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BitCoin can be better viewed as gold. If you would use gold to buy something then you will use BTC (illegal markets apart of course). But peercoin could stand

by atmosx 13y ago

BitCoin can be better viewed as gold. If you would use gold to buy something then you will use BTC (illegal markets apart of course). But peercoin could stand a chance to become a sort of online trading currency because of it's inflationary[1] policy. Something BitCoin should also have in order to become a widely accepted currency instead of a hoarding mechanism that gives the early adopters huge advantage over anyone else. [1]: http://en.wikipedia.org/wiki/PPCoin#Steady_inflation http://en.wikipedia.org/wiki/PPCoin#Steady_inflation [1]: http://ppcoin.org/ http://ppcoin.org/

negamax 13y ago
Gold is inflationary. There's infinite amount of that on asteroids and other planets. Bitcoin is totally an asset. It will probably have far wider usage than currency.
- atmosx 13y ago
  I wrote a 30+ words comment, but to make it shorter: * The nature of BitCoin could make it from an asset worth 350 USD to 0 USD overnight. * Gold has been there for centuries. I won't even comment on the asteroid thing.
  - jafaku 13y ago
    > I won't even comment on the asteroid thing. Because you can't refute it?
    - atmosx 13y ago
      No I can't. Neither I can refute that you're... Batman!
    - TillE 13y ago
      Nobody will be mining asteroids and shipping the resources back to Earth within our lifetimes. Certainly not profitably. It's a complete irrelevance unless you're specifically talking about 100+ years in the future.
      - mrosseel 13y ago
        this company (backed by high-profile investors) is setting out to do just that: http://www.planetaryresources.com/ http://www.planetaryresources.com/
  - hbbio 13y ago
    Seems a bit like: "You're a startup, I won't use your product." But like startup customers, bitcoin users exist and eventually the new product takes over.
  - lectrick 13y ago
    > * The nature of BitCoin could make it from an asset worth 350 USD to 0 USD overnight No. Not unless it stops being traded for anything. Read this: http://bitcoinsurvey.wordpress.com/2013/04/08/what-is-the-real-price-of-bitcoin-measuring-bitcoin-hoarding-irrational-exuberance-and-the-inevitable-crash/ http://bitcoinsurvey.wordpress.com/2013/04/08/what-is-the-re... It makes sense if you think about it. As long as 2 parties will accept Bitcoin as a trade medium, it literally MUST have a value in order to carry that exchange value. Whether it's 10,000 coins for 1 pizza or 1 coin for a gold bar. So no, it will never go to zero anymore unless something as useful and unique comes out which is at least twice as good (due to network effects). That doesn't mean a portion of the current value isn't speculative. But the speculative value is NOT "all" the value.
    - SilasX 13y ago
      Grandparent: Bitcoin could fall to 0 USD overnight. You: Not true, it would only fall arbitrarily close to 0 USD. Me: Not reassured.
      - lectrick 13y ago
        If you actually read the article, at the time it was written (months ago, when BTC volume was lower), it calculated a "bottom, minimum" value of about $45 USD. So if it ever goes back to there, it will most certainly be a buy... which will of course drive the price higher, into the speculative space. Basically, since the cat is out of the bag, it won't be possible to get completely rid of the speculative portion of the value, but the fundamental portion of the value WILL keep rising (at this rate).
        SilasX 13y ago
        I was replying to your comment[1], not the numerous, separate arguments that could have been made in defense of a related point. I'm optimistic myself about BTC, but don't think your comment as written is a good reason to think so in the context of the GP's point. [1] specifically, "As long as 2 parties will accept Bitcoin ... it literally MUST have a value ... Whether it's 10,000 coins for 1 pizza ...". That last bit is the "arbitrarily close to zero" lower bound I was attributing to you.
pakitan 13y ago
Inflationary currency makes sense from economics point of view, if you can force it onto people, as governments do. No one will hold inflationary currency voluntarily, if they can choose a deflationary one, all else being equal.
- atmosx 13y ago
  Sure, but no one will spend a non-inflationary currency when he can spend an inflationary one.
  - pakitan 13y ago
    Yes, and that's why I agree that bitcoin is "digital gold", rather than the Holy Grail of ecommerce. But that doesn't make peercoin a good idea. If I want to spend I have credit card and a paypal account, I don't need whatevercoin to help me with that.
    - atmosx 13y ago
      I totally get that and I agree with you. My initial point stands though: As a currency BTC is/has failed. As an asset might work, but I don't know for how long.
      - pakitan 13y ago
        "Failed" is a strong word and it's still too early to tell. Sure, I don't think it will ever be used predominantly as an exchange medium but that could be a nice "bonus" functionality. A lot of it depends on how bitcoin-friendly governments are. For example, if a global network of bitcoin ATMs can be built, this could practically put Western Union out of business.
  - snitko 13y ago
    It is really a sad state of things that people misunderstand deflation. They have this idea that no one will spend, but it doesn't stand any scrutiny, really. Please read these articles, we made a real effort here to explain why deflation wouldn't be a bad thing: http://blog.oleganza.com/post/66215430631/deflationary-spiral http://blog.oleganza.com/post/66215430631/deflationary-spira... http://snitko.ru/blog/the-beauty-of-deflation.html http://snitko.ru/blog/the-beauty-of-deflation.html
wuschel 13y ago
I am sorry - this is something I do not understand. Where is the problem in deflation? You can always pay in fractions of a bitcoins, e.g. nanobitcoins, picobitcoins, etc. There is not really an agreement in the ivory towers that a limited amount of currency is a bad thing per se. Could someone explain this to me?
- nhaehnle 13y ago
  I don't know which ivory towers you frequent and what you mean by "limited", but the idea that the money supply should be flexible has been pretty well established after some failed experiments in the 1970s and 80s. As for the inflation / deflation thing: I'm pretty sure we all agree that the faster the relative prices of things can change to reflect changes in the underlying reality, the better. A priori, it seems that these relative adjustments should be independent from the average adjustment and hence the overall price level. However, economic actors tend to resist a nominal decrease of income much more than a real decrease of income. You may not think that this is rational, but you have to work with the reality that you have. This means that inflation is beneficial, because it allows real decreases of income without nominal decreases of income, and this means that real income can decrease more easily, which is what you need for relative prices to adjust reasonably quickly.
crassus 13y ago
I like the mining design of Peer Coin much better. I worry that bitcoin mining will become too centralized/unprofitable due to declining block rewards. I'd feel more comfortable using a coin with a continuous small inflation tax paid to miners (say, 1% a year), than a coin that depends on fees becoming higher/more popular in the future. Besides, I hate fees in my coin, it hurts microtransaction applications.
josephagoss 13y ago
Peercoin lets those who have the ability to leaves funds untouched for 30 days accrue this interest. Peercoin was designed to enable the early adopters that can simply sit on their coins. In the real world most poor people cannot let any amount of coin remain unmoved for 30 days, so Peercoin in a privilege based coin and SunnyKing the creator intended this. A simple change = Allow all coins no matter age accrue interest. Sunny is a rich millionaire and does not care about the wealth divide his coin will cause if it took off.
- makomk 13y ago
  The last time I looked at Peercoin, it also appeared to be designed so that people with more coins in effect accrued a higher rate of interest on them due to a subtle quirk of the inflation algorithm. That may have been fixed since then though.

