Central Banks Can't Ignore the Cryptocurrency Boom (bloomberg.com) 165
The boom in cryptocurrencies and their underlying technology is becoming too big for central banks, long the guardian of official money, to ignore. From a report: Until recently, officials at major central banks were happy to watch as pioneers in the field progressed by trial and error, safe in the knowledge that it was dwarfed by roughly $5 trillion circulating daily in conventional currency markets. But now as officials turn an eye toward the increasingly pervasive technology, the risk is that they're reacting too late to both the pitfalls and the opportunities presented by digital coinage. "Central banks cannot afford to treat cyber currencies as toys to play with in a sand box," said Andrew Sheng, chief adviser to the China Banking Regulatory Commission and Distinguished Fellow of the Asia Global Institute, University of Hong Kong. "It is time to realize that they are the real barbarians at the gate." Bitcoin -- the largest and best-known digital currency -- and its peers pose a threat to the established money system by effectively circumventing it. Money as we know it depends on the authority of the state for credibility, with central banks typically managing its price and/or quantity. Cryptocurrencies skirt all that and instead rely on their supposedly unhackable technology to guarantee value.
Oh but they can, and will (Score:1)
Governments, on the other hand, are going to ruthlessly crack down on cryptocurrency. Smuggling is still smuggling.
Re:Oh but they can, and will (Score:5, Interesting)
Bitcoin is the New Gold
https://www.forbes.com/sites/p... [forbes.com]
Re:Oh but they can, and will (Score:4, Informative)
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How long have you been saying that BTC value is a bubble?
Since the first time it burst, and every time since.
Bitcoins have no intrinsic value, it is not just overvalued, it is by design 100% overvalued. Much unlike real money that are based on debt.
Re:Oh but they can, and will (Score:4, Insightful)
Nothing has intrinsic value. Things are only valuable because we decide they are.
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Some things are abstract constructs in their entirety, and you cannot eat, drink, or wear them, or use them to hunt with, or even turn them into a ring. Such things with a physical manifestation do not tend to lose half their value in terms of their utility between starting lunch and ending it, as happened in the Weimar Republic with cash.
Re:Oh but they can, and will (Score:5, Interesting)
THIS^^^
Inherently, there is no reason for bitcoin to be valuable. There is also no reason for gold certificates to be valuable. Bitcoin is valuable among other reasons because people literally use it as a gold standard to trade all other coins. Look at the bittrex exchange: every coin is traded against bitcoin (and ethereum). It is quite literally the digital gold backing all other coins.
Crypto is very volatile, but as the total crypto market cap increases, so will the bitcoin price. And I predict that over the long term, bitcoin is going to go up as long as people keep buying other coin. At least, until and as long as bitcoin remains the gold standard. 2018 could very well have 5 digit bitcoin prices.
The only reason that bitcoin crashed a couple years back is because Mt. Gox folded and many people lost all their coin and the trust in crypto.
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Compare this for example with currency like the USD. During the 2008 crisis the US just printed 200 billion $ (backed up by air... well, or the good faith in the US economy).
Art is also a very conve
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In the case of real money, what makes it valuable (and this has been true since the dawn of civilization) is governments demand its payment in taxes and adjudicate debts only on state currency.
Bitcoin is not money. It's more like baseball cards.
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Bitcoin is not money. It's more like baseball cards.
There's money in baseball cards.
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Or software licenses. You can go online, purchase a software license for a month or year, and all they send you is 25-digit license string. That could be worth anything from $1000 to $100,000 depending on whether it's a single seat license for a single system or a enterprise site license for hundreds of computers.
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Nothing has intrinsic value. Things are only valuable because we decide they are.
Nope. That is just retarded in how stupid it is. Food has value because it can be eaten. Everything useful has value.
Modern money has value because it based by debt on thing that have use to you. For instance an average person owes more money on their house than they have in their pockets or bank accounts. All that money they have available is backed by their debt, and is leveraged by the threat of taking away thing that has intrinsic value.
