4 ms·

Is it? It's incredibly unstable and has a tiny pool of buyers/sellers, that makes it a terrible characteristic for wealth transfer.

by ohashi 15y ago

weavejester 15y ago
Why? The long term stability of the currency is irrelevant if you're just using bitcoins as a temporary intermediary, as the exchange rate only has to be remain constant for the time taken to verify a transaction.
- ohashi 15y ago
  Because with such a tiny market you cannot actually move a lot of wealth without influencing the value of the currency itself.
  - weavejester 15y ago
    But that would only be a problem if you wanted to move large amounts of wealth infrequently. If you only wanted to move small amounts of wealth frequently (like Paypal), then there wouldn't be any problem.
    - ohashi 15y ago
      Your argument basically boils down to: it's a toy 'currency,' is that really the best argument you can make? If so, this really isn't worth discussing because it's a joke.
      - weavejester 15y ago
        Huh? That's not my argument at all. Have you replied to the wrong comment by accident?
        ohashi 15y ago
        I did, and I stand by my statement. You are arguing that it's viable if you move small amounts of money. That means it only works with toy amounts, any large amount of money will influence the price because demand is shallow. Thus, you argue if you move small amounts frequently it would work, but then it is subject to the same volatility. This is why it's a toy 'currency' because it only works with tiny amounts of money.
        weavejester 15y ago
        So, in your opinion Paypal, credit cards, and physical cash are all toys because they're designed for moving small amounts of money? Or are you saying that the potential threat of a sudden market crash precludes using bitcoin as a reliable way of transferring wealth? Let's take a look at the economics of the latter. Let's assume that over the course of the year, a modest $1 million worth of money passes through my dollar-to-bitcoin and bitcoin-to-dollar gateways, and as I'm charging 1% on each (2% total), I'm making a $20,000 profit. Then bitcoin market suddenly crashes, and 99% of bitcoin's value is lost. What a disaster! I'll lose all of... well... assuming I wait 1 hour to confirm transactions, I'll lose $100 dollars on average. If I waited 10 minutes, then I'd lose only $16 dollars. So whilst bitcoin might be volatile, the odd market crash doesn't actually affect people who want to bitcoin as a protocol for transferring wealth, rather than storing it.
        ohashi 15y ago
        Paypal, credit cards and physical handle large amounts infinitely better than bitcoin. Look at mtgoxlive and see how much money it really takes to move the market a good amount. $10,000 would move it 20 cents on the buy side which is a 7% move because the demand is shallow. It's a toy currency. Paypal can handle 5 figure transactions without blinking (maybe even 6, havent heard of anyone try but I've seen 5 figure transactions). My point is, you can't even move a good chunk of money without influencing the value of the market. It doesn't help that you can't store value in it either because of its volatility.
        15y ago

Is it? It's incredibly unstable and has a tiny pool of buyers/sellers, that makes it a terrible characteristic for wealth transfer.

by ohashi 15y ago

Is it? It's incredibly unstable and has a tiny pool of buyers/sellers, that makes it a terrible characteristic for wealth transfer.

weavejester 15y ago

Why? The long term stability of the currency is irrelevant if you're just using bitcoins as a temporary intermediary, as the exchange rate only has to be remain constant for the time taken to verify a transaction.

ohashi 15y ago
Because with such a tiny market you cannot actually move a lot of wealth without influencing the value of the currency itself.
- weavejester 15y ago
  But that would only be a problem if you wanted to move large amounts of wealth infrequently. If you only wanted to move small amounts of wealth frequently (like Paypal), then there wouldn't be any problem.
  - ohashi 15y ago
    Your argument basically boils down to: it's a toy 'currency,' is that really the best argument you can make? If so, this really isn't worth discussing because it's a joke.
    - weavejester 15y ago
      Huh? That's not my argument at all. Have you replied to the wrong comment by accident?
      - ohashi 15y ago
        I did, and I stand by my statement. You are arguing that it's viable if you move small amounts of money. That means it only works with toy amounts, any large amount of money will influence the price because demand is shallow. Thus, you argue if you move small amounts frequently it would work, but then it is subject to the same volatility. This is why it's a toy 'currency' because it only works with tiny amounts of money.
        weavejester 15y ago
        So, in your opinion Paypal, credit cards, and physical cash are all toys because they're designed for moving small amounts of money? Or are you saying that the potential threat of a sudden market crash precludes using bitcoin as a reliable way of transferring wealth? Let's take a look at the economics of the latter. Let's assume that over the course of the year, a modest $1 million worth of money passes through my dollar-to-bitcoin and bitcoin-to-dollar gateways, and as I'm charging 1% on each (2% total), I'm making a $20,000 profit. Then bitcoin market suddenly crashes, and 99% of bitcoin's value is lost. What a disaster! I'll lose all of... well... assuming I wait 1 hour to confirm transactions, I'll lose $100 dollars on average. If I waited 10 minutes, then I'd lose only $16 dollars. So whilst bitcoin might be volatile, the odd market crash doesn't actually affect people who want to bitcoin as a protocol for transferring wealth, rather than storing it.
        ohashi 15y ago
        Paypal, credit cards and physical handle large amounts infinitely better than bitcoin. Look at mtgoxlive and see how much money it really takes to move the market a good amount. $10,000 would move it 20 cents on the buy side which is a 7% move because the demand is shallow. It's a toy currency. Paypal can handle 5 figure transactions without blinking (maybe even 6, havent heard of anyone try but I've seen 5 figure transactions). My point is, you can't even move a good chunk of money without influencing the value of the market. It doesn't help that you can't store value in it either because of its volatility.
        15y ago