Adam,
None of those quotes are relevant here. To explain why, let's go with the example Hayek gave, cosmetics. Let's say Mr A claimed that some rare poison is a cosmetic. Mr B counters with the argument that the poison is well known to kill someone the instant they touch it, and that a thing that kills on contact cannot be considered a cosmetic. Mr A counters that it doesn't matter, because Hayek and others say that as long as people decide it is, it is. Mr B counters that the very fact that it is universally known to kill on contact is proof that no one will ever think of it as a cosmetic, because cosmetics are used to look good, and people want to look good when they are alive, not when they are dead.
In other words, B is arguing that from the very definition of a cosmetic, certain things are precluded from ever being considered a cosmetic by people.
Mr A is baffled. "Then what did Hayek mean when he said people decide what a cosmetic is?" B explains patiently that Hayek did not mean that people can decide that what does not fit the definition of a word X can become X by their decision. An apple does turn into an orange because everyone decided it does. [Although they might decide to change the definition of "apple" to include oranges, but that just means they started speaking a different language. If the definition of apple is fixed, people's decisions cannot change it into an orange].
And once we accept that a word X has a fixed meaning, we can sometimes show by logical reasoning that an object Y will never fit the definition of X. 5 cannot become 4. A deadly poison that kills on contact cannot become a cosmetic. Something that does not fulfill the conditions of the regression theorem [Mises proved] cannot ever fit the definition of the word money.
My humble blog
It's easy to refute an argument if you first misrepresent it. William Keizer
Helloween,
You are saying that the regression theorem only applies in a barter economy, not in a money economy.
My humble article, Bitcoin All in One Place, proves otherwise.
BTW, that Shostak article, brilliant though it is, has a different explanation of why bitcoin has a mtgox number higher than zero.
He says it's only because bitcoins are convertible to real money, like dollars. Meaning the moment the bitcoin folk say that bitcoin is like the roach motel, where you can buy in, but never exchange it for dollars, bitcoin will plummet to zero. Observe that historically other moneys have had that imposition placed on them by govts, and the money continued just fine. This, says Shostak, means that bitcoin is not desired per se as money, [and never will be], but only for its ability to shift real money back and forth.
He is correct of course in his analysis of why a price on mtgox means nothing, but I think he is giving bitcoiners to much credit for having any intelligence at all. The reason bitcoin has a mtgox price is
A. Because people are idiots caught up in some insane fad, like tulipmania and the Ithaca Hour and other well known examples.
B. Because the mtgox price is a fraud in the first place and proves nothing, as explained here.
C Because the truly trivial amount of people who use bitcoins to buy and sell things [75! See the important article and comments here], and the trivial amount of their income this trivial amount of people spend via bitcoin [because it is impossible to buy most things people use routinely with bitcoin, such as a car or a shopping bag full of name brand groceries], and the trivial amount of the stock of bitcoins used by this trivial amount of people to buy a tivial amount of things [one three thousanth of one percent] proves nothing at all. 75 people scattered all over the world spending a few pennies worth of bitcoin to buy one or two items apiece, while way over 99% of bitcoins in the universe just sit there, never used, means bitcoin is a joke.
All in the articles, Helloween.
Ultra short answer: Jewelry is not using gold as money. Avoidance of govt is an advantage a money can have. But regression theorem proves it cannot be a money in the first place. The Emperor's new clothes were far superior to other clothes in that they never had to be washed or ironed or repaired [=avoidance of govt], but since they werent clothing in the first place, such superiority is meaningless.
And that Shostak article is topnotch. His explanation of why the mtgox number is meaningless is, dare I say it, even better than mine.
How does one "build on a price"? If Mr A says a bitcoin should be worth ten dollars, and Mr B that it should be 20, how does one decide who to go by?
More, how did Mr A decide it should be ten dollars in the first place? Same for B.
All these questions have no answer, which is why bitcoin cannot get off the ground.
Euros on the other hand, had an answer. The govt said they would trade in your D marks for Euros at a rate they decided on. It was accept their rate or get nothing. There was no choice.