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Food has value because it has utility for us. That isn't anything intrinsic to the food. Is gold valuable intrinsically? Nope. It's also only valuable if you have some use for it. Dollars, both physical and virtual, have close to zero utility in and of themselves, but we still think of them as valuable.
It's all made up shit. The difference between bitcoin and dollars is only a difference of opinion.
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We have been conditioned by central banks to accept decreasing purchasing power for our fiat currency, in no small part because debt confers value to the borrower through inflation. Inflation allows the government to claim the economy is growing, regardless of whether the actual purchasing power of dollars of GDP actually buys more stuff. In 1900, a pound of raw steak could be bought for $0.13. Now it will cost you $7 or more. That represent a
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- It's unhackable / un-forgeable.
- It is easily portable.
- It is easily divisable.
Therefore it has value as a means of exchange and a means of storing value.
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Wow, edging towards $5k. Congrats to speculators in this; but I prefer to follow the Buffet method of not investing in things I don't understand, use, or enjoy. If BTC is like the gold standard, it could go a lot higher. OTOH, the BTC *economy* could have a depression. During the Great Depression, managers stimulated the economy by abandoning the gold standard. BTC can't do that. It's locked in to deflationary currency. We could see a paradoxical situation where the BTC value is off the chart, while
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Is it the malware host that the blue hipster fucktard who knows nothing about science used to link to, or am I confusing it with something else?
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Forbes.com the internet site is just a blogging platform like Wordpress.com.
Really? I'm surprised. I don't read it because of their aggressive popups that happen when you first go to the site so I would have never known. Funny how things change...
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Sure. Right. Things have been SOOOO much better since 1972! gold-backed dollars?? Bah! Unnecessary.
We're obviously much better off with a dollar based on its ability to buy oil. What could possibly go wrong??
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It is the new gold in that people who have it is trying to hype it to get the value up. In fact it has always been like gold that way. Though it is slightly more useless than gold.
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Some people and businesses speculate on computer components like CPUs, memory chips and hard disk drives. There are those that buy up the latest releases and sell them on like ticket touts. Then there are those that buy up auctioned off surplus military inventory; circuit boards for missiles, control systems, rocket boosters and just about anything else that they have space for.
As long as the governments can get their taxes at whatever end of the pipe the money comes from, they will be happy.
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That's easily fixed. https://hardware.slashdot.org/... [slashdot.org]
FDIC (Score:4, Insightful)
At least in the U.S., if you have less than the insurance limit (I think it is about $200K) and the bank loses it, then you can get reimbursed. If you have less than whatever in internet coins and they get lost, you get squat. That's going to be a big hurdle, who guarantees those transactions? All it would take is one major exploit on a crypto-currency to tank it.
Re:FDIC (Score:5, Insightful)
However the blockchain was not hacked at $1,000,000.00 dollars, and it wasn't hacked when it was 1000 times that amount (1 billion) and it's still not hacked now. So far so good.
Re 51% attack - that's getting pretty close to impossible even for governments.
Can government stop crypto? Of course. Make it illegal and shoot people who have (or are suspected to have BTC). That ought to work.
You talk about one major exploit - true. But, of course, if people could counterfeit US dollars that would also tank the dollar. Right?
Re:FDIC (Score:5, Insightful)
You missed the fact that the brokers have been hacked, time and time again, but then again banks seem to like leaving our details out anyway, so they are hardly who I'd turn to for trust worthy storage either ;)
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Turns out trusting people you don't know. Have never met and just have a website isn't a good idea.
I don't hand out cash to random strangers on the street that tell me they'll hold it for me either.
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Mining pools can exceed 50% (Score:2)
Re 51% attack - that's getting pretty close to impossible even for governments.
It wasn't a government, but Bitcoin has already had a single entity in a position to launch a 51% attack, fortunately they did not desire to "attack".
"The mining pool ghash.io briefly exceeding 50% of the bitcoin network's computing power in July 2014, leading the pool to voluntarily commit to reducing its share of the network. It said in a statement that it would not reach 40% of the total mining power in the future."
http://www.investopedia.com/te... [investopedia.com]
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Re:Mining pools can exceed 50% (Score:4, Interesting)
Yes. In 2014. It's far more difficult today. Although a consortium of mining pools can reach 51% each pool is made up of thousands of individual miners.
