patrick.net

WookieMan says

errc says

Bitcoin is headed for six figures valuation

I'm genuinely not being a smart ass. Why?

They are in limited supply, while the demand is increasing

errc says

They are in limited supply, while the demand is increasing

I understand that and there is a finite number of bitcoins. Why is demand increasing for it though? That's what doesn't make sense to me. What is "it" that's in demand?

Again, I'm being serious. I really do enjoy investment advice, but I simply don't understand anything about this. I know how to get it. I know how to sell it. But why? Why is this worth $17k and why won't it be worth $1 in 2 hours time? Until someone can explain that to me, I'm willing to watch people make millions, while I continue on my path to retire at 50. Which I'm cool with.

Tax evasion.

You can counterfeit a dollar bill but you can't counterfeit a bitcoin. Think about it. Who's crazy now?
Hopefully the IRS comes to their senses and taxes bitcoins as "collectibles" (like gold and silver).

WookieMan asks:
Why is this worth $17k and why won't it be worth $1 in 2 hours time?
That is roughly the "cost" the the equipment and energy used to "mine" a bitcoin at this time. Who's crazy now?

anon_3e01a says

Who's crazy now?

You’ve said this twice now. Please explain who is calling someone crazy here? Sure wasn’t me.

Patrick says

They should not. Land is the best object of taxation, and cannot be hidden. So Bitcoin helps

I never understood this claim. So a large farming operation should according to you pay more taxes than Google? Why?

anon_3e01a says

You can counterfeit a dollar bill but you can't counterfeit a bitcoin. Think about it.

If it was created by humans it most certainly can be counterfeited. Or even easier, stolen. It’s already happened.

When someone can answer why bitcoin can’t go to $2, I’ll think about investing. Until then I’ll stick with things that have a history of consistent returns.

Again, invest in this stuff all you want. I won’t stop you and I don’t think my postings here have been negative towards those that have decided to invest. I’m just looking for someone to tell me why this is sustainable. Why there is “demand” for “it.” No one has explained this. I don’t think anyone can truthfully.

http://www.zerohedge.com/news/2017-08-25/bitcoin-really-anonymous-irs-moves-track-cryptocurrencies-new-chain-analysis-tools "According to a contract recently obtained by the Daily Beast, the IRS can now track bitcoin and other cryptocurrency addresses. They can do this to route out potential tax evaders."

WookieMan says

anon_3e01a says

You can counterfeit a dollar bill but you can't counterfeit a bitcoin. Think about it.

If it was created by humans it most certainly can be counterfeited. Or even easier, stolen. It’s already happened.

When someone can answer why bitcoin can’t go to $2, I’ll think about investing. Until then I’ll stick with things that have a history of consistent returns.

Again, invest in this stuff all you want. I won’t stop you and I don’t think my postings here have been negative towards those that have decided to invest. I’m just looking for someone to tell me why this is sustainable. Why there is “demand” for “it.” No one has explained this. I don’t think anyone can truthfully.

I don’t hear many people referring to Bitcoin purchases as “investments”. Bitcoin can serve as a divest from the USD, or as a pure speculative gamble, which is the camp I fall into. The market for Bitcoins has seen the majority of inflows from The East, first China, now primarily Japan.

I learned long ago, that to ask “why” is anathema to investing in momo plays, the question you need to ask is “why not”, so you know when to exit.

I was first turned on to bitcoins almost five years ago, by some very intelligent sports gamblers, looking for cracks in our Horrific Anti-Freedom Republican laws. Around the time they went from the teens all the way to $30. Lol. Was BTC a bad buy at $30?

I just bought some Bitcoin..$10.00 worth from curiosity. It was the easiest thing in the world.

Heraclitusstudent says

http://www.zerohedge.com/news/2017-08-25/bitcoin-really-anonymous-irs-moves-track-cryptocurrencies-new-chain-analysis-tools "According to a contract recently obtained by the Daily Beast, the IRS can now track bitcoin and other cryptocurrency addresses. They can do this to route out potential tax evaders."

If someone figures out a way to buy and sell Bitcoins with cash, the economy will be exposed to some weird challenges.

WookieMan says

Again, I'm being serious. I really do enjoy investment advice, but I simply don't understand anything about this. I know how to get it. I know how to sell it. But why? Why is this worth $17k and why won't it be worth $1 in 2 hours time? Until someone can explain that to me, I'm willing to watch people make millions, while I continue on my path to retire at 50. Which I'm cool with.

Here's a BS Test for Bitcoin
If just ONE government shuts down a major bitcoin exchange... Will the price go sky high or will it collapse?

If the latter, the libertopian/technoutopian dreams are shown to be mirages since many see a currency "safe from gov't/corporate" meddling.

TwoScoopsMcGee says

Here's a BS Test for Bitcoin
If just ONE government shuts down a major bitcoin exchange... Will the price go sky high or will it collapse?