by atmosx 13y ago

negamax 13y ago

Gold is inflationary. There's infinite amount of that on asteroids and other planets. Bitcoin is totally an asset. It will probably have far wider usage than currency.

atmosx 13y ago
I wrote a 30+ words comment, but to make it shorter: * The nature of BitCoin could make it from an asset worth 350 USD to 0 USD overnight. * Gold has been there for centuries. I won't even comment on the asteroid thing.
- jafaku 13y ago
  > I won't even comment on the asteroid thing. Because you can't refute it?
  - atmosx 13y ago
    No I can't. Neither I can refute that you're... Batman!
  - TillE 13y ago
    Nobody will be mining asteroids and shipping the resources back to Earth within our lifetimes. Certainly not profitably. It's a complete irrelevance unless you're specifically talking about 100+ years in the future.
    - mrosseel 13y ago
      this company (backed by high-profile investors) is setting out to do just that: http://www.planetaryresources.com/ http://www.planetaryresources.com/
- hbbio 13y ago
  Seems a bit like: "You're a startup, I won't use your product." But like startup customers, bitcoin users exist and eventually the new product takes over.
- lectrick 13y ago
  > * The nature of BitCoin could make it from an asset worth 350 USD to 0 USD overnight No. Not unless it stops being traded for anything. Read this: http://bitcoinsurvey.wordpress.com/2013/04/08/what-is-the-real-price-of-bitcoin-measuring-bitcoin-hoarding-irrational-exuberance-and-the-inevitable-crash/ http://bitcoinsurvey.wordpress.com/2013/04/08/what-is-the-re... It makes sense if you think about it. As long as 2 parties will accept Bitcoin as a trade medium, it literally MUST have a value in order to carry that exchange value. Whether it's 10,000 coins for 1 pizza or 1 coin for a gold bar. So no, it will never go to zero anymore unless something as useful and unique comes out which is at least twice as good (due to network effects). That doesn't mean a portion of the current value isn't speculative. But the speculative value is NOT "all" the value.
  - SilasX 13y ago
    Grandparent: Bitcoin could fall to 0 USD overnight. You: Not true, it would only fall arbitrarily close to 0 USD. Me: Not reassured.
    - lectrick 13y ago
      If you actually read the article, at the time it was written (months ago, when BTC volume was lower), it calculated a "bottom, minimum" value of about $45 USD. So if it ever goes back to there, it will most certainly be a buy... which will of course drive the price higher, into the speculative space. Basically, since the cat is out of the bag, it won't be possible to get completely rid of the speculative portion of the value, but the fundamental portion of the value WILL keep rising (at this rate).
      - SilasX 13y ago
        I was replying to your comment[1], not the numerous, separate arguments that could have been made in defense of a related point. I'm optimistic myself about BTC, but don't think your comment as written is a good reason to think so in the context of the GP's point. [1] specifically, "As long as 2 parties will accept Bitcoin ... it literally MUST have a value ... Whether it's 10,000 coins for 1 pizza ...". That last bit is the "arbitrarily close to zero" lower bound I was attributing to you.

