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What happens if someone releases bitcoin2? right now bitcoin exists as a unique entity, but with competition what happens to it's value? bitcoin to me seems lik

What happens if someone releases bitcoin2? right now bitcoin exists as a unique entity, but with competition what happens to it's value? bitcoin to me seems like how beenie babies were to moms in the 90s. Super fun and interesting for a while, but a couple years later and everyones trading pokemon cards. Plus I don't think I'm ever going to be able to get over how lopsided bitcoin favors early adopters.

SkyMarshal 15y ago
There already is Bitcoin2, and 3, and 4, etc. Lots of forks, and even forks of forks (Bitcoin -> Ixcoin -> I0coin). Solidcoin is probably the main one, and has some interesting critiques of Bitcoin: http://solidcoin.info/faq.php http://solidcoin.info/faq.php Fundamentally, the value of anything is a function of its supply and demand, even currencies. In Bitcoin's case, the demand derives from the new utility provided by a unique and clever solution to the problem of distributed consensus among untrusted parties. Eg, people want to transact and neither trust each other to deal honestly nor trust a central monetary authority (either not to devalue the medium of exchange, or not track them, etc). Bitcoin created a system to make that possible, and hence has demand (and limited supply) and value. As long as the underlying reasons for that demand don't vanish, it should always have some value. The question is, can forks of Bitcoin provide that utility in a significantly better way, that gives them enough marginal demand over Bitcoin to incentivize most people in the Bitcoin network to switch? Same as the general competing currencies idea espoused by Ron Paul and others (for the record, I'm a skeptic, but find the idea interesting), just applied to virtual P2P currencies that are created by hackers rather than nation states (of course, there's nothing stopping a nation state from creating one either except their own laws, mindset, and momentum). As for early adopters being favored, you can only make that observation with the benefit of hindsight. Had bitcoin failed early or never taken off, early adopters would have lost. The expected value back when early adopters decided to commit and mine and accumulate bitcoin is decidedly different from the realized value of bitcoin now. Also, most currencies favor early adopters, even (especially) gold and silver. I don't think that's really anything new.
- jpdoctor 15y ago
  > Also, most currencies favor early adopters If you amend "currencies" to be "currencies of finite supply* then yes. However any currency administered by a central bank does not favor early adopters: The dollar being a very obvious case.
- gerggerg 15y ago
  we all know what supply and demand are, and i understand the basics of crypto currency. The question is, can forks of Bitcoin provide that utility in a significantly better way Thats not really the question is it? It's not about better utility. It's about where you can unload the currency and for what/how much. It's not about usefulness it's ultimately about money. Real money. Bitcoins are only valuable in a world where there use is necessary. I wish I could bold that on HN, NECESSARY. Without the necessity any normal consumer would use a more convenient, less volatile system. Lets shift for a sec. Think about the silk road marketplace. What they should really do is come out with a bitcoin clone of their own, get a bunch of early adopters behind it and then switch the website over to only accept their crypto currency. The'd rake in the cash and have a pile of it on hand from getting in early. They'd be selling the currency and the products you buy with it. The worlds best drug dealers. In fact theres no telling whether the bitcoin early adopters are involved in this very practice at silk road. It's not about beating bitcoin in usefullness, it's about real money. Also, most currencies favor early adopters, even (especially) gold and silver. I don't think that's really anything new Gold and silver don't compare. They're not currency, they're commodities that have actual use and value outside the realm of wealth exchange, and they didn't favor early adopters(thousands of years ago). That comparison holds little to no value and frankly I'm growing rather tired of people pretending like it does.
  - wmf 15y ago
    It's not about better utility. It's about where you can unload the currency and for what/how much. This sounds like the Bitcoin-as-investment thinking that produced the bubble. Imagine a fork of Bitcoin that clears transactions faster, has less volatility, and has a better GUI; would you still judge it only on its exchange rate?

SkyMarshal 15y ago

There already is Bitcoin2, and 3, and 4, etc. Lots of forks, and even forks of forks (Bitcoin -> Ixcoin -> I0coin). Solidcoin is probably the main one, and has some interesting critiques of Bitcoin: http://solidcoin.info/faq.php http://solidcoin.info/faq.php Fundamentally, the value of anything is a function of its supply and demand, even currencies. In Bitcoin's case, the demand derives from the new utility provided by a unique and clever solution to the problem of distributed consensus among untrusted parties. Eg, people want to transact and neither trust each other to deal honestly nor trust a central monetary authority (either not to devalue the medium of exchange, or not track them, etc). Bitcoin created a system to make that possible, and hence has demand (and limited supply) and value. As long as the underlying reasons for that demand don't vanish, it should always have some value. The question is, can forks of Bitcoin provide that utility in a significantly better way, that gives them enough marginal demand over Bitcoin to incentivize most people in the Bitcoin network to switch? Same as the general competing currencies idea espoused by Ron Paul and others (for the record, I'm a skeptic, but find the idea interesting), just applied to virtual P2P currencies that are created by hackers rather than nation states (of course, there's nothing stopping a nation state from creating one either except their own laws, mindset, and momentum). As for early adopters being favored, you can only make that observation with the benefit of hindsight. Had bitcoin failed early or never taken off, early adopters would have lost. The expected value back when early adopters decided to commit and mine and accumulate bitcoin is decidedly different from the realized value of bitcoin now. Also, most currencies favor early adopters, even (especially) gold and silver. I don't think that's really anything new.

jpdoctor 15y ago
> Also, most currencies favor early adopters If you amend "currencies" to be "currencies of finite supply* then yes. However any currency administered by a central bank does not favor early adopters: The dollar being a very obvious case.
gerggerg 15y ago
we all know what supply and demand are, and i understand the basics of crypto currency. The question is, can forks of Bitcoin provide that utility in a significantly better way Thats not really the question is it? It's not about better utility. It's about where you can unload the currency and for what/how much. It's not about usefulness it's ultimately about money. Real money. Bitcoins are only valuable in a world where there use is necessary. I wish I could bold that on HN, NECESSARY. Without the necessity any normal consumer would use a more convenient, less volatile system. Lets shift for a sec. Think about the silk road marketplace. What they should really do is come out with a bitcoin clone of their own, get a bunch of early adopters behind it and then switch the website over to only accept their crypto currency. The'd rake in the cash and have a pile of it on hand from getting in early. They'd be selling the currency and the products you buy with it. The worlds best drug dealers. In fact theres no telling whether the bitcoin early adopters are involved in this very practice at silk road. It's not about beating bitcoin in usefullness, it's about real money. Also, most currencies favor early adopters, even (especially) gold and silver. I don't think that's really anything new Gold and silver don't compare. They're not currency, they're commodities that have actual use and value outside the realm of wealth exchange, and they didn't favor early adopters(thousands of years ago). That comparison holds little to no value and frankly I'm growing rather tired of people pretending like it does.
- wmf 15y ago
  It's not about better utility. It's about where you can unload the currency and for what/how much. This sounds like the Bitcoin-as-investment thinking that produced the bubble. Imagine a fork of Bitcoin that clears transactions faster, has less volatility, and has a better GUI; would you still judge it only on its exchange rate?