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Let's say I think that in one year's time Bitcoin will be gone. And let's say I want to put my money where my mouth is and want to short Bitcoin. Presumably the

Let's say I think that in one year's time Bitcoin will be gone. And let's say I want to put my money where my mouth is and want to short Bitcoin. Presumably there's a lot of people who think that Bitcoin is going to appreciate and thus should be happy to give me a low-interest loan. And yet there is no way to get a Bitcoin-denominated loan. Does this mean that people don't really believe Bitcoin will be with us in one year's time?

jboggan 14y ago
If I were to give someone a Bitcoin loan, what interest rate should I charge? The massive uncertainty of that question is enough to discourage any such activity. I wouldn't make a Bitcoin loan with a one-week period.
- rrrrtttt 14y ago
  That's exactly what I'm saying. If it's deflationary then it should be worth your while to give me a loan at 0% (assuming I am low default risk). The fact that we don't know where Bitcoin is going to be in one week means that we don't really believe it's deflationary.
  - Nursie 14y ago
    "If it's deflationary then it should be worth your while to give me a loan at 0%" Why? I can just hang on to it for the same return and no risk at all. This is why BTC loans really don't make sense, to me. Positive interest rates are punitive if the value keeps rising, negative ones pointless.
geoffschmidt 14y ago
Bitcoin is not exactly a mature currency. When a new merchant starts accepting Bitcoin payments it's still front page news. So I wouldn't read too much into the lack of lending infrastructure. Evaluating creditworthiness, and going after defaulters, is a lot more work than holding cash deposits or accepting cash in return for products, and those things are still big logistical challenges in Bitcoin land.
- rrrrtttt 14y ago
  Sure, but I still have my doubts. Apparently merchants like Namecheap accepting Bitcoin don't name their price in Bitcoin, they name their price in USD. Again, if you believe in Bitcoin, shouldn't you name your price in Bitcoin?
  - lucb1e 14y ago
    With the volatility of Bitcoin's price, it's quite hard to do. They can't set a single price, so they would have to modify their existing site (where most people probably come to pay in USD anyway) to automatically fetch the current market price.
  - toomim 14y ago
    Not yet, but that will happen once bitcoins saturate the market of currencies. We're just in the beginning stages. Linux sucked when it was first released too.
ok_craig 14y ago
Pretty sure you can borrow and loan bitcoin at bitfinex.com.
jerguismi 14y ago
There also options and futures: mpex.co and icbit.se And also bitfinex.com but generally they are not perceived well. (haven't used them myself)
wmf 14y ago
https://bitcointalk.org/index.php?board=65.0 https://bitcointalk.org/index.php?board=65.0 You can short BTC on Bitcoinica... oh wait.

jboggan 14y ago

If I were to give someone a Bitcoin loan, what interest rate should I charge? The massive uncertainty of that question is enough to discourage any such activity. I wouldn't make a Bitcoin loan with a one-week period.

rrrrtttt 14y ago
That's exactly what I'm saying. If it's deflationary then it should be worth your while to give me a loan at 0% (assuming I am low default risk). The fact that we don't know where Bitcoin is going to be in one week means that we don't really believe it's deflationary.
- Nursie 14y ago
  "If it's deflationary then it should be worth your while to give me a loan at 0%" Why? I can just hang on to it for the same return and no risk at all. This is why BTC loans really don't make sense, to me. Positive interest rates are punitive if the value keeps rising, negative ones pointless.

geoffschmidt 14y ago

Bitcoin is not exactly a mature currency. When a new merchant starts accepting Bitcoin payments it's still front page news. So I wouldn't read too much into the lack of lending infrastructure. Evaluating creditworthiness, and going after defaulters, is a lot more work than holding cash deposits or accepting cash in return for products, and those things are still big logistical challenges in Bitcoin land.

rrrrtttt 14y ago
Sure, but I still have my doubts. Apparently merchants like Namecheap accepting Bitcoin don't name their price in Bitcoin, they name their price in USD. Again, if you believe in Bitcoin, shouldn't you name your price in Bitcoin?
- lucb1e 14y ago
  With the volatility of Bitcoin's price, it's quite hard to do. They can't set a single price, so they would have to modify their existing site (where most people probably come to pay in USD anyway) to automatically fetch the current market price.
- toomim 14y ago
  Not yet, but that will happen once bitcoins saturate the market of currencies. We're just in the beginning stages. Linux sucked when it was first released too.

ok_craig 14y ago

Pretty sure you can borrow and loan bitcoin at bitfinex.com.

jerguismi 14y ago

There also options and futures: mpex.co and icbit.se And also bitfinex.com but generally they are not perceived well. (haven't used them myself)

wmf 14y ago

https://bitcointalk.org/index.php?board=65.0 https://bitcointalk.org/index.php?board=65.0 You can short BTC on Bitcoinica... oh wait.