With bitcoins if you don't like someones rate, and why should you, you just refuse to take bitcoins.
A word about short answers. In my limited experience, they are effective for very intelligent people who have the required background. The marginally interested will understand them as a hound dog understands advanced calculus. But hey, Smiling Dave takes requests.
Peter Šurda: ToxicAssets: Let's make it simple: Is bitcoin a commodity? If not, why not? That's a difficult question. I probably wouldn't describe it as commodity, rather maybe quasi-commodity or commoditised service.
ToxicAssets: Let's make it simple: Is bitcoin a commodity? If not, why not?
Let's make it simple: Is bitcoin a commodity?
If not, why not?
That's a difficult question. I probably wouldn't describe it as commodity, rather maybe quasi-commodity or commoditised service.
Okay, but what quality of a full-commodity is lacking on bitcoin?
Or, rearranging the question, commodities are something more than non-unique/homogenous economic goods, that is, goods that are distinguishable only by quantity and standardized quality grades, and for which there are organized markets specialized in tradind them?
And if that's all you'll need to qualify as commodity, which criteria bitcoin fails?
How many people thought it was "cool"?
Who says gold was money when its uses were not yet known?
Like gold or not, it's a matter of individual taste. Like Bitcoin or not, it's a matter of individual taste....Isn't the intrinsic value of gold as esthetic as that of Bitcoin? Myself, I don't care at all about gold as decoration, but I do have gold in my mouth as a placeholder in a tooth protesis. It seems gold isn't more useful than that, for us who don't go for bling bling.
That is true. But, and this is a huge difference that makes all the difference, what is important is the numbers of likers. How many people like gold or bitcoin for non monetary use? Well, in India,with its billion people, every marriage has gold involved. Bitcoin would kill for that kind of popularity.
With stuff like food or fuel, which actually produce utility when it is consumed, things would be different. But neither gold nor Bitcoin can in themselves be consumed in (chemical) exchange for utility.
Why do you think that is the only thing that counts? Also, http://geology.com/minerals/gold/uses-of-gold.shtml
Imagine Robinson Crusoe.
To understand money, which is a medium of exchange, meaning there is trade going on, Robinson Crusoe alone on his island is the wrong model.
Helloween, I'm going to put answering you on hold until you tell me you have digested [not merely read or, horrors, skimmed], the articles I've written. It's apparently a subtle topic, judging by the elementary blunders so many people are making.
Malachi: Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given socio-economic context or country.[1][2][3]. we have been telling you this for a long time. the people who use bitcoin as money are context for bitcoin as money. since these people exist, you must either acknowledge that bitcoin is money or pretend they do not exist. so far you have chosen the latter.
Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given socio-economic context or country.[1][2][3].
we have been telling you this for a long time. the people who use bitcoin as money are context for bitcoin as money. since these people exist, you must either acknowledge that bitcoin is money or pretend they do not exist. so far you have chosen the latter.
Smiling Dave: It's apparently a subtle topic, judging by the elementary blunders so many people are making.
I guess you don't understand how much of a douche this sort of thing makes you look. And you do it over and over...
ToxicAssets: Okay, but what quality of a full-commodity is lacking on bitcoin? Or, rearranging the question, commodities are something more than non-unique/homogenous economic goods, that is, goods that are distinguishable only by quantity and standardized quality grades, and for which there are organized markets specialized in tradind them? And if that's all you'll need to qualify as commodity, which criteria bitcoin fails?
It depends on how you interpret it. Your interpretation is possible. However, my point is that concentrating on the term "commodity" is not helpful.
Attention all bitcoiners.
Send all your hate mail to Professor Shotak from now on. He argues exactly what I have been saying for years, only better.
http://mises.org/daily/6411/The-Bitcoin-Money-Myth
A thing that becomes money needn't have commodity value originally.
All it needs is value originally, whether commodity or some other kind of value.
This point is obscured by history because previous forms of money have often had commodity value. But that doesn't mean other kinds of money can't have had another kind of value.
