One day, while I was learning about cipherspace, I discovered BitCoin. BitCoin is a completely decentralized, anonymous online monetary system that relies on a distributed database to facilitate transactions. The creator put a great deal of effort into ensuring that the system is secure and reliable. Unfortunately, there are no real assets backing he currency of BitCoin (and no coercive government backing it either). Thus ends BitCoin.
I can imagine, though, a system like BitCoin that allows people to write promissory notes and sign them with an RSA digital signature (to prevent couterfeiting). These promissory notes could be backed by gold, silver, fiat currencies, stocks and bonds, or pretty much anything. Then, these notes could be transfered from one person to another anonymously.
Couple this with an ebay-like service that allows people to swap these virtual currencies. Say, for example, that I have a gold note issued by a bank in South Africa. Since taking delivery of the gold could be a problem, I trade my notes for notes issued by a bank in U.S.A. Then, I can redeem those notes and have them FedEx me the gold (insured, of course).
This system would be Fed-proof, IRS-proof, FBI-proof and judgment-proof. This system would protect the users against monetary inflation, making it Fed-proof. Since nobody has a bossman ratting out their earnings, it is IRS-proof. It is FBI and NSA proof because all transactions are encrypted and anonymous. And, most importantly, it is judgment-proof because it is perfectly legal.
There are, at present, no laws that could be used to criminalize what I propose. Laws against money-laundering, for example, do not apply because there is no way to prove that the money came from an illegal source, such as drug dealing. Laws against tax-evasion do not apply either, because no taxes have ever been levied on imaginary currency. In addition, if you had your day in court, you could defend yourself on First Amendment grounds. Besides, international free trade agreements also have generous loopholes.
So what we are dealing with is anarcho-capitalism and wildcat banking on a global scale. If not for my non-existant programming skills, I'd be forking a new project off BitCoin right now.
Anybody here know C++?
"As long as there are sovereign nations possessing great power, war is inevitable."
@gabriel: Oh, man, you're begging for a flame-war.... ;-)
Of course, C++ and Perl are not even in the same solution-space... but I absolutely love Perl. Unfortunately, Perl has lost its roots with Perl6, which I think is going to be a fork, I don't think Perl5.x is ever going to be truly end-of-life'd, the code base is a large part of what makes Perl so powerful. Ruby and Python are Perl's closest relatives but they both lack the "down-and-dirty" quality of Perl5 that I fell in love with.
Clayton -
No worries, I'm just being inflammatory. I write C/C++ (C#, and some assembly) for a living, so I have a certain affection for them :). Now if there's any "God that Failed" book that should be written about a programming language, it's Ruby. Not a fan.
filc: TBH It's not clear that you understand what currency or money is.
TBH It's not clear that you understand what currency or money is.
From my perspective, It's not clear that either could really be explained to you. I'll admit up front, I'm certain that I'm incapable of correcting your particular distortions and misunderstandings.
It is however definately artificial IE fake.
Yes, it is artificial. Fake if you insist. Just like any paper currency in the world, as well as most of the paper trading derivitives, whether they are trading promises of gold or silver or simply promises.
Just heard about this. At first glance I thought someone had adopted a cluster computing model like folding@home that allowed people to buy and sell timeshares on their workstation or server (something which would actually be useful). But apparently all this system does is have your computer make arbitrary calculations until a 'block' is created and then you get some points for that. Sorry, but if I was going to be that lame I would simply farm items for some random online game and earn cash that can actually be used to make transactions.
banned: Just heard about this. At first glance I thought someone had adopted a cluster computing model like folding@home that allowed people to buy and sell timeshares on their workstation or server (something which would actually be useful). But apparently all this system does is have your computer make arbitrary calculations until a 'block' is created and then you get some points for that. Sorry, but if I was going to be that lame I would simply farm items for some random online game and earn cash that can actually be used to make transactions.
In due time, all shall be true belivers. Be it Bitcoin or some future derivitive, there is no putting this back in the bottle.
It is entirely likely that you will see a derivitive. I could see MAstercard/visa card integrationof BTC mechanisms. I could see people having the technological means to place transactions inhouse, without even the need of a Mastercard/Visa company existing, other then to provide credit.
The difference in the derivative though will be one of two.
A) A digital currency backed by something solid. Stock or commodity.
B) BTC continuing to be used as it currently is, nothing more then a laundering mechanism. This certainly has it's value on the market but this doesn't make it a money.
If I take 10 dollar bills. Place them in socks, then transport those dollars in socks to friends. The socks do not become some type of currency, instead they are just the transport mechanism. All BTC's could be seen for is a way to move dollars around securely and anonymously. All the economic calculation and exchange ratio's however are still in dollars or some other currency.