There is little difference between 2014 and today, if anything its slightly worse today. We are even farther from the point where the masses could economically participate in mining; it is an even more specialized, an even more commercialized, effort that it once was. We are every bit as vulnerable to the good intentions of pool operators today as we were in 2014.
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Still you have thousands of people who own a few Antminer S5s and S7s and S9s whose combined power make up a pool. Are there some operators with farms of 1000s of ASICS? Yes, of course.
Right now the top 4 pools could, theoretically launch a 51% attack.
https://blockchain.info/pools [blockchain.info]
Re: Mining pools can exceed 50% (Score:1)
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Blockchains can't be hacked.
It is simply a chain of signatures.
It is basically the electronic equivalent of handing a check over to the next guy and signing its backside with your name.
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As of now SHA 256 is secure. Can we imagine a time when it is no longer secure? Sure. Long before then (hopefully) we will have forked to SHA516 or SHA1024 or whatever.
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They don't need to hack bitcoin. They just need to "mine" it instead. Everyone is writing optimized SHA-256 hashing systems on everything from GPU's with CUDA to OpenCL, bitcoin mining pools. You even get custom ASIC's costing $1500 that just sit there and do bitcoin mining. Someone gets lucky and finds a valid bitcoin blockchain hash, they're $4000 richer. ASUS came out with a motherboard with 19 molex sockets so that 19 GPU cards can be plugged into the same motherboard.
Home-brew supercomputers:
https://i [huffingtonpost.com]
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Everyone is using ASICS now. One cannot CPU or GPU mine anymore.
GPUs produced hashrates of below 1GH/s and using 450w/hr (motherboard+cpu+ gpu)
Then ASICs came out hashing at 100GH/s for the same wattage; then 400GH for the same wattage and now 14TH/s (14,000 GH/s) for 4 times the wattage.
This makes the BTC mining community more centralized but it isn't a hack and it isn't directly harmful unti
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Yes, it's not hacking. Because there is the opportunity to mine bitcoins there isn't any need to hack the bitcoin ayatem.
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> Can government stop crypto? Of course. Make it illegal and ...
1. Making numbers "illegal" is idiotic.
2. Digital currency is property, not currency.
3. EO6012 does NOT apply to digital currency.
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You just have to make the exchange to real currency illegal; all the BTC folks want the ability to buy shit from people that don't share their delusion of value, which is most of us.
Ignore? It's a bubble they helped create! (Score:4, Insightful)
Cryptocurrencies are currently the bubble du jour. As central banks have suppressed interest rates for so long, people are desperate for yield in anyway shape or form.
Cryptocurrencies are the easiest thing to game and blow up into a bubble. People are rushing in and flipping it to a greater fool the same way people were doing this with houses back in the mid 2000s.
Cryptocurrencies certainly have a lot of interesting uses, however their value is a direct threat to government control of currency. They're currently enjoying lax regulatory oversight which anyone with half a brain means that current valuations are bloated and in a perilous position if governments start deciding to heavily regulate it. I know, coindorks will come thrashing about saying "crypto will bypass this and become the next reserve currency!"
No, if governments make ease of conversion into fiat difficult in anyway or outright ban it that will directly impact the price of the coins in the longterm.
If you're using crypto presently, consider it purely a speculative play and continue to take profit along the way. If you've put your entire life savings into anything like this, you're an idiot and need to seriously reconsider your exposure to risk!
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2012:~$30 lol bubble
2013:~$1000 lol bubble
2017:~$4600 lol bubble
Starting to see a pattern here.
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2012:~$30 lol bubble
2013:~$1000 lol bubble
2017:~$4600 lol bubble
You left out:
2014: ~$450
2015: ~$230
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The point being, it's a bubble.
And anything that shakes confidence in cryptocurrencies will destroy that confidence and subsequently destroy it's price.
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And anything that shakes confidence in cryptocurrencies will destroy that confidence and subsequently destroy it's price.