The giant money of Yap island has zero commodity value, they're just giant round stones with a hole drilled in the middle. Yet no one says they aren't money. Yet they have value and function as money.
Pinning down something's value to any one thing isn't even a necessary condition, nor is it a condition that that value be widely agreed upon or existent.
In practice this is why we focus on commodity value, because a commodity is widely desirable for its characteristics and broad demand.
As for bitcoin, originally it had only one valuer, that of its creator, Satoshi Nakamoto, who mined them alone for over a year.
Some say the early adopters after Nakamoto valued it for nerd-cred, for its mathematical beauty, for its elegant solution to the double-spend problem and the many applications that the blockchain could be put to as a result.
Bitcoin is an idea, not a material thing. This is the heart of why people are having difficulty groking it. And an idea is singular when it is first created by its first thinker, in this case Nakamoto, but an idea must be transmitted.
Because bitcoin offered qualities that would function in a superior manner as a medium of exchange, people began using it as such.
The first transaction done in bitcoin, the famous 10,000 btc pizza, which today would cost some $1.2 million, was the first public and high-profile transaction.
Why did the person who bought that pizza for the offerer value 10,000 bitcoin over the ~$20 it would cost him to send the pizza?
For whatever reason, that person did value 10k btc higher than $20.
What's required for a thing to become money, at the most elementary level, is that it is valued at all.
Why it's valued initially is not so important and in the case of bitcoin it's not likely to have any one initial value.
Rather, bitcoin's spread as a currency is due much more to its suitability as currency than to the reasons it was initially valued.
When a business-owner takes a look at bitcoin's value-proposition today, what they see as relevant are the features that allow it to offer the lowest possible transaction costs, and the ability to avoid chargebacks and fraud.
Who the hell cares about commodity value when a business realizes it can make more profit on bitcoin sales than fiat sales? It no longer matters.
Mises showed that any money has multiple simultaneous kinds of value built into it. Gold's price is only in part due to commodity value; most of its value is due to its use as a value store and its exchange value.
Bitcoin too--its price in terms of their mathematical beauty and nerd-cred value are fairly low compared to the value it obtains from its use as a currency--its exchange value, and its value-store proposition is tied to its limited number. Its fungibility is also second to none.
For me this ends the argument.
Bitcoin is already being used as a currency the world over. To argue it cannot be or the price must eventually collapse to zero seems beyond ridiculous, it seems ignorant and at this point pig-headed.
Smiling Dave: Attention all bitcoiners. Send all your hate mail to Professor Shotak from now on. He argues exactly what I have been saying for years, only better. http://mises.org/daily/6411/The-Bitcoin-Money-Myth
He makes some pretty silly assertions and conclusions.
"Observe that a bitcoin is not a thing; it is a unit of a non-material virtual currency."
So digital objects are not things? I discur.
"A bitcoin has no material shape; hence from this perspective the notion that it could somehow replace fiat money is not defendable."
According to Shostack money must, apparently, have a physical form to be used as money. Honestly?
"Consequently for something to be accepted as money, it must have a pre-existing purchasing power: a price. This price could have only emerged if it had an exchange value established in barter."
He's right it needs to have a pre-existing price, but that price need not be established based on commodity value. It could be based on collection-value, coolness-value, or any of a hundred other reasons to value a thing.
"Notwithstanding this, it is the historical link to gold that makes paper money acceptable in exchange."
No, it's the law which makes paper money viable in today's world. If people had a choice they'd revert to good money, ie: gold and the like. And yes, maybe even bitcoin.
"Bitcoin can function only as long as individuals know that they can convert it into fiat money, i.e. cash on demand"
Unless bitcoin became the unit of account, a point he conveniently skips over. THis whole piece just seems hacked together. Earlier he called the creator of bitcoin "Satoshi Nakamote." Not 'Nakamoto.' So what did he do, 30 seconds of research, or 45 seconds?
"Without a frame of reference or a yardstick, the introduction of new forms of settling transactions is not possible."
How then does he explain bitcoin's current use as a currency? Forest for the trees.
