Talk:Bitcoin/Archive1

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Adding a 'Critics' section[edit]

I'd like to add a little balance to the anti-libertarian angle of the article with a section on critics. Would any one object to me adding this:

"==The critics==

Statists tremor at the thought of a currency that is not issued and cannot be controlled by government, so many are critical of bitcoin. These critics have an obsessive hatred for libertarians, and claim they're ignorant about economics, all the while they themselves believe in an ideology that has been proven a failure repeatedly throughout history. The irony is lost on them." — Unsigned, by: Amin / talk / contribs

Whence came Amin? Twitter last night:
coinbits: RationalWiki on Bitcoin: submitted by greenrd t.co/n7I56DCw · Reply · RT
BitCoinReporter: RationalWiki on Bitcoin t.co/mVvPmFo1 #bitcoin · Reply · RT
BTCNews247: RationalWiki on Bitcoin t.co/RFeaZFXK · Reply · RT
Scream!! (talk) 07:07, 31 October 2011 (UTC)
Also, I object to that addition, Amin, because it is crazy. Try to rephrase it in a way that isn't crazy.--ADtalkModerator 07:40, 31 October 2011 (UTC)
The entire article is filled with parody against libertarians and Bitcoin. Ridiculing Bitcoin's critics from the libertarian perspective only adds a little balance to it. In the name of objectivity, right? Here's an improved version:
"==The critics==
The thought of a currency that is not issued by governments and cannot be regulated disturbs those inclined to authoritarian ideologies, so many statists are critical of Bitcoin. Bitcoin's critics tend to have an obsessive hatred for libertarians, claiming that libertarians are ignorant of history and economics. [1] The irony of their believing in a statist ideology that has, throughout history, been proven a complete failure, is lost on them."
So how about it? Amin (talk) 09:52, 31 October 2011 (UTC)
Amin, your section is (a) crazy (b) uncited. - David Gerard (talk) 08:28, 31 October 2011 (UTC)
Look at what's written about libertarians: The decentralised nature attracts libertoonian idiots. The excerpt about Bitcoin's critics is on par with what's in the article about libertarians in terms of seriousness and objectivity. Amin (talk) 09:53, 31 October 2011 (UTC)
I object to the words "libertoonian idiots" because it doesn't actually say anything, really. It's just a vague insult. Yeah yeah yeah, libertarians can be total fucknuts, but I can't see how that relates to Bitcoin very much. ADK...I'll plagiarize your tuba! 13:25, 31 October 2011 (UTC)
I put that in particularly talking about the specimens found on the forums. Go read and see what you think - see Amin for an example. The sort of people who literally think anyone who doesn't think much of Bitcoin is a "statist" and "socialist", and can't conceive of a world where this isn't the case. They look like cartoon caricatures, but they're real - David Gerard (talk) 13:50, 31 October 2011 (UTC)
This is a highly subjective critique. I could just easily say I'm talking about the specimens who have a visceral hatred for bitcoin and its supporters, and literally think any one who is strongly for it is a "libertoonian idiot" and can't conceive of a world where this isn't the case. See David Gerard for an example. Any way, for the sake of balance, let me put my counter criticism in the Wiki. Amin (talk) 23:05, 31 October 2011 (UTC)
We're a highly subjective wiki - we have SPOV not NPOV like Wikipedia. And yes, you could talk like you say, but unfortunately it is crazy. Can you restate it in a way that is not crazy? Because so far you haven't.--ADtalkModerator 00:48, 1 November 2011 (UTC)
Last I heard it was more or less dead anyway.--BobSpring is sprung! 08:59, 1 November 2011 (UTC)
The article now has a link to Buttcoin, describing it in the terms Amin favours. I assume this will completely satisfy his demands for balance with no further objections - David Gerard (talk) 19:42, 1 November 2011 (UTC)
+1 for snarkiness, but you're still not accepting criticism of your 'side' while you're all too eager to dish it out. Amin (talk) 13:21, 2 November 2011 (UTC)
We're SPOV and anti-crank. Bitcoin is extremely crank-ish. The major sites have gone down several times, with Mt. Gox once just rolling back a whole day's trading because they didn't like the price drop. While it's true that Bitcoins can't be manipulated by any state, it's also true that they lack the subsequent support of any state, such as American FDIC assurance for bank accounts, which is why people have lost all their money when an idiot reset his server and lost all of their "wallet" files. And so on. I have been learning more about Bitcoins, as you can see, but have not yet added such things to the article - you'd be wiser to stop your constant attempts to add your asinine edits lauding bitcoin advocates as defenders of liberty (see Streisand Effect).--ADtalkModerator 08:39, 3 November 2011 (UTC)
I'd say it might be a case of something well intentioned going awry. Amin's defence of it might have been what the initiators wanted it to be, but they forgot to take into account a) that people are idiots and b) that people are greedy. Hence it's become a speculative bubble with "scame" and "uber fail" written all over it. It might well have been originally intended to be a defence of liberty and freedom from state control (if someone wants to say that's what the founding principle was, I won't argue), but it's clear that you cannot think that's still the case. Scarlet A.pnggnostic 11:15, 3 November 2011 (UTC)
No one denies that there's greed, speculation and spectacular failures in the bitcoin economy, but the point of the currency is that people are free to do with the bitcoins what they want. The alternative is state-dictum, where the greedy people just go into government and turn every thing into a scam, and you have no choice but to wait four years to vote for another candidate hand-picked by the very industries that are fucking the population. New bitcoin businesses are started on a regular basis, because you don't need approval from a government agency, or a huge amount of money, to start one. It uses the internet infrastructure for storing and transferring wealth, so any one can plug into it and use it. Amin (talk) 08:12, 4 November 2011 (UTC)
Frankly, the FDIC is a horrible thing. Mandatory insurance means that banks can socialize the risk to the rest of the population. The consequence is things like Bank of America using millions of people's deposits as collateral for $75 trillion of EU derivative contracts. If people had to pay for their own losses, there would be the occasional bank run, with people losing every thing, but at least depositors would take more time to decide who to bank with. People nowadays spend more time learning about the next smart phone they're going to buy than who they're going to bank with. This is a consequence of FDIC and the transfer of responsibility and costs that it makes. Amin (talk) 08:18, 4 November 2011 (UTC)
On the other hand, if there's a server error with my bank account, I don't lose all my money. If I had bitcoins, I would instantly be broke. The very slight cost to me of underwriting that insurance for everyone and minor subsequent abuses is worth that security.
When people had to pay for their losses, there were constant booms and busts with banks. Eventually, people got so sick of this they instituted that security of which I speak.
When your talking points come from Marcus Crassus, you have a problem, bucko.--ADtalkModerator 08:49, 4 November 2011 (UTC)
No doubt, bitcoin is lacking, severely, right now. It would require significant development, in the way of services that provide distributed and secure storage of bitcoin private keys, to make it any where near comparable to current financial services in terms of security of deposits.
As for the pre-FDIC/central-bank era and the booms and busts with banks, they were actually significantly less severe in that era than today:
Only four countries experienced severe waves of bank insolvency worldwide in the years 1875-1913; in
the period 1978-2009, in contrast, roughly 140 such episodes have occurred, more than 20 of which are more severe than any of the pre-World War I episodes in terms of negative net worth of failed banks relative to GDP. http://www0.gsb.columbia.edu/faculty/ccalomiris/EP%20Calomiris%20Banking%20Crises%200910168.pdf
Not only were banking crises less severe, but economic downturns were less frequent, and average GDP growth was higher before central-banking and banking regulations came into effect: http://youtu.be/yLynuQebyUM#t=6m10s
As for banking regulations, tax-funded mandatory insurance, and central banking coming into effect because people saw a real need for regulations, that's just one theory. Another is that established players manipulated the public into accepting these changes for their own benefit. Look at the newspaper headline announcing the creation of the Federal Reserve: http://en.wikipedia.org/wiki/File:Fed_Reserve.JPG
I recommend you look into how the Federal Reserve was created, if you think it was created due to the initiative of regular people: http://en.wikipedia.org/wiki/Jekyll_Island#Planning_of_the_Federal_Reserve_System Amin (talk) 11:27, 4 November 2011 (UTC)
Don't misleadingly quote. Your quote is about bank failures, not runs and panics. FDIC insurance is actually more attractive when you point out there have been a lot of recent failures (mostly from poor lending practices) and a lot of past panics. To quote from that paper, "Nationwide banking panics occurred in 1819, 1837-9, 1857, 1873, 1884, 1890, 1893, 1896, 1907, and 1933. In the four decades prior to World War I the U.S. was unique in its propensity for panics. The U.S. also experienced an unusually high frequency of severe waves of bank failures: in the 1830s, 1920s, and 1930s." Read the goddamn things you quote.
Yes, the establishment of the Reserve served the purposes of the 1% (to use current parlance) as well. And no, the plan and structure for it were not coagulated from a mob. But the impetus came from people sick of the lack of surety of a bank, in a broader sense. Much like how Teddy Roosevelt personally launched the park system by fiat, yet he was responding to a movement that was agitating for some action to preserve the American wild in some way.--ADtalkModerator 21:33, 4 November 2011 (UTC)
I didn't misleadingly quote. A bank run happened when banks were rumored to be failing, or failing. Panics happened where there were a large number of bank runs. You're obviously too ignorant and stubborn to debate. Amin (talk) 13:17, 5 November 2011 (UTC)
Yes, bank failures could lead to a run on a bank, or be caused by a run on a bank. But they're not the same thing. A bank failure could be caused by everyone withdrawing at once, leaving no capital (a run) or by a series of extremely poor investments that overextended that capital and then soured (the simple version of the subprime failures recently) or a few other things. That's why recent bank failures are not "runs" or "panics," as I said, contrary to your misleading quote. A lot of panics occurred before FDIC insurance, and virtually none afterward, because it is effective and works pretty well and no one has to worry about George Bailey's personal assurances. But then, I guess you realized all this, which is why you clipped your comment short and declared that I was unfit to debate.--ADtalkModerator 21:14, 5 November 2011 (UTC)

Removed libertarian references, subjective and totally out of subject. There are many forum to display hate again libertarian but this wiki is not a place for that.

This is the wiki for that. Scarlet A.pngnarchist 01:07, 9 April 2013 (UTC)
"Amin" pretty much lost all my respect for it's "arguments" when it ignored the Great Depression in its history of banking. ħumanUser talk:Human 06:38, 15 December 2013 (UTC)

these still exist?[edit]

Really?--il'Dictator Mikalosa (talk) 13:26, 31 October 2011 (UTC)

Documented Bitcoin scammers[edit]

Bruce Wagner could do with some investigation and possible writing up - David Gerard (talk) 08:20, 2 November 2011 (UTC)

'Privilege' and Other Buzzwords[edit]

OK, I get humor based on buzzwords and using word-noise fluff as if it had meaning. Right. Wonderful. However, while I dispute that jokes should be marked out by tags or smilies, I do insist that they be marked out by being funny.—216.220.28.76 (talk) 00:57, 23 May 2012 (UTC)

I know nothing about this topic - but get a consensus and stop the edit waring.--Green mowse.pngGodot 01:48, 23 May 2012 (UTC)
The currency runs on cryptography, which has to actually be done by people with nice computers; therefore, to prop up the initial system, it was designed to bribe early users with exponentially better rewards than latecomers could get for the same effort. Basically, this means it runs on opportunism, especially of people who like the idea of decentralized techno-money. So yeah, the "joke" is a fairly accurate statement, though it could stand to be rephrased (if only because "unexamined privilege" is a weird phrase). ~ Kupochama[1][2] 03:51, 23 May 2012 (UTC)
No, it's a precise phrase with a conventional meaning, not any sort of neologism. They're the sort of geeks who are libertarians because they don't really believe people different to them exist, and if such people do exist they need to just learn more about computers. They also feel superior to these foolish people who just don't want to become as powerful geeks as they are, so they see a great market opportunity. Thus, their unexamined privilege is a resource ripe for exploitation by the pump-and-dumpers - David Gerard (talk) 10:02, 23 May 2012 (UTC)
No, it's an appalling use of the word. Explain what it actually means if you're going to make a statement like that. Otherwise it's just some hideously dismissive handwave. Scarlet A.pngnarchist 10:36, 23 May 2012 (UTC)
Which word? - David Gerard (talk) 12:17, 23 May 2012 (UTC)
See? poke it a bit and people agree it doesn't mean shit. (Or, rather, they can't agree about what, if anything, it does mean, which is even better.)—216.220.28.76 (talk) 04:31, 24 May 2012 (UTC)
That line of meta-arguing is ridiculous when applied to evolution, but hey, I'm sure it makes sense here. (Not to mention you were trying to delete the entire sentence, whereas this is about two words.) ~ Kupochama[1][2] 05:00, 24 May 2012 (UTC)
Are you trying to say that people can't agree on what 'evolution' means? Not merely that they propose different mechanisms or emphasize different aspects, but that they can't agree on a definition? Uh. Ok. Do you live too close to wherever Conservapedia is hosted? Also, the joke won't work without the buzzword. The entire sentence had to go if the joke was unfunny.—216.220.28.76 (talk) 05:47, 24 May 2012 (UTC)
Taking everything literally is making it hard to talk to you, so let's just say I disagree and think you should let this go. ~ Kupochama[1][2] 06:07, 24 May 2012 (UTC)
You're the one insisting that scientists can't agree on a definition for 'evolution'.—216.220.28.76 (talk) 00:04, 25 May 2012 (UTC)

Errors in the article[edit]

1. "Every time someone successfully "finishes" a work package (which becomes more difficult every time anyone finishes one), they receive a handful of free bitcoins."

The highlighted portion is simply not true. The difficulty in creating a new block is adjusted so that, on average, it takes 10 minutes to solve a block. Also, why is the word "finishes" in quotes? It seems to be there just to instill doubt/distrust.

2. "As more and more bitcoins get mined, it requires more and more processing power to mine new ones."

Again, this is not true. It'd be accurate to say "As more computing power joins the network, ..."

3. "This then bites them in the arse when they discover that running a Magic: The Gathering card exchange site is insufficient experience to securely run a currency exchange"

To my knowledge, the domain mtgox.com was previously a MTG card exchange site, but the current owner is a different individual/group than the one(s) who ran the card exchange. So not only is this remark an ad-hominem (which seems ill-placed in a rational wiki,) but a false one at that.

4. "In order to prop up the initial system, Bitcoin 'mining' was designed to bribe early users with exponentially better rewards than latecomers could get for the same effort."

Again, this statement seems to stem from a misunderstanding of how block difficulty works. Mining was easier early-on because there were so few computers trying to mine, *not* because it's hardcoded that Block #00000 is easier to mine than Block #99999.

5. "This effectively makes Bitcoin a pump-and-dump scheme wherein these early adopters..."

This is pure speculation. Certainly individual users have tried pump-and-dump tactics, but implying that Bitcoin was explicitly designed for such purposes is completely without basis. I would rewrite this paragraph so:

"In order to initially distribute Bitcoins, "miners" compete to solve a difficult cryptographic puzzle. The difficulty of this puzzle is periodically adjusted so that, on average, it takes 10 minutes for someone on the network to solve. Early miners could easily mine with just their CPUs, but as Bitcoin has increased in popularity, there has been an "arms race" for faster mining equipment, such as graphics card GPUs and, soon, custom-designed ASIC machines. Because it is now substantially more difficult for newcomers to mine, some have speculated that this effectively makes Bitcoin a pump-and-dump scheme wherein these early adopters, who have more Bitcoins, hype it up so that they can offload their Bitcoins onto later adopters who think they'll strike it rich as speculators, or whomever else will accept them as payment, especially among people who like the idea of decentralized techno-money." Kinghajj (talk) 09:57, 17 September 2012 (UTC)

If you can find a reference for the 10 minute claim it should definitely go in the article. However I think the article is placing some undue emphasis on the possibility of speculators making or losing money. The main winners are the criminals whose risks a bit of anonymity reduces considerably. Nobody wants to pay for child porn with their credit card. In transactions like that the buyer or the seller don't necessarily have to hold onto their bitcoins for longer than a few minutes, which makes hyperinflation less of a problem. --83.84.137.22 (talk) 14:16, 17 September 2012 (UTC)
I have taken the liberty of numbering these items for easier reference.
  1. This is obvious to anyone knowing anything about Bitcoin, but if a reference is needed - https://en.bitcoin.it/wiki/Difficulty.
  2. In addition to the difficulty increasing, the block reward is halved every 210,000 blocks. So in fact it is true that more bitcoins being mined cause it to be harder to mine bitcoins.
  3. Mtgox.com was never actually a Magic: The Gathering Online Exchange. The domain was bought with the intention to create one, but this never happened and it was used for a Bitcoin exchange. Of course, it is now owned by completely different people.
  4. See above. Of course, contrary to the mistake in the article, the inflation schedule was designed to conform to sound economic principles, while also incentivizing people to develop Bitcoin.
  5. Agreed, see above.
79.183.143.4 (talk) 19:34, 14 September 2013 (UTC)

Differences with "local currency"[edit]

How is Bitcoin different from local currencies like the Ithaca Hour, which is only accepted in a ten-mile radius of one Upstate NY college town? I don't mean this rhetorically, I seriously don't get how one survived, and one hasn't. --TheLateGatsby (talk) 20:37, 28 September 2012 (UTC)

