4 ms·

> The only clearly valuable thing Bitcoin accomplishes now is the facilitation of illegal trade online. How do you figure? Being able to send money across the

by lukifer 13y ago

> The only clearly valuable thing Bitcoin accomplishes now is the facilitation of illegal trade online. How do you figure? Being able to send money across the world for next to nothing (compare to credit card fees, not to mention the higher prices of Western Union or hawala) has immense value. Charitable organizations have already raised large sums using crypto-coins. You are correct about volatility. It makes more sense right now to treat as a highly fungible asset than a currency; it will be interesting to see if it can self-stabilize without any central organization.

pron 13y ago
Bitcoin's role as a large-sum money-transfer mechanism for legitimate purposes hinges on availability of immediate exchange at each end of the transaction (immediate because of the volatility). Bitcoin exchanges aren't getting the best PR lately, either. I don't think responsible organizations would allow the use of Bitcoin as a transfer medium in the current chaos just to save some money. So this utility, I claim, is more theoretical at this moment. In any event, the volume of such transactions by established, lawful, and respected organizations is probably too limited to be categorized as clear value just yet.
betterunix 13y ago
"Being able to send money across the world for next to nothing (compare to credit card fees, not to mention the higher prices of Western Union or hawala) has immense value." This is likely to end as Bitcoin exchanges discover the cost of compliance.
- lukifer 13y ago
  The cost of compliance is a serious issue, true. I would hope that at least some states recognize the value in letting the experiment play out without interference, as with the early days of the internet, but with real money on the line it's harder to dismiss as a mere toy. However, I wouldn't neglect the "gray market" use cases of Bitcoin: things that happen outside the law, but are not as nefarious or blatantly illegal as Silk Road. Immigrants sending money home to their families, secondary savings accounts for those in countries with unstable currencies, etc.
notahacker 13y ago
The real cost of money transfer isn't really "next to nothing" when it depends on an asset so volatile it might lose 20% of its value before the party at the other end realizes they've been paid, and counterparties involved in the transaction are people that really shouldn't be running financial institutions. When you look at the proportion of Bitcoins in existence whose owners are known to have lost them to incompetence/malice, suddenly those 2% conventional currency transfer fees with banks' associated guarantees look very cheap indeed. If you want a "disruptive" money transfer system with low fees then there are a whole lot of p2p-based FX firms which offer very competitive rates that are run by relatively competent people and don't rely on a volatile asset in the middle of the transaction. Obviously, if you want a speculative investment vehicle, to stick a middle finger to fiat currency or to facilitate money laundering then Bitcoin has other appeal.

by lukifer 13y ago

pron 13y ago

Bitcoin's role as a large-sum money-transfer mechanism for legitimate purposes hinges on availability of immediate exchange at each end of the transaction (immediate because of the volatility). Bitcoin exchanges aren't getting the best PR lately, either. I don't think responsible organizations would allow the use of Bitcoin as a transfer medium in the current chaos just to save some money. So this utility, I claim, is more theoretical at this moment. In any event, the volume of such transactions by established, lawful, and respected organizations is probably too limited to be categorized as clear value just yet.

betterunix 13y ago

"Being able to send money across the world for next to nothing (compare to credit card fees, not to mention the higher prices of Western Union or hawala) has immense value." This is likely to end as Bitcoin exchanges discover the cost of compliance.

lukifer 13y ago
The cost of compliance is a serious issue, true. I would hope that at least some states recognize the value in letting the experiment play out without interference, as with the early days of the internet, but with real money on the line it's harder to dismiss as a mere toy. However, I wouldn't neglect the "gray market" use cases of Bitcoin: things that happen outside the law, but are not as nefarious or blatantly illegal as Silk Road. Immigrants sending money home to their families, secondary savings accounts for those in countries with unstable currencies, etc.

notahacker 13y ago

The real cost of money transfer isn't really "next to nothing" when it depends on an asset so volatile it might lose 20% of its value before the party at the other end realizes they've been paid, and counterparties involved in the transaction are people that really shouldn't be running financial institutions. When you look at the proportion of Bitcoins in existence whose owners are known to have lost them to incompetence/malice, suddenly those 2% conventional currency transfer fees with banks' associated guarantees look very cheap indeed. If you want a "disruptive" money transfer system with low fees then there are a whole lot of p2p-based FX firms which offer very competitive rates that are run by relatively competent people and don't rely on a volatile asset in the middle of the transaction. Obviously, if you want a speculative investment vehicle, to stick a middle finger to fiat currency or to facilitate money laundering then Bitcoin has other appeal.