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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

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.
        weavejester 15y ago
        If you're using bitcoin as a mechanism for transferring wealth, the volatility doesn't matter if your revenue stream is relatively constant, because only a small percentage of your revenue will exist as bitcoins at any instance in time. Volatility only matters if you're interested in storing wealth, or if your transactions are both infrequent and large relative to the bitcoin market. These are the only conditions where a sizeable proportion of your capital would have to exist as bitcoins at one time, and therefore the only conditions where you'd care about volatility. So sure, using bitcoins to pay for a house or an expensive car is probably not a good idea, but it seems, well, utterly bizarre to dismiss bitcoins just because it's currently unsuitable for a small segment of the market. And personally, I'd view physical cash as being wholly unsuitable for purchases over $10,000, due to the risk of manually transporting that much money. If I had a choice solely between paying someone $10,000 in physical cash, or $10,000 in bitcoins, then I'd think seriously about using bitcoins. Does this mean that physical money is just a "toy currency"?
        ohashi 15y ago
        $10,000 in cash or at a bank is the same. If you tried to move $10,000 into bitcoins you would move the market a substantial amount just to try and convert your money/bitcoins. Volatility matters in a greater sense, because you cannot simply say it's only for wealth transfer since it is trying to act as a pseudo currency as well. The characteristics that make it suitable (in your mind) for wealth transfer are because it's being used as a pseudo currency. By utilizing it to transfer wealth, you are also affecting the currency side - which matters. If it became only a method to transfer wealth (no wealth stored), then there should be no demand for it. At most the interest in it would be the difference of transferring money in regular currency. But it's not used that way currently, but its market is so small that people who try to use it to transfer wealth could/do in fact manipulate its value even in real time.

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.
      - weavejester 15y ago
        If you're using bitcoin as a mechanism for transferring wealth, the volatility doesn't matter if your revenue stream is relatively constant, because only a small percentage of your revenue will exist as bitcoins at any instance in time. Volatility only matters if you're interested in storing wealth, or if your transactions are both infrequent and large relative to the bitcoin market. These are the only conditions where a sizeable proportion of your capital would have to exist as bitcoins at one time, and therefore the only conditions where you'd care about volatility. So sure, using bitcoins to pay for a house or an expensive car is probably not a good idea, but it seems, well, utterly bizarre to dismiss bitcoins just because it's currently unsuitable for a small segment of the market. And personally, I'd view physical cash as being wholly unsuitable for purchases over $10,000, due to the risk of manually transporting that much money. If I had a choice solely between paying someone $10,000 in physical cash, or $10,000 in bitcoins, then I'd think seriously about using bitcoins. Does this mean that physical money is just a "toy currency"?
        ohashi 15y ago
        $10,000 in cash or at a bank is the same. If you tried to move $10,000 into bitcoins you would move the market a substantial amount just to try and convert your money/bitcoins. Volatility matters in a greater sense, because you cannot simply say it's only for wealth transfer since it is trying to act as a pseudo currency as well. The characteristics that make it suitable (in your mind) for wealth transfer are because it's being used as a pseudo currency. By utilizing it to transfer wealth, you are also affecting the currency side - which matters. If it became only a method to transfer wealth (no wealth stored), then there should be no demand for it. At most the interest in it would be the difference of transferring money in regular currency. But it's not used that way currently, but its market is so small that people who try to use it to transfer wealth could/do in fact manipulate its value even in real time.