There isn't that much of a difference functionally. The real problem with Bitcoin is the number of people who think it's going to save the world from fiat collapse as well as the general economic ignorance of many Bitcoiners. Well, that and the fact that Bitcoin transactions are irreversible and the value fluctuates wildly. And that just because the math makes sense doesn't mean anyone's going to take it seriously and very few people actually do, a large proportion of which are drug dealers and money launderers. See, private currencies are essentially gift certificates. The main issue with Bitcoin is that these are gift certificates that fluctuate in value, which does not make them attractive to merchants; there's a reason very few places in the US dollar zone (for example) allow you to pay in Euros (for example), and of the few that do, they're mostly small businesses in tourist areas with people willing to look up the exchange rate on a daily basis and deposit the funds immediately. EVDebs (talk) 22:56, 28 September 2012 (UTC)
Or tourist-focused shops in the middle of London, who happily accept euros at a ruinous rate of exchange. Falkvinge's use case (a replacement for PayPal or credit cards, i.e. an actual medium of exchange on the Internet) is the closest I've seen to a sensible use for the things - David Gerard (talk) 07:48, 29 September 2012 (UTC)
Even then, I used to work in downtown Boston. Lots of European tourists come to do the Freedom Trail thing and whatnot, and from what I understand, they tell them back home to not even bother with changing currency unless they have to -- it's easier for them to just use credit cards and let the banks fight it out over the exchange rate. Putting aside the wankery about fiat currency and anti-government paranoia, that use is the single best justification for Bitcoin, and now that we've reached the point where a panhandler with a cheap smartphone can take plastic, not even that makes sense anymore. EVDebs (talk) 18:07, 29 September 2012 (UTC)
But dude! Freedom from The Man is why Facebook is losing out so badly to Diaspora![citation NOT needed] - David Gerard (talk) 20:01, 29 September 2012 (UTC)
I don't even see the problem here that "bitcoin" is supposed to solve (PS the article really sucks). I take payments from people all over the world - Eurozone, Asian tigers, the Antipodes, via credits cards directly or Paypal. I get US dollars, they pay in local currency, and MC/Visa/Discover/Paypal don't rip them off. ħumanUser talk:Human 06:43, 15 December 2013 (UTC)

Bad reference[edit]

http://www.technollama.co.uk/a-look-at-the-bitcoin-network-transaction-history is used as a reference, but the paper it cites is flawed, since it has a few fundamental misconceptions about how bitcoin works. --Henk (talk) 16:19, 4 November 2012 (UTC)

Yes, we know the Bitcoin advocates hate the paper and have tried to attack its methodology - David Gerard (talk) 17:48, 4 November 2012 (UTC)
If you had met the authors of that paper (which I did), you'd know they are very enthusiastic about Bitcoin.
We don't hate the paper, since there is nothing in it which is genuinely troubling. We do hate how it's being misinterpreted in the media. 79.183.143.4 (talk) 19:10, 14 September 2013 (UTC)

Archive.org[edit]

Is now paying their employees in Bitcoin TyJFBAA 00:10, 26 February 2013 (UTC)

A good drop in price today (though rising already), exchanges partially shut down[edit]

I'm not clear on what's happening but it's related to incompatibility between 0.7 (buggy?) and 0.8 (correct?). --83.84.137.22 (talk) 04:18, 12 March 2013 (UTC)

Mt. Gox is trading at roughly the same level it did before. There was a flurry of trades about 25% below (around $36/BTC) the running average (mid $40 range), but the current asking prices are above $45. Ochotonaprincepsnot a pokémon 05:56, 12 March 2013 (UTC)

Alternate names[edit]

In some corners of the blogosphere, bitcoins are called "Dunning Krugerrands" or "Douchemarks." I didn't find a neat spot to tuck that into the article, so I didn't. Sprocket J Cogswell (talk) 01:54, 9 April 2013 (UTC)

Also "shitcoins". Secret Squirrel (talk) 23:09, 22 June 2013 (UTC)

So much stupid...[edit]

Because you're all so smart, how about the editors of this article actually READ THE WHITEPAPER. You know, the one that defines the protocol. You know, what actually makes bitcoin bitcoin.

Perhaps you'd find it easier to grasp your head around this obviously challenging concept.

You're welcome. — Unsigned, by: Wiw / talk / contribs

Why? It's just some idiots moronic scam.--Token Conservative (talk) 17:27, 8 August 2013 (UTC)
What difference does understanding the protocol make? Yeah, it was an interesting idea when Nakamoto wrote it. But the volatility alone makes it of limited value for its intended purpose. It will always be, at best, a go-between between other currencies. At worst, it will end in a total train wreck and the idea will be taken over by someone actually competent. As it is, the entire culture surrounding Bitcoin is an anarchic mess wide open to con artists. All the math in the world can't save it from being run by idiots. EVDebs (talk) 06:40, 13 August 2013 (UTC)

Token, that's not really fair. This is actually a quite impressive scam. The guys who came up with this know what they're doing. The main guy behind this scam, a French web designer living in Tokyo, is taking in big bucks. As far as scams go, this one is top notch. I could find many less flattering words to call this character, but idiot or moron would not be among them. --DrStephenFalken (talk) 20:25, 15 November 2013 (UTC)

Silver?[edit]

Anything this article lacks for silver? - David Gerard (talk) 07:41, 12 August 2013 (UTC)

Not really. I'd silver it now. Osaka Sun (talk) 22:49, 15 August 2013 (UTC)
Silvered - David Gerard (talk) 22:02, 27 August 2013 (UTC)
By the time I found it it was barely literate and didn't explain it's topic. So I undid that. You might want to find an old version that hasn't been mucked with by illiterates and reinstate it. ħumanUser talk:Human 06:47, 15 December 2013 (UTC)
Actually, to be fair, I don't think I read it from the beginning. I think I popped into a section someone edited, and it was an unclear mess. Perhaps that was just their version. ħumanUser talk:Human 06:57, 15 December 2013 (UTC)
Here are all the differences between the version Gerard certified and the version Human dislikes. There don't seem to be drastic differences; lots of minor rewording, some sections rearranged, and the quote at the top changed. The only new section was "Ripple," which is written fine (though I do question its relevance). I don't honestly know where you're getting "barely literate", and it clearly explains the topic right in the first few sentences. I think it reads just fine. Wehpudicabok [話] [変] 08:45, 15 December 2013 (UTC)

I'm speechless[edit]

Seriously. Instead of an article making any attempt to give an objective description of Bitcoin, the editors who let the article exist in its current form clearly have some ax to grind. All the criticisms that are being spewed out are myths which are easy to refute (which I'll be happy to do, but I am highly skeptic about the capacity of the authors for reasonable debate).

A key ability for rationalists is to recognize when they are wrong, and to admit it. Maybe now, after 4.5 years of Bitcoin existence, a huge community, thousands of businesses accepting it as payment and a lot of content having been written to explain it, someone will be finally willing to admit they were wrong?

Sorry for sounding like a troll, but it can't really be helped when criticizing an article with such poor quality. 79.183.143.4 (talk) 19:20, 14 September 2013 (UTC)

I personally agree that this does seem a bit stuck in the past.--Weirdstuff (talk) 20:38, 14 September 2013 (UTC)
The goal of Bitcoin is replace all central bank-backed currencies. Until you solve the inherent problems related with not having a central bank, all Bitcoin will be is a fad. It doesn't matter how "speechless" you are because it's survived for as long as Myspace's golden age. Osaka Sun (talk) 20:48, 14 September 2013 (UTC)
Can you please name these problems? (Also, any problems that may exist do not justify the way the article is written... I'm not as interested in convincing anyone about the merits of Bitcoin, as in trying to make the article more reasonable.) 79.183.143.4 (talk) 21:11, 14 September 2013 (UTC)
Read the Economics section. Just because more people are using it doesn't mean it's a secure currency. Osaka Sun (talk) 21:36, 14 September 2013 (UTC)
I've read the economics section, otherwise I wouldn't be so infuriated. If you're just referring me to some already written criticism, why shouldn't I just refer you to already written debunking such as https://en.bitcoin.it/wiki/Myths?
But I'll do it anyway and debunk all the criticisms in that section.
  • "they have no use-value" - Currency is a tool that exists to facilitate commerce. It doesn't need any other use-value, any more than hammers need other use-value from driving nails.
  • "Its biggest problem as an exchange medium is that it is not widely accepted, and that trading is thus very thin indeed." - True. Fortunately, that feature is completely mutable. As more people understand its inherent advantage, it will be more widely accepted. Bitcoin is a startup currency - you don't expect a startup company to generate profit from day one, and you don't expect a startup currency to be current from day one.
  • "There is also the matter of built-in deflation." - It's a feature, not a bug. You didn't specify what is supposedly wrong with that, but in case it's "people will hoard and not buy anything!", you need to look no further than the computer market to debunk this. People buy computers even though they could get it for half price in 2 years. People buy things because they want/need them, and they need them now, not in 2 years.
  • "As more and more Bitcoins get mined, it requires more and more processing power to mine new ones." - And? Since mining difficulty adjusts to network hashrate, this just means less power will be spent mining bitcoins.
  • "Also, if your wallet file is deleted, your Bitcoins are gone for good." - You can back up your wallet, and there will be software, hardware and guides to make this easier. For those that find it too difficult, they can still trust their bitcoins with a bank just like legacy currency.
  • "Mostly internet services, geek toys, phone sex, illegal drugs, and, of course, Bitcoin mining hardware". You can buy everything with Bitcoin. See for example https://en.bitcoin.it/wiki/Trade.
  • "To allow payment with a high volatility currency like Bitcoin, it is common for merchants to price their goods in fiat currency," - That is to be expected in this early stage of Bitcoin's life, and will be less common as it matures.
  • "The trouble with reimplementing the gold standard in the 21st century is that financial attacks, just like cryptographic attacks, don't get less effective with time." - Bitcoin stands to become the asset with the most value and activity in the world. When that happens such financial attacks will not have any effectiveness. Even in the current stage their effectiveness is exaggerated.
  • "And we can now see this in practice.[15]" - Not really a criticsm, but a demonstration of what is wrong with the article. You solely pick references that seem to support your personal opinion, in this case a post making some unsubstantiated claims (and some obvious errors, such as ignoring the legitimate speculative aspect). A post by someone who, incidentally, is an enthusiastic Bitcoin supporter who believes Bitcoin usage will grow to the point that each bitcoin is worth $1M.
79.182.136.68 (talk) 05:30, 15 September 2013 (UTC)

Crap like this turns up in every nasty recession. No one has any money, so people come up with pretend money they can pretend to use to pretend to pay for things. I remember a similar joke back in '92. It was a trading group with pretend money, that of course I could only use in the group, not for any of my real bills. Dumbest ideas I have seen come down the pike in my life. ħumanUser talk:Human 06:53, 15 December 2013 (UTC)

Mainframe rant looks superfluous[edit]

It doesn't really add anything, and is conceptually questionable: when the financial industries want to do calculation - e.g., spreadsheets that run overnight - they use the fastest PC they have to hand, and don't forget that LibreOffice Calc is adding the ability to use the video card to crunch numbers. In fact, serious billions of dollars and pounds and euros are literally calculated in Excel (and you should be frightened by this), and that's really not less shonky than running Bitcoin hashes on video cards. The mainframes are used for reliability, not speed. (So, the exchanges should be using those, not fucking AWS instances.) - David Gerard (talk) 10:33, 20 September 2013 (UTC)

obsolete devices serving thousands of obsolete companies with millions of obsolete customers moving billions of obsolete dollars every day, for profit
If such things really do serve this large a market, and they're still being made, then they're not obsolete in any meaningful sense of the word. I know Silicon Valley's stock-and-trade is "disruptive innovation" and obsoleting the "old school" but if something serves a market that large with no problems other than "business model hasn't changed in a while", then it doesn't fucking matter, it's just an abstract problem for business students and self-styled "revolutionary" tech entrepreneurs to masturbate over. Star of David.png Radioactive afikomen Please ignore all my awful pre-2014 comments. 11:08, 20 September 2013 (UTC)
Well... I'm not going to put up a fight over it. The "obsolete" thing is a running joke in mainframer circles. My point was less about the architecture (the GPU thing is definitely a thing) and more about the utter lack of quality control of both home-build and commercial mining rigs. Google's data centers are documented to run *really* hot for data centers (around 90F), but the big difference is that they don't do insanely dumb things constructing them. EVDebs (talk) 17:08, 20 September 2013 (UTC)
It's still somewhere between non sequitur and not even wrong. I'll add bits to the discussion of Bitcoin financial institutions - David Gerard (talk) 18:45, 20 September 2013 (UTC)

Silkroad is gone now[edit]

i can't be bothered to massage it into the article but it did make for a big drop in bitcoin value --81.175.225.92 (talk) 06:00, 3 October 2013 (UTC)

US government seems to be taking some interest[edit]

There's a Senate hearing going on regarding virtual currencies. A more concise summery. Compro01 (talk) 15:15, 19 November 2013 (UTC)

Outdated energy consumption estimate[edit]

"Bitcoin is also an environmental disaster, using 982 megawatt-hours a day..."

Currently (November 27, 2013), the Bitcoin mining network is estimated to be using 79.88 gigawatt-hours per day.

79.88 GWh is equal to 285.86 terrajoules. For comparison, Fat Man (the nuclear bomb dropped on Nagasaki) had a yield of 88 TJ. Little Boy (the nuke dropped on Hiroshima) had a yield of "only" 67 TJ.

The average amount of electricity used in a U.S. home per year in 2011 was 11.3 MWh.

Using that number as a base, the electricity used by the Bitcoin network in a single day could power 7,000 homes for an entire year. Or, you could power nearly 85,000 homes for an entire month. Or, you could power 2.5 million homes for a single day.

The environmental nightmare will only get worse. As the difficulty increases, people will invest in more powerful mining units. And, generally speaking, bigger hashrate = more electricity. These ridiculous energy requirements will eventually kill Bitcoin. —ShadowFan-X 00:08, 28 November 2013 (UTC)

Mining requirements[edit]

"The currency needs lots of computers to process and record transactions. "

Not quite true, but I don't know how to change this and the rest of the paragraph to explain it nicely. A single computer could handle all the demands of mining, but since everyone wants a slice of the buttcoins a processing-power arms race started up. Every computer DOES need to a record of the blockchain though nvm i'm dumb Jayzus (talk) 23:50, 5 December 2013 (UTC)

This article is terrible.[edit]

I normally come to RationWiki looking for a decent treatment of a subject, but this article is appalling. Its full of misinformation prejudice and is basically just an anti-Libertarian rant. Get a fucking grip folks, be pragmatic. You might not like the political agenda of some advocates of Bitcoin but that shouldn't blind you to the technological benefits. Mintz (talk) 17:13, 28 December 2013 (UTC)

I am making some changes, but I don't have time to do a complete re-edit. Mintz (talk) 17:27, 28 December 2013 (UTC)
"Technological benefits?" Those are some pretty high claims to make. From where I sit in IT, Bitcoin is neither new, nor innovative, nor provides me with any increased benefit or utility in the workplace. Please be explaining to me what these "technological benefits" are. --Castaigne (talk) 18:26, 29 December 2013 (UTC)
We describe the technological benefits of millions of MWH's being wasted doing worthless cryptography in our article on Global warming. Hipocrite 19:29, 29 December 2013 (UTC)

So now its been reverted and protected and still full of falsehoods and prejudice. Am I on RationalWiki or Conservapedia? Okay lets take this one step at a time. Why is this is in Category:Scam? What's your evidence for that? Mintz (talk) 20:27, 28 December 2013 (UTC)

Discussion moved from Saloon Bar[edit]

This discussion was moved here from RationalWiki:Saloon bar. ЩєазєюіδWeaselly.jpgMethinks it is a Weasel 13:35, 31 December 2013 (UTC)

The article on Bitcoin is an appalling rant full of myths and misinformation about bitcoin interspersed with an anti-Libertarian dig every few sentences. I began an effort to change this into an article that actually explains what bitcoin is from an objective point of view earlier today after first commenting on the talk page. The article is in categories "bullshit" and "Scam" and could be summarized as follows - "Libertarianism is stupid therefore Bitcoin is stupid". That's not a sensible skeptical analysis. I now find that the article has been reverted and protected while I have been labelled a vandal. I understand the technology behind Bitcoin and I think it has amazing potential. I am not Libertarian but I am pragmatic. Whether bitcoin fulfills Libertarian ideals or not the article should not poison the well by simply saying that bitcoin is crap because it's Rand Paul's wet-dream. Mintz (talk) 20:50, 28 December 2013 (UTC)

Very well, then. Write an essay explaining your viewpoints, that's the way you refute thing 'round 'ere. --Ray´s Super Fun Hellhole! g͘͡r̸̀a̸̶̡n̶̶͜ţ̡ ̀҉̴̨͡m̀͘͜͢e͡ ̸͟҉̷̢ỳ̸̡̀͞ơ̡̢̡ų̧r̴̀͡͝ ̡҉҉̧̛s̵̕͏̡ǫ̀́͢ų́l̵̕҉ 21:38, 28 December 2013 (UTC)
Where would I put such an essay, and how do I know this would not be wasted effort? The article was protected after I made two modest edits. That kind of knee-jerk protectionism is something I would expect at Conservapedia. This place doesn't have the same level of oversight as Wikipedia and I wonder whether those who patrol their pet articles can be persuaded to be objective. Mintz (talk) 22:16, 28 December 2013 (UTC)
This discussion should really be on the article's talk page. Any editors with an interest in Bitcoin are likely to be watching the page. ЩєазєюіδWeaselly.jpgMethinks it is a Weasel 22:25, 28 December 2013 (UTC)
You can write an article as a sup-page of your user page. E.g. User:Mintz/Bitcoin. Redchuck.gif ГенгисOur ignorance is God; what we know is science. Moderator 22:42, 28 December 2013 (UTC)
I have commented on the article talk page and the talk page of the user who reverted my edits. I accidentally deleted some other comments on his page and the result is that my user has been blocked (I'm using a proy now) and edits deleted from the user talk page and I have been called a motherfucker. This does not bode well for anyone responding sensibly to me writing an essay to make my point - Mintz