If the latter, the libertopian/technoutopian dreams are shown to be mirages since many see a currency "safe from gov't/corporate" meddling.

At the very least there will be a crash. If the USA bans Bitcoins and other countries start following, it will completely collapse.

WookieMan, I'm a pat.net oldtimer and appreciate your presence here. I don't mean to suggest you're crazy. All fiat currencies ARE an act of faith and it behooves us as investors to do our due diligence. I'm still trying to wrap my head around the Bitcoin. At this point, miners are spending thousands of dollars in "real" fiat US currency to set up farms to mine Bitcoins. A compute revolution or energy breakthrough could cause prices to go down, but because of the way the Bitcoin algorithms are setup, it takes incrementally more resources to mine the next coin. At some point miners throw in the towel, or the Bitcoin limit (21 million) is reached. At that point, other demand mechanisms sustain the currency.

And to think that people thought GOLD ETFs were crazy...

Strategist says

I just bought some Bitcoin..$10.00 worth from curiosity. It was the easiest thing in the world.

Real men Mine their own Bitcoin. Wonder if the RoR is better than selling excess solar back into the grid?

anon_3e01a says

WookieMan, I'm a pat.net oldtimer and appreciate your presence here.

Come on out from behind the curtain my friend. Be a "new" oldtimer. I am slightly crazy though, not gonna lie.

anon_3e01a says

At this point, miners are spending thousands of dollars in "real" fiat US currency to set up farms to mine Bitcoins.

This is still what I don't get. Bitcoin will never become a mainstream (credit card use EVERYWHERE, like now) payment method. Mine away. Spend money on equipment. When the bitcoin limit gets hit, then what? I still don't understand the demand portion of this. My dollars work fine. What is bitcoin doing for me that I can't already do? If I had 10 bitcoins, can I get something for cheaper? Seriously asking. The US gov. (or any other country with the ability) isn't letting bitcoin become the worlds reserve currency. So why is there demand for it? I simply don't understand the demand side with this.

Let me finish by saying I don't begrudge anyone getting into this. I genuinely hope some/many of you hit a home run, seriously. I'm not that bitter, jealous person like it may appear with what I'm writing on this topic. As you said, I'm trying to wrap my head around it, but I'm not getting any clear answers from my research or anyone that says they know this market.

WookieMan says

What is bitcoin doing for me that I can't already do?

Cash dollars (literal paper money) has much of the same function of bitcoin locally. But bitcoin has the advantage of being instantly transmissible around the world without physical delivery of anything.

Patrick says

WookieMan says

What is bitcoin doing for me that I can't already do?

Cash dollars (literal paper money) has much of the same function of bitcoin locally. But bitcoin has the advantage of being instantly transmissible around the world without physical delivery of anything.

Yea but Western Union has done that forever, no?

Patrick says

Cash dollars (literal paper money) has much of the same function of bitcoin locally. But bitcoin has the advantage of being instantly transmissible around the world without physical delivery of anything.

Who the hell is doing that though? Transacting with other countries and people on that level? I have zero need to be able to send money to Italy, Poland, China, New Zealand, etc. Very, very few people need that. I don't think bitcoin alleviates the current systems in place for this either. Along with the fact that no nation will ever allow bitcoin to become a world wide currency of acceptance on a governmental level. This is why it's dead in the water to me.

I've got a lot a shit out there with me being negative. I've yet to see someone post something positive about bitcoin yet outside of it's "upside." Tell me why this sticks around and doesn't go to $1. There still hasn't been a person here to explain why there is demand for this. I understand the supply is limited. By why is anyone demanding this outside of absolute speculation? This has the looks of the worlds largest pump and dump scheme I've ever seen in my opinion. And by all means, gain on the pump. Just don't get caught in the dump.

errc says

Yea but Western Union has done that forever, no?

There are records of Western Union transactions.

Maybe the people who use bitcoin do not want to leave any traces of their transactions that could be connected back to themselves.

errc says

Patrick says

WookieMan says

What is bitcoin doing for me that I can't already do?

Cash dollars (literal paper money) has much of the same function of bitcoin locally. But bitcoin has the advantage of being instantly transmissible around the world without physical delivery of anything.

Yea but Western Union has done that forever, no?

Bitcoin transactions cost almost nothing. Western Union is expensive. Especially for foreign countries. Right now, if a company was to accept payments in bitcoin over credit card and other methods, their profit margin would increase dramatically based on avoiding the fees that come from the middlemen.

anonymous says

The system’s value is entirely based on perception

Much like Enron?

Patrick says

errc says

Yea but Western Union has done that forever, no?

There are records of Western Union transactions.

Maybe the people who use bitcoin do not want to leave any traces of their transactions that could be connected back to themselves.

