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I guess you don't get the economics of a currency, national currencies can be fiat because the supply is eaten by taxation and it's printed to fund development, so it has value(paying taxes) and it can't get run unless a huge number of people changed to a foreign currency... which they wouldn't because they need it for taxes.

Although fiat these days is no longer sovereign, it's issuance is controlled by the central bank instead of the government, and the government loans it from the central bank who created it out of thin air instead of the government... so it's value is redundant and self-imposed... it's valuable because someone is in debt to pay back the loan that made it... stupid system, designed to boom and bust.

Private currencies which are fiat are most vulnerable to collapse unless they have decent sized holdings... which is funny enough - the situation with modern banks who have a minuscule amount of money in the vault compared to the amount of deposits, fractional reserve banking.

Bitcoin is a good(as new) currency, but it brings along flaws from the current fiat system, only advantage is anonymity.

Could start my own bank... but I don't have big enough holdings.
 
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I would add that bitcoins unlike USDs do not include a system of devaluation by design through inflation. This to me is their greatest advantage. While there are more being created as demand increases it is not regulated by one body and cannot be used to devalue(steal) from everyone using bitcoins the way the Federal(not) Reserve(none) uses quantitative easing(dilution) to steal from everyone using USDs.

I mine bitcoins, convert them to USDs then convert the USDs to real money(SILVER and Gold).
 
Ya, inflation is a terrible thing, yet it's a core part of the current currency system, it's supporters must love feudalism.
Silver and gold is annoying, lots of counterfeiting unless you buy it raw, which is actually cheaper.
I like tin, copper, tantalum... valuable materials which are consumed rather than stockpiled.

Bitcoin "mining" is the flaw of bitcoin though, people buy bitcoin but the wealth isn't reserved to keep the value. Banks get free money to make money, bitcoin miners make money out of computing... any data on the economics? I've seen a post saying $1 of computers made $2 of bitcoin...
 
I've never personally seen a counterfeit silver coin in my years of buying and selling. I deal in 90% and 1oz Silver American Eagles. I suppose you'd have to be more careful if you invested heavily in gold. Copper pennies are attractive since they have a negative premium, but you cannot melt them to obtain the bullion...yet. Doesn't prevent one from stockpiling them in anticipation of the day in which you can. Copper bullion premiums are so high as to make it unattractive.

I do not find mining to be a flaw at all...quite the contrary. Dual 6950s in this system generate over 800 megahashes and cost me a few bucks a month in electricity. The cards themselves were $210 each and I use them for multiple purposes. I and other individuals are creating the supply of this crypto currency and not some fascist banker pig mashing a few keys on a keyboard and looting savers of USDs at will.
 
Just like a bullion or regular fiat currency, bitcoin seems to have a steep early adopter advantage, mining... although I haven't looked into th numbers, people who mine don't seem to publish numbers like bullion and paper bugs.

Also, yum, tantalum has served me far better than any other metal.

One concept I talked to someone about was energy based currency, an interesting tie into both fiat and bullion... as interesting as it would be a mess, although would drive a thorium/ammonia economy better than fossil fuels.
 
I'm really digging this consistent $5-6 exchange rate lately. :thup: [knocks on wood]

I wonder if it will go up more when the blocks only give 25 BTC a block, thats going to be a MASSIVE decrease in Payout no matter how much Ghash you have. I'm already in danger of not making the energy it cost.

BTC would have to jump to $10/BTC to make up for the 50% generation loss, and i don't see that, because if it hit $10/BTC people would fly in thinking it's still 50BTC per block or as easy as it was last year and increase difficulty, causing a vicious cycle of what happened when it hit $30/BTC, people will sell out and you can take it from there, it takes months for BTC to recover from hits like that.

