The Bitcoin Hard Fork Fast Approaching, SEGWIT2X, is a BAD DEAL. #NO2X!

originally posted by: ScepticScot

Only it can be overproduced via forks. The scarcity element of crypto is entirely artificial.

An infinite number of competing currencies can arise removing any limit on supply.

No, because they have to have enticing enough a reason to fund them. They can play games with their own worthless fiat if they want... voluntarism will make the freest one highest priced.

originally posted by: JamesCookieIII

originally posted by: ScepticScot

Only it can be overproduced via forks. The scarcity element of crypto is entirely artificial.

An infinite number of competing currencies can arise removing any limit on supply.

No, because they have to have enticing enough a reason to fund them. They can play games with their own worthless fiat if they want... voluntarism will make the freest one highest priced.

Bit coin itself has forked twice recently with a potential third on the horizon. Each time this increases the supply. They forked versions may be valued different and have different named but functionally there is little difference.

The start up costs of a completely new crypto are negligible which is why there are so many ICOs (many of which are just pump & dumps).

originally posted by: ScepticScot
Only it can be overproduced via forks. The scarcity element of crypto is entirely artificial.

An infinite number of competing currencies can arise removing any limit on supply.

How is that any different from the credit market?

originally posted by: Aazadan

originally posted by: ScepticScot
Only it can be overproduced via forks. The scarcity element of crypto is entirely artificial.

An infinite number of competing currencies can arise removing any limit on supply.

How is that any different from the credit market?

Because credit creation results in an asset and a liability.

originally posted by: ScepticScot
Because credit creation results in an asset and a liability.

So does bitcoin creation. The liability created is the cost to produce the coin, in the US it costs about $20,000 in electricity to produce a single coin (this rate varies on current difficulty). That's the liability produced. The asset is the coin and what the coin purchases.

Mining actually isn't where you want to be with BTC anymore, instead you either want to be a currency trader, or a payment processor. Payment processing is essentially free money but it requires some infrastructure to set up.

Actually though, I don't think BTC is even worth it. I don't know everything about cryptocurrencies but Etherium seems much better to me, because you can build contracts into the exchanges, and that allows for funds to transfer in seconds rather than days.

I think BTC is going to eventually unravel, as we're already at about 80% of the maximum possible supply so we're eventually going to reach a situation where the expansion of the money supply doesn't come from the item itself but rather from the items ability to be divided. Such a system can only work however if the money supply continues to appreciate in worth. I'm not yet convinced that such a thing will happen, because the cost of creation will eventually be eroded through inflation in other currencies.

a reply to: Aazadan

Bitcoin doesn't create a liability. It has a cost to create, which is why bitcoin creation is a net economic loss.

If created a liability I would be able to redeem it for that electricity.

originally posted by: ScepticScot
a reply to: Aazadan

Bitcoin doesn't create a liability. It has a cost to create, which is why bitcoin creation is a net economic loss.

If created a liability I would be able to redeem it for that electricity.

You can redeem it anywhere it's accepted.

originally posted by: Aazadan

originally posted by: ScepticScot
a reply to: Aazadan

Bitcoin doesn't create a liability. It has a cost to create, which is why bitcoin creation is a net economic loss.

If created a liability I would be able to redeem it for that electricity.

You can redeem it anywhere it's accepted.

No I can buy things where it's accepted.

Same as I can buy gold with dollars, it doesn't mean the dollar is redeemable for gold.

The electricity used to create bitcoin is gone. There is no way of getting it back and bitcoin has no corresponding liability.

Personally I have been following Bitcoin since inception, loved the tech and principle but was dubious at first. Due to a few factors, Mt. Gox etc. Now I am just kicking myself for not investing then.

Recently have got onto an exchange and am dabbling in LTC, ETH & Classic and XRP. But still have not purchased any Bitcoin. It just keeps going up and up, currently sitting at around $8876 AUD (Australian)atm. Has gone up $2000 in a few weeks. From my reading and research I now speculate it is just going to keep going up. Waiting for a slide on the price and it is not going to happen so will have to get a lil bit and sit on it.

a reply to: aliensanonymous

6600 dollars this morning hahahahahaha

a reply to: ScepticScot
The liability is always more than the asset when credit is issued. If the Federal Reserve system prints up and loans you $1000, the $1000 is the asset and the $1000+interest is the liability. All traditional currency is this way, and that is why the collective debt always grows and is mathematically impossible to erase. There is more liability than asset value in traditional currency.

If everybody had some Bitcoin it would be more prevalent in p2p transactions. There would also be more demand for infrastructure like atms and such. That just takes time. You can't unseat 100s of years of the old system easily or quickly.

Bitcoin doubters either cannot comprehend or don't believe that someday everybody will have some cryptocurrency. I believe the future currency will be a basket of cryptos, it won't be a single unit from a corporation like the Fed has with the dollar.

The world of finance is complex, and cryptocurrencies will allow some of that complexity filter down to the end-users. For the foreseeable future cryptocurrencies seem like the Wild Wild West, with new ones popping up with different niches to fill. Governments will eventually issue their own variant, and I think that's a good thing. I believe the government should control our currency, and adopting cryptos is a way for that to happen. The government would be in a better place if it too would kick the Federal Reserve to the wayside.

originally posted by: JamesCookieIII
a reply to: aliensanonymous

6600 dollars this morning hahahahahaha

Just hit $8900 AUD will hit $9000 by end of the week.....