"It was through a prolonged process of selection that people had settled on gold as the most marketable commodity."
So he'll just conveniently ignore that virtually every commodity in existence has been used as a currency at some point, including wheat, iron, cloth, spices, etc., etc., etc. Using something as money makes that thing money for that transaction. It's not the final selection of gold that alone can be considered money.
"Besides, Bitcoin is not a new form of money that replaces previous forms, but rather a new way of employing existent money in transactions."
Again, if bitcoin becomes a unit of account then this point is obviated.
"Because Bitcoin is not real money but merely a different way of employing existent fiat money, obviously it cannot replace it."
This is not anymore obvious than why gold replaced other commodities as a money. Suppose there were economies that used cowrie shells as money, and along came those who introduced the technology of gold. Some might have said the same thing, gold isn't money, people are just buying gold with cowrie shells, it's just a different way of buying with cowrie.
That reasoning only lasts until practically everyone's using gold, then the story changes. And the story changes because gold is a better money than cowrie shells, in fairly objective terms. So too, bitcoin is a better money than fiat or gold for digital/online and distance transactions, which are the primary form of transacting in today's world.
"Contrary to the recent hype, we hold that Bitcoin is not money but rather a new way of employing existent money in transactions. The fact that the price of bitcoins has jumped massively lately implies that people assign a high value for the services it offers and nothing more."
This is silly, and I full expect Shostak to regret and eventually retract and correct this knee-jerk opinion piece.
Peter Šurda:It depends on how you interpret it. Your interpretation is possible. However, my point is that concentrating on the term "commodity" is not helpful.
My point is that once we all agree that bitcoin is a commodity then there are a few possible future scenarios:
1. It becomes the most used item that serves as accounting unity, exchange means, buffer of liquidity or whatever other property that people think only money has.
2. It becomes frequently used for certain types of things and transactions but not as a general means of exchange.
3. It never fully grows into this money-potential and dies out eventually and everybody forgets it has ever existed.
That's true for every commodity, from gold to crude oil to pork bellies, so if one accepts bitcoin is a commodity, one must accept that this is true for bitcoin aswell.
Of course, one can simply deny it is a commodity. But in that case it becomes kinda hard to explain what all these people owning and trading it are really doing. Is it all a fucking mirage, a trap, an evil scheme, an episode of collective hysteria?
So I decided it would be interesting to know if the anti-bitcoin crew at least accepted it is a commodity. Maybe a very obscure commodity that interests only a few geeks that like to read cyberpunk novellas. But still a commodity.
And once they accept that bitcoin is a commodity they have at least to accept that it has a potential to grow in usage and become money.
Because some people here seem to be sustaining some weird theological views, that seems to imply that bitcoin wouldn't be "true" money even if most transactions were executed in this protocol and everybody talked in terms of bitcoin figures and income taxes were calculated in bitcoins.
Maybe I'm wrong, maybe I'm misunderstanding what they are saying.
Maybe they are simply saying that bitcoin is some fashionable commodity that will disappear sooner rather than later, never fulfulling it's alledged money potential.
But still, I felt I needed to ask.
To understand what these people are really trying to say.
Because sometimes it just looks like they are waving their arms in the air babbling non-sense that can be roughly translated to something like "bitcoin is evil and bitcoiners are being fooled by some evil bitcoin overlord".
For now I am convinced that bitcoin system is basically only new payment system like paypal. Bitcoin unit is needed to participate in this new payment system - it is useless outside of that. As long as people value properties of bitcoin payment system to transfer what is considered estabilished money around there will be demand for bitcoin units. Are bitcoin units as a means necesary to participate in bitcoin payment system a commodity?
1. About the Yap Island money. They present no theoretical difficulty, satisfy the regression theorem perfectly, and have nothing whatsoever to do with bitcoin.
Most of it is just normal sized coin shaped money, with a few exceptions. They are valued for their prettiness [= not applicable to bitcoin] and the story behind them [= not applicable to bitcoin], and size [=not applicable to bitcoin]. In other words, they are what a Westerner understands as works of art. Later they became legal tender [= not applicable to bitcoin].
