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Articles like this are actually quite revealing. It's incredibly interesting to watch "experts" comment on bitcoin as they study it, now, for the first time and

Articles like this are actually quite revealing. It's incredibly interesting to watch "experts" comment on bitcoin as they study it, now, for the first time and have to think about it. Like a lot of people my initial impression was that of scam (it lasted for three hours) then realization of the ingenious concept with the thought that "this will not survive long enough to become what it is intended for". So I kept selling most of the coins I mined all throughout 2012. Three "bubble pops" later, I could see my "confidence"/"trust" in bitcoin shift. It really has to go through these intense run-ups and crashes to actually prove itself. If it continous to, it will appear as an extremely trustworthy long-term store of value, independent of any central agency and as difficult to slay as file sharing. At which point more people will pile in, to protect their wealth, again, long-term. Money they could afford to lose, initially. What we might be observing could be a Kurzweilian visualization of an exponential graph similar to technological break-throughs from the Dark Ages to the Modern Age. Bitcoin's wealth transfer and processing network seems to be on a similar level (monetary internet) regarding markets, finances and currency. If it succeeds a whole lot of middle-man industries will meet their demise and capital allocation would be supercharged. The price of bitcoin just reflects that realization on a (global) level.

JoeAltmaier 13y ago
I don't get that; runs and crashes means your confidence is improved; that bitcoins have 'proved themselves'? I would argue just the opposite. No responsible financial counselor would recommend something as volatile as bitcoins; no business can survive the busts ("Just wait a few months Mr Vendor; my money will be worth something again then I promise!") So its used by - who? Speculators and suckers?
- novalis78 13y ago
  I agree with you. Let me explain - I think you have to separate bitcoin, the protocol and bitcoins, the currency. Secondly, if you separate the two functions of bitcoins as a storage of value and bitcoins as a currency, it might make more sense. After each of the last three big crashes, the price built a new base at twice the initial level before the bust and then beat the original high in a relatively short amount of time. This has been going on for 3 years now. If I want to save some money that I can afford to lose potentially, with the main rational that it cannot be inflated long term and can "forget" about (so I don't lose sleep over the fluctuations) now I found a secure home for capital that I don't want to touch. It took a long time for me to develop that confidence (I daytraded in the past, esp. penny stocks, so "supernovas" are not something new). Now, if (the big question of course) bitcoin as a currency continues to be adopted, a bitcoin will be unaffordable and most trading will be in the μBTC etc range we could see it stabilize due to the sheer volume of participants. However, even if that would never be the case, bitcoin as a protocol could lead to innovations in the entire supply chain that make transactions of raw material all the way up to product pricing instantaneous.
  - JoeAltmaier 13y ago
    Confidence is a funny word for gambling. Secure an odd choice for something defined as volatile. If you need money and your bitcoin savings is worthless, you lose. Volume of participants has had no stabilizing effect on bitcoins. They suffer in spades the destabilizing properties of real currency, with no corresponding 'federal reserve' able to (try to) control fluctuations.

JoeAltmaier 13y ago

I don't get that; runs and crashes means your confidence is improved; that bitcoins have 'proved themselves'? I would argue just the opposite. No responsible financial counselor would recommend something as volatile as bitcoins; no business can survive the busts ("Just wait a few months Mr Vendor; my money will be worth something again then I promise!") So its used by - who? Speculators and suckers?

novalis78 13y ago
I agree with you. Let me explain - I think you have to separate bitcoin, the protocol and bitcoins, the currency. Secondly, if you separate the two functions of bitcoins as a storage of value and bitcoins as a currency, it might make more sense. After each of the last three big crashes, the price built a new base at twice the initial level before the bust and then beat the original high in a relatively short amount of time. This has been going on for 3 years now. If I want to save some money that I can afford to lose potentially, with the main rational that it cannot be inflated long term and can "forget" about (so I don't lose sleep over the fluctuations) now I found a secure home for capital that I don't want to touch. It took a long time for me to develop that confidence (I daytraded in the past, esp. penny stocks, so "supernovas" are not something new). Now, if (the big question of course) bitcoin as a currency continues to be adopted, a bitcoin will be unaffordable and most trading will be in the μBTC etc range we could see it stabilize due to the sheer volume of participants. However, even if that would never be the case, bitcoin as a protocol could lead to innovations in the entire supply chain that make transactions of raw material all the way up to product pricing instantaneous.
- JoeAltmaier 13y ago
  Confidence is a funny word for gambling. Secure an odd choice for something defined as volatile. If you need money and your bitcoin savings is worthless, you lose. Volume of participants has had no stabilizing effect on bitcoins. They suffer in spades the destabilizing properties of real currency, with no corresponding 'federal reserve' able to (try to) control fluctuations.