Bitcoin Discussion

[Stu Roughton]

i am getting spammed by friends jumping on this usi tech ponzi scheme. Talk about a bubble!! These are just everyday randoms pumping money in thinking it can only go one way. Agree... people are going to get burned from this

 

[Cynicor]

i am getting spammed by friends jumping on this usi tech ponzi scheme. Talk about a bubble!! These are just everyday randoms pumping money in thinking it can only go one way. Agree... people are going to get burned from this

They've just got to get out before the house of cards falls. If I had some at anywhere near the old prices, selling most seems like the sensible move.

 

[Daver6]

i am getting spammed by friends jumping on this usi tech ponzi scheme. Talk about a bubble!! These are just everyday randoms pumping money in thinking it can only go one way. Agree... people are going to get burned from this

Can you explain how this is a ponzi scheme? I'd contend that it actually has nothing in common with what the very definition of a ponzi scheme is.

They've just got to get out before the house of cards falls. If I had some at anywhere near the old prices, selling most seems like the sensible move.

I bet you would have said that two months ago. Now it's worth double. Hindsight is awesome when it comes to investments

 

[juddles]

Can you explain how this is a ponzi scheme? I'd contend that it actually has nothing in common with what the very definition of a ponzi scheme is.....

This is not my area of expertise, but to a simpleton like me bitcoin is a perfect example of a ponzi scheme. The rise in value has nothing to do with any inherent increase in worth, nor commercial basis. It is solely driven by new investors paying previous investors, driven by greed.

Tomorrow, if no new investors want to invest, the bitcoin has almost zero intrinsic worth.

The only worth I see in bitcoins is their providing a certain anonymity in financial transactions. This worth is greatest with stability, not amazing value changes. All the rest of it is ponzi.......

 

[BAM1748]

That's right when people who want to buy have all bought the price will stall like an upward 380 reaching max altitude.

I too am getting spammed to buy, but once the market who wants it have it, then what's its value, they will start to sell as the 380 crests he top.

I had one friend tell me just yesterday it's the new gold and did I know gold went down while Bitcoin went up.

I think I'll go buy some gold while the price is down not Bitcoin while the price is all over the place.

 

[cambriamarsh]

Given that Bitcoin mania is now making headlines, I thought I would post a referral link for those interested in dabbling in this area to get $10 free Bitcoin for signing up with Coinbase, which is one of the major BTC wallets/trading services:

Coinbase - Buy/Sell Digital Currency

Disclaimer - I also get a $10 bonus if you use my link.

Thanks, unfortunately Coinbase doesn’t work for buyers from nz for some reason

 

[drron]

Bitcoin is a bubble.The worst since tulipmania.It has already beaten that.
There is no value.It represents nothing.People are already being robbed and scammed.
lots of unanswered questions such as one I saw posed by the TSA-If they examine your computer on entering the USA and they find a bitcoin wallet you can be required to open it.What happens then is open to question but they are looking towards a test case that could mean seizure if you are bringing in more than $10000 worth of bitcoin.

Saying that there is real value in the technology.Many firms are beginning to use it.It is rumoured the IMF is creating their own version of cryptos-think the little guys are going to be left alone by the big guys?

However like any bubble it may go for some time.This time isn't any different.

 

[get me outta here]

The secret policeman’s ball finally has funding;

Prosecutors rush to sell $11m in bitcoin seized in drug bust

 

[Daver6]

This is the definition of a Ponzi scheme from Wikipedia

A Ponzi scheme (/ˈpɒn.zi/; also a Ponzi game)[1] is a fraudulent investment operation where the operator generates returns for older investors through revenue paid by new investors, rather than from legitimate business activities or profit of financial trading

The important part is generating returns for old investors through revenue paid by new investors. This is NOT the case with bitcoin. Its simply a tradable commodity, although intangible. You can exchange bitcoin for other currencies, good and services. How is this different to any other currency?

The other way to gain bitcoin is through the mining process, where you're essentially being rewarded for verifying transactions.

I do see issue with bitcoin (as opposed to other crypto-currencies which have largely solved the problems). Namely the relatively slow speed of getting transactions verified.