As a self-proclaimed Libertarian, STFU. Just write the damned essay once your block wears off.--The Madman (talk) 00:34, 29 December 2013 (UTC)The Madman

Evidence of scam?[edit]

You want evidence that bitcoin, in which a guy designed a new currency, and then gave himself 30%+ of the total value of said currency, and then distributed the rest to the market at large is a scam? Hipocrite 16:50, 29 December 2013 (UTC)
If that's your best evidence, (and you should be giving your best evidence first) then it's pretty poor. Satoshi did not give himself 30%+ and then distribute the rest to the market. He (or more likely they) does not own anywhere near 30% and he did not award himself any of the bitcoins that he possesses. Every single bitcoin was 'mined' by finding a cryptographic hash to encode a block in the blockchain as part of the 'proof of work' algorithm. At first Satoshi was the only person mining, because he wrote the software. Satoshi published the software to the community on 9 January 2009 with a post in the cryptography mailing list - http://www.mail-archive.com/cryptography@metzdowd.com/msg10142.html. Hal Finney responded to that post two days later. Hal was one of the developers behind Pretty Good Privacy and developed the first practical proof of work algorithm. Hal was the first person to mine other than Satoshi himself (see here for his story https://bitcointalk.org/index.php?topic=155054.msg1643833#msg1643833) The first block Hal mined was #70 something. A transaction block is mined every 10 minutes and the first blocks awarded 50 bitcoins per block. So Satoshi's exclusivity was restricted to the first 3500 bitcoins. For some considerable period of time there were very few miners. bitcoin was a plaything. The coins were literally worth nothing. The early adopters exchanged them just to test the software. Then a marketplace started up called https://www.bitcoinmarket.com (it no longer exists). In May 2010 someone offered to pay for two pizzas with 10,000 bitcoins (which they said were worth about $41 on bitcoinmarket.com), so at this time a bitcoin was valued at less than a cent. This kick-started the bitcoin economy. There were maybe a hundred or so people people mining them at this point, but I'm not sure of that. By August 2010 10,000 bitcoins were worth $600 (so each bitcoin was worth about 6 cents). By this time Satoshi's active involvement had ended completely. He said he had moved onto other things. It is estimated that Satoshi mined around 1,000,000 bitcoins (which is about 8% of the coins in existence today and 4.7% of the 21m total that will be produced) They were worth about $60,000 when Satoshi disappeared. It appears that virtually all of those coins have not been touched since they were first mined. Quite possibly the private key for them is lost and they can never be spent, perhaps Satoshi is dead, perhaps he will come out and spend them them one day. Nobody knows. As those coins have not been exchanged for cash it's highly unlikely that Satoshi is now living the dream travelling by private jet and living in a grand mansion, like some genuine scammers Mintz (talk) 04:39, 31 December 2013 (UTC)


I also think that the article is pretty bad. But I can't find the will to get in a fight over it. I guess we will just have to see if it continues to operate and is still around in five years.--Weirdstuff (talk) 18:29, 29 December 2013 (UTC)
It's a scam because the value of bitcoins is 100% backed by speculation and not a thing else. Look at what happened when it was banned in China: it lost an huge chuck of its value. While speculation is a minor part of regular currency, the US dollar and the yen (for example) are also backed by their respective country's GDP and things like US bonds and budgetary appropriations to pay them off, which is why US treasuries are still one of the safest investments in the market. Reckless Noise Symphony (talk) 07:13, 30 December 2013 (UTC)
"It's a scam because the value of bitcoins is 100% backed by speculation and not a thing else. " - Yeah just like gold, speculation of future prices fuels price rises. That's what market forces do. The price rises on demand driven by good news and falls on bad. Just as speculation on Twitter has done. Price is a function of supply and demand driven by potential utility. But what about value? How do you determine whether the price of something is a valid measure of its value, more specifically is the price a function of 'intrinsic value'? Value is a little bit of a nebulous concept. The value of Twitter is not obvious but one thing that makes it valuable is the metadata it produces. So the value can be highly context dependent. I have read people talk about the intrinsic value of gold, seemingly unaware that on a desert island gold is far less useful than a coconut, which you can use as a tool (gold is too soft), make fibre from, turn into a drinking vessel and eat. In an industrial capacity gold is certainly less useful than copper. But per Kg gold is about 7,000 times more expensive than copper, despite global production of gold only being about 1/6th that of copper. So the industrial value of gold is pretty much irrelevant to the price. Perhaps it comes down to gold being valuable because people like shiny things and other people speculate on the demand for shiny things. I think this is closer to the mark but if so we're talking about a value based upon the subjective aesthetic qualities, in other words sentiment and nothing more. Where's the real value that underpins the price of gold? So is gold a scam too? Turning to bitcoin. Bitcoins as units of currency have value because the possession of bitcoins (lower-case 'b') gives you the ability to make use of the Bitcoin(upper-case 'B') network. So the value of units of bitcoin stems from the value of the utility provided by the bitcoin network. That is something I will address when I have some more time. Mintz (talk) 11:59, 31 December 2013 (UTC)

Mintz v. Osaka[edit]

I went to the talk page for Bitcoin before editing. User:Osaka Sun's edit summary says "Protected "Bitcoin": Excessive vandalism: Go to the talk page before you start blanketing multiple sections."

I resent being called a vandal. I rewrote the top section about mining because it was wrong and it was crap. The first paragraph poisoned the well by saying that bitcoin appeals to Libertarians. I.e.e Libertarianism is stupid therefore bitcoin is stupid. I am not a libertarian. I was trying to edit the article to inform the reader what Bitcoin actually rather than the article being a anti-Libertarian rant. A skeptic should base their view on at the evidence not on prejudice. Mintz (talk) 20:34, 28 December 2013 (UTC)

A skeptic should realize that a currency that halves its value upon the closure of a single exchange in China is not a stable one. The fact that its significant appeal (ie. the lack of a central bank, something which has had historic consequences) is inherently libertarian, it's no surprise that we will criticize them. Osaka Sun (talk) 21:00, 28 December 2013 (UTC)
No it's not stable. Only an idiot would claim it was. I have not done so. So why do you bring it up? It's a straw man. It's price stability is not a detriment to its utility for low-fee international remittance or as a payment mechanism when using services like BitPay. Your next point - So because Bitcoin operates without a central bank and Libertarians love the idea of a currency without a central bank, Libertarians are stupid - therefore bitcoin's is stupid? Is that your argument? Would you apply that logic to anything else? For instance Atheism has no God. Communists love the idea that there is no God, Communism is stupid therefore atheism is stupid? You are also factually incorrect. The Chinese exchange BTC China has not closed, it is still in business, people can still trade and withdraw bitcoins and currency, they just can't deposit yuan. The price has also bounced back somewhat. Currently it's at USD760 at MtGox and Usd 720 on BTC China, which is where it was only 5 weeks ago in the middle of the climb towards it's very brief high of USD1200.
Let's stick to the facts on the price rise and 'crash' - Much of the recent price rise from late October through to early-December was driven by the announcement in mid October that Baidu (China's equivalent of Google) would be accepting bitcoin payments for their services. Buoyed by this news those Libertarian-loving Chinese poured in yuan to buy bitcoin like no tomorrow. Inevitably the price climbed dramatically as its use was endorsed by a big player in China. But even hardcore bitcoin advocates warned that that such a steep price rise in such a short time was frothy to say the least. No-one could predict when the bubble would burst, but a price correction was inevitable. It burst when the Chinese government banned payment processors from dealing with bitcoin exchanges. The price trend is still up. This is the 3rd or 4th time that bitcoin has been a bit frothy and 'crashed' and each time the price has recovered to a level higher than the start of the bubble before some time later reaching a new high. At the same time bitcoin is being adopted by more and more merchants.
I note you haven't replied on the article's talk page to my main question so here it is again. The article is in the category 'scam' (also bullshit). Why is Bitcoin a scam? There are of course people using bitcoin to scam other people, just like there are scammers using email and USD. Why is bitcoin itself a scam? Mintz (talk) 23:26, 28 December 2013‎
"I note you haven't replied on the article's talk page to my main question so here it is again." We do have lives beyond the Internet, you know.
"It's price stability is not a detriment to its utility for low-fee international remittance or as a payment mechanism when using services like BitPay." That volatility is the reason why it's only used by about 200,000 people and deemed a fad at best. The larger the userbase, the larger the amount relying that it doesn't sharply drop and rise in the manner it does. (What do you think would happen if the USD lost 50% in a day against the euro?) You can't just handwave it with "Oh, we knew it was a bit frothy and it's all fine now," then set up a suicide hotline and expect to be taken seriously. We've also linked to multiple papers explaining the very real possibility of a hacker nuking the entire system within the current governance structure, provided the initiative. It is considered a scam, simply put, because its adherents whitewash these flaws.
Anyways, an idea does not have to be libertarian to be illogical; if we were debunking those exaggerating the effects of, say, NAFTA, we would clearly identify their ideological beliefs. And using your example of Communism, you don't have to be theistic at all to realize that stamping out all religions and replacing them with a secular personality cult is dumb. Osaka Sun (talk) 01:21, 29 December 2013 (UTC)
I don't have time to address all of your points right now. I will go off and read the Dion paper.
Re users - "it's only used by about 200,000 people and deemed a fad at best." - I'm sure that figure was correct at some point but I think it's a little out of date. The most recent figure I've heard is about 2 million, but it's really hard to estimate. I just checked how many users are registered on BitcoinTalk.org (https://bitcointalk.org/index.php?action=mlist) and it's over 200,000, I seriously doubt that every user of bitcoin is also registered on bitcointalk.org. Impossible to say what the ratio is though. One other way to estimate the number of users is to extrapolate from the number of nodes on the network. This can be done on http://getaddr.bitnodes.io/chart/nodes/. This gives a snapshot of active nodes - that is people who are using BitcoinD and syncing up the their copy of the blockchain and perhaps running miners. Of course this doesn't take into account people who have their computer switched off, or are not running the daemon at the moment. It also doesn't include those who are using online wallets like Blockchain.info. Blockchain have a graph showing the number of registered wallets which is here - https://blockchain.info/charts/my-wallet-n-users that shows about 950,000 registered users. Blockchain by no means has a monopoly on online wallets.
The larger the user base the less likely it is than a big-player can shift the market price significantly, especially if the number of exchanges increases.
"What do you think would happen if the USD lost 50% in a day against the euro" There have been steady rises in the price of bitcoin and sharp falls. Bitcoin is not a viable replacement for fiat currency because of the volatility - I know the mantra. There's no need to endlessly repeat that. But I think, and I am not alone in this, that the volatility is a symptom of it's currently small userbase and market cap. But even with the current volatility it still has useful properties for international remittance and payment. In November alone BitPay saw a doubling in the number of merchants using their services processing $100 million http://www.coindesk.com/merchants-love-bitcoin-bitpay-100-million-reasons-prove/ in transaction. Small beer at the moment but it is increasing.
"Suicde hotline" - this is FUD. One reddit user posted links to a US suicide hotline. - Here's the thread - http://www.reddit.com/r/Bitcoin/comments/1t5ofu/please_sticky_usa_suicide_hotline_1800273talk/
I'm going for a country walk now and will return to deal with your other points. Mintz (talk) 14:15, 29 December 2013 (UTC)
"Bitcoin is not a viable replacement for fiat currency because of the volatility - I know the mantra. There's no need to endlessly repeat that." Bitcoin's goal is to present a fully convertible electronic alternative to fiat, for political/legal/hobbyist/usability reasons. In order to do that you need to convince people to make that shift. I would suggest to go to your local university economics department and ask if anyone would want to do it. Even the more favourable views praise the technology, but acknowledge the gaping holes of using it as a currency.
"The larger the user base the less likely it is than a big-player can shift the market price significantly, especially if the number of exchanges increases...I am not alone in this, that the volatility is a symptom of it's currently small userbase and market cap." So when will that end? 5 million? 10 million? That Economist article you dismissed as FUD also pointed out that the pump and dump scheme is still very much going on; we've seen it with individual companies, yet not with mediums of exchange. There's no precedent to compare to this, and that's the problem. Amazon was able to survive dot-com because it was able to quickly present itself as a means to buy store-available goods on the Internet not only with ease, but securely.
So sure, keep going around on websites around defending Bitcoin. Just don't think that you're going to get your edits inserted with "Look, it'll survive four more years in its current state because... oh, look at all the more than negligible amount of users!" Because that's all that you've given me so far.
(P.S. Along with the Dion paper I would suggest "The Economics of Bitcoin Mining" by Kroll, Davey and Felten.) Osaka Sun (talk) 20:55, 29 December 2013 (UTC)
3/4 of the way through the Dion paper and just off to bed so I thought I'd look in here.
"Bitcoin's goal is to present a fully convertible electronic alternative to fiat, for political/legal/hobbyist/usability reasons. " - there's no goal of bitcoin because bitcoin isn't an entity. Everybody who codes, mines, trades bitcoins, or provides goods in exchange for them, or services to support the infrastructure of the bitcoin network does so for their own reasons. I don't think its going to replace fiat currency. I do think it it will play a significant role in shaking up the current payment processing industry including the likes of Western Union, PayPal, VISA etc. For micro-payments it has significant advantages over credit-cards where the transaction fee is a large fraction of the total cost. For instance The Skeptics i n the Pub talks I host have a ticket price of £3.00 but to do an online sale using VISA I get charged 80 pence which I have to pass on to the customer. I would love to use bitcoin for this so that the customer wasn't paying 25% over the odds.
""In order to do that you need to convince people to make that shift. I would suggest to go to your local university economics department and ask if anyone would want to do it. " - I will hopefully soon be hosting an SitP talk with Garrick Hileman from the London School of Economics on the future prospects for alternative currencies including bitcoin.
"So when will that end? 5 million? 10 million? " - much greater than that I think!
"That Economist article you dismissed as FUD" - No. I dismissed the reference from your comment about the suicide hotline as FUD. No one set-up a suicide hotline as you claimed. It was just some user posting a link to a suicide hotline on Reddit. As for the Economist article it states "... makes it almost impossible for anyone in China to buy or sell Bitcoin for yuan." - this is not true. There is still plenty of trade going on on BTC China and OKCoin. In fact BTC China is still leading the markets in terms of volume - see http://bitcoincharts.com/markets/. Re pump and dump it says "Speak to Bitcoin enthusiasts and it soon becomes clear that they while they think that Bitcoin will revolutionise online payments, they are mostly buying it in the hope of selling it off for a profit later. A few drug users aside, no one appears to be buying it as a way to buy things" - Bitcoin is not just a currency it's a payment protocol and because of the potential a speculative instrument. Many people are indeed treating it just as a speculative instrument intending to get out of bitcoin when they've made a few quid but that's no different to people forex trading. Forex trading is essential to find the price of currencies. But most of the people I know who are buying bitcoins in anticipation of profit are in it for the long haul. They are holding. They're not pumping and dumping. The problem is that in many places its still very difficult at the moment to find anywhere where you can spend bitcoins however people are definitely spending bitcoins and it is on the increase. Gyft announced that on Black Friday they processed more bitcoin transactions than CC transactions. Recently my colleague's wife specifically bought bitcoins for the first time in order to take advantage of special offer (20% off or something) for using bitcoin. She converted £75 to bitcoin and spent about £70 on some scarves online. I don't know who the retailer was. See this image showing the increase in the number of merchants who accept bitcoin between May and October
"There's no precedent " - correct it's a new thing! It's a technology that solves two computer science problems, the double-spend problem and the Byzantine generals problem. Bitcoin is a new technology. It's like SMTP for email, or MPEG for movies and MP3 for audio files. Those technologies are ubiquitous now because they make possible the transfer of information in various guises. Bitcoin does the same for another type of information, one that carries and incorruptible record of the possession and transfer of value. But it's more than that - it's programmable money. The bitcoin protocol has a lot of currently dormant features built into it that can be used for things like escrow, contracts, proof of ownership, and automated meditation. Most people, except the coders and futurists are not interested in these things right now, but time will tell.
"not only with ease, but securely." - bitcoin itself is very secure. The blockchain cannot be forged. Wallets use SHA256 cryptography. The problem is that the Internet itself is not secure. Bitcoin sites have been hacked, but so have dozens of other sites like Facebook, Playstation and most recently Target (I think their EPOS software was hacked).
"that's all that you've given me so far..." - I've not yet gotten around to addressing some of your earlier points. I'm reading the Dion Paper which is mostly about other things like e-Gold and Liberty Dollars relatively little about Bitcoin. It also has a number of factual errors in it.
" Just don't think that you're going to get your edits inserted" - the edit that you deleted and labelled "vandalism" described the mining process in completely neural terms. It was hardly contentions. I edited out a paragraph that described a block on the blockchain as a "work package" or something, and then said mining was required to reel in suckers. You seem protective of this. Did you write it?
Off to bed it's v.late. Mintz (talk) 04:25, 30 December 2013 (UTC)

Overstock.com[edit]

In what the CEO (apparently a libertarian who likes Austrian economics) is calling "as much a political statement as a business decision", wp:overstock.com is apparently now accepting bitcoins. This should be interesting to watch. Compro01 (talk) 22:01, 9 January 2014 (UTC)

Through a payment provider. The only reason for this announcement is publicity - David Gerard (talk) 23:18, 9 January 2014 (UTC)
David. This takes the volatility out of the equation for the retailer through the process of instant conversion to fiat. This is exactly how all virtually businesses , (like the Pembury Tavern in Hackney) that use bitcoin to receive payments operate. Overstock are using Coinbase other businesses use Bitpay. You call it publicity. OverStock call it $124,000 business from 780 bitcoin transaction on Day 1. Mintz (talk) 02:23, 12 January 2014 (UTC)
*cough* You realise I know Steve Early and told him to get the heck moving on the Pembury Bitcoin gateway because it would be totally worth it in pure publicity? He nets a couple thousand quid a month in Bitcoin, which is bugger-all - but the publicity has been worth a fortune. He regards Bitcoin as an amusing geek toy - David Gerard (talk) 09:19, 12 January 2014 (UTC)
Interesting. He told me that bitcoin represents less than 1% of his takings. This would be expected of course. He also told me that his reasons for accepting bitcoin were exactly those stated on the individual pubs website, i.e. the comparative ease of processing transactions compared to credit cards together with the triviality of adding it to his EPOS software. He also told me that the level of publicity was much more than he anticipated. Mintz (talk) 23:23, 12 January 2014 (UTC)
Technically, every form of payment they take is through a payment provider. I don't believe they accept cash. Compro01 (talk) 02:29, 10 January 2014 (UTC)
The key difference: "Before each payment is made, Coinbase sets an exchange rate, immediately converts the buyer’s bitcoin into dollars, and transfers the dollars to Overstock. The retailer never holds any bitcoin." You couldn't rely on Bitcoin in a billion-dollar business with razor-thin margins without an intermediary turning it into "real" money. Justbrowsing (talk) 03:15, 10 January 2014 (UTC)

the fuck's a "bitcoin" anyway?[edit]

Note: I posted this in the talk page of the bitcoin article here and in the talk page of the Wikipedia article of the same name: What's a bitcoin" anyway? [Now in wp:Talk:Bitcoin/Archive 10#What's a "bitcoin" anyway? Civic CatTalk to Civic Cat20:57, 10 April 2014 (UTC)], as respondents in one might help in the other.