There is a video on youtube that i will find and link that basically tells you how to play the stock market correctly you cannot flip out when you put in $10,000 and loose $12,000 (you owe $2000) it happens all the time, give it a few months and you can have $24,000 with any luck, or you'll get your $12,000 back, but when people see their investment dwindling they freak out and end up hurting themselves and everybody else who has invested around them, this is no different, you have to chill out and wait. Withdrawing your investments early hurts the company, the same way it hurts BTC to cash out 1,000 BTC at one time.

This is part of it.

The key is though: You have to stick with what you do. - Generally, if you stick with it, you'll do pretty well.. over a long period of time. - If you jump from, what's hot today to something thats hot tomorrow, then, generally you don't make money.
 
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I think the bitcoin market will adjust ahead of time for the decrease in block rewards. It is well documented and will not be a surprise.
 
Plus you have almost a year before the project payout change. I'm sure some serious stuff is going to happen in the next two months. :p No sense in worrying about it now!
 
It's bitcoin.
Something serious is always "going to happen in the next two months".
The funny part is that it often does :D
 
Iv'e been out of the news loop i guess, what do you think will happen in the next couple months?

+1. I'm not out of the loop, but I'm still wondering what's going to happen... You seem to know something we don't. :sn:


Oh just wait and see... :)

*I actually don't have a damn clue, but if you look back the past year some serious **** is always going on... 1 -> 32 -> 17 -> 3 -> 7 -> 4... Crazy crazy bouncy this market be.
 
Actually in all honesty I feel like the market is stabilizing somewhat. (don't quote me)

If you look back a couple weeks to that $7.20 bubble or so that popped, it was because a lot of people were using bitcoinica (leverage making small gains constantly) and were being really gutsy and pushing the bubble. Someone dumped ~50k+ bitcoin and this dropped prices quite a bit, then those people that were leveraged hit their liquidate price, and they sold all of their bitcoin at once, and so on. This caused quite a drop (~20%).

Now, either people have wised up (short or long term) or those bitcoinica people got burned so hard they are out of bitcoin for good, or whatever else...

But fastforward to today, someone dropped 20k bitcoin and the market moved 0.3 bitcoin. Hardly a nudge.

I just hope this stability stays for a long time. I get nervous when the price grows too fast for its own good.

Edit: Long story short, in a commodity that is less than two years old, don't make plans a year in advance. :p
 
:rofl: You can say that again. :thup:

I've been reading around a bit and some of the mainstream analysts of the market predict this spring/summer will have a bigger growth than from 2010 to june of 2011 (you know, the $30+ exchange rate days). I'd like that quite a bit. Hell if they were consistently exchanging at $10 I would cry tears of joy.
 
I've never personally seen a counterfeit silver coin in my years of buying and selling. I deal in 90% and 1oz Silver American Eagles. I suppose you'd have to be more careful if you invested heavily in gold. Copper pennies are attractive since they have a negative premium, but you cannot melt them to obtain the bullion...yet. Doesn't prevent one from stockpiling them in anticipation of the day in which you can. Copper bullion premiums are so high as to make it unattractive.

I do not find mining to be a flaw at all...quite the contrary. Dual 6950s in this system generate over 800 megahashes and cost me a few bucks a month in electricity. The cards themselves were $210 each and I use them for multiple purposes. I and other individuals are creating the supply of this crypto currency and not some fascist banker pig mashing a few keys on a keyboard and looting savers of USDs at will.


Ive seen plenty counterfeit silver and gold.

Thats not to discourage the use of the two metals, its simply so that people do not burn themselves and get fakes.

I personally love silver, if you want a incredible investment over the next 5-20 years silver FTW.
 
Finally got my issues ironed out. I'm not mining BTC and LTC on my AMD rig with my 555 x2 unlocked to x4. Cpu is running at 3700 on stock volts with three threads for the BTC miner and 2 (one overlaps) for the cpu miner. 5870 runs nicely at stock volts and 950/300. :thup:

Then I have my 2600k in my main rig chugging along at stock for LTC mining.
 
I thought about tring out bit mining with my 7970 but I live in the state with the highest electricity costs in the nation (>0.30/kwh).

Probably not worth it eh?
 
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