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As opposed to "real" money like the dozens that have totally crashed over the last few decades? I'm not planning on buying my groceries with bitcoins any time

As opposed to "real" money like the dozens that have totally crashed over the last few decades? I'm not planning on buying my groceries with bitcoins any time soon, but saying a four-year-old currency in the first throes of popularity and stress-testing, and using inadequate means for it at that, is "not real money" seems awfully shortsighted.

InclinedPlane 14y ago
If you're not planning to buy groceries with bitcoins any time soon then bitcoin isn't going to be a currency any time soon.
- derefr 14y ago
  What do you call a volatile commodity used as an ephemeral financial instrument for the (anonymous) transfer of value, which is immediately converted into a more stable commodity (e.g. a currency) after it's received? "Non-fiat cheques", perhaps?
  - tptacek 14y ago
    The same thing you'd call a tulip bulb, or a share of Pets.com stock. The only basis you seem to be using to qualify Bitcoin is that it (often) has a spot price.
    - morsch 14y ago
      Pets.com stock isn't being put forward as an immediate medium of exchange for services and goods, though. And if it was, we might want to have a word describing that commonality with BTC. As long as BTC is nothing more than an investment, I agree.
      - tptacek 14y ago
        The dollar is more than just a commodity with a liquid market. It is also a store of value that is stable enough that it can be used as a unit of account. Bitcoin can't currently be: its value could double tomorrow, or go to zero. If the dollar doubled or went to zero tomorrow, Bitcoin would be irrelevant, because there wouldn't be an Internet to transact in it over. The reality is that every item for Bitcoin-denominated sale has an underlying intended value denominated in dollars; the correspondance between BTC and USD is (a) virtually always unbreakable and (b) wishful and fraught for (depending on phase of moon) buyer and seller alike. The notion of Bitcoin as "money" is counterfeit for the overwhelming majority of its users; for one group, BTC is a P2P alternative to Paypal; for the other, they're virtual tulip bulbs.
        deleted 14y ago
        [deleted]
    - derefr 14y ago
      Indeed: Bitcoin isn't, fundamentally, "a currency, but digital"; it's simply "bits on a computer that have a [market-discovered] spot price" (a unique thing among bits-on-computers.) Any conclusions about its usefulness or lack thereof should be made based upon that fact. Which is to say, it's not a very good currency--and anyone who is taking a long position that Bitcoin will somehow replace or surpass any real currency is a fool who this bubble is going to bankrupt. But, if you just need some bits that hold a (however-ephemeral) value--not a high value, just any defined value--without any central authority needing to back that value, then BTC seems like a good option. A good example of a use for "bits that have a spot price regardless of any central authority" might be, say, a market for CPU cycles for agents within a distributed computation mesh (somewhat ironically, a dual to Bitcoin's own mining process.) Picture a version of, say, the Erlang VM, where processes could voluntarily surrender some part of each allocated timeslice to other processes who they "owed." Agent processes would need to create highly divisible units of currency to pay other agents on other (untrusted!) systems in exchange for their time. "Real money" would be very hard to use in this system--if every single agent had a real bank account, transaction fees would quickly overwhelm the system's usefulness. And "fiat play-money" (machine-hour-tokens or something) would only work if everyone could agree, across the whole distributed mesh, that they were worth something, and either there was a "central bank" with which all transactions had to coordinate (turning the distributed system into a hub-and-spoke design), or all systems could be trusted to allocate agents units of of currency only in proportion to productivity. Bitcoin is something a machine can make, and which will have a price for long enough for it to use to pay another machine for useful work. Also, it cannot be made without doing work proportional to the cost of making it. This combination of factors makes Bitcoin unusual enough to be useful in some limited cases. Just not any of the ones people are hoping for. :)
  - InclinedPlane 14y ago
    Contraband?
- deleted 14y ago
  [deleted]
i386 14y ago
Currencies don't "stress test".

InclinedPlane 14y ago

If you're not planning to buy groceries with bitcoins any time soon then bitcoin isn't going to be a currency any time soon.

derefr 14y ago
What do you call a volatile commodity used as an ephemeral financial instrument for the (anonymous) transfer of value, which is immediately converted into a more stable commodity (e.g. a currency) after it's received? "Non-fiat cheques", perhaps?
- tptacek 14y ago
  The same thing you'd call a tulip bulb, or a share of Pets.com stock. The only basis you seem to be using to qualify Bitcoin is that it (often) has a spot price.
  - morsch 14y ago
    Pets.com stock isn't being put forward as an immediate medium of exchange for services and goods, though. And if it was, we might want to have a word describing that commonality with BTC. As long as BTC is nothing more than an investment, I agree.
    - tptacek 14y ago
      The dollar is more than just a commodity with a liquid market. It is also a store of value that is stable enough that it can be used as a unit of account. Bitcoin can't currently be: its value could double tomorrow, or go to zero. If the dollar doubled or went to zero tomorrow, Bitcoin would be irrelevant, because there wouldn't be an Internet to transact in it over. The reality is that every item for Bitcoin-denominated sale has an underlying intended value denominated in dollars; the correspondance between BTC and USD is (a) virtually always unbreakable and (b) wishful and fraught for (depending on phase of moon) buyer and seller alike. The notion of Bitcoin as "money" is counterfeit for the overwhelming majority of its users; for one group, BTC is a P2P alternative to Paypal; for the other, they're virtual tulip bulbs.
      - deleted 14y ago
        [deleted]
  - derefr 14y ago
    Indeed: Bitcoin isn't, fundamentally, "a currency, but digital"; it's simply "bits on a computer that have a [market-discovered] spot price" (a unique thing among bits-on-computers.) Any conclusions about its usefulness or lack thereof should be made based upon that fact. Which is to say, it's not a very good currency--and anyone who is taking a long position that Bitcoin will somehow replace or surpass any real currency is a fool who this bubble is going to bankrupt. But, if you just need some bits that hold a (however-ephemeral) value--not a high value, just any defined value--without any central authority needing to back that value, then BTC seems like a good option. A good example of a use for "bits that have a spot price regardless of any central authority" might be, say, a market for CPU cycles for agents within a distributed computation mesh (somewhat ironically, a dual to Bitcoin's own mining process.) Picture a version of, say, the Erlang VM, where processes could voluntarily surrender some part of each allocated timeslice to other processes who they "owed." Agent processes would need to create highly divisible units of currency to pay other agents on other (untrusted!) systems in exchange for their time. "Real money" would be very hard to use in this system--if every single agent had a real bank account, transaction fees would quickly overwhelm the system's usefulness. And "fiat play-money" (machine-hour-tokens or something) would only work if everyone could agree, across the whole distributed mesh, that they were worth something, and either there was a "central bank" with which all transactions had to coordinate (turning the distributed system into a hub-and-spoke design), or all systems could be trusted to allocate agents units of of currency only in proportion to productivity. Bitcoin is something a machine can make, and which will have a price for long enough for it to use to pay another machine for useful work. Also, it cannot be made without doing work proportional to the cost of making it. This combination of factors makes Bitcoin unusual enough to be useful in some limited cases. Just not any of the ones people are hoping for. :)
- InclinedPlane 14y ago
  Contraband?
deleted 14y ago
[deleted]

i386 14y ago

Currencies don't "stress test".