Of all the RW editors who have done as many edits as I have or more (which are likely in the hundreds), I wouldn't be surprised if I was the 10% of the dumbest when it comes to computers and the internet. Wikipedia wp:Bitcoin was of little help to me and so is this article—not to demean those who made it—but if I can't figure it out, chances are many others can't.

"Bitcoin is an Internet-based digital currency, that uses strong cryptography to make sure nobody is duplicating money. This allows it to work without relying on any government, corporation, or other centralized entity, which tends to appeal to libertarians, anarcho-capitalists, and technophiles."

I get the second sentence, but not the first.

So here's my understanding. Take barter. A hunter exchanges a deer carcass for some flint arrows, or in a more modern times, a laptop. That's understandable. Aztecs used cacao beans in trade. Cacao beans had/have value, are compact, and inflation can be dealt with. Ditto gold. I'm not sure what money is, but if you send some to the government, in what they call "taxes" they tend to leave you alone. I read that some money inflates more than others, so if you're going to keep some for a while, it should be in "hard" currencies—US/Cdn/Aus/NZ dollars, £UK, euros, yen, or Swiss francs. Banks keep money for you, as do the credit card companies, or they lend it at interest. When you spend some of it, perhaps some clerk gets a pen and marks off your balance and writes in a new balance, balance minus spent, and the does the same with a vendor's balance: scratches out balance and writes in a new number representing balance plus what was gained. These days a computer does it electronically.

So when they say "electronic" or "digital" currency, they likely mean that some place is holding varying amounts in varying accounts and shifting things back and forth. Those who do it honestly tend stay in business. The (thoroughly) dishonest ones tend to go out of business, and maybe get arrested. Oh yeah, and these transactions tend to be monitored lest the guv'mint doesn’t get its cut and people trade in illegal things like contraband cigarettes or marihuana reefers, or engage in things like the hiring of prostitutes.

Now the way I figure it, if you’re going to cheat on your taxes or engage in illegal trade, your best bet is probably to use cash, i.e. pieces of paper that can be easily used in trade in goods and services. You want a clour TV, you could, say, sell a few "lids" of marihuana for money, or perform sexual favours for money, and you can use the money to buy that colour TV. Indeed, one might even use barter if the colour TV vendor would accept marihuana and/or sexual favours in lieu of money. I suppose more creative types can use electronic currency and tell the gov'mint that the marihuana was some special rare herbal mix and/or the sex favours were something else.

I suppose other items can be used for money: bills from other countries, gold, cigarettes, marihuana itself, chocolate, silk stockings, blue jeans, beaver pelts, whatever.

Now where does this bitcoin fit in? Is it (a) valuable, (b) portable, (c) hard to inflate, and (d) difficult for the guv'mint to trace? Okay, assuming it's just electrons or something-digital, I can accept it fulfills the portability requirement. As for value, I suppose that one can make people believe it's valuable—as some say such is the case with money-as-we-know it; but the important thing is, that issuers of our bills will take it back. If giving the guv'mint a few 1000 or 10 000 dollars, pounds, euros, whatever will keep you out of court or jail, then it has value. The guv'mint has a vast array of means of propaganda so they can also hype up the value of money. Also, the money we know today was based on bills that could be used to do things like get the gold or silver they once represented. What does this bitcoin have? Maybe if someone redeemed it for "real" money while slowly inflating the currency—maybe. Maybe if someone printed the currency of some micronation and it looked like US money, except that instead of some US president, it had a picture of some celebrity, maybe it could be hawked. I wouldn't be (too) surprised if one could, say, sell a $100 bill in Confederate money for over half its face value—maybe—even though the Confederate States of America stopped existing about 150 years ago; but even here, the CSA once existed. Where does bitcoin get its value? I don't know.

But the thing that gets me is how can it be spent, not replicated, and done so digitally in a de-centralized manner? WDF?!? How is this done? What do they mean by "mining" and the use of supercomputers? Do they get a bunch of super-large prime numbers and multiply them and then have others figure out the original prime numbers—would these be the bitcoins? How would such be spent and not multiplied? Duplicated? And how is it soooooo superior to the aforementioned ways of cheating on taxes or illegal trade?

Again, the intro and article pretty much says nothing to me. Sorry. (Guess there won't be anything for possible wiktionary:Bitcoin or wiktionary:bitcoin entries. Huh?)     :-/
Civic CatTalk to Civic Cat 22:05, 12 December 2013 (UTC)

Hmmm. Seems there are entries in Wiktionary; and cp:Bitcoin too—last entry almost 2 years ago though. :-)Civic CatTalk to Civic Cat 22:30, 12 December 2013 (UTC)
Bitcoin is spent by effectively shouting into the network "HEY EVERYONE! I'M SENDING X AMOUNT TO ADDRESS Y!". That shouted statement is signed via public key cryptography, which establishes that you control (by way of possessing the private key(s)) the funds being sent. Miners then take that transaction and record it into the blockchain (which is like a massive accounting ledger containing every bitcoin transaction ever) in a computationally intensive manner (a "proof of work" system) that makes it near-impossible to modify or reverse. Bitcoins can't be duplicated because there's nothing to duplicate. They're not discrete pieces of data. They're numbers in an accounting ledger. Compro01 (talk) 22:51, 12 December 2013 (UTC)
I'll give your response a better thinking it deserves later. The thing is, where did one get the keys? How are such handled? How does one know that another has the legit keys? "Bitcoins can't be duplicated because there's nothing to duplicate. They're not discrete pieces of data. They're numbers in an accounting ledger." Nothing save perhaps the key. But more later. It's cold and I'm listening to a Japanese cover of Siberian Khatru to celebrate-it-sort-of. Cheers.Civic CatTalk to Civic Cat 23:13, 12 December 2013 (UTC)
  1. The keys are created by you, as if you set up a numbered Swiss bank account (account numbers=address) with a password (password=private key).
  2. Not sure what you mean by "handled"
  3. You determine that by checking with the public key. If the signing checks out against the public key, that means the person who signed the transaction has the private key, and thus control of the public key/address and the value it contains.
  4. Duplicating the key wouldn't do anything to the value. Going back to the Swiss account, if you took the account password and wrote it out a thousand times, it wouldn't change the amount in the account.Compro01 (talk) 16:40, 13 December 2013 (UTC)

External link cull[edit]

Culled the increasingly unwieldy list back. If it's relevant, it should probably be worked into the article - David Gerard (talk) 17:15, 5 March 2014 (UTC)

A minor question for pedants[edit]

Why is "Bitcoin" usually capitalized when dollars, euros, rand, rubles, pounds, francs, kroner, yen, and pesos are not? TeenageWasteland (talk) 01:55, 7 March 2014 (UTC)

Convention! - David Gerard (talk) 11:22, 7 March 2014 (UTC)
The latter group are currencies. Octo8 (talk) 11:27, 7 March 2014 (UTC)
Bitcoin is an online/virtual....currency, no? TeenageWasteland (talk) 14:35, 7 March 2014 (UTC)
Probably Possibly 'cause there's more than one variety of all?/most? of the others & only one of bitcoin? Scream!! (talk) 14:38, 7 March 2014 (UTC)
I was making a joke, TW ;) That being that no matter its fanboys' claims, Bitcoin is no real currency. Octo8 (talk) 19:16, 13 March 2014 (UTC)
I don't see "dollar" capitalized much (as it's not really a proper noun without further elaboration, as there are like a couple dozen currencies called the something dollar), but I do see properly named dollars and other currencies capitalized e.g. "United States Dollar", "Canadian Dollar", "Swedish Kroner", "Swiss Franc", "Euro", etc. Bitcoin is the proper name in and of itself, same as with the Euro, thus it gets the capital. Compro01 (talk) 15:33, 7 March 2014 (UTC)
Where do you see those instances of upper-case currencies? The BBC, NYT, WAPO, Times of London and the Guardian don't do that. TeenageWasteland (talk) 15:52, 7 March 2014 (UTC)
CBC does. Though I was mostly talking about general discussions online rather than in the news. Compro01 (talk) 16:32, 7 March 2014 (UTC)
The convention is that when referring to the project, technology, software etc we use "Bitcoin" because as the name of a protocol or piece of software it's a proper noun. When referring to a unit of the currency "bitcoin" or "bitcoins" is appropriate, keeping in line with common use of "dollars" or "euros." In short it's a side effect of the unit of currency and the protocol/software that makes it work having the same name.--70.170.95.122 (talk) 19:15, 13 March 2014 (UTC)

Ripple?[edit]

Is this even a thing worth mentioning yet? - David Gerard (talk) 17:51, 30 March 2014 (UTC)

Anonymity[edit]

The real and overriding issue with Bitcoin is that it does practically nothing that isn't already possible, ...

What about anonymity? Is that something that's been possible in digital currency without using Bitcoin? (Of course, anonymity doesn't outweigh the many disadvantages of the currency.) Swerve (talk) 02:40, 8 May 2014 (UTC)

I believe that sentence was was talking about currencies in general (and remember that most digital currencies already mimic Bitcoin because it was the first "true" example). Bank secrecy has existed for 80 years, and will likely stay around for much longer. Osaka Sun (talk) 03:37, 8 May 2014 (UTC)

Holy fuck, the plummet[edit]

[2] 2h chart for the past week, 1d chart for the past few months. /r/bitcoin looks very like an ocean of panicked Ponzi bagholders. What happens when the perfect deflationary currency goes inflationary, when enthusiasts can praxeologically prove that can't happen - David Gerard (talk) 14:21, 5 October 2014 (UTC)

Anyone feel up to writing up the Mt Gox scam?[edit]

The price rise and bubble in 2013 was largely artificial. [3][4][5] This should probably be a section itself. Anyone feel competent to write it up? - David Gerard (talk) 20:23, 5 October 2014 (UTC)

If this was recent I'd put it on clogs[edit]

The eyes. You cannot look away from the eyes. - David Gerard (talk) 22:00, 8 October 2014 (UTC)

Spotted on /r/buttcoin[edit]

'Satoshi Nakamoto is an anagram of "So a man took a shit."' (And "Mark Karpeles" is "sparkle maker".) - David Gerard (talk) 22:01, 10 October 2014 (UTC)

51% cannot do "anything they like"[edit]

"Since mining is the "core of the Bitcoin protocol," there is the possibility of what is termed a "51% attack," where miners could consolidate into a cartel to exceed 50% of the mining power (yes, a de facto monopoly) and so could unilaterally ratify the entire blockchain to do anything they like."

This is not strictly true. They would not be able to get coins out of someone else's wallet if they don't have that person's private key.

See http://bitcoin.stackexchange.com/questions/658/what-can-an-attacker-with-51-of-hash-power-do — Unsigned, by: Ike / talk / contribs

I'd say it's fairly obviously do anything they like with the blockchain. They also can't crash the moon into the earth, for example - David Gerard (talk) 16:31, 7 November 2014 (UTC)

They can't create a transaction that isn't signed. If they create such a transaction, any client can easily see that it isn't signed. Did you read my link?Ike (talk) 16:48, 7 November 2014 (UTC)

"Attacker has a lot of computing power

An attacker that controls more than 50% of the network's computing power can, for the time that he is in control, exclude and modify the ordering of transactions. This allows him to:

Reverse transactions that he sends while he's in control. This has the potential to double-spend transactions that previously had already been seen in the block chain. Prevent some or all transactions from gaining any confirmations Prevent some or all other miners from mining any valid blocks

The attacker can't:

Reverse other people's transactions Prevent transactions from being sent at all (they'll show as 0/unconfirmed) Change the number of coins generated per block Create coins out of thin air Send coins that never belonged to him" Ike (talk) 16:49, 7 November 2014 (UTC)

Fair enough. Feel free to put in an alternate wording, hopefully avoiding over-jargoning an already technical paragraph - David Gerard (talk) 18:24, 7 November 2014 (UTC)
How's that? Ike (talk) 19:23, 7 November 2014 (UTC)

The fire story is true[edit]

The link posted only said that some of the details were wrong, not that the fire didn't happen. Here is a better source: http://www.popularmechanics.com/technology/gadgets/tech-news/this-is-what-happens-when-a-bitcoin-mine-burns-down-17410755

Fair enough for a better story. It's still pretty tangential to the paragraph, though. YMMV - David Gerard (talk) 17:37, 12 November 2014 (UTC)
OK, I will add it to the existing footnote on fire. That should be satisfactory. --Bongolian (talk) 20:20, 12 November 2014 (UTC)

The article still hasn't been fixed[edit]

Over a year ago I've brought to your attention the terrible state of the article. Instead of "rationally" presenting Bitcoin you're just spreading myths and nonsense, with tons of factual errors and biased interpretations. Mintz has also offered a critique. I look at it now and it still looks like it was written by a 12-year old. You all should be ashamed. What do you have to say for yourselves?

(This is rhetorical, I have no intention to engage in discussion here because from my past experience here I know that RW regulars visiting this article have no interest in reasonable debate. I'll make do with offering you another opportunity to reflect on your wrongdoings. And yes, I know I once again sound like a troll. When you have an article that is this bad you should expect this kind of comments. PS I'm not hiding behind an anon IP address, I just won't bother to create an account. My name is Meni Rosenfeld, feel free to look me up.) 77.127.88.240 (talk) 22:33, 15 November 2014 (UTC)

In answer to your question, rhetorical though it may be, I have nothing to say for myself. (I have no interest in reasonable debate. I'll make do with reflecting on my wrongdoings.) Fonzie (talk) 23:48, 15 November 2014 (UTC)
"I look at it now and it still looks like it was written by a 12-year old. You all should be ashamed. What do you have to say for yourselves?" Look at the date of that Mintz discussion. Look at the price. Look at it now. And don't give us the "Oh, that was all speculation, everything's fine now!" excuse. Osaka Sun (talk) 00:59, 16 November 2014 (UTC)

True value of fiat currency[edit]

The article currently says:

Bitcoin is an entirely imaginary currency (i.e., has no use-value), but not particularly more so than US dollars, and could be a general currency if 300 million people similarly behaved as though it was one, i.e., would do work in exchange for it.

This ignores the fact that the US government requires payment of taxation in US dollars and can compel you to pay it with force, so anyone operating in Bitcoins, or Dogecoins, or whatever, will still at some point have to convert to US dollars meaning it will always maintain a value. - π 00:37, 16 November 2014 (UTC)

Okay I see the "citation" says that. - π 00:39, 16 November 2014 (UTC)

Term for "51% attack"[edit]

In a cursory Googling, "51% attack" gets "about 398,000 results"; "Goldfinger attack" gets 329 - as far as I can tell, almost nobody uses that term. "Operation Grand Slam" as a section title is amusing, but not informative, so I gave the section back its boring title. Are there any other terms for a 51% attack that non-negligible numbers of people use in the wild? - David Gerard (talk) 12:58, 17 June 2014 (UTC)

No--72.196.9.223 (talk) 13:06, 30 November 2014 (UTC)

Ancaps[edit]

Isn't bitcoin more of a libertarian thing? Even ancaps and Austrians think Bitcoin is silly, if a through and rigorous investigation (that consists solely of wading through ancap subreddits) is indicative. |₹Λ¥$€₦₦ Red rose 02.svg I'm a survivor, keep on survivin' 21:29, 28 November 2014 (UTC)

In late 2014, everyone on Reddit who isn't actually in /r/bitcoin thinks Bitcoin is silly, and half of them do too. Ancaps and Austrians thought it was dandy when it was going up, uP, UP!!1! - David Gerard (talk) 01:00, 29 November 2014 (UTC)
To my knowledge, the a large portion of Bitcoin advocates I know online and offline and a few core developers are ancaps. It is a governmentless currency... seems like it would appeal to ancaps more than anyone.--72.196.9.223 (talk) 13:11, 30 November 2014 (UTC)

Not sure how this website defines "rational" in terms of Bitcoin[edit]

I just finished reading over the entry on Bitcoin, the writer is obviously a Bitcoin critic, which is fair. Bitcoin has a lot of flaws and problems. It is good to draw attention to them. At the same time there are a lot of very intelligent people who see quite a lot of possibilies in Bitcoin. A truly rational essay, that's what this site supposedly prides itself as being (right?), would have fair viewpoints from both partisan sides.