Especially given that the current spike in price is largely due to the influx of wall street investors, people whose automatic trading platforms will be dumping bitcoin at the speed of a natural language parser seeing a negative story floating across news sources.
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As long as bitcoin remains the gold standard backing all other crypto, no one is going to dump it. I am never overly optimistic, but bitcoin has become the gold standard and unless the crypto world disappears again or chooses a new backing standard for trading, its long term direction is only up.
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As long as bitcoin remains the gold standard backing all other crypto, no one is going to dump it. I am never overly optimistic, but bitcoin has become the gold standard and unless the crypto world disappears again or chooses a new backing standard for trading, its long term direction is only up.
Crypto enthusiasts may persist but the wall streeters who currently drive the price sure as hell can abandon it. Blockchain technology will persist and be critical in the future, but bitcoin is just the flavor of the day using blockchain technology. Its entirely replaceable, its long term viability is wildly speculative.
People will make money in the short term so long as the "greater fools" exist. Its OK to play that game as long as you acknowledge the risk.
The "only up" long term notion is BS spin. U
Re:Ignore? It's a bubble they helped create! (Score:4, Insightful)
Using your logic the financial crisis of 2008 was irrelevant since on the scale of decades the economy will be up.
You are quite correct in labeling those investing in Bitcoins with a decades long time frame as speculators. It is very risky speculation. Bitcoin has flaws, for example vulnerability to 51% attacks, mining being in the hands of a select few (ASICs) rather then its design assumption of mining being in the hands of the masses (CPUs, GPUs).
The current spike to $4,600 is largely driven by a new class of speculators, wall street. However the "hype" over bitcoins on wall street is partly based on their misunderstanding of the technology. It is really blockchain technology, not bitcoin itself, that will revolutionize finance and the transfer of money. Bitcoin is merely one user of blockchain technology, the user that brought the underlying technology to the attention of the masses. Something based on blockchain technology will be used decades from now, whether that something is bitcoin is wildly speculative and frankly unlikely.
Now none of this prevents speculators from making money, so long as there are still "greater fools" to sell to.
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You are right. Many of the coins I see don't solve problems that other coins don't also solve. Most project only mint their own coin for profit. The handful of coins I consider long term are bitcoin because it's currently the backing standard of the crypto world, ethereum because people are building things on top of it AND using it om some exchanges to trade, and NEO because it provides some functionality like ethereum but it's Chinese and Chinese tend to favour Chinese tech (aliexpress instead of amazon et
Don't Forget The Public Ledger (Score:5, Interesting)
Cryptocurrencies introduce direct competition to this rip-off market. If it is cheaper for me to convert some of my local currency [Pounds Sterling] into Bitcoin and then, upon arrival in say the United States, covert that from Bitcoin into US Dollars - then if those conversions have significantly lower transaction fees than a conventional Bureau de Change type of deal, then they offer a fantastic and useful market-disrupting alternative.
An even more useful application of Bitcoin technology is the ledger itself. When transactions are conducted in a publicly-shared ledger, then it is possible for entities to exchange funding without actually needing a central bank at all. Most of the big banks are already looking at the "public ledger" aspect of the technology - not necessarily to start offering Bitcoin exchanges in high street branches, but to look to cut out central agencies like SWIFT and CLS and their kind.
Interestingly, the central clearing banks (Federal Reserve, Bank of England, ECB, etc) could themselves be replaced by a public ledger for much of the daily transaction volumes that privately held banks (your JPMorgans and Barclays of this world) actually need. So maybe the central banks are looking to regulate cryptocurrency and related technologies as part of a move in self-preservation?
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There are already direct competitors in the exchange market. If you're paying currency conversion fees you're wasting money because there are many traditional banking firms that perform such tasks for no cost at all.
The reason they big players like Barclays and Lloyds get away with it are because customers in the UK are content with the status quo. You want to talk about horrible banks, look no further than the UK as a prime example.