The problem with BTC advocates is that they get childishly defensive when we point out that BTC's are not acting as a currency or a money. Ironicly much of BTC's own documentation explains this. Yet some of you guys get all fired up as if we're making some type of personal attack on you. As if we're passing judgement on the utility BTC's have to offer. Your missing the point of the critique. Not being a money isn't a bad thing. Stop taking the critique as a personal attack. The key positive benefits BTC's are complimentary to any money or currency.
Filc; I predict that you, personally; will one day buy, hold and transact in Bitcoin (or it's successor) without regard to whether it's a currency in it's own right or not.
ok?
Whether or not you consider Bitcoin an independent currency or not is irrelevent. There will come a day that you will use it as such. Then, as now, the distinction is semantics.
Bitcoin will only become a currency if a government or government-like entity (UN, IMF, BIS, etc.) were to adopt it and promulgate it as a legal currency and the solution to our economic woes.
MoonShadow: Whether or not you consider Bitcoin an independent currency or not is irrelevent. There will come a day that you will use it as such. Then, as now, the distinction is semantics.
I'm not the "defensive" one.
Still, it seems that more and more of your peers disagree with your assesments.
http://cs702.wordpress.com/2011/05/29/on-the-potential-adoption-and-price-appreciation-of-bitcoin-in-the-long-run/
What peer?
filc: What peer?
The common Internet commentator with the pretense of an education in the subject. The difference being that this one actually knows Bitcoin pretty well, although his economic credentials could be in question; and you don't understand Bitcoin while your economic credentials are still in question.
MoonShadow: although his economic credentials could be in question;
So he's not really a peer than.
MoonShadow:and you don't understand Bitcoin while your economic credentials are still in question.
I probably know alot more about it's technological makeup then you give me credit for. I'm not so well informed in the politics behind it's movement though. In either case neither are relevant.
It seem's to me that you are mistaking and discounting a lot of the people here as mere Internet commentator's with no background whatsoever that would validate our commentary. Why is it that you are here if you obviously feel this way? If you view us as such, then wouldn't it be normal to go about your business and take advantage of the situation that you obviously believe you have with being already involved with Bitcoin?
From reading your posting here, it seem's to me you are trying to convinve yourself moreso than the rest of us.
Just to add, I have no peer's here or otherwise on the Internet in places that you would be able to read their opinion without paying them.
BTW, I know Bitcoin very well. I took the time to look at the source code, and I recognized a lot of Bit-Torrent 1.6 code in there. Beg's the question of why BT and uTorrent, which infinitely more secure. Oh I know why, because it's too hard to track the transaction's and the creator really isn't worried about security so much as record keeping...
That bring's me to wonder who these people that wrote this actually are. I would be more concerned about intent than accepting something of this nature as anything more than a scam.
NidStyles: The common Internet commentator with the pretense of an education in the subject. The difference being that this one actually knows Bitcoin pretty well, although his economic credentials could be in question; and you don't understand Bitcoin while your economic credentials are still in question. It seem's to me that you are mistaking and discounting a lot of the people here as mere Internet commentator's with no background whatsoever that would validate our commentary. Why is it that you are here if you obviously feel this way? If you view us as such, then wouldn't it be normal to go about your business and take advantage of the situation that you obviously believe you have with being already involved with Bitcoin? From reading your posting here, it seem's to me you are trying to convinve yourself moreso than the rest of us.
LOL! You must be projecting. I've made little effort to convince this crowd of anything. Everyone here seems set in their mode of thinking, whether they agree with myself or not. Perhaps that's also true with myself. Everyone believes they are the rational ones. I've read this forum off & on for years, due to an outsized interest in praxeology, and I'm consistantly impressed with the lack of insight considering that this is a forum that is supposedly intended to allow Austrian minded people to comfortablely communicate. Apparently there exists a wide understanding about what Austrian Economic Theories actually mean.
This may be so, and it may be so for anyone else, but I have no evidence of this. For all that I know, you are a 13 year old kid pretending to be an educated adult; like half of the forum members on all of the forums that I've ever participated in.
BTW, I know Bitcoin very well. I took the time to look at the source code, and I recognized a lot of Bit-Torrent 1.6 code in there. Beg's the question of why BT and uTorrent, which infinitely more secure. Oh I know why, because it's too hard to track the transaction's and the creator really isn't worried about security so much as record keeping... That bring's me to wonder who these people that wrote this actually are. I would be more concerned about intent than accepting something of this nature as anything more than a scam.
There is no bitttorrent code in Bitcoin, although there is some that is very similar. That is only related to how the nodes connect to one another, and how they share information about other peers. The two techs are very different beyond the p2p protocol level.
And if bitcoin is a scam, I'm going to lose a fortune. Feel free to sit out, however. I'm not interested in trying to convince you of anything.