The problem I find most often with people following Bitcoin is that the can be broken out into two rabidly fanatical camps. Pro-Bitcoin and Anti-Bitcoin. What I like to term "The Priests & The Pornographers"

The Priests are the guardians of the old gospel. They consist of the majority of /r/buttcoin and the Somethingawful forums. To them the system works this way, and there any change is, while not necessarily bad, definitely suspect. They are the defenders of the status quo. And when they approach the subject of Bitcoin their criticism is shallow, sometimes flawed, and often outright lies.

The Pornographers are metaphorically the Pro Bitcoin crowd. They are a group who is so out of touch with habits, needs, and mores of regular folk that the their exhibitionist Libertarianism becomes so offensive that it is all anybody looks at. At the same time this group is historically the first to grab hold of new technology and try to use it to peddle their freemarket ideological smut.

The first group is all about anti-bitcoin sermons while looking at the pro-bitcoin folk as a source of titivation. The second closes their mind to all criticism no matter how legitimate. Both groups approach bitcoin from their own respective, close minded, cultish echo chambers.

The thing is neither group is at all rational or objective. It is all emotional, biased, and frequently involves magical thinking on both sides of the debate. — Unsigned, by: 174.20.10.140 / talk / contribs

This is like creationists trying to define "pro-evolution" as a religion - David Gerard (talk) 10:03, 29 November 2014 (UTC)

No this is an observer who has participated on both sides of the debate saying that your position is more like Calvinists arguing with Jesuits. In that both sides are frigging cultists nut-jobs. Even if they can't realize it themselves. And no I'm not a hodler. I think Bitcoin is doomed to fail spectacularly. That it has innumerable problems throughout. I just think that the Buttcoin people are every bit as nutty as the bitcoiners.

Okay, anonymous dude(tte), what would reasonable, rational criticism then look like (some specific examples would be a nice bonus)? I can see that you agree that Bitcoin and similar systems are hardly flawless and that collapses have been rather more frequent among "virtual currencies" than among mundane national ones. ScepticWombat (talk) 11:51, 29 November 2014 (UTC)

Point out all the flaws. Point out the sheer energy consumption. Point out the thefts and security issues. Point out the scalability issues. Point out the libertards. But don't forget to point out the VC funding pouring in. Mention the Bitcoin 2.0 stuff that is actually starting to be used in the mainstream (IBM has forked Ethereum, Citibank has a team looking at how to add Ripple as an alterantive to SWIFT) I honestly don't know. It is just the tone of the piece that bothered me. There are some very intelligent, very knowledable, people who are excited about crypto (Bill Gates, Mark Andreessen, Ralph Merkel) to just dismiss the technology out of hand.

I mean, half the time I read from the Buttcoiner "what can bitcoin do that paypal cant" and yet here is the President of Paypal reaching out to Vitalik (https://mobile.twitter.com/davidmarcus/status/456292516455673857) — Unsigned, by: 174.20.10.140 / talk / contribs

Actually, I think we can get on the same page in regards to this. The article is not intended to bash advances in cryptography — the proposition that some of the Bitcoin infrastructure could be adapted large-scale to make issues like time lags and transaction fees a thing of the past is fascinating (it's mentioned only briefly in the Salmon piece and I wouldn't mind expanding on that).
Unfortunately, the system is hampering the technology, and authorities who heap praise on its promise are not being candid enough (e.g. Gates believing it's currently a "cheap" investment). Bitcoin is not being advertised as something you could tinker around with; people are rather investing millions on the assumption that the financial "establishment" should completely disappear and that the currency is working exactly as Nakamoto wanted it to. (Andreessen is proving Homo economicus wrong as we speak.) And the scary thing is not that advocates are looking at it through rose-tinted glasses (that's just groupthink), it's that there is no incentive to change the protocol when the shit hits the fan. If the Bitcoin Foundation starts fraying away at decentralization, they're done for. Osaka Sun (talk) 14:36, 29 November 2014 (UTC)

BTW, if anyone's wondering at the recent burst of euphoria, this article got linked on /r/buttcoin (where I'm active) and shortly after on /r/bitcoin - David Gerard (talk) 18:58, 29 November 2014 (UTC)

"the proposition that some of the Bitcoin infrastructure could be adapted large-scale to make issues like time lags and transaction fees a thing of the past is fascinating" - This is not the value proposition of Bitcoin, in fact due to the physical limitations of the speed of light and the cost securing the decentralized network, Bitcoin is at a significant disadvantage in both lag and will require a fee. You can invoke trust and have near instant transactions, but that removes many of the benefits of a trustless network.--73.168.27.59 (talk) 20:43, 1 December 2014 (UTC)

Beware the Middleman: Empirical Analysis of Bitcoin-Exchange Risk[edit]

The article really needs a section that's just a catalogue of the scams. This paper would be a good reference starter. Are there any Bitcoin businesses that aren't full of crooks? Even the Bitcoin Foundation recently accepted a self-admitted Ponzi scheme as a logo sponsor - David Gerard (talk) 11:05, 1 December 2014 (UTC)

I agree. It is important to talk about how terrible the Bitcoin ecosystem is.--73.168.27.59 (talk) 11:20, 1 December 2014 (UTC)
Here is a good place to find Bitcoin thefts https://bitcointalk.org/index.php?topic=83794.0
It is important to note that many major "banks" (they SHOULD NOT be acting as banks and don't have the specialists necessary) have bad practices. Namely Coinbase which rewrote consensus code and had their consensus broken which allows doublespending by low hashrate miners. Coinbase has rewritten consensus code once again, but they admitted that they aren't using the code in production themselves. It is strange that they aren't including some warning to not use it in production code though since they themselves have learned not to.--128.211.171.2 (talk) 14:35, 1 December 2014 (UTC)
My favorite part is the probability of breach chart where the 90% confidence interval dead ends on 100% chance for large exchanges. Ikanreed (talk) 15:17, 1 December 2014 (UTC)

Various Edits For Accuracy[edit]

49% attacks:

49% attacks are forcing large reorgs without guarantee. In the http://rationalwiki.org/wiki/Bitcoin#The_51.25_attack section it is mentioned that GHash performed a 49% attack. This is incorrect, no reorgs were forced. They simply doublespended losing bets and included the doublespends in blocks they won. If they lost they mined on the block that made them lose. This is a Finney attack and I have edited to reflect that.

Imaginary currency:

It is mentioned that Bitcoin is an imaginary currency is the http://rationalwiki.org/wiki/Bitcoin#Economics section. This is just silly. It is reasonable to think Bitcoin is a scam, but it is by no definition imaginary.

Diseconomies of scale:

Bitcoin has economies of scale in managing and buying mining rigs, but it has diseconomies of scale in terms of electricity. Running a mining rig can be used to heat your home therefore the electricity can be considered free if you are substituting your homes heating with a mining rig.

Doublespending:

"blockchain to do things like double-spending their own coins" limits miners to double spending *their own* coins. They are free to enter contracts to doublespend others coins, thus "blockchain to do things like double-spending confirmed transactions"

Poorly traded:

"bitcoins are being generated by people running hashing algorithms to process transactions on a poorly-traded virtual currency" Poorly traded is irrelevant to the hardware section and poorly explained. It leaves me wondering what poorly-traded means.

Protein Folding Scamcoin:

Removed "If only they'd based it on protein folding."

Basing your PoW on something on protein folding removes many of the security assumptions including the assumption that it isn't optomizable. SHA2 is simple and a problem designed by humans to have certain properties. Protein folding is a problem of nature that isn't designed to have those properties. Because an explanation for why CureCoin is mostly worthless would be irrelevant, I have just removed it

Devcoin Scamcoin:

"Devcoin which was designed to pay as rewards to open source developers" Removed because devcoin is centralized and irrelevant.

Altcoin Reasoning:

"most of the value proposition of Bitcoin is the strictly limited quantity available, and they perceive altcoins as undermining their hloding, instead suggesting"

Is incorrect. Most Bitcoin users are fine with non-scamcoins such as Namecoin. I have changed this to reflect their dislike of scam altcoins.

--72.196.9.223 (talk) 01:11, 30 November 2014 (UTC)

The point about using your rig as a heater is not really relevant on the scale that paragraph is addressing, especially since it's clear that there are strong enough economies of scale to lead to GHash's majority.
Calling it a "Finney attack" is less clear to anyone outside the Bitcoin community than calling it a "49% attack".
~One transaction per second is actually quite "poorly-traded" for a currency.
The limited availability of bitcoins is often held up as a virtue and so that is actually a common issue claimed with altcoins. That they are considered scams is already mentioned. You also made a number of typos in this section
The section about Curecoin is snark that turned out to be accurate. Insert a line about security risks after it instead of deleting it.--TiaC (talk) 01:30, 30 November 2014 (UTC)
It is relevant because it considers both sides of the centralization problem that may lead to a 51% attack.
Calling it a Finney attack is correct and a 49% attack is incorrect. It is better to use the term that accurately describes the scenario than the one that is better known. I have edited it back to Finney and linked to a page explaining Finney attacks.
Poorly traded is irrelevant in that paragraph. I have edited "Its biggest problem as an exchange medium is that it is not widely accepted, and that transaction volume is thus very thin." in the economics section. It is relevant here and sufficient to only explain the issue here.
Apologies for the typos. I will modify the section to reflect both sides (scarcity and scam reasons for disliking).
Will expand on curecoin

--72.196.9.223 (talk) 01:45, 30 November 2014 (UTC)

About the double-spending: please look earlier in the talk page (by 51%) for the source that a 51% attacker can only double-spend its own coins. That's because it can only create transactions at all from wallets that it has the private keys to.Ike (talk) 01:49, 30 November 2014 (UTC)
You aren't required to create a transaction a transaction to doublespend it. That page isn't exhaustive.
--72.196.9.223 (talk) 01:52, 30 November 2014 (UTC)
Can you source that, then? As I understand bitcoin, to spend anything at all you need a private key for where the coins are currently. Even if you reverse recent transactions, you still can't spend the coins unless they were in your own wallet recently (the further back, the harder).Ike (talk) 03:37, 30 November 2014 (UTC)
I think we are speaking past each other. The miner can *help* you doublespend and collude with you. They can't force you to doublespend.--72.196.9.223 (talk) 10:32, 30 November 2014 (UTC)

"And I don't think anyone honestly cares that altcoins are "hurting" Bitcoin's image" - Osaka Sun

I would disagree strongly speaking as someone that regularly speaks to people involved in Bitcoin. I don't think anyone is legitimately concerned with Bitcoin being taken over by these scamcoins, but they are worried about noobs investing in scamcoins and being scared away from cryptocurrencies.

--72.196.9.223 (talk) 03:14, 30 November 2014 (UTC)

"I would disagree strongly speaking as someone that regularly speaks to people involved in Bitcoin." You're putting that indistinguishably from disliking competition. From the outside view, how are they more scams than Bitcoin? Bitcoin being the one substantially mined early-on, then released to suckers who thought they were smarter than the common man. (Big libertarians preying on smaller libertarians. The immaculate con is to make the sucker think they're the conman.) I'm really not seeing what makes Bitcoin less of a scam in practice. Which of your criticisms of altcoins don't apply to bitcoins? - David Gerard (talk) 09:26, 30 November 2014 (UTC)
That is a great question. Luke-Jr puts it better than I could https://bitcointalk.org/index.php?topic=23768.msg3815348#msg3815348
I should note that it is still reasonable to claim Bitcoin may be pump and dump scheme (it is yet to be determined whether Bitcoin will provide a net positive value to the world), but it is unreasonable to NOT call these altcoins that don't provide any innovation scams.--72.196.9.223 (talk) 10:32, 30 November 2014 (UTC)
But that's not more of a problem than Bitcoin already has, and the innovation they do provide is competition and a way out of the 21-million coin limit. (Whether this is an innovation of any value depends on cryptocurrency being an innovation of any value; if the latter, then I submit the former.) Luke-Jr's post's only substantive point is "but we were the first and worst". He doesn't actually say anything other than "they're the competition and don't have a value proposition"; Bitcoin doesn't have one either on that level - David Gerard (talk) 16:23, 30 November 2014 (UTC)
I'm not sure what you mean by "a way out of" the 21-million coin limit. Is the number 21,000,000 problematic? None of these altcoins advertise themselves as being a way out of the 21,000,000 coin limit, so I'm not sure what your point is here. The phrase "first and worst" is misleading since it implies these trivial changes provide an advantage for the altcoin. Bitcoins value-proposition is that it is the first trustless currency and it has the network effect. Bitcoin is used for many purposes (including speculators using it to make themselves wealth), but one of the purposes is being a trustless currency. Because the role of trustless currency already exists, these altcoins only exist to make their creators and speculators rich, they don't have any value other than that. His argument isn't that they're competition, it's that they shouldn't have existed in the first place since software doing that already existed. Bitcoin is a protocol like HTTP. I'm not going to make HTTPX (a hypothetical HTTP with a slight modification in the header that doesn't provide any value) because there is no reason to, however, if there was money to be made from making HTTPX, a malicious actor (like Litcoins creator) might create HTTPX and lie about it being better and make money from it. HTTPX would be considered a scam (even though it functions as well as HTTP).--73.168.27.59 (talk) 07:31, 1 December 2014 (UTC)
No, it's that the strictly-limited supply is an important aspect. "You can't get any more! You have to get these! Ignore the altcoins behind the curtain, we'll have sidechains any day now!" They don't need to advertise themselves as a way out of that limit, because they obviously are. For "first and worst" not to be true, you'd have to be assuming Bitcoin is perfect and immaculate. I'm not sure your HTTP comparison is very good, given you're comparing an unlimited free-to-everyone protocol to something people are treating as money (and demanding that it be treated as money).
"these altcoins only exist to make their creators and speculators rich, they don't have any value other than that." From the outside view, that sentence works just as well with the word "Bitcoin" in, because that's really obviously the purpose for pretty much anyone presently involved in it. That it has interesting technologies attached (the blockchain ledger is indeed an interesting thing) doesn't change that - and, more importantly, doesn't require the blatant scamminess of the Bitcoin "economy" in particular, the thing you're specially pleading for, attached to it.
You haven't shown that Bitcoin isn't just as scammy as any altcoin. At best, you've only shown it's only just as scammy as any altcoin. Even that's not a sure thing, given the ridiculous hype levels around Bitcoin - David Gerard (talk) 09:49, 1 December 2014 (UTC)
The HTTP comparison works because really Bitcoin is just a money transmission protocol. Unless you add something important to the protocol, there is no purpose for the protocol to exist. Also, I don't think anyone is claiming "we'll have sidechains any day now!"
"From the outside view, that sentence works just as well with the word "Bitcoin" in" - Like I said, it is reasonable to think Bitcoin is a scam, (however due to its innovation over all other currencies, it has purpose other than making its investors rich). "the purpose for pretty much anyone presently involved in it" - This is incorrect, just *most* of the people (it is annoying how many people are interested in Bitcoin for speculation).
"(the blockchain ledger is indeed an interesting thing)" The blockchain doesn't work without cryptocurrencies. It is silly to think the blockchain is interesting, but not Bitcoin.
"You haven't shown that Bitcoin isn't just as scammy as any altcoin." - I don't see how I haven't done so. If you recognize Bitcoins advantages over traditional currencies to be sufficient, then it isn't a scam. If you don't consider them to be sufficient, it is a scam. If it is a scam then so are all other cryptocurrencies (since they share the same properties). If it isn't a scam then you have a protocol that isn't a scam performing a certain task. Any protocols made after that that don't innovate have no purpose since a protocol performing that task already exists. Since it was created without purpose, it is merely there to make the founders rich. Bitcoin on the other hand was created with the purpose of being a trustless currency. Like I have said, it is reasonable to consider Bitcoin a scam, but it is also reasonable to not consider Bitcoin a scam. Altcoins with no innovation, however, should always be considered a scam.
I'm not quite sure how to break this down so it is more understandable. I'll repeat, Bitcoin was created to fill a need. These altcoins are created, but the need for them is already filled.
--73.168.27.59 (talk) 11:19, 1 December 2014 (UTC)
"really Bitcoin is just a money transmission protocol" This is not quite as ridiculously incorrect as claiming Gamergate is about ethics in game journalism, but it's on the same scale. We have a whole article on everything else Bitcoin has turned out to be. I'm really not going to buy your blatantly self-serving claims that altcoins are a scam but somehow Bitcoin isn't - David Gerard (talk) 16:03, 1 December 2014 (UTC)
I don't see the relevance of gamergate here. I also don't see what is wrong with saying Bitcoin is just a money transmission protocol. I could also say "HTTP is just a hypertext transfer protocol" and I would be 100% correct regardless of the product of the protocol (websites). I have explained why you clones of a protocol are useless, but you seem to have made up your mind. If you want to discuss the actual reasoning rather than attacking me (incorrectly stating that my claim is self-serving) then feel free to respond. I enjoy a civil discussion and recognize that I may be wrong, but you aren't making much sense to me, so if you could elaborate on your thoughts it would be helpful.--73.168.27.59 (talk) 19:04, 1 December 2014 (UTC)
I'm going to add everything except "Altcoin Reasoning" and "Scaling" (since those two are still being discussed) if that's fine with you.--73.168.27.59 (talk) 09:37, 1 December 2014 (UTC)