Banks that don't charge currency conversions fees in the UK are Norwich and
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While they don't charge a fee, there's still a spread. If you convert US$100 to Euros and back to USD fee-free, you'll end up with about $97.50. Xe.com tends to
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Even with the spread that FOREX firms use as their fee have you factored in the cost that folks like Coinbase and others charge for their commission to convert BTC into fiat? Coinbase's fee for US accounts is 1.49%, i'm not sure how you'd compare it to Xe.com's fees. I'd hazard a guess however that it beats out coinbase's fee.
I'd still bet more on tradational forex to beat out crypto exchanges on fees.
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Cryptocurrencies may introduce direct competition to this rip-off market at some point, maybe
FTFY. BTC exchanges do exactly the same thing: they charge more for BTC than they pay for them. At a popular exchange here, the difference is about 2.65%. Sending money to someone overseas using BTC has the same problem, plus there's a transaction fee, which gets pretty steep at times if you want a reasonably fast confirmation. Sometimes banks are cheaper.
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What you are describing is actually the reason why bitcoin was created and why it is tolerated.
We are returning to a Bretton Woods system, whereby foreign exchange by private entities will be banned.
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Cryptocurrencies are currently the bubble du jour. As central banks have suppressed interest rates for so long, people are desperate for yield in anyway shape or form.
They should have been in equity then? We've had pretty big growth in equity over the last 10-years on top of recovering from the crash because of low rates. Low rates should only really affect bonds (and savings accounts).
People looking at cryptocurrencies really need to read The Four Pillars of Investing, particularly the history and psychology of investing.
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> Cryptocurrencies are currently the bubble du jour
Indeed. Anatomy of a bubble [netdna-cdn.com]
>They're currently enjoying lax regulatory oversight
There is _no_ oversight. The US government did NOT create the Cryptocurrencies "coins" -- the have ZERO authority to tax them. Bitcoins are private property. PERIOD.
The IRS doesn't tax my World of Warcraft gold either -- because they don't own it.
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> I own property but if I don't pay the property tax I lose the property.
You keep using this word "own". It doesn't mean what you think it means.
Allodial Title [uslegal.com] is the ONLY legal concept of land ownership.
But go ahead and keep complaining about "usage tax" and how you got conned into thinking you "owned" it. I suggest you go read Black's Law Dictionary in the meantime.
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A HUGE assumption in this argument:
1) Governments have the power to control or ban crypto currencies: There are many things that are currently banned by the government that can easily be obtained. Drugs come to mind first. Any teenager can go and get as much Pot as they want, they don't care that its banned by the government. The ban does now slow consumption, it only increases value. Many a ban or a regulation attempt will also increase crypto's value
Apples v. Oranges.
Drugs and especially pot have value because you can get high with it.
They tried to restrict gold dealers in Europe too in an attempt to prevent money laundering. Going to be very hard, because gold is gold and has value both intrinsically and industrially.
Both of these have value because you can hold it with your hands. Fiat has value for a different reason. You have to pay taxes with it. Certain countries are ahead of the curve by accepting bitcoin for taxes, but they're still converting
unspoken bias speaks volumes (Score:1)
How many bitcoin are the three authors, 4 contributor, and the various people whom the article quotes holding? This thinly-veiled, self-promoting, product placement article doesn't begin to address the fact that cryptocurrencies, despite all of the hype, don't really circulate. They are little more than quasi-anonymous parking places for "wealth"; and as long as their legitimacy is tied to their convertibility back into an internationally recognized currency, they will never be more than that.
Which begs the question... (Score:3)
Cryptocurrencies skirt all that and instead rely on their supposedly unhackable technology to guarantee value.
Is it unhackable?
Or, rather, is it less hackable than the status quo?
And, is its value guaranteed? We at least have FDIC in the United States, but what happens to BitCoin if the system collapses?
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FDIC doesn't guarantee the value of currency, only of savings.
It's also unclear why FDIC is still needed. If you keep your money in an FDIC-insured account, you're a fool.
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FDIC doesn't guarantee the value of currency, only of savings.
I'll go a step further: how will the FDIC guarantee the value of savings if it can't guarantee the value of currency?
Bottom line: if your government collapses then your money is worth less than toilet paper and isn't nearly as absorbent.
Buy land. If something comes along that is capable of destroying your land then you've bigger problems than your investment to worry about.