 

[drron]

NASDAQ definition of a bubble-
Definition: A market phenomenon characterized by surges in asset prices to levels significantly above the fundamental value of that asset. Bubbles are often hard to detect in real time because there is disagreement over the fundamental value of the asset.

Bitcoin fits.

 

[jb747]

It's a means of transferring money from the gullible to, well, the cloud I guess.

 

[Daver6]

A bubble does not equate to a Ponzi scheme and vice-versa. There was an argument being made that Bitcoin is a Ponzi scheme which I disagree with.

As for a bubble, you really need hindsight to determine whether its in a bubble or not. When bitcoin rose rapidly to about the $1000 mark, one could have said that was a bubble.

It's a means of transferring money from the gullible to, well, the cloud I guess.

Not really. Everyone has access to the ledger. Hence the distributed nature. You're private key might be stored in the cloud, but doesn't have to be. Most will store on the phone, computer ot encrypted thumb drive.

Your money in the bank doesn't physically exist either. You can transfer your money to another account or get cash out. You can use it to trade for goods and services....just like Bitcoin. If you currency you hold belongs to a country like Zimbabwe, it can suddenly become worthless...even if you hold physical currency.

I think half the problem with Bitcoin is the lack of understanding how it actually works.

 

[jb747]

I think half the problem with Bitcoin is the lack of understanding how it actually works.

Ok, but why does/should it have any value at all?

 

[Daver6]

Ok, but why does/should it have any value at all?

Why should a $10 bill have any value either then?

 

[drron]

Because a government says it does.OK not foolproof but better than anything Bitcoin has.

Which is why a physical asset at this time is worth at least having a proportion of your wealth in.

 

[Daver6]

And how did that go for the people of Venezuela, Zimbabwe and I'm sure plenty of other countries where the currency collapsed? The government might have said its worth something but no other countries were interested in it so it became worthless.

Bitcoin (or other crypto-currencies) aren't going to collapse due to bad fiscal or monetary policy by a government. Or by the same token, a dead economy. Why are you so convinced that crypto-currencies are different or worse than government backed currencies? I think all the arguments made against it could apply to any currency.

 

[Cynicor]

That's really the argument of both sides, though. These currencies collapsed when the economy supporting them collapsed. The same may happen for crypto, or it may not. But currently the value shooting stratospherically seems to be a bubble.

And yep, I would also have said sell 6 months ago or whatever. and those who got in early would still have made a profit. Missing out on further gain is not a loss so it's nothing to do with hindsight. I just know that not everyone can get out at the top.

 

[drron]

And how many crypto currencies are there now?What makes you think Bitcoin is the one going to make people millions for ever.
Personally I think it will survive but not be in general use.Will still be OK for those places you mention and for the dark web.
The underlying technology is the thing that will bring changes.Not any particular crypto.The big boys are getting involved-as I said the IMF but Russia is said to be thinking of it's own crypto currency.
So bitcoin will survive but many will lose their life savings or be badly burnt.

 

[Daver6]

I tend to agree. I don't think for a second Bitcoin will make millions forever. IMHO, Ether based on Etheruem is more likely to be the dominant currency, which in itself has had a very decent run of late too.

 

[samh004]

I saw posed by the TSA-If they examine your computer on entering the USA and they find a bitcoin wallet you can be required to open it.What happens then is open to question but they are looking towards a test case that could mean seizure if you are bringing in more than $10000 worth of bitcoin.

That's an interesting test case, but an electronic wallet isn't the same as what we carry around in our pockets right now (a leather wallet for example). While I understand in some respects how they might see a "bitcoin wallet" as being the same as a leather wallet with bills in it... it's much more similar to a bank account, in the fact both are electronic and I can carry a piece of plastic into a country before withdrawing large sums of cash and converting the 1's and 0's into physical money – in much the same way a bitcoin wallet would allow me to do so.

As an example, if they asked me to "open" my bank account on my phone they might see I have more than $10k in my savings account, or more than $10k credit on my cards. After all, there's nothing stopping me (except common sense) from getting a $10,001 cash advance from an ATM AFTER I have entered the country.

I welcome the TSA testing this new idea and permanently screwing up the world, as any electronic wallet, including regular USD would fall under the same scrutiny.