From Wikipedia:
Yap is notable for its stone money, known as Rai: large doughnut-shaped, carved disks of (usually) calcite, up to 4 m (12 ft) in diameter (most are much smaller). The smallest can be as little as 3.5 centimetres (1.4 in) in diameter.
Their value is based on both the stone's size and its history. Historically the Yapese valued the disks because the material looks like quartz, and these were the shiniest objects around. Eventually the stones became legal tender and were even mandatory in some payments.
The bitcoiners are befuddled by these stone coins, because they think Mises was saying coins have to be made of a material that has "industrial use", which they think means a use like making a sword out of them or something. This is because they did not bother to actually read, or else failed to comprehend, the regression theorem. Little do they know that Mises makes quite clear that all they need to be valued for something other than shopping with them. These Yap stones are works of art to the islanders, and that is their non shopping value.
2. I like that Pete thinks he refutes Prof Shostak's cogent arguments by writing "that will no longer be true if and when so and so happens to bitcoins". He doesn't get that Prof Shostak is saying that the so and so, not being linked to dollars, will never happen, because that would violate the regression theorem. In other words, the good prof is arguing that pigs cannot fly, and Pete is refuting him by saying that if pigs had wings they could fly with ease.
3. Faithful readers of these threads, and/or my many articles on bitcoin, know that the nerd cred and math beauty nonsense is just that. First of all, it's a myth. Nobody has ever bought a bitcoin because it is beautiful, [because it's not, it's invisible], or to get nerd cred from it. And of course, the Yap Islanders are a whole economy. That stupid nerd is one person, if he ever existed, which he didn't.
4. The bitcoiners still have not met my challenge of listing what they have actually bought with bitcoins. So I continue to assume they have bought nothing, and are gamblers and speculators who are hoarding them, but have never actually used them to buy anything [besides Pete buying a slice of pizza with a bitcoin he got for free at some bitcoiners meeting].
That stupid nerd is one person, if he ever existed, which he didn't.
true to form, Dave denies the existence of people whose existence contradicts his faith-based opposition to bitcoin.
Smiling Dave: 1. About the Yap Island money. They present no theoretical difficulty, satisfy the regression theorem perfectly, and have nothing whatsoever to do with bitcoin. They are valued for their prettiness [= not applicable to bitcoin]
Smiling Dave:and the story behind them [= not applicable to bitcoin]
Smiling Dave:and size [=not applicable to bitcoin].
Smiling Dave:In other words, they are what a Westerner understands as works of art.
Smiling Dave:Later they became legal tender [= not applicable to bitcoin].
Smiling Dave:The bitcoiners are befuddled by these stone coins, because they think Mises was saying coins have to be made of a material that has "industrial use", which they think means a use like making a sword out of them or something. This is because they did not bother to actually read, or else failed to comprehend, the regression theorem. Little do they know that Mises makes quite clear that all they need to be valued for something other than shopping with them. These Yap stones are works of art to the islanders, and that is their non shopping value.
Smiling Dave:2. I like that Pete thinks he refutes Prof Shostak's cogent arguments by writing "that will no longer be true if and when so and so happens to bitcoins". He doesn't get that Prof Shostak is saying that the so and so, not being linked to dollars, will never happen, because that would violate the regression theorem. In other words, the good prof is arguing that pigs cannot fly, and Pete is refuting him by saying that if pigs had wings they could fly with ease.
Smiling Dave:3. Faithful readers of these threads, and/or my many articles on bitcoin, know that the nerd cred and math beauty nonsense is just that. First of all, it's a myth. Nobody has ever bought a bitcoin because it is beautiful, [because it's not, it's invisible], or to get nerd cred from it. And of course, the Yap Islanders are a whole economy. That stupid nerd is one person, if he ever existed, which he didn't.
Smiling Dave:4. The bitcoiners still have not met my challenge of listing what they have actually bought with bitcoins.
