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I don't own any bitcoins, but felt like pointing a couple of things out. Whatever shreds of interest your bank gives you will be way, way less than the inflati

I don't own any bitcoins, but felt like pointing a couple of things out. Whatever shreds of interest your bank gives you will be way, way less than the inflation you're experiencing. In other words, your money's purchasing power keeps decreasing even if you're getting some interest on it, ie. you're losing your wealth. Bitcoin doesn't experience inflation like that, so it should be a better store of value than your fiat currency. I said "should" because bitcoin has been in a speculative bubble, and just came down even more. Right now it's still just a speculative asset, but it could serve as a stable currency. Your card is irrelevant. Transaction fees are not extortion. They're a massive skimming operation inflicted on the masses, because the masses have no choice but to eat them. Thank your state-maintained bank cartel for that.

tribaal 12y ago
> Your card is irrelevant. My card is very relevant. If someone steals it, they can use it but it doesn't impact me in any way except having to wait for the new card to come. If someone steals my bitcoins, it means they have a copy of my private key, and there is nothing I can do about it. Zich. Nada. Transaction fees pay for this insurance (among other things, but still).
- leni536 12y ago
  You can have multiple wallets though. You can have a really secured wallet, maybe signed with a smart card (is it possible? If yes then it's pretty much impossible to steal, unless someone steals it physically.) and have a less secure wallet on your smartphone. Your smartphone plays the role of a "regular wallet" and you only have minimal amounts on it (like what you need for daily purchases).
  - tribaal 12y ago
    That's where my original comment of "I don't see adoption becoming anything more than anecdotal" comes from :) I don't think the benefits of bitcoin outweight having to maintain (multiple) private key's security.
  - hueving 12y ago
    And what happens when you lose said wallet?
    - vacri 12y ago
      Or the smartcard develops a hardware fault?
      - leni536 12y ago
        Well I'm a bit late on the questions but here is my suggestion: For the really secure wallet you program two (or more) cards with the same key in case one of them is lost or craps itself (then throw away the private key). They are protected by a PIN code so they brick themselves after 3 subsequent wrong tries. If you lose one of the cards then you get two new cards, program them with identical private keys (clearly it is different than the previous one) then transfer all of your money to the new wallet. It's really hard to be your own bank, but it is possible. The beauty of bitcoin that you don't have to trust any third party, but it's really hard manage properly. I would be surprised if anybody used this scheme, I don't have any bitcoins either. If I jump into the bitcoin business I'm sure I will adopt this scheme.
  - kijin 12y ago
    Sure, but that takes a considerable amount of time and mental energy to set up and maintain. If possible, most people would just outsource the whole operation to some third party so that they can forget about it and get on with their lives. Of course, the third party would charge a fee for the convenience that they offers to their customers... ...and that's how you get a bank.
- dingaling 12y ago
  > If someone steals it, they can use it but it doesn't impact me in any way except having to wait for the new card to come. Unfortunately this is no longer the case in Europe with cards activated under 'Verified by Visa' ( and presumably the Mastercard equivalent ). If an VbV card is used and passes authentication then it is assumed that the cardholder authorised the transaction and they are liable.
  - tribaal 12y ago
    Ah, sure, if they use my card with the chip and PIN then I'm liable. Same if an online purchase is validated by 3dsecure, since that would mean that they somehow got my password on top of the physical card and personal details.
sanswork 12y ago
>Bitcoin doesn't experience inflation like that Bitcoin inflation is at 10% per year right now not even considering the dropping price.
deleted 12y ago
[deleted]
redthrowaway 12y ago
There are no grounds to say that BTC should be a superior store of value. Aside from its very public history of being an absolutely abysmal store of value, it also has no central bank tending its value, as fiat currencies do, and no substantial trade denominated in it, which is what gives fiat currencies value in forex markets. It is solely a speculative vehicle. It sucks at commerce and it sucks at investment. Bitcoin's sole value as a currency lies in its ease of use as a back-end for transactions. It's not a bad intermediary for transactions between people using different currencies, provided the third party transaction service has legal, fast, and cheap ways to convert to and from fiat in both countries. But then, it's not so much a currency as a transport layer with added uncertainty. I've yet to see a compelling case for BTC as anything but TCP/IP for dollars or a wayback machine for anything you want. It's bad for savings, god-awful for investment, and useless for [legal] commerce.
- derefr 12y ago
  I think you're attacking somewhat of a weak-man: the people saying Bitcoin as it is valued right now is any sort of store of value (and there are, indeed, such people) are obviously slightly insane. But in a long-term sense—an imagined future where all the speculative value has gone out of Bitcoin and it is now just "worth what it is worth"—it would make a fairly good store of value, in exactly the same way gold would if we knew exactly how much of it there was to mine out of the earth, if some property of the (never-changing) extraction process meant that it was only able to be mined out at an exactly inverse-exponential rate, and if it were very easy to handle the resulting gold in 0.00000000001g pieces.
  - redthrowaway 12y ago
    A store of value must be such over any given timeframe. If the balance in your savings account is worth $100 today, $50 in three months, $150 in six months, and $75 in a year, then it is a terrible store of value -- regardless of whether it's worth $200 two years from now. Similarly, talking about imagined futures is not a convincing way to defend a currency as a store of value. If you have to posit that your money will still be there iff A, B, and C are true, then you're not going to park your money in that particular stall.
davidw 12y ago
> the inflation Not a lot of that going around the developed world at this point in time, though, is there?
pjc50 12y ago
There is a "cost per transaction" in bitcoin as well: https://blockchain.info/charts/cost-per-transaction https://blockchain.info/charts/cost-per-transaction It costs a certain (very high!) amount of real electricity to process a block. This plus an incentive has to be paid to miners. Miners have to pay for their electricity in real local currency. Therefore for every transaction block processed either someone "buys in" ~$10 worth of bitcoin or the outstanding value of all bitcoin drops by that amount.