Scaling:

I would like to change "Bitcoin is already failing to scale. It is limited to a worldwide total of 7 transactions per second, due to the design of the protocol." to "Bitcoin is currently failing to scale. It is limited to a worldwide total of 7 transactions per second, due to the design of the protocol. Sidechains would allow an increase in this limit because there would be multiple blockchains, but they present new scaling problems. These problems include potentially not enough full nodes to audit each blockchain and an increased economy of scale in mining." --72.196.9.223 (talk) 13:05, 30 November 2014 (UTC)

I'd leave it until sidechains are more than hypothetical. Is anyone actually using sidechains? AIUI each sidechain is effectively another altcoin - David Gerard (talk) 16:23, 30 November 2014 (UTC)
Sidechains aren't altcoins, but they are altchains. The value of a Bitcoin on one sidechain should be the same as on another sidechain. I would change it is "Bitcoin will fail to scale without major changes." rather than "Bitcoin is already failing to scale".--73.168.27.59 (talk) 07:20, 1 December 2014 (UTC)
Functionally there's little difference, and the Bitcoin community has bitterly resisted such changes to the protocol so far - David Gerard (talk) 09:49, 1 December 2014 (UTC)
There have been plenty of protocol changes. It is problematic to change it in a way that makes not backwards compatible so that is avoided. Sidechains allow you to have new protocol without isolating old versions. There is a difference between altcoins and an altchain. Altchain is to Bitcoin Mainchain as dollar coin is to dollar bill. Altcoin is to Bitcoin as dollar is to Euro.--73.168.27.59 (talk) 19:04, 1 December 2014 (UTC)

49% Attack Continued:

An N% attack where N<50 is an attack where you force a large reorg (create more blocks than the rest of the network is creating and cause everyone to move to your blocks). Here is a good web app to calculate the odds of success: https://people.xiph.org/~greg/attack_success.html

A 49% share of the network hashrate, for example, gives you 95% odds of success. With 30% you only have a 13% chance of winning and when you don't win you lose out on all the rewards you would have gotten from honest mining. I think it is important to hilight that with a Finney attack you don't lose any rewards and your odds of winning are much higher. With 5% of the hashrate a mining pool could have Finney attacked this poker website (which has approximately a 98% return), and made the return ~103%. In other words, a Finney vulnerability is much worse since a 5% mining pool can steal all your money with high probability while with a <=49% attack a mining pool with 5% will almost certainly lose with 6 confirmation security.

I'm pretty sure it wouldn't add a lot - it's a side-mention that such scams attacks are possible and that this actually happens, and a link to a page on the subject for those who care about the details - David Gerard (talk) 09:49, 1 December 2014 (UTC)
By scams do you mean attacks?--73.168.27.59 (talk) 11:00, 1 December 2014 (UTC)
Such attacks, yes - David Gerard (talk) 11:05, 1 December 2014 (UTC)
I mentioned this attack in the article- "... even a confirmation doesn't guarantee your transaction won't be doublespent. Without an active attacker, the Bitcoin network already has ~1.78% of blocks "ignored"[44]. An attacker with less than 51% of the network hash rate can remove a certain number of confirmations with some probability of success[45]. If your confirmation is invalidated then the person sending money to you can steal your money back (doublespend). Of course, if your money can be taken away from you easily then the Bitcoin network has no value. It is yet to be determined whether Bitcoin can solve the issue of groups with lots of hashing power being able to attack the network easily."--128.211.171.2 (talk) 09:29, 4 December 2014 (UTC)

Deflationary Assets Vs Government Controlled[edit]

I think one problem with Bitcoin may be harm to the economy done through the lack of a market planning abilities. Ultimately, ~~my belief is that the positives of not having anyone control a currency outweigh the harm to an economy. Looking at Japans stagnant economy and zero inflation rate policy, one may conclude that deflation harms society though.

Bitcoin can be changed to allow demmurage (similar to inflation), but not through a central authority, rather, through miners deciding. This makes the question "is not having government control a problem for the economy" rather than "is not having inflation a problem for the economy" with regards to Bitcoin. --128.211.171.2 (talk) 09:40, 4 December 2014 (UTC)

The answer to that is the same as the answer to "why aren't we on the gold standard any more?" - David Gerard (talk) 11:04, 4 December 2014 (UTC)
The reason we aren't on the gold standard right now is political. What should be in the article is an explanation of the harm and benefits of a government not controlling a currency. The answer may not necessarily be the same since gold can't have it's inflation or deflation rate set.--73.168.27.59 (talk) 18:31, 4 December 2014 (UTC)
The reason is because free banking leads to a hideous boom and bust cycle that makes our present fluctuations look horrendous. You're asking questions we know the answers to - David Gerard (talk) 18:50, 4 December 2014 (UTC)
I'm not asking the questions, I'm discussing whether it should be in the article.--73.168.27.59 (talk) 19:14, 4 December 2014 (UTC)
Nah, take a look at that "my belief" sentence in your first post. You might not have realized it, but your words activated a magical spell that teleported us to the "debating opinions" dimension. How about you restate your proposed changes to the article without that part. Ikanreed (talk) 19:44, 4 December 2014 (UTC)
Not my intention, I specifically mentioned Japans lost decade as an example of Bitcoins potential harm to avoid this problem. I was just explaining my belief, and my belief isn't valid without reasoning. This is why I was asking him if he wanted the negative economic impact in there. My reasoning for liking Bitcoin is mostly already in the first paragraph: "it uses strong cryptography to prevent users from duplicating money. Bitcoin's independence from the control of governments, corporations".--73.168.27.59 (talk) 20:21, 4 December 2014 (UTC)


Restated Proposal:

Include economic side effects of deflation.--73.168.27.59 (talk) 20:23, 4 December 2014 (UTC)

Hoo boy. That's a big 'un. There's a lot to be said about deflation, and a lot of it is complex and debated, as the near universal conclusion of governing economic bodies is that it's bad for growth. But that's a very top-level conclusion oriented assertion, and there's a lot of theory and history to that that leaves a lot of debate present. I mean just look at what the IMF has to say about it. Ikanreed (talk) 20:28, 4 December 2014 (UTC)
Yeah, a section on it is probably out of the scope of this article. There probably could be a link to [6] since it is the same concept.--73.168.27.59 (talk) 20:45, 4 December 2014 (UTC)

Disappointing[edit]

I made an edit including all the changes I added to the talk page. David Gerard is not a skeptic, he is blindly against ANYTHING I add to the page.

I made an edit including a critical attack on bitcoin (negative for bitcoin, this is probably the most critical attack on bitcoin for the least expense), a correction of terminology (neutral to bitcoin), mentioned diseconomies of scale (positive for bitcoin), and finally included this:

" The most important of these being the inability to predict the value of a hash function without calculating it. With protein folding not being designed to be difficult to predict, solutions may have a big optimization one day, giving attackers with this optimization an advantage."

which TaiC, another admin said to include "The section about Curecoin is snark that turned out to be accurate. Insert a line about security risks after it instead of deleting it."

He reverted the other half of my edit with 'almost all of this edit was "cool story bro"'

It is truly disappointing to see this. And no, this isn't about him disliking bitcoin, I have a paragraph about an attack on Bitcoin that is well cited that he deleted. I didn't touch the parts of the page such as the altcoin mention since he disagrees.

In the pages discussions he has been incredibly obtuse, making strange illogical arguments rather than addressing the issue:

'"really Bitcoin is just a money transmission protocol" This is not quite as ridiculously incorrect as claiming Gamergate is about ethics in game journalism, but it's on the same scale. We have a whole article on everything else Bitcoin has turned out to be. I'm really not going to buy your blatantly self-serving claims that altcoins are a scam but somehow Bitcoin isn't - David Gerard (talk) 16:03, 1 December 2014 (UTC)'


This type of behaviour likely wouldn't have happened if I had just gone with the crowd and left the page at Bitcoin is bad for these <incorrect reasons>, but I thought RATIONALwiki would appreciate me removing irrational reasons and adding MORE rational reasons to think Bitcoin is bad.

You may laugh about this, but I think this is a good time to take a moment to look at how your teams biases (and not biases towards rationality) are effecting this wiki.

--73.168.27.59 (talk) 19:46, 4 December 2014 (UTC)

I am incredibly biased. Not about bitcoin. I barely care about cryptocurrencies at all, except in the narrow context of potentially problematic black markets. But I promise, everyone here has seen this exact screed before with some words swapped out here and there. Click the random article button a few times. When you find an article with a talk page: scroll down to the first post by an anonymous IP(take another random article if there isn't one). See if there's a substantial difference between what you've posted and what they've posted. I'll be even odds that you won't. Ikanreed (talk) 19:54, 4 December 2014 (UTC)
So my lack of an account is the issue?--73.168.27.59 (talk) 20:12, 4 December 2014 (UTC)
No. It's just that new users tend to think that they've got the unique ideas no one has seen before, and wiki collective is suppressing. An account would help your credibility(unless you build up a negative reputation) but it's not the point. My main point is the "but I thought this was RATIONALwiki"(yes, we are) and "You have a bias"(yes, our articles do) just don't work as arguments the way you're thinking, and we've seen them thousands of times before, and almost exclusively it's about one crank idea the individual newcomer is sure is rational. Ikanreed (talk) 20:24, 4 December 2014 (UTC)
The thing about my ideas are that they are supporting his viewpoint for the most part. I didn't claim his bias is for one idea or another, but against me editing. I'm not exactly sure how to interpret his comments, but I think he's implying they're trivial edits. Here is the edit where he removed it. In order, the first edit is slightly positive explaining that Bitcoin isn't necessarily guaranteed to become centralized. This is useful for when Bitcoiners may say "haha, look they were wrong, this discredits their whole article", however there are many good points made in the article. In that same paragraph I clarified that mining pools exist to decrease variance (neutral), then I wrote a paragraph explaining an attack on Bitcoin (negative for bitcoin). I wrote a few small edits and included a section requested by a janitor.
I would prefer this page not have any inaccuracies since it may lead to the rest of this page being dismissed, therefore I edited out minor errors like the misuse of "49% attack".--73.168.27.59 (talk) 20:37, 4 December 2014 (UTC)
(EC)I can see why you'd be frustrated. I can't address the factual merit of your edits, but I can say something about your writing: it made the article seem rougher and less coherent. I'd volunteer to jump in and polish it if I were sure the facts were solid, too. However, from the discussion above (thank you for discussing it as you apparently did), it seems that you hadn't persuaded the locals. That's likely where your changes went awry. You were doing a good job of talking it over. You were on the right path to changing something (not everything) and then ... frustration. Nothing personal, your were just not yet persuasive.MarmotHead (talk) 19:57, 4 December 2014 (UTC)
I tried discussing and included everything I thought wasn't controversial (basically everything that wasn't disagreed with), but I guess I can't include anything because it's a "cool story bro" edit. I appreciate the commentary on my writing style though. If the undo edit said "make things more coherent" rather than "cool story bro" I would have done so.--73.168.27.59 (talk) 20:12, 4 December 2014 (UTC)
You don't seem to have understood the objections to your marvellous propositions, and then you add more on top - David Gerard (talk) 21:05, 4 December 2014 (UTC)
I tried to add only things that weren't controversial. There also wasn't a response to "I'm going to add everything except "Altcoin Reasoning" and "Scaling" (since those two are still being discussed) if that's fine with you" for three days while you were editing the page. Apparently I failed and I included controversial things. I just realized I misread your section about 49% where you said you only wanted a side mention of the 49% attack, however that was only this edit which could have been reverted by itself.
It is pretty condescending to sarcastically call my edits and talk pages "marvelous propositions". I am just trying to make the page more accurate.--73.168.27.59 (talk) 22:05, 4 December 2014 (UTC)

"prosecution futures"[edit]

I found a few sources for this marvellous phrase in January, all leading back to this NYT story on Silk Road:

“Bitcoin isn’t really a ‘coin’ as much as a distributed, public balance ledger,” Mr. Weaver added, “with every balance and transaction recorded.” Hence Bitcoin’s wry new nickname in legal circles: “Prosecution Futures.”

Anyone heard it elsewhere, or via someone other than Nicholas Weaver? - David Gerard (talk) 18:31, 10 December 2014 (UTC)

An apology to IP: I was wrong, a lot of alts are *even scammier*[edit]

Per recent edits, the IP above was right: a lot of alts are even scammier than Bitcoin. Oh boy - David Gerard (talk) 12:02, 4 January 2015 (UTC)

Prediction of the bitcoinpocalypse[edit]

http://arxiv.org/pdf/1405.0534v11.pdf

Spotted on /r/buttcoin. "'m on page 30 of this paper and it is FUCKING AWESOME! It contains the perfect amount of bitcoin bitch slaps, while maintaining a level of professionalism. My guess is that this paper in rough draft form contained at least 72 "bitcoin is totally fucking stupid, and yet, here we are"" - David Gerard (talk) 18:20, 14 January 2015 (UTC)

Pump and dump[edit]

Looking at the history of the article I see that we have been calling this a Pump and dump scheme since the article's inception in June 2011. As it's now 2015 that seems rather a long time, as I was under the impression that "pump and dump" usually works on a shorter time-scale. Or are we suggesting that it's still being "pumped" and the "dump" is yet to come?--Coffee (talk) 19:02, 14 January 2015 (UTC)

Didn't Mt Gox already do it once? --Someon (talk) 19:21, 14 January 2015 (UTC)
The big hodlers got coins at costs of cents a coin - David Gerard (talk) 21:55, 14 January 2015 (UTC)

Name for Bitcoin "Enthusiasts"[edit]

I propose that we refer to such a person as a "bitwit". Rhymes with "nitwit". CorruptUser (talk) 19:45, 29 March 2015 (UTC)

"Hodler" will do. Standard greeting: "Sorry for your loss" - David Gerard (talk) 22:55, 29 March 2015 (UTC)

Blockchain woo?[edit]

Is it just me or have blockchains been hailed as the solution to pretty much everything by Bitcoin enthusiasts? Could this be the woo to end all woo? —ShapeshiftingLizard ~▲~ hear me roar ~▲~ 00:29, 7 November 2015 (UTC)

They're using "blockchain" as a euphemism for "bitcoin". Sadly the former has also been cycled through the euphemism treadmill. The next term in sequence is not clear - David Gerard (talk) 00:50, 7 November 2015 (UTC)
They're using "blockchain" as a euphemism for "bitcoin".[citation needed]
You may be getting confused with side chains here Deku-shrub (talk) 19:46, 5 February 2016 (UTC)

24 GW?[edit]

When is that figure being published? I think we can calculate the updated figure if necessary. Thieh"6+18=24" 00:59, 1 December 2015 (UTC)

That was in the referenced paper, where the numbers were fuzzy but it was accurate within an order of magnitude. Which is a rather wide range, but even the lower end of it is fucking ridiculous.
I'm not sure what current usage would be, for an updated number one would have to basically do the paper again - David Gerard (talk) 14:14, 4 December 2015 (UTC)
Your edits are fine. I put it in GWh because energy more easily translates to carbon, but power (GW) is possibly more immediately comprehensible to the casual reader - David Gerard (talk) 11:15, 5 December 2015 (UTC)
The Bitcoin FAQ has this to say btw:
Spending energy to secure and operate a payment system is hardly a waste. Like any other payment service, the use of Bitcoin entails processing costs. Services necessary for the operation of currently widespread monetary systems, such as banks, credit cards, and armored vehicles, also use a lot of energy. Although unlike Bitcoin, their total energy consumption is not transparent and cannot be as easily measured.