Smiling Dave:So I continue to assume they have bought nothing
Smiling Dave:and are gamblers and speculators who are hoarding them, but have never actually used them to buy anything [besides Pete buying a slice of pizza with a bitcoin he got for free at some bitcoiners meeting].
Why don't you tell us what you've bought with gold? At least I've bought something with bitcoin. I bet you've never once in your LIFE bought anything with gold, yet you will readily agree that gold is a money.
Lame.
Fr33 Aid has now become a Bitcoin-based organisation.
From their website:
Why did you choose Bitcoin for your financial operations? Bitcoin has many of the features we look for in banking: 1) Ability to conduct a variety of financial transactions. Fr33 Aid has accepted online bitcoin donations and offered our volunteers reimbursement in bitcoin since late 2011. Now that Bitcoin has been around a few years, it’s relatively easy to convert bitcoin into any currency, and vice versa, without traditional banks, both online and in person. To date, Fr33 Aid has received most of its donations in cash at events like PorcFest. This year, Lamassu will bring a Bitcoin ATM to PorcFest, where Fr33 Aid donors can insert their cash and send it to Fr33 Aid’s bitcoin address. For anyone who still wants to donate directly to Fr33 Aid in cash, we can easily put their donations through the Bitcoin ATM ourselves, eliminating our need to carry cash back to our bank for a deposit. On the expense side, more and more companies are accepting Bitcoin in exchange for goods and services. For example, BitMit offers a wide variety of products for bitcoin, and the Bitcoin Store offers electronics and accepts only bitcoin. We believe the day is coming soon that we can directly purchase first aid and educational supplies in bitcoin. Until then, donors may send us supplies we need directly from our Amazon wish list, and there are a number of Fr33 Aid volunteers who are happy to accept bitcoin as reimbursement for Fr33 Aid expenses. 2) Ability to Hold Its Value. The way Bitcoin was designed makes it behave in predictable ways over the long term, much like gold and silver. No one can increase the supply of bitcoin beyond what the open source protocol allows for, and governments all over the world can create more of their own currencies whenever they want. This causes us to believe the value of bitcoin will continue to rise in terms of government-issued currencies, much like gold and silver. We also believe that the more people who realize Bitcoin’s inherent value of allowing for anonymous transactions, the more the value of bitcoin will rise. 3) Security and Continuity. There are ways to keep bitcoin safe via technologies like 2-part authentication and offline wallet modes, even paper wallets that can be stored in fireproof safes. These technologies enable each bitcoin address holder to be the only person with access to that address. Because it’s possible for bitcoin to be completely secure even from bankers, there is no one to appeal to in case a private key or wallet passphrase is lost, or in case the bitcoin holder is incapacitated. This creates a new requirement for continuity plans in case something happens to the bitcoin address holder. Fr33 Aid has chosen to manage this continuity requirement with DeathSwitch, which will send a message to our back-up treasurer in case I don’t enter my password there when it prompts me each month. The message will have part of the information the backup treasurer needs to access Fr33 Aid’s assets, and the other part was provided to her earlier. Because Bitcoin depends on the internet, one potential drawback to asset continuity with bitcoin is a scenario in which the internet may no longer be available. Fr33 Aid spends most of its assets shortly after donations are received, because we believe this is the responsible way for a charity to behave. However, if in the future we decide to do a big, long-term project that would require us to accumulate capital over a year or more, we would likely convert some of our bitcoin to gold. Tim Frey at Roberts & Roberts Brokerage, a long-time sponsor of Fr33 Aid, told me he’d accept bitcoin for gold, which would enable us to avoid banks if we would like to do so. 4) Transparency. We believe charity organizations should be transparent about their assets and financial dealings and subject to audits by their board of directors and other entities. Although it’s possible to work anonymously with Bitcoin, the Bitcoin protocol allows for great transparency. Fr33 Aid publishes its bitcoin address, and we’ve also tagged it with our website and transferred our bitcoin to a new vanity address with “Fr33Aid” in the prefix. We choose to publish this information because we want anyone to be able to see the assets we have and the types of transactions we’re doing. If we accumulate a lot of bitcoin, our volunteers and donors might rightly ask us to do something with our assets and/or suggest a new program. In addition, the Bitcoin Blockchain provides a publicly-transparent log from which auditors may use to confirm a charity is handling donations responsibly. Since I’m the only person with access to Fr33 Aid’s bitcoin wallet and private key, I have single-point accountability for questions from our board or others about our bitcoin transactions. 5) Last but not least: Bitcoin allows us to do business without government or traditional banks. Fr33 Aid prefers to do business only with people and organizations whose actions are consistent with the non-aggression principle. Similar to buying or selling gold or silver, many Bitcoin services do not require government-issued ID numbers or paperwork. Bitcoin thus gives us more control over who we do business with and protects our assets from confiscation or theft.