tribaal 12y ago

> Your card is irrelevant. My card is very relevant. If someone steals it, they can use it but it doesn't impact me in any way except having to wait for the new card to come. If someone steals my bitcoins, it means they have a copy of my private key, and there is nothing I can do about it. Zich. Nada. Transaction fees pay for this insurance (among other things, but still).

leni536 12y ago
You can have multiple wallets though. You can have a really secured wallet, maybe signed with a smart card (is it possible? If yes then it's pretty much impossible to steal, unless someone steals it physically.) and have a less secure wallet on your smartphone. Your smartphone plays the role of a "regular wallet" and you only have minimal amounts on it (like what you need for daily purchases).
- tribaal 12y ago
  That's where my original comment of "I don't see adoption becoming anything more than anecdotal" comes from :) I don't think the benefits of bitcoin outweight having to maintain (multiple) private key's security.
- hueving 12y ago
  And what happens when you lose said wallet?
  - vacri 12y ago
    Or the smartcard develops a hardware fault?
    - leni536 12y ago
      Well I'm a bit late on the questions but here is my suggestion: For the really secure wallet you program two (or more) cards with the same key in case one of them is lost or craps itself (then throw away the private key). They are protected by a PIN code so they brick themselves after 3 subsequent wrong tries. If you lose one of the cards then you get two new cards, program them with identical private keys (clearly it is different than the previous one) then transfer all of your money to the new wallet. It's really hard to be your own bank, but it is possible. The beauty of bitcoin that you don't have to trust any third party, but it's really hard manage properly. I would be surprised if anybody used this scheme, I don't have any bitcoins either. If I jump into the bitcoin business I'm sure I will adopt this scheme.
- kijin 12y ago
  Sure, but that takes a considerable amount of time and mental energy to set up and maintain. If possible, most people would just outsource the whole operation to some third party so that they can forget about it and get on with their lives. Of course, the third party would charge a fee for the convenience that they offers to their customers... ...and that's how you get a bank.
dingaling 12y ago
> If someone steals it, they can use it but it doesn't impact me in any way except having to wait for the new card to come. Unfortunately this is no longer the case in Europe with cards activated under 'Verified by Visa' ( and presumably the Mastercard equivalent ). If an VbV card is used and passes authentication then it is assumed that the cardholder authorised the transaction and they are liable.
- tribaal 12y ago
  Ah, sure, if they use my card with the chip and PIN then I'm liable. Same if an online purchase is validated by 3dsecure, since that would mean that they somehow got my password on top of the physical card and personal details.

sanswork 12y ago

>Bitcoin doesn't experience inflation like that Bitcoin inflation is at 10% per year right now not even considering the dropping price.

deleted 12y ago

[deleted]

redthrowaway 12y ago

There are no grounds to say that BTC should be a superior store of value. Aside from its very public history of being an absolutely abysmal store of value, it also has no central bank tending its value, as fiat currencies do, and no substantial trade denominated in it, which is what gives fiat currencies value in forex markets. It is solely a speculative vehicle. It sucks at commerce and it sucks at investment. Bitcoin's sole value as a currency lies in its ease of use as a back-end for transactions. It's not a bad intermediary for transactions between people using different currencies, provided the third party transaction service has legal, fast, and cheap ways to convert to and from fiat in both countries. But then, it's not so much a currency as a transport layer with added uncertainty. I've yet to see a compelling case for BTC as anything but TCP/IP for dollars or a wayback machine for anything you want. It's bad for savings, god-awful for investment, and useless for [legal] commerce.

derefr 12y ago
I think you're attacking somewhat of a weak-man: the people saying Bitcoin as it is valued right now is any sort of store of value (and there are, indeed, such people) are obviously slightly insane. But in a long-term sense—an imagined future where all the speculative value has gone out of Bitcoin and it is now just "worth what it is worth"—it would make a fairly good store of value, in exactly the same way gold would if we knew exactly how much of it there was to mine out of the earth, if some property of the (never-changing) extraction process meant that it was only able to be mined out at an exactly inverse-exponential rate, and if it were very easy to handle the resulting gold in 0.00000000001g pieces.
- redthrowaway 12y ago
  A store of value must be such over any given timeframe. If the balance in your savings account is worth $100 today, $50 in three months, $150 in six months, and $75 in a year, then it is a terrible store of value -- regardless of whether it's worth $200 two years from now. Similarly, talking about imagined futures is not a convincing way to defend a currency as a store of value. If you have to posit that your money will still be there iff A, B, and C are true, then you're not going to park your money in that particular stall.

davidw 12y ago

> the inflation Not a lot of that going around the developed world at this point in time, though, is there?

pjc50 12y ago

There is a "cost per transaction" in bitcoin as well: https://blockchain.info/charts/cost-per-transaction https://blockchain.info/charts/cost-per-transaction It costs a certain (very high!) amount of real electricity to process a block. This plus an incentive has to be paid to miners. Miners have to pay for their electricity in real local currency. Therefore for every transaction block processed either someone "buys in" ~$10 worth of bitcoin or the outstanding value of all bitcoin drops by that amount.