will still be considered valid. So I'd argue that being able to cryptographically transfer a bitcoin is an intrinsic property of the bitcoin, and therefore something that gives a bitcoin intrinsic value (assuming you think this property is useful).
      - hugh3 15y ago
        I have a hard time believing the intrinsic value of anything is zero. Well shit man, I have some random bytes I'd like to sell you. How much are you willing to pay for 'em? So I'd argue that being able to cryptographically transfer a bitcoin is an intrinsic property of the bitcoin, and therefore something that gives a bitcoin intrinsic value (assuming you think this property is useful). Like I've said before (and nobody has yet taken me up on this offer), I'm selling Bitcoin Prime. This has the following properties: 1. Every string of bits that is a bitcoin is also a bitcoin prime 2. All bitcoins prime currently in existence are owned by me. Does my huge stock of bitcoins prime have any intrinsic value? I think not. But if anyone disagrees them I'm more than willing to part with my entire collection for a hundred US dollars. (I reserve the right to invent bitcoin double-prime as soon as our transaction is completed...) My point: even if a bitcoin is a string with some unique properties you don't actually own that string of bits in any useful sense, you only own it by convention with other bitcoin users. Bitcoin is just one of an infinite number of possible equivalent systems, and just happens to be the only one in which there's any real money floating around at the moment.
        weavejester 15y ago
        You may have a point with the random bytes. That is as close to worthless as makes no difference. But regarding your "Bitcoin Prime": your system isn't backed by proof of work. My point is that bitcoins are not just a set of random bytes, or even a chain of signed transactions. They are also secured by a proof of work chain, and without this they are not bitcoins, by definition. So even though you can come up with a set of bitcoin primes, one for each bitcoin, there's no proof of work backing your system. You can't reuse the proof of work that backs bitcoins without knowing all of the private keys, so you'd have to start from scratch.
        thebooktocome 15y ago
        If they were truly random bytes, I think I could find a market. However, I'd have to undercut random.org, somehow. Not impossible, though. I know there's someone who runs a dice-rolling machine to run games-by-email, because random.org "wasn't random enough" ostl.

hugh3 15y ago

I don't know how you can begin to do that for an asset whose fundamental value no one knows, not even remotely. Actually the fundamental value is well known. It's zero.

weavejester 15y ago
Only if you see no value to being able to transfer wealth electronically without the need for a centralized broker.
- hugh3 15y ago
  We're not talking about the value of the idea, we're talking about the value of an individual bitcoin: http://en.wikipedia.org/wiki/Intrinsic_value_%28finance%29 http://en.wikipedia.org/wiki/Intrinsic_value_%28finance%29 which is zero -- an owned bitcoin can't produce any income, nor keep you warm at night, nor feed you nor be hammered into jewellery.
  - weavejester 15y ago
    I have a hard time believing the intrinsic value of anything is zero. A bitcoin is list of signed transactions that is encoded within a chain of blocks verified by a proof of work. A list of transactions is only considered a valid bitcoin if it is accepted by the largest existing block chain. So a bitcoin must follow certain rules if it is to be considered to be valid, and this means it has certain intrinsic properties. For instance: if you have the private key that signed the last transaction for the bitcoin, you can extend the bitcoin with a new transaction, and that bitcoin will still be considered valid. So I'd argue that being able to cryptographically transfer a bitcoin is an intrinsic property of the bitcoin, and therefore something that gives a bitcoin intrinsic value (assuming you think this property is useful).
    - hugh3 15y ago
      I have a hard time believing the intrinsic value of anything is zero. Well shit man, I have some random bytes I'd like to sell you. How much are you willing to pay for 'em? So I'd argue that being able to cryptographically transfer a bitcoin is an intrinsic property of the bitcoin, and therefore something that gives a bitcoin intrinsic value (assuming you think this property is useful). Like I've said before (and nobody has yet taken me up on this offer), I'm selling Bitcoin Prime. This has the following properties: 1. Every string of bits that is a bitcoin is also a bitcoin prime 2. All bitcoins prime currently in existence are owned by me. Does my huge stock of bitcoins prime have any intrinsic value? I think not. But if anyone disagrees them I'm more than willing to part with my entire collection for a hundred US dollars. (I reserve the right to invent bitcoin double-prime as soon as our transaction is completed...) My point: even if a bitcoin is a string with some unique properties you don't actually own that string of bits in any useful sense, you only own it by convention with other bitcoin users. Bitcoin is just one of an infinite number of possible equivalent systems, and just happens to be the only one in which there's any real money floating around at the moment.
      - weavejester 15y ago
        You may have a point with the random bytes. That is as close to worthless as makes no difference. But regarding your "Bitcoin Prime": your system isn't backed by proof of work. My point is that bitcoins are not just a set of random bytes, or even a chain of signed transactions. They are also secured by a proof of work chain, and without this they are not bitcoins, by definition. So even though you can come up with a set of bitcoin primes, one for each bitcoin, there's no proof of work backing your system. You can't reuse the proof of work that backs bitcoins without knowing all of the private keys, so you'd have to start from scratch.
        thebooktocome 15y ago
        If they were truly random bytes, I think I could find a market. However, I'd have to undercut random.org, somehow. Not impossible, though. I know there's someone who runs a dice-rolling machine to run games-by-email, because random.org "wasn't random enough" ostl.