Government Explained 2: The Special Piece of Paper
Law without Government
How about photos of people actually buying product at a retailer, using bitcoin? How will Smiling Dave spin this? Or will he finally begin to frown?
"After years of being relegated to a seedy online market, Bitcoin is creeping into the mainstream — including a Midtown lounge that began accepting the digital currency as a method of payment recently and has since racked up $7,000 in electro-cash revenues... Staff at EVR use tablets to pull up a service called BitPay, which functions like a credit-card processor. BitPay calculates a dollars-to-Bitcoins exchange rate and generates a unique code, which customers can scan to transfer money..."
"After years of being relegated to a seedy online market, Bitcoin is creeping into the mainstream — including a Midtown lounge that began accepting the digital currency as a method of payment recently and has since racked up $7,000 in electro-cash revenues...
Staff at EVR use tablets to pull up a service called BitPay, which functions like a credit-card processor. BitPay calculates a dollars-to-Bitcoins exchange rate and generates a unique code, which customers can scan to transfer money..."
"IPAID: Customer Pinsi Lei uses Bitcoin on her phone to pay the tab at EVR lounge on West 39th Street in Manhattan last week."
"On a recent evening at EVR, Gabe Sukenik, 24, paid his $45.73 bar tab with .3843 Bitcoins. “Rather than handing your card over to a server and having to sign for it, a server can just come to you once and be done with it,” Sukenik said. “I would use Bitcoins every day over dollars.”"
"On a recent evening at EVR, Gabe Sukenik, 24, paid his $45.73 bar tab with .3843 Bitcoins.
“Rather than handing your card over to a server and having to sign for it, a server can just come to you once and be done with it,” Sukenik said.
“I would use Bitcoins every day over dollars.”"
Two words: Fuckin' awesome.
Yeah fcking awesome indeed. I just see no difference here, from usability standpoint, from paying using PayPass card or NFC terminal.
boniek: Yeah fcking awesome indeed. I just see no difference here, from usability standpoint, from paying using PayPass card or NFC terminal.
if bitcoin doesnt provide any benefits for you, then bitcoin doesnt provide any benefits for you. I guess you can just categorize this post with all the posts on the ferrari forums where people come in just to say "that car is too fast and italian! it provides no benefits over my beat-up kia" etc.
So like cash, but with the transaction being recorded and saved for eternity on millions of computers. My! The world is sure evolving fast...
BTW, who's the troll this time? "How will Smiling Dave spin this?"
Hornswaggled! http://finance.yahoo.com/news/bill-gates-hates-cash--here-s-why-185938362.html "Transparency: Less corruption and theft when payments can be easily tracked. In Afghanistan, U.S. aid agencies use it so workers aren’t so vulnerable to robbery. Security: The money gets where it’s supposed to go. Financial inclusion: Electronic payment is a way for unbanked people to establish a record of on-time payment of their bills. This can be an “on-ramp” for them to get other services, such as loans, speakers said. Cost savings: Moving physical cash around is costlier than zipping electrons. Many poor people, however, still find it cheaper to use cash, because some cashless networks charge high fees. Access to new markets: This benefit is mainly for providers of financial services."