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And the value of land is determined...how? By the value of principal exchange, money. You can argue land is still intrinsically valuable (you can live on it, farm it, etc) or have some value in alternate money types (gold, bitcoins, etc).
But chances are, if the value of primary money (dollars, etc) approaches zero, owning the land is probably marginally valuable unless you're obtaining intrinsic value from it (ie, you farm it, or you live on it).
If land was such a great long-haul investment, I would kind
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More to the point, if the money system collapses so will the system of property rights. If the dollar becomes worthless all you will have to protect any asset is a gun.
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More to the point, if the money system collapses so will the system of property rights. If the dollar becomes worthless all you will have to protect any asset is a gun.
I've said that if we have a collapse, I'd rather have lead than gold. And bitcoins, being virtual, would be even worse for bullets than gold.
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The boundaries of your land are tied to government, and if it collapses you may be sitting on someone else's land.
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The FDIC doesn't guarantee the value of savings, only the nominal amount.
That is true for government-issued and government-manipulated fiat currency. It isn't true of money in general.
Or anything else of durable value, or a fiat currency outside the control of gover
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Does bitcoin work without electricity or the internet?
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What a stupid question.
There is nothing "inverted" about American totalitarianism: it's the same kind of totalitarianism that socialist, progressive, and fascist countries have always had and that has always been rooted in state supported corporatism. And it is gullible fools like you that promote this state of affairs.
Re:Which begs the question... (Score:4, Informative)
Is it unhackable?
No. There is an inherent flaw in the design, the 51% attack.
"The mining pool ghash.io briefly exceeding 50% of the bitcoin network's computing power in July 2014, leading the pool to voluntarily commit to reducing its share of the network. It said in a statement that it would not reach 40% of the total mining power in the future."
http://www.investopedia.com/te... [investopedia.com]
Another flaw in bitcoin is that its design assumes that anyone can be a miner. That was an incorrect assumption. CPUs and GPUs can not economically mine bitcoin, specialized ASIC hardware is necessary. So mining is not done by the masses as assumed, it is done by a specialized few.
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Another flaw in bitcoin is that its design assumes that anyone can be a miner. That was an incorrect assumption. CPUs and GPUs can not economically mine bitcoin, specialized ASIC hardware is necessary. So mining is not done by the masses as assumed, it is done by a specialized few.
This is why there are some new coins that attempt to limit how effective ASICs can be by using memory constrained algorithms rather than compute constrained ones.
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LOOMING THREAT TO THE ESTABLISHMENT (Score:3)
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https://pizzaforcoins.com/ [pizzaforcoins.com]
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https://pizzaforcoins.com/ [pizzaforcoins.com]
Q: "Can I walk down the street and buy a slice?"
A (cash): Yes.
A (card): Yes.
A (cryptocurrency): Okay: first, go to pizzaforcoins.com and enter your
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yea, but... (Score:2)
Didn't you just post a story about how no one actually buys anything with it? [slashdot.org]
So which is it? The Barbarian at the gate or a useless holding currency? Or some kind of intermediary that can coexist with the current banking system, which is needed to actually buy things.
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It's a bunch of people who don't grasp anything about economics or complex monetary systems being completely-fascinated with the strange thing they just discovered in their pants.
It's a commodity. Go onto ETrade, short gold, and buy cotton with the proceeds. Congratulations: you just bought cotton with gold. You're expecting the relative value of cotton to increase over the relative value of gold. Welcome to arbitrage!
Here's the fun bit: if both go down, but cotton falls less proportionally than g
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That's a good way to see it. As a commodity, although one that, more so than other things, has value only because people think it has value. So it still is a bit like a fiat currency, whereas cotton and gold can be put to physical uses. but I guess there is a lot of 'virtual' stuff that has market value like that. It's all gambling in the end.
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It bugs me mainly because commodities make bad currencies--they're unstable and deflationary--and, in the case of virtual currencies, because Bitcoin and other cryptocurrencies are produced by the expenditure of labor to no useful end.