Bitcoin mining has been designed to become more optimized over time with specialized hardware consuming less energy, and the operating costs of mining should continue to be proportional to demand. When Bitcoin mining becomes too competitive and less profitable, some miners choose to stop their activities. Furthermore, all energy expended mining is eventually transformed into heat, and the most profitable miners will be those who have put this heat to good use. An optimally efficient mining network is one that isn't actually consuming any extra energy. While this is an ideal, the economics of mining are such that miners individually strive toward it.
Credit cards also use energy, so therefore wasting more energy on this is okay. And maybe at some point in the future it will cost less energy, so therefore what's the problem? Carpetsmoker (talk) 12:44, 5 December 2015 (UTC)
The cost per transaction with Bitcoin is ludicrous compared to the cost per transaction for e.g. Visa. They're literally claiming "we don't have a number so therefore they might be as bad as us." And Bitcoin is observably bad. Remember that whereas banks use entries in a database, Bitcoin uses "proof of work", i.e. literally wasting electricity in an arms race; it is constructed to be wasteful - David Gerard (talk) 15:01, 5 December 2015 (UTC)
To be fair, Credit cards charges ~1.5%-3% per transaction. So Bitcoin transaction would be on par if the average transaction size is ~$600 worth of bitcoin (I have no idea how much a typical transaction would be)? K61824TK = Terry Koeckritz 00:04, 12 December 2015 (UTC)
That's not the cost in energy per transaction, which is what we were just talking about - David Gerard (talk) 13:51, 12 December 2015 (UTC)

mid-December 2015[edit]

If bitcoin uses too much energy to be economical, why not switch to one of the altcoins? Also could bitcoin spur wind and solar as one can turn off the computers during calm nights, while exploiting the sources when the sun is shining or wind blowing a lot?Civic CatTalk to Civic Cat 22:21, 16 December 2015 (UTC)

Renewable energy isn't really something that libertarians are known for giving a shit about. WeaseloidWeaselly.jpgMethinks it is a Weasel 01:05, 17 December 2015 (UTC)
True, but if the costs go down enough, they might. I'm thinking of a few cents per kilowatt-hour.Civic CatTalk to Civic Cat 19:08, 5 February 2016 (UTC)
Which would require resources to support. Just to power the processing and the 7 GW estimated for 2015 energy usage, which seems on track, would require a renewable power source about equal to the wp:Grand Coulee Dam (6,809 MW) the 6th largest dam. Which for all three power plants is about $1 billion, 550 feet x 5,223 feet x 30 feet of concrete/steel, non-renewable transport (with current gas/oil), the land for the dam/lake, and at least $1 million a year in maintenance just to hash out bitcoins. Where is this money supposed to come from? -EmeraldCityWanderer (talk) 20:21, 5 February 2016 (UTC)
I'm thinking something like one wind turbine in use when the weather is at it's 10% windiest.Civic CatTalk to Civic Cat 21:20, 5 February 2016 (UTC)
The large offshore wind turbines generate a maximum (as of now) of 6 MW, which is about 2x their average operational generation, not even enough to generate the amount of power required for 2013 bitcoin hashing and 1,000 times less than required for 2015 estimates. They also run about $2.1 million per MW before installation. You really need to do some actual research in these topics because it doesn't seem very grounded in reality and these figures are coming from readily available Google searches from renewable power organizations. -EmeraldCityWanderer (talk) 21:40, 5 February 2016 (UTC)

Yes, I should do some research, and I'll read the pages you linked to. Until then, here's this:

Okay, my understanding of bitcoin is still limited. It still haven't figured out the term "hash" (inevitable thoughts of hash browns, and occasionally hashish comes up), public keys, private keys, etc: of which Wikipedia and RationalWiki have been pretty well no help to me (and likely others)—however well-intentioned editors have tried. Even the simple English WP on the article.

So when you're dealing with me on this issue, you're dealing with someone with a fair amount of ignorance.

I get a bit annoyed when the electrical output of a dam or other electrical plant is measured only in units of power rather than energy.

What is meant by the term "7 GW" any way? Is that 7 joules expended over a period of 1 nanosecond?

Okay, let me guess: 7 gigawatts, and given there are about 31 557 600 seconds a year, that'd be 220.9 petajoules, or 61.362 terawatt-hours, a year.

At 7 gigawatts, if the average household used 1 kilowatt continuously, one would need the equivalent of 7 million households to keep bitcoin going.

At, say, 10¢/kilowatt hour, that'd cost $6.1362 billion. That'd be what, a few $100s, maybe several $10s, per bitcoin processed a year? Whatever.

Again, why not use an alt-coin: I presume the processing would use far less electricity.

At any rate, I reiterate more explicitly what I mentioned earlier. Correct me if I'm wrong, but one of the biggest, perhaps 'the' biggest, obstacle to developing renewable forms of electricity is storage. Wind and solar is great, but what about when the wind doesn't blow nor the sun shines.

Now despite all the talk about technological achievements, and even accelerated change—this after a month where noted musicians were dropping like flies, many not reaching 75 years in age, oh and that 3-D printed kidney of 2011 has yet to lead to not needing kidney donations, with this in mind, I figure the development of the most used form of storage for electricity, the battery, is still likely pathetic.

I ask you, is there an electric car of the same price of a typical gas car, that if fully charged, would take you even 1/4th as far as the gas car filled up? What represents more energy: a 25 liter gas can filled with gasoline and likely has less than 25 kg in mass (both the gas and the can), or a high tech battery that has a mass of 25 kg? Would the latter also be as cheap?

I didn't think so.

I doubt there will be much innovation in that front either because there's likely more profit, or assumed (presumed?) profit, in developing stupid "apps," some new iPhone or "wearable," some new website (but isn't Facebook the pinnacle of Internet heights?), or other cons, than in developing very high-energy-storage-per-mass batteries. I predict that there will be more publicity given, if not already, to Google cars and maybe an "iCar," than some overpriced sports car that runs on electricity. The latter might be better for the environment, or even human health and the economy, but it won't be better for the high tech corporation CEOs and shareholders.

This is why for a while, renewable-electricity will be considered idealistic, impractical, something that, as User:Weaseloid put it, not something libertarians are known for giving a shit about—save perhaps survivalists, "preppers", and those who wish to live off the grid—let's be fair to them.

However, what I'm proposing—and again, I admit ignorance, at least relative to the many great minds at RationalWiki—would generally dispense with the need for such batteries, and given that, as I think, wind and solar could produce a lot of electricity, perhaps as competitively with, if not more competitive than, nuclear, hydro, or even coal—but again, it's just that it's not constant, one could simply have a few computers powered by wind and/or solar, in places where there's a lot of wind and/or sunlight, when the wind and/or solar are at their peak. When they aren't, just shut down the computers for a few hours.

If a renewable source, say, provided 100% needs 20% of time, 50% needs another 20% of time, 0% for 20%, but 200% for 20%, and 350% for 20%, it'd come out to 140% the needs averaged out. Again, batteries would be needed, in this case, 40% of the time, but only if electricity was constantly needed. Again, I presume this is not the case for computers or similar devices mining bitcoins.

That way, one could process bitcoins and the like as cheaply, perhaps more cheaply, than when using regular forms of electricity. This could spur the development of better and cheaper turbines, PVCs, and maybe other forms of renewable electricity—wave, biomass, geothermal, whatever, which could lead to reducing overall prices, eventually prices so low that even if batteries were added on, that'd make non-bitcoin renewable electrical production more viable.

Imagine, if you will, a bitcoin miner investing in a wind turbine. While an additional turbine might double the turbine prices, it might increase the cost of labour, transportation, securing property-use rights, a watch-and-maintenance person, etc by less than 100%—maybe only by 20% or 30%—maybe for the overall cost of two rather than one turbine. This could make electrical production with batteries for uses other than bitcoin mining—such as powering the hamlet or village one is near—more cost competitive .

Let's say bitcoin miners around the world bought $400 million worth of PVCs. That'd be more capital for PVC makers to reinvest. Let's say 5% of that money was used in purchasing more experimental types of PVCs—cheaper and/or better: $20 million more capital.


Indeed, it might not even be necessarily to locate far out of the way. If a wind or solar farm sold heavily discounted electricity during peak production and off-peak use—say a very windy night or a very sunny Sunday—it would profit both bitcoin miners and such electricity producers. This would be even more the case with wave energy, non-dam hydro-electricity during rainy days, and some forms of geo-thermal.

Indeed, for all we know, such might already be happening with wind and solar.

As for quick Google searches, here's this. Civic CatTalk to Civic Cat 00:29, 10 February 2016 (UTC)

Any altcoin that uses competitive proof-of-work (i.e. computing useless hashes) will have the same problem. The actual data processing done could be done on a Raspberry Pi; the reason for the energy use is the miners trying to outdo each other. The root problem is not finding lovely renewable energy sources for the mining, the root problem is that competitive proof-of-work is bad - David Gerard (talk) 14:40, 10 February 2016 (UTC)
A Watt is a Joule a per second, so your annoyance at it being in Watts instead of in Joules is an absolute basic misunderstanding of even the units of measure you are discussing in the first place. I don't see the point in continuing to discuss these things when you don't know anything about them, don't care to read anything about them when it's at your fingertips, and decide you just want to argue. If you just want to argue and get mad you can search here for more active forums full of people that like to do the same. -EmeraldCityWanderer (talk) 15:36, 10 February 2016 (UTC)
To: David Gerard
Hmmmm. Interesting. Still, that people go on about energy use despite your implied solution still indicates a decent possibility of it promoting renewable electricity. If they are so stupid to think they need vast amounts of electricity to compute "useless hashes," renewables might help them in this limited sense and, again, in the process promote renewable electricity. Again, my ignorance of the issue is vast, and I'll give it some more thinking.
To: EmeraldCityWanderer
I saying that a joule is a unit of energy and a watt of is of power indicates that I misunderstand things? I read do things, and will do the WP article you linked. Nor am I mad. I stop being mad a long time ago, save for the odd thoughtless blocking of my account. As for winning arguments, hah! I tend to lose them here—differences with the mob at times being irreconcilable, assuming that people address my concerns at all. If you don't wish to discuss stuff with me, such is your choice. I'm almost through with this, and with the winding down of these discussions/arguments User talk:Civic Cat#So, here's the deal with those categories you want on Encyclopedia Dramatica, Talk:Encyclopædia Dramatica#Should this be in Category:Homophobia, Category:Racism, and Category:Sexism?, and Fun talk:Greatest songs, liberal and conservative#Cut Down? Any objections?, my activities here should wane even more.
Civic CatTalk to Civic Cat 22:33, 23 February 2016 (UTC)

A section on scams and scamminess[edit]

I would like this to be gold, and the one thing it lacks is getting across just how fractally scammy literally everything about Bitcoin is. BadBitcoin, List of Heists and /r/sorryforyourloss list a lot of the individual scams, and I've seen articles pointing out the stupendous failure rate of Bitcoin exchanges; the trick is how to write up something that (a) gets across the general scamminess of bitcoin (b) can back up its claims for the querulous. Anyone else feel like essaying upon such a task? - David Gerard (talk) 11:03, 30 March 2016 (UTC)

Article is biased like many others on internet (or at least just made some simple mistake), it commit the same mistake as other news articles about it.[edit]

The article says: "The currency's only practical use case is purchasing illicit goods (e.g., drugs) and services (e.g., murder-for-hire scams)[9][10] and extortion (e.g., "ransomware").[11] It is becoming the preferred currency for internal use by online criminals.[12][13] There has so far been no other use case for which it is superior to existing channels. "
Then the article start to complain, that bitcoin is a ponzi scheme.
So, the article first complain that its used by people doing illegal things and then it complains its a ponzi scheme.
The thing is, you CANT complain about both stuff at the same time.
Imagine this situation:
Some guy is creating and selling rocket launchers to terrorists. But he is not a good creator and if someone tries to shoot with it, the weapon wont work.
Anyway on this case, if you consider the fact that he sell weapons to terrorists to be a problem, you can't consider the fact that his weapons wont work as some sort another (second one) problem that happens on this hypothetical story. This, because if the terrorists try to use the weapon and the weapon doesn't work, this fix the first problem, this because the weapon wouldnt be able to be used to harm people, not only that but the terrorists would waste their money on something useless. When talking about this hypothetical situation you have 2 choices:
1- complain about the guy selling it to terrorists or 2- complain about the weapon not working, because if the first situation is a problem, the second one is a problem, this because the second situation would fix the first problem.
The same happens here, if bitcoin is a ponzi scheme, this would actually be a positive thing, assuming you consider bitcoin to be a bad thing because of people using it to do illegal stuff.
This makes this article looks like some shady article that wants to make sure people dont use bitcoin. Like this, first you complain about it being used by it being used by people to do illegal stuff, if someone doesn't care about that (people still buy guns despise this being used by terrorists, dictators armies......), you will them complain about it telling it doesn't work.201.79.73.17 (talk) 13:50, 5 April 2016 (UTC)

Is this for real? Being used in a Ponzi scheme doesn't mean money somehow stops working like a damaged weapon. Did the US dollar stop being used for normal monetary operations when Bernie Madoff ran his Ponzi scheme? Nope. Was his Ponzi scheme a positive thing? Well, I can see it being good if you don't care about harming other people for economic gain if you were lucky to get out of it quickly. Maybe you should learn what you are talking about... -EmeraldCityWanderer (talk) 14:20, 5 April 2016 (UTC)
Yeah. You can pay someone with sex for drugs, but that doesn't affect the fact that sex is still a really stupid currency. Annquin (talk) 15:30, 5 April 2016 (UTC)
"Did the US dollar stop being used for normal monetary operations when Bernie Madoff ran his Ponzi scheme?"
This is one guy using some currence (that was not created specifically for ponzi schemes). The article specifically implies the entire bitcoin currency is a ponzi scheme like thing. And if that is true like the article implies, then, people using it to do illegal stuff would be an positive thing since they would be losing money while they try to archieve something unsing bitcoin.
"Yeah. You can pay someone with sex for drugs, but that doesn't affect the fact that sex is still a really stupid currency. "
But that means that selling drugs for sex is a positive thing. Because after some amount of time, trading their drugs for sex, the drug dealers would go banckrupt.201.79.73.17 (talk) 18:02, 5 April 2016 (UTC)
It wasn't created to be a Ponzi scheme, but the exchanges allowed it to become one without regulations and obstinate refusal to fix issues (software and user) that made it become so. Anything can, given the right conditions, like tulip bulbs did in Amsterdam. No where does it say it was built to be but many seem to fight any sort of attempt to stop Ponzi schemes no matter how many times it seems to happen. If your toaster shot you every time you made toast, and the manufacturer and buyers fought fixing it, then practically it seems kind of like that's part of the design. This seems pretty basic reasoning.
Just allowing illegal transfers (without any evaluation) doesn't seem like a positive when it involves bankrupting people and contract killing. If that's a "positive" to you then we are in irreconcilable moral structures. Even in the most selfish view of allowing those also puts you and your loved ones in the crosshairs. Just saying. -EmeraldCityWanderer (talk) 19:07, 5 April 2016 (UTC)
"and contract killing" This is a myth... Deku-shrub (talk) 22:13, 5 April 2016 (UTC)
The idea is not about allowing illegal transfers without any evaluation, but allowing people to enter some ponzi scheme to do illegal things with the money, so its not just some usual transfer of money, but something that requires the user to join a ponzi scheme that will defund himself, in the end he will lose money and so not have funds to run his illegal companies.201.79.76.179 (talk) 12:03, 7 April 2016 (UTC)

Too immature?[edit]

Hey, Lan here, too lazy to log in. Don't mean to be rude, but while "buttcoin" is a somewhat funny crude joke, referring to bitcoin in that manner over and over throughout comes off as really immature, and in my opinion ruins an ok joke. Thoughts? 198.150.22.2 (talk) 16:34, 7 June 2016 (UTC)

As Much Electricity as Denmark[edit]

Not sure if this is reliable enough to include, but this article says that Bitcoin could use as much electricity as the whole of Denmark by 2020. rpeh •TCE 11:09, 1 April 2016 (UTC)

"he calculated that a single bitcoin transaction requires as much electricity as the daily consumption of 1.6 American households,"
and if it's 10 minutes per transaction, that'd be about 54 000 a year or 86 400 American households


""The total bitcoin mining network currently comprises a calculation speed of over 800 petahashes per second, which requires over 10,000 metric tonnes of hardware, considering that even the newer machines weigh over 12 kilograms each (15 grams per GHash/sec. on average in the analysis below). That is enough material to build another Eiffel tower.*"
or about 10% of 1% of the cars North Americans purchased a year


"This network of so-called bitcoin “miners” ensures the security of the system, but unfortunately also consumes a lot of electricity—currently about 350 megawatts according to my own calculations, which is roughly equivalent to the electricity demand of 280,000 American households."
350 Mw / 280 000 households = 1250 watts
which again, is a unit of power, not energy.
Civic CatTalk to Civic Cat 17:16, 19 May 2016 (UTC)

Bitcoin creator identified?[edit]

Reverend Black Percy (talk) 11:51, 3 May 2016 (UTC)

The guy's an obvious fraud, see what I posted to WIGO:Blogs. But we might go for a section of Satoshi Nakamotos from history (Nick Szabo, Hal Finney, Dorian Nakamoto, Craig Wright) ... Wright is a particularly persistent conman - David Gerard (talk) 13:13, 3 May 2016 (UTC)
Interesting - thanks for the links, buddy! Based on those, I support your conclusion fully. Reverend Black Percy (talk) 13:46, 3 May 2016 (UTC)

Steam starts accepting bitcoins[edit]

https://blog.bitpay.com/load-your-steam-wallet-using-bitcoin/ Reverend Black Percy (talk) 11:52, 3 May 2016 (UTC)

All sorts of businesses have started accepting bitcoins and then quietly stopped when nobody uses them - David Gerard (talk) 13:13, 3 May 2016 (UTC)
It always surprises me a little when big companies start accepting Bitcoins. I would imagine it just risks bringing instability to their profits, new legal/taxation risks, new payment security risks, product delivery hassles (e.g. the blockchain lagging to the point where purchases essentially halt) aside from the obvious risk that they're accepting laundered or otherwise crooked money. What's the reasoning behind it, you think? Reverend Black Percy (talk) 13:50, 3 May 2016 (UTC)
To look cool and that way attract new customers, maybe?--Kugelschreiber (talk) (mail) (block) 14:36, 3 May 2016 (UTC) 14:36, 3 May 2016 (UTC)
Pretty much none of them ever touch a bitcoin - they get Coinbase or Bitpay to accept the bitcoins and they only ever see dollars. (Then nobody ever uses them, then they discontinue the Bitcoin option because they can't be bothered.) Usually the motivation is that someone convinced someone in the company that bitcoins would be a wonderful option and would open new markets, aaaand this never transpires - David Gerard (talk) 17:57, 3 May 2016 (UTC)

The DAO[edit]

Holy shit is this thing a clusterfuck. Regulatory, legal, the code itself ... it's Ethereum not Bitcoin, but has the same quality of people involved. Wonder which section to put it in - David Gerard (talk) 18:34, 29 May 2016 (UTC)

Pump and Dump?[edit]

According to the archives, way back in Jan 2015 I wrote:

"Looking at the history of the article I see that we have been calling this a Pump and dump scheme since the article's inception in June 2011. As it's now 2015 that seems rather a long time, as I was under the impression that "pump and dump" usually works on a shorter time-scale. Or are we suggesting that it's still being "pumped" and the "dump" is yet to come?"