Yeah, Bill Gates just wants to help the poor people. Like he does with his predatory vaccination programs. But this is different. It's grass roots or revolutionary, or some other BS word of the day.
One question I have and it may have been answered before. If something hasn't proven itself to be a "store of value", then does that disqualify it from being money?
Al_Gore the Idiot: One question I have and it may have been answered before. If something hasn't proven itself to be a "store of value", then does that disqualify it from being money?
Not really. It's a question of relative terms. Something losing value rapidly is a bad money compared to something losing value less rapidly, but both can be used as money.
What do you mean by "proven itself"?
Something is money insofar and as long as people are willing to use it as a buffer commodity to ease transactions.
There are no quintessencial "value-storage" property that categorically proves its moneyness.
Something that was money in a certain period and location and among certain groups can cease to be in a different place and epoch and peoples.
Some forms of money can be very local and have very short duration.
For instance, these tickets that serves as cash substitutes to purchase food and beverages in certain public gatherings and festiveties, so people don't need to transact in cash all the time.
The anti-bitcoiners are coming up with these obscure, useless and meaningless criteria for moneyness just because they don't like the fact that bitcoin does not seem to fit their preconceived notions of what it takes to be considered money.
You are way too defensive. Bitcoin provides value for me. I just don't see anything special or unique about what was shown before.
yes, I am "too defensive" because I didnt bother to relieve you of your ignorance as to bitcoin's objective superiority in that context, trusting instead that if you cared, you would discover it for yourself. wow.
theres obviously nothing special or unique about bitcoin, you must have stumbled into the wrong thread. cheers!
Bitcoin has only been around for a few years. It didn't become money through the conventional way (i.e. regression theorem).
A "theorem" is a piece of abstract theory or knwoledge, and not the real process whereby something comes into being or becomes something else.
Sometimes I feel like people here don't understand or underestimate the difference between theoretical knowledge and concrete reality.
the regression theorem applies to bitcoin in the same way it applies to all other forms of money. it is merely a description of actions and motives that is derived from praxeological means, rather than from experience.
regression theorem is apodictically certain and helps us to answer questions like "what makes money valuable?" in the case of bitcoin, people must have valued it as a means of exchanging data on the bitcoin network, or they would never have exchanged other valued goods for it. having this value (enabling reliable and pseudonymous digital communication) means that, if people stop using bitcoin as money, the bitcoin can be used for something else (communication).
One of the key misunderstandings of poeple reading the regression theorem is they focus on the word 'commodity' and then knock bitcoin as having no commodity value.
Money needs to be a commodity only because each unit needs to to be identical to the next one so that they're equal units, and they have to be broadly available so that they're fungible (ie: if there was only 1 lb of gold in the world it would be useless as money).
Commodities have thus filled this gap and served as money. It's not that a money -must- be a physical commodity, only that commodities possess these qualities a money needs.
Bitcoin too allows each unit to be identical and allows very many of them to exist and for them to be easily subdivisible.
To the serve as money, the RT says it must have been initially valued in some way to later serve as money.
Clearly bitcoin was valued, for it was produced at a cost by the early miners. Miner's chose to create it and pay for the cost of creation with dollars, over the cost-savings of not creating it. That gave it a non-zero value at that point.
It could've been that only its creator would be interested enough in it to do so, but that was not the case. Time passed and others became very interested in the qualities of bitcoin, and valued it for a host of reasons, either for the coolness factor or the potential value gain--speculation or investment value.
That's all it needed, some non-zero value at some point in order to eventually become a money. The ship has sailed, it's now used as money every day by those who use it so. It's market cap as a currency already exceeds the market cap of several smaller nation's currencies. It's accepted by over 5,500 businesses which freely trade goods and services for bitcoin.
It is money. The experiment has proven successful.
Those still claiming bitcoin isn't or cannot be are essentially claiming the earth is flat or the sun goes around the earth. And their logic is of the kind that says if the earth were round and spinning instead of the sun going around the earth, wouldn't we all be thrown off the surface of the earth from its angular momentum? It's logic that at first glance seems to make sense but misses the finer points and emphases.