When a person works, he expends time. For that time, we pay a wage. That wage (really, the total payroll cost--wage, benefits, taxes) is the cost of the good: if it takes 10 hours of labor at an average $10/hr to make a good, you have to charge $100 for that good to pay
Cashless society (Score:3)
Central Banks will do whatever it takes to keep people hooked into their system, so once they axe cash to huge uproar, it will be easy to control everyone at the touch of a button, something they cannot do as long as cash and the metaphorical cash under mattress survives.
The so called "bail in" that the ECB did to Cyprus circa 2013 was a test to see how easy it would be to raid people's bank / savings accounts once cash is axed, and if the bankers and governments could get away with it (they did).
The purpose of Bitcoin and gold (Score:2)
THe purpose is by ultra conservatives and libertarians who want 0 intervention is to use something where the government or banks can't do anything to destroy value.
In their eyes if government didn't exist then inflation and crashes would NEVER EVER happen. So what can the central bank do? Either the libertarians and ultra conservatives will be right and it will never crash as that only happens due to the government interfering with the free market or it will go down and the investors with that philosophy wi
translation (Score:3, Interesting)
Translation: "OMG, we can't screw over regular people anymore by manipulating the money supply or charging excessive fees for transactions."
Well, Mr. Sheng, perhaps you can't ignore cyber currencies, but cyber currencies can ignore you. That's kind of the point.
Bitcoin is so last week (Score:5, Funny)
Bubblicious (Score:3, Interesting)
There are some 900 cryptocurrencies at the moment, more variants than there are real currencies. I've been amazed the whole thing has maintained its hype so long. I expect a huge collapse before too long (not sure if its a year or ten however), as currently huge swaths of money are going into mining, but the amount of actual legal commerce enabled has been rounding error. At some point too many coin holders will ask the question: "Now what?"
Failing that I expect that when one too many criminal cases (especially money laundering and tax evasion) will get stymied by their involvement we will have major governments crack down and outlaw their anonymous sale and the whole mess will collapse. My conspiracy theory is that the NSA and its ilk have probably already cracked things well enough to track what is really going on, if not operating some of the exchanges themselves. Perhaps the whole thing has been turned into a giant honeypot already...
I'm getting pessimistic in my dotage (Score:3)
"Money as we know it depends on the authority of the state for credibility, with central banks typically managing its price and/or quantity. Cryptocurrencies skirt all that and instead rely on their supposedly unhackable technology to guarantee value."
Yeah, about that. Money used to be issued by private banks. Governments took took over this duty, not because they are any better at it, but because they wanted the power. There are still private currencies [wikipedia.org] and complementary currencies [wikipedia.org], in countries that allow them, but they are likely only tolerated because their circulation is so small.
The internet initially allowed the completely free exchange of information, and some of us were naive enough to hope that it would reduce the power and dominance of nation states. Unfortunately, most people didn't care enough, and have let governments impose national-level regulations on this exchange of information: everything from the "Great Firewall of China" to Europe's "right to be forgotten". The potential of the internet has been hobbled.
Cryptocurrencies are likely next. Until now they have been nearly irrelevant. If the problems of transaction frequency can be solved, and they begin to be more widely accepted for payment, national governments will begin to take a dim view of currencies outside of their purview. Regulation will quickly follow. In most countries, the local tax authority has full access to your banking information - expect them to demand the ID of your cryptocurrency wallet, so that they can track your BitCoin transactions. Anonymous currencies like Monero may be prohibited outright (though enforcement will be difficult).
Goverments want power. Money is power, currency is money.
Does Bitcoin's NSA crypto have a backdoor? (Score:1)
Score:-5, Pwned (Score:1)
Witness BitZtream getting pwned! [slashdot.org]... twice [slashdot.org].....three times! [slashdot.org]
Re: (Score:1)
It's bitztream the autism-hating, custom EpiPen-hating, Musk-hating, Qualcomm-hating, Firefox tabs-hating Slashdot troll!
So (Score:2)
Re:They can, have and will continue to do so (Score:4, Insightful)
It's been in a bubble since 2012 apparently. Still waiting for it to burst.
Wrong, it crashed from $1,000 to $250 from 2013 to 2015.