It seems to me that the "Pump and Dump" idea (which the article still supports) belongs more in the realm of conspiracy theory than reality.--Coffee (talk) 20:17, 7 June 2016 (UTC)

The pump was quite early on. Additionally, smaller pump'n'dumps have continued to happen - David Gerard (talk) 06:29, 8 June 2016 (UTC)
And I said that in 2015 (Krugman concurred that it's big libertarians preying on smaller ones) and you went silent - David Gerard (talk) 14:45, 8 June 2016 (UTC)
Soo.. errr. Still waiting for the dump then? Since 2011.--Coffee (talk) 17:50, 1 September 2016 (UTC)
In the intervening years, we had the bubble, not sure if you noticed it - David Gerard (talk) 20:09, 1 September 2016 (UTC)

"Bitcoin is only for criminals" notion[edit]

I find it very odd that many RW editors fail to understand people's concerns about ~all mainstream electronic payment systems being controlled by US corporations. It seems that the self-proclaimed American "liberals" are not so far from the wingnuts who they oppose. --178.55.116.173 (talk) 21:41, 29 October 2016 (UTC)

"Bitcoin is only for criminals" That's like saying privacy tools are for criminals. If the article actually says that, please remove that immediately because it's a baseless and downright lie.—Hamburguesa con queso con un cara Spinning-Burger.gif (talkstalk) 01:03, 30 October 2016 (UTC)
Insofar as Bitcoin is used to buy stuff, it is, however, substantially for illicit goods and services, and this has been the case since Silk Road opened. Nobody else uses it as money. Mind you, >95% of exchange and blockchain activity is speculation on Chinese exchanges, rather than buying things - David Gerard (talk) 17:09, 3 November 2016 (UTC)

What is RW's take — new bubble on the way?[edit]

Scanned this in passing (from 4 days ago):

So what’s causing it? No one knows for sure. Maybe it’s the usual hype that Bitcoin sees around Christmas time. Maybe it’s a delayed natural reaction from the halving – or maybe it’s just a sign that Bitcoin is doing better than people think it is.

Wild theories, anyone? Reverend Black Percy (talk) 17:10, 2 January 2017 (UTC)

Wild theory? How about some market manipulation?—Hamburguesa con queso con un cara Spinning-Burger.gif (talkstalk) 17:44, 2 January 2017 (UTC)
*INCEPTION BWAAAAAM* Reverend Black Percy (talk) 17:47, 2 January 2017 (UTC)
That and the MMM Ponzi in Nigeria - David Gerard (talk) 17:11, 3 January 2017 (UTC)
"MMM"? ("Manipulated Market Malaise" is my best guess at this point) Reverend Black Percy (talk) 17:23, 3 January 2017 (UTC)
Prices go up and down and it's easy to infer patterns and then conspiracies from what might be random noise.
This is a bitocn value from 2010, this is gold from around the same period, this is oil this is iron ore. Obviously, many of these movements will have rational explanations, others will be the result of the market being moved by expectations or simple herd mentality.
But guessing any of them over the next six months would be quite difficult.--Bob"Life is short and (insert adjective)" 18:17, 3 January 2017 (UTC)
Nigerians, Everything you need to know about the MMM Bitcoin scam. MMM (Ponzi scheme company)Wikipedia - David Gerard (talk) 00:18, 4 January 2017 (UTC)
Thanks, David! Nigerians, eh? Here's a VICE thing on computer scamming in Ghana from a while back. Nothing special, but it's elucidating to watch the footage captured on-location and so on. Reverend Black Percy (talk) 01:39, 4 January 2017 (UTC)
As of writing, the price has reinflated to around 1700 USD with no sign of stopping. While new crashes may be inevitable, the article currently sounds as though the Mt Gox crash was the end of Bitcoin, when in fact the story continues.
It could do with some updating. But explaining the current "price" is a tricky one. Mostly it's being dragged up by the fact that you can't get ActualMoney out of Bitfinex. I have detailed opinions and sources to explain all this, but I need to put it toward my book on the subject first ... - David Gerard (talk) 10:55, 9 May 2017 (UTC)

Is bitcoin unregulated ?[edit]

"libertarians slowly discover why financial regulations exist to begin with"

Why aren't there financial regulations on bitcoin ? Don't regulations that apply to other currencies apply to bitcoin ? Diacelium (talk) 00:31, 16 February 2017 (UTC)

Its hard to regulate. Bitcoin has no grounds in real life and no one really owns it. The US trys to regulate it but falls be because most users are anonymous.— Unsigned, by: 107.72.164.34 / talk / contribs
No, Bitcoin is the least anonymous currency to ever exist. This fact can be read on Bitcoin's website.—Hamburguesa con queso con un cara Spinning-Burger.gif (talkstalk) 02:38, 16 February 2017 (UTC)
Yes that it is true, anyone can see were and when the bitcoin is moved about. Let me clarify, no one knows who is doing it if you don't put your name to anything. This way it is hard to regulate. — Unsigned, by: 107.72.164.34 / talk / contribs
There's a sort of patchwork of regulation springing up. But basically, governments of capitalist first world countries tend to do this with financial innovation: let people get on with doing new things, then remind them regulation does actually apply. - David Gerard (talk) 10:55, 9 May 2017 (UTC)
Might be a good idea to add a section on current regulations and attempted regulations. Things like BitLicense, the People's Bank of China's attempts to limit the market, things like that. Cpancake (talk) 21:18, 11 May 2017 (UTC)
There's a shitload of updating the article needs for 2017. e.g. an explanation of how being unable to withdraw ActualMoney sends the "price" up (which happened with Mt. Gox and is happening now) - David Gerard (talk) 11:34, 12 May 2017 (UTC)

David has hit the limelight[edit]

And the YouTube comments are as delightful as one can expect. Fuzzy "Cat" Potato, Jr. (talk/stalk) 22:50, 23 July 2017 (UTC)

Book's just out too - David Gerard (talk) 06:23, 24 July 2017 (UTC)
@FuzzyCatPotato Thanks for the link, I'll be sure to check it out! And just since David mentions Buttcoin about 15 minutes in — is this graph something we could borrow for the article? Reverend Black Percy (talk) 01:05, 26 July 2017 (UTC)
@David Gerard Pre-ordered it on Kindle. Job well done mate. Reverend Black Percy (talk) 01:06, 26 July 2017 (UTC)

PC Gamer: "How Bitcoin and cryptocurrencies are hurting gamers"[edit]

Check it out. Relevant quote:

Instead of becoming a currency free of the controls of governments and banks, Bitcoin is now largely controlled by a small collection of interested parties who have heavily invested in securing the network. And ironically, greater acceptance of Bitcoin will likely come only with additional regulations.

Phrased well enough to serve the article, methinks? Reverend Black Percy (talk) 00:31, 26 July 2017 (UTC)

Ethereum literally claims no possibility of "downtime, censorship, fraud or third party interference"[edit]

No, really. Verbatim. Reverend Black Percy (talk) 01:18, 26 July 2017 (UTC)

Yeah, as per The DAO bailout the intereference is second-party - David Gerard (talk) 10:46, 26 July 2017 (UTC)
Wow, just Googled that. What a mess. Having to fork the blockchain in order to undo damage =/= being invulerable to damage in the first place (as promised). Reverend Black Percy (talk) 12:22, 26 July 2017 (UTC)

BitCoin has split in twain[edit]

Source. @David Gerard, a penny for your thoughts? Reverend Black Percy (talk) 22:27, 1 August 2017 (UTC)

My thoughts are over on my authorial Facebook page, which is turning into a bitcoin blog ;-) but what's actually happening here is that one of the whales, Roger Ver, is trying to take control, despite not really being a techie. And it's fallen flat on its face - David Gerard (talk) 23:52, 4 August 2017 (UTC)
Good post! Also, thanks for summarizing things. All the best, Reverend Black Percy (talk) 04:51, 5 August 2017 (UTC)

About comparing with real or fiat currencies[edit]

Aren't fiat or real currencies also succeptable to drastic flutuations caused by unstable government, rating agencies, banking systems and speculation from stock markets? So that isn't a advantage of fiat currencies over bitcoin.

--85.245.131.219 (talk) 10:23, 12 September 2017 (UTC)

Cryptos vary at 5-10% a day - David Gerard (talk) 12:35, 12 September 2017 (UTC)
Not nearly as much. A massive swing in the value of the dollar is losing a quarter of a cent to the Euro. It's currently the 12th and Bitcoin has fluctuated by $200. Back in July it was at $1940 and then 2 months later it was $4940, but it's going to come crashing down, then up, then down, then up, and down. That is NOT the kind of fluctuation you want when major companies take a week to sign a massive contract. Maybe for speculators who like to gamble, but not for someone who signs a contract to build a factory. You'd be better off using Berkshire Hathaway shares as currency; at least those are backed by something AND pay dividends, as well as being far more stable.CorruptUser (talk) 12:40, 12 September 2017 (UTC)

All in a day's work[edit]

Fiat currencies have intrinsic value/backing because they're accepted as payment by governments?[edit]

Can someone explain this to me. My euros are intrinsically valuable because I can use them to pay taxes with? Does that mean if I have a thousand dollars, they're intrinsically valuable because other people can pay taxes with them? When I think of a currency being backed, I think of something like the gold standard, or using Berkshire Hathaway shares as a currency. I just don't BUY this argument as a problem with Bitcoin. I don't see why a currency needs to have intrinsic value in the first place, and I don't get how being able to use it as payment for anything gives it intrinsic value. You might aswell say Bitcoin has intrinsic value cause you can use it to purchase cocaine. Dapperedavid (talk) 14:37, 5 December 2017 (UTC)

At the same time, it also does not enjoy the security, protection and dispute resolution which those large bodies tend to provide, making it a volatile and often insecure asset.[edit]

As far as I understand it "security" and "protection" are just platitudes in this sentence, and though I don't know what dispute resolution is, I'm sure many people can live without it. I mean for thousands of years people used sea shells (which by the way don't have intrinsic value^) as a currency in India and that probably didn't have dispute resolution eiter (whatever that is). You don't tell me the dollar is a stable currency because it enjoys dispute resolution, it's stable because millions of people use it and the federal bank doesn't print trillions of dollars every minute. How does not having these things make bitcoin an insecure asset? Dapperedavid (talk) 19:55, 12 December 2017 (UTC)

Respected individuals that do like bitcoin[edit]

If we're gonna list respected individuals like Warrren Buffet, that don't like Bitcoin, it's only fair to also mention respected individuals that DO like bitcoin. I don't know any myself, but I'm sure there are some. I think Bill Gates said some positive things about it. Dapperedavid (talk) 20:17, 12 December 2017 (UTC)

Chart[edit]

I'm trying to update the bitcoin chart but it doesn't let me. How the profanity do you even upload an image. Sorry for all the spam I just want to improve the page but don't know how and can't be profanitied to figure it out because it seems to be unnecessarily confusing. Dapperedavid (talk) 20:36, 12 December 2017 (UTC)

You can find the "Upload file" link on the left sidebar of every page, @Dapperedavid. Also, the link is here: Special:Upload. When you upload an image, don't forget to include the license information that you're claiming, typically either "fair use" or "public domain". Bongolian (talk) 17:57, 22 December 2017 (UTC)

UH-OH, SPAGHETTIO'S![edit]

To paraphrase leading analysts; "POW, right in the kisser!" 95.195.205.16 (talk) 09:57, 22 December 2017 (UTC)

Something tells me this is just the "first sell offs" stage in a gigantic crypto bubble, if Bitcoin will indeed ever be a bubble. Nothing has happened yet, a lot of Bitcoin owners swear by it and believe in it like people believe in God, they're not gonna sell anytime soon. It's not even under 10.000 USD yet and people have been saying it was a bubble when Bitcoin was below that. In fact this page has been saying bitcoin is worthless since its inception when bitcoin was somewhere in the hundreds of dollars. I think everyone's dad will want to look into Bitcoin now that the price is "low" and they've heard more about it from their son/brother/friend/son in law/cousin/nephew/aquintance/neighbour/etc. during christmas dinner/new year/or what have you. Some dads may even buy the dip, a lot of college students like me will, the price may get back over 16000 and once that has happened, the ball has started rolling. Am I a lunatic for thinking this? Dapperedavid (talk) 17:10, 22 December 2017 (UTC)

And this happened: https://www.cnbc.com/2018/01/10/south-korea-official-reportedly-readying-bill-to-ban-all-cryptocurrency-trading.html?__source=sharebar%7Ctwitter&par=sharebar — Unsigned, by: 64.90.127.38 / talk / contribs

Separating serious criticisms from economic/technological poor understanding and anti-libertarian rants[edit]

This page could be a really interesting discussion of cryptocurrencies, from economic and technological point of views, but instead any serious argument is contaminated by poor understanding of Economics and how criptocurrencies work and, most of all, a blind hate for anything which as anything to do which libertarianism.

Some examples:

"While other distributed computing systems are investigating protein folding or sifting through radiotelescope data for signs of intelligent communication from the stars, Bitcoins are being generated by people running hashing algorithms to process transactions on a poorly-traded virtual currency."

So what? Can't people do what they what with their own computers? Must every computing power not used for Science be forbidden?

"The many bizarre and frankly stupid cooling schemes are usually good for a laugh as well, including one Darwin Award applicant who poured a bucket of liquid nitrogen on the floor next to his rig to cool it."

How is this a criticism of Bitcoin?

"The actual processing done by the miners could be done by a Raspberry Pi; the only reason to waste gigajoules a day is to keep it distributed without trust between actors. It turns out trust is vastly more efficient."

Of course, if everybody behaves then there would not be even necessity of doors, locks... and not even money!

"Despite having a reputation for being used to pay for illegal goods and services anonymously, bitcoin is the most transparent currency in existence because it records everything in a blockchain."

But every Bitcoin-HowTo explains this thing very well...

"As of 2017, it was estimated that 980,000 Bitcoins had been stolen (worth roughly US$15 billion as of December 6th 2017)."

Were they stolen because Bitcoin have flaws? Wallsmart lose $3 Billion per year because of theft, but nobody would say that as a criticism of hypermarkets.

"Bitcoin has no intrinsic value or backing of any kind. It is based on "greater fool" theory, the idea of finding a sucker investor who will pay more than you did."

The same can be said for any currency.

"In practice, the only thing Bitcoin does better than conventional currencies and existing payment systems is to let libertarians buy illicit goods without having to go to the bad part of town and talk to minorities."

And of course, to conclude, it must be said that libertarians hate minorities...

I will try to fix this page. McLaghing (talk) 14:35, 15 January 2018 (UTC)

Some of your suggestions sound reasonable, but I think there is a legitimate argument regarding electricity consumption because the amount is nontrivial and it is I think in some cases government subsidized (a libertarian no-no), e.g. in parts of China.
There is a legitimate argument to be made about the value of trust and the concept of (fiat) money vs. the expense of Bitcoin's non-trust and the costs of slow transaction rates.
With regard to Walmart, retail theft is a fact of business and some percentage loss is always assumed. For Walmart it about 1%, which is actually low: the industry average is 1.4%. For Bitcoin on the other hand, I believe that theft tends to wipe out entire accounts and in at least one case (MtGox), an entire Bitcoin exchange. This is significant especially because Bitcoin touts itself as being secure, when it is in fact quite risky.
I think the greater fool argument is legitimate because Bitcoin is looking less and less likely to show its retail utility. This is due in part to the ruling in some jurisdictions that it is a commodity not a currency, but also the speed bottleneck caused by how the blockchain is managed. Bongolian (talk) 18:43, 15 January 2018 (UTC)
"I think there is a legitimate argument regarding electricity consumption" I think so too, but the legitimate argument is about the environmental impact and it should made some precise comparison with other energy consumptions (I have to check some numbers...), it should not be like: "We could have spend that energy for Science!" Because, otherwise, we could say that of almost every human activity...
"This is significant especially because Bitcoin touts itself as being secure, when it is in fact quite risky." The point is that all the stolen bitcoins have not been stolen because Bitcoin is insecure. But because people, for laziness and/or ignorance, delegate the security of their wallets to websites, which is incredibly stupid, since the whole point of Bitcoin is being decentralized. This should be explained.
"I think the greater fool argument is legitimate because Bitcoin is looking less and less likely to show its retail utility. This is due in part to the ruling in some jurisdictions that it is a commodity not a currency, but also the speed bottleneck caused by how the blockchain is managed."
What are you saying are some true problems of Bitcoin, but that is not the "greater fool" argument showed in the page. Regarding the blockchain, I agree that it is becoming unmanageable. However these things should be put in the perspective that Bitcoin is the first large scale cryptocurrency, so it should be not a surprise that it is not perfect. Otherwise, to anyone with a minimum of knowledge of the topic, they sound like criticizing the first airplane because it flew low and for short time. McLaghing (talk) 22:25, 15 January 2018 (UTC)
As far as I'm concerned you can have a go at writing with more accuracy and nuance. Anyone else who cares can weigh in of course. Bongolian (talk) 04:09, 16 January 2018 (UTC)
De-whitewashed - David Gerard (talk) 20:32, 22 January 2018 (UTC)
De-De-whitewashed. I have explained my changes. You just reverted everything back without a word of explanation. McLaghing (talk) 17:37, 23 January 2018 (UTC)