"Bitcoin is not anonymous

Some effort is required to protect your privacy with Bitcoin. All Bitcoin transactions are stored publicly and permanently on the network, which means anyone can see the balance and transactions of any Bitcoin address. However, the identity of the user behind an address remains unknown until information is revealed during a purchase or in other circumstances. This is one reason why Bitcoin addresses should only be used once. Always remember that it is your responsibility to adopt good practices in order to protect your privacy."

https://bitcoin.org/en/you-need-to-know#anonymous
Basically, there's a way to connect you back to your Bitcoin transactions if you are not super-careful 100% of the time and the record is kept forever and, ulike WU, doesn't even require subpoena to be read by authorities (or bad hombres).

HEYYOU says

Guess you missed the cost to the electrical system to run the Bitponzi.

That was the other point that story in the WSJ made, besides the huge server farms that will be objectionable to environmentalists, is the huge amount of electricity consumed.

anon_7b43f says

their profit margin would increase dramatically based on avoiding the fees that come from the middlemen.

While I agree with this and think it would be better for consumers and businesses to whack the fees, the middlemen you mention aren't just going to bend over and take it. They'll just compete and make it not worthwhile to have their clients switch over to bitcoin (or any crypto). Or they'll find a legal way or lobby to have bitcoin outlawed.

Also, only people that own bitcoin are pushing for it to be used as a payment method. I don't have bitcoin, so I have zero use for it. I'm sure it's higher, but 99% of people on this planet don't have a single fraction of a bitcoin. I haven't been to a brick and mortar store that accepts it. Even if they did, it would take time to obtain coins and then add an app to my phone (or something) to make the payment.

It's not as anonymous as most espouse it to be and is easily stolen from naive people getting into it that have no business doing so. I still have my cash and can be as anonymous as I want, but don't have any reason to do so because I don't transact in illegal activities (same with 90% of people).

If I have $250,000 worth of cash in the bank, my government guarantees it. Bitcoin, not so much. Talk to Mt. Gox. And if the news and stories are to be believed, 650,000 coins aren't accounted for. Or 3% of all TOTAL bitcoins from one theft. Right now that's probably around 5% or so of bitcoins available.

I can go into a bank, commit $20k to purchasing a $100k investment property and can make more dollars collecting rent from others that transact in the worlds reserve currency. Not so much with bitcoin.

I can put my dollars into a tax deferred 401k account, avoiding taxes today. I can't with bitcoin (as far as I've seen). Saving me 25% on my top end tax bracket and allowing that 25% savings to compound at a historical average of 7% in the stock market plus the original amount put in.

And I'm just scratching the surface here. Bitcoin (and cryptos) are speculation vehicles. I actually have no problem with them or people that invest in them. I've been reading a lot up on it and nothing has convinced me that bitcoin is sticking around for the long term. Nothing. I don't have the risk tolerance for it, but if you do go for it. If you can, let me know how bitcoin can equal or beat any of the above I'm all ears. (This is for anyone, not just the quoted comment)

Bitcoin resembles gold. It's all in the spot price, pays no dividends, the fundamentals do not "Grow".

Unlike say, stock in a coffee franchise that goes from making $5M a year to $50M a year.

Referring back to the other thread on Real Estate, stocks are far more liquid.

In my mind, there are 2 games with BTC
Game 1: The utility of BTC is NOT to add anything other currency CAN not do. It’s original purpose is to neuter the banks. Cut their dicks off so that they can NOT screw the mass. We do NOT need bank account to trade stuff. What we trade, nobody knows and nobody tax us. If the .gov wants to cripple me by freezing my asset, they can NOT do it. If the lenders fucked up, there will be NO bailouts because there is NO central banks to print BTC. Sure, nobody can lend recklessly as well because there is NO BTC printer. YES, this is revolution after the smart ones knew how banks and .gov fucked everybody in 2008. The trust was lost and BTC was born. If you want your 250K to be “protected”
by the banks and .gov, just remember that you are their sheep and they can fleece you at any moment. Do you want “protection” or do you want power in your own hand? that’s up to different people’s nature. Are you sheep or are you dogs?

Game 2: The mass sheep always wants to transfer other sheep’s $ into their own pocket. BTC become such an vehicle. Sheeple wants $ as much as sheep wants food. they donNOT care they are fed and they will get fleeced by the masters. They just compete with each other. Then BTC come in as the emperor’s clothes. All the sheeple praise the BTC and everybody is excited and happy and okay the game until the girl shouts “the emperor has NO clothes” AKA “BTC has no military or police violence power backing”. Then the sheeple will turn 180.

The bankers know the true threat is game 1, so they distract the sheeple with game 2. Let the sheeple get burnt by the BTC “bubble” give it a bad name, so sheeple will NEVER even realized the perspective of Game 1.

You are being played.