pakitan 13y ago

Inflationary currency makes sense from economics point of view, if you can force it onto people, as governments do. No one will hold inflationary currency voluntarily, if they can choose a deflationary one, all else being equal.

atmosx 13y ago
Sure, but no one will spend a non-inflationary currency when he can spend an inflationary one.
- pakitan 13y ago
  Yes, and that's why I agree that bitcoin is "digital gold", rather than the Holy Grail of ecommerce. But that doesn't make peercoin a good idea. If I want to spend I have credit card and a paypal account, I don't need whatevercoin to help me with that.
  - atmosx 13y ago
    I totally get that and I agree with you. My initial point stands though: As a currency BTC is/has failed. As an asset might work, but I don't know for how long.
    - pakitan 13y ago
      "Failed" is a strong word and it's still too early to tell. Sure, I don't think it will ever be used predominantly as an exchange medium but that could be a nice "bonus" functionality. A lot of it depends on how bitcoin-friendly governments are. For example, if a global network of bitcoin ATMs can be built, this could practically put Western Union out of business.
- snitko 13y ago
  It is really a sad state of things that people misunderstand deflation. They have this idea that no one will spend, but it doesn't stand any scrutiny, really. Please read these articles, we made a real effort here to explain why deflation wouldn't be a bad thing: http://blog.oleganza.com/post/66215430631/deflationary-spiral http://blog.oleganza.com/post/66215430631/deflationary-spira... http://snitko.ru/blog/the-beauty-of-deflation.html http://snitko.ru/blog/the-beauty-of-deflation.html

wuschel 13y ago

I am sorry - this is something I do not understand. Where is the problem in deflation? You can always pay in fractions of a bitcoins, e.g. nanobitcoins, picobitcoins, etc. There is not really an agreement in the ivory towers that a limited amount of currency is a bad thing per se. Could someone explain this to me?

nhaehnle 13y ago
I don't know which ivory towers you frequent and what you mean by "limited", but the idea that the money supply should be flexible has been pretty well established after some failed experiments in the 1970s and 80s. As for the inflation / deflation thing: I'm pretty sure we all agree that the faster the relative prices of things can change to reflect changes in the underlying reality, the better. A priori, it seems that these relative adjustments should be independent from the average adjustment and hence the overall price level. However, economic actors tend to resist a nominal decrease of income much more than a real decrease of income. You may not think that this is rational, but you have to work with the reality that you have. This means that inflation is beneficial, because it allows real decreases of income without nominal decreases of income, and this means that real income can decrease more easily, which is what you need for relative prices to adjust reasonably quickly.

crassus 13y ago

I like the mining design of Peer Coin much better. I worry that bitcoin mining will become too centralized/unprofitable due to declining block rewards. I'd feel more comfortable using a coin with a continuous small inflation tax paid to miners (say, 1% a year), than a coin that depends on fees becoming higher/more popular in the future. Besides, I hate fees in my coin, it hurts microtransaction applications.

josephagoss 13y ago

Peercoin lets those who have the ability to leaves funds untouched for 30 days accrue this interest. Peercoin was designed to enable the early adopters that can simply sit on their coins. In the real world most poor people cannot let any amount of coin remain unmoved for 30 days, so Peercoin in a privilege based coin and SunnyKing the creator intended this. A simple change = Allow all coins no matter age accrue interest. Sunny is a rich millionaire and does not care about the wealth divide his coin will cause if it took off.

makomk 13y ago
The last time I looked at Peercoin, it also appeared to be designed so that people with more coins in effect accrued a higher rate of interest on them due to a subtle quirk of the inflation algorithm. That may have been fixed since then though.