Bitcoin Currency Surpasses 20 National Currencies In Total Value 583
Velcroman1 writes "More than $1 billion worth of bitcoins now circulate on the web – an amount that exceeds the value of the entire currency stock of small countries like Liberia, Bhutan, and 18 other countries. Bitcoin is in high demand right now — each bitcoin currently sells for more than $90 U.S. — which bitcoin insiders say is because of world events that have shaken confidence in government-issued currencies. 'Because of what's going on in Cyprus and Europe, people are trying to pull their money out of banks there,' said Tony Gallippi, the CEO BitPay.com, which enables businesses to easily accept bitcoins as payment. 'So they buy gold, they put it under the mattress, or they buy bitcoin,' Gallippi said."
Is it really circulating? (Score:5, Interesting)
Re:SELL!!! (Score:5, Interesting)
I've been investing myself for about 25 years and I thought exactly the same thing when I saw this. There is clearly a bubble in the value of BitCoin right now and there is really nothing backing that value. In the past when the US dollar was "young" it was backed by gold. That ended long ago, but the value of the dollar on it's own had been long established before that change. Other currencies have similar histories. That's the the case here. Not only would I sell if I had anything in BitCoin now and move into either US dollars (being a US investor) or metals (silver, gold, platinum being the primary three), but if I had a few grand to gamble with I'd actually short BitCoin at these rates and make some cash as the value starts to slide - be that a short term correction or more likely a collapse of BitCoin altogether.
Re:SELL!!! (Score:5, Interesting)
I bought a load of bitcoins last April when they were 5 GBP... with a view to buying stuff off SilkRoad.
Which I did... but I still had about half of them left. I just held onto them to watch the price (what the hell I thought.. let's see what happens).
A few days ago I worked out that selling them would get me the equivalent of a month's wage. I could carry on watching and hoping it doesn't crash... or sell them and get a month's wage ON TOP of the drugs I bought (and enjoyed).
Fuck it.. I cashed out.
Re:SELL!!! (Score:5, Interesting)
Not a bad idea by any stretch, if you already have them. Personally, I still have no faith in the bitcoin. Though to be honest, when I first started looking at bitcoins last october, they were $11 each, and I thought they were overvalued then. Now (as I write this) they are $86.71 a peice. Given that yesterday afternoon they were $89 something each, the price does seem a bit volatile, however it has made many similar fluctuations along the way up, so that doesn't mean it has peaked. If I had bought say a thousand worth and then sold them today, that is upwards of $8,000 of income.
Where it will head from here is anybody's guess. I don't believe I am any good at currency speculation by any stretch, but I haven't seen any indication that they have topped out. Still, I wouldn't buy any myself, nor would I suggest anybody else do that either.
I actually mined some bitcoins to pay for VPN and seedbox services (I make more than enough money in bitcoins per month to pay for these) using GPU power I already have (one 5750 and one 7850) at a combined 600MH/s, which at the current exchange rate yields about $100 USD per month. Thinking of using my spare bitcoins to buy an entry level asic, which will yield ten times that amount at about one tenth of the energy consumption.
If the bitcoin does end up collapsing, I haven't really lost anything other than idle GPU time. Where I live (Arizona) electricity is cheap, and based on my current metrics (which I am able to monitor in 5 second intervals btw) I have probably thus far spent $5 on mining bitcoins over the four month span that I first started mining them. A general rule of thumb in investing is that you should never invest so much that if you lost it all, you wouldn't be able to afford to keep your house. I don't think I'll miss $5. Best of all, unless I convert it into real dollars, it'll never be taxed. Meanwhile, as time passes there are more and more goods/services that I can buy with bitcoins.
If everybody does exactly what I'm doing, the value of bitcoins will only increase because more people will have a stake in them.
And before any eco activists complain about my carbon footprint: My area is nuclear powered. Nuclear has an almost non-existent carbon footprint and is dirt cheap. (I'm not one to concern myself with carbon in any case - call me an anti-social insensitive clod or whatever incorrect label you want, but I just don't see the point worrying about it - see my recent comment history for an explanation.) You can thank the government if your area isn't nuclear powered.
Re:SELL!!! (Score:5, Interesting)
Can you imagine $1m for a Bitcoin? I could hold your family at gunpoint for one coin, and at worst get a few months in prison. Or just pay some meth head a couple hundred bucks to do it.
Meanwhile, you can't prove I stole anything of real value from you - just a file from your computer. You can't insure it like a piece of property, you can't "cancel" it like you could a check, and nobody gives a crap where the BTC ends up because it doesn't count as real currency.
So while it's fun to imagine, the moment BTC becomes worth more than harvesting someone's credit cards via botnet, they're coming for your virtual wallet and nobody will care, not the banks, not the government, and not the retailers, because they all operate on regulated currencies and the protections they afford.
Re:SELL!!! (Score:3, Interesting)
Re:SELL!!! (Score:3, Interesting)
There is no such thing as inherent value. I dare you to try measuring any such physical attribute.
Ok. How about the ability to keep one human alive for one day? Therefore, food, water, shelter, and heating (or cooling) have inherent value. As does anything that can be directly converted into one of these things, like seeds, hydrogen & oxygen, electricity, wood, bricks, and so on.
Unless you want to argue that human life has no value, in which case I can just shoot you and win the argument.