Frk $8925 might be $9000 by the end of todays Asian morning run on trades.

originally posted by: SouthernForkway26
a reply to: ScepticScot
The liability is always more than the asset when credit is issued. If the Federal Reserve system prints up and loans you $1000, the $1000 is the asset and the $1000+interest is the liability. All traditional currency is this way, and that is why the collective debt always grows and is mathematically impossible to erase. There is more liability than asset value in traditional currency.

If everybody had some Bitcoin it would be more prevalent in p2p transactions. There would also be more demand for infrastructure like atms and such. That just takes time. You can't unseat 100s of years of the old system easily or quickly.

Bitcoin doubters either cannot comprehend or don't believe that someday everybody will have some cryptocurrency. I believe the future currency will be a basket of cryptos, it won't be a single unit from a corporation like the Fed has with the dollar.

The world of finance is complex, and cryptocurrencies will allow some of that complexity filter down to the end-users. For the foreseeable future cryptocurrencies seem like the Wild Wild West, with new ones popping up with different niches to fill. Governments will eventually issue their own variant, and I think that's a good thing. I believe the government should control our currency, and adopting cryptos is a way for that to happen. The government would be in a better place if it too would kick the Federal Reserve to the wayside.

Having a liability is an inherent part if how currrencies work and us not in anyway a bad thing. The lack of liability is arguably why bitcoin isn't really money but a commodity.

The federal reserve system however does not print up and loan people money. The money we use day to day is created by commercial banking, not central banks.

The government could kick the federal reserve to the wayside at any point it chooses. Adopting bitcoin (or any other crypto currency) as the replacement however would be incredibly stupid and economically damaging.

a reply to: ScepticScot
When I 'buy' a good or service I typically think of it as selling my dollars. People like to buy my dollars with their useful stuff, I think it's insane. I don't believe in the Federal Reserve system and try to get out of it as much as I can. I can't believe how many people are literally brainwashed to love useless pieces of paper with numbers on them. Paper that is created and owned by another man, just on loan to us, the slaves.

The electricity to mine a Bitcoin is gone, but the Bitcoin remains forever. In the future it will be even more electrically expensive in USD to mine a Bitcoin, with the dollar becoming more worthless over time. Bitcoin is technically backed by the electricity and math needed to create them. This might be an imeasureably small amount of value, but at least it's a positive value rather than Federal Reserve notes that contain a negative value.

a reply to: ScepticScot
I agree Bitcoin is a commodity, in a sense that gold and silver are. It isn't money because it isn't widely adopted yet. Gold and silver are no longer money the way they were 150 years ago, largely because they aren't widely adopted since the Federal Reserve was created. Gold is worth more in dollars now than it has ever been (except for the peak of manipulated bubbles).

The commercial banks get their 'money creating power' from the central bank. The commercial banks are indebted to the FR too but they play on the same team so their cash flow is protected. I definitely oversimplified the path the money takes from it's creation down to the borrower, but the point is the debt exceeds the amount of money in the system, by design.

I believe the Federal Reserve has held us back over the last 100 years. Sure we have made many great advancements but we should have pushed further. There are a lot of world changing ideas that are dormant because of the inefficiency of the monetary system, and I believe that is intentional.

a reply to: SouthernForkway26

Something can't back a currency once it's used. The only inherent value of bitcoin is its usefulness as a payment system ( which is my view is limited).

Dollars have a value because they have a corresponding liability.

Banks will exchange the money they create for federal issued money either literally in paper form or by moving money between banks reserve accounts.

a reply to: ScepticScot
The electricity allows for the math, and that math is there forever. At any given time you can look back through the Blockchain and see the results of the math. The Blockchain holds accountability for the system and makes up the unviversally accepted transaction history.

'Wasted' energy is needed for any currency system. I still get paid with a physical check I take to my bank. Traditionally it has been bank workers 'wasting' their energy processing the check by withdrawing from my employers account and crediting my account. The miners are substituting human energy for CPU electricity to do what the workers at my bank do.

It costs 20k in electricity for a Bitcoin only because of competition. If half of miners went offline it would only cost 10k in electricity. Bitcoin are released on a set schedule, indifferent to how much CPU power is mining them. Miners are rewarded based on the percentage of CPU power they contributed when one is mined.

Banks don't have to exchange the money they make for anything. It is the same money the FR makes. They just have to make timely payments to the bank they borrowed from. They have to report their accounts so the Federal Reserve can do their job to keep the monetary supply balanced. There is a reason it's illegal to loan money for profit without credentials. 'Off books' money lending makes the Federal Reserve's account of the system inaccurate.

I had to do a large cash transaction before, the seller demanded physical cash only, at the bank. The bank manager rolled his eyes and had to order the physical cash as he didn't have it on hand. It was a gigantic hassle.

a reply to: JamesCookieIII

On Coinbase what will happen is that Bitcoin will remain ‘Bitcoin’ and segwit2x will be ‘Bitcoin2x’. Will be credited for equal amounts of both.

a reply to: SouthernForkway26

The maths doesn't give bitcoin value either. The maths required has no utility other than the creation of bitcoin. It doesn't matter how much electricity or maths is used in its creation once it's used it used.

All electronic money systems require electricity however bitcoin mining is spectacularly and deliberately inefficient as part of mechanism to artificially ensure scarcity. The problem I have with that is that the same level of scarcity could have been achieved without the same economic and environmental costs.

I am not sure you are correct about amount of electricity being used as irrelevant as my understanding is that while the complexity of mining changes on a schedule the actual creation isn't. So if the amount of processing power was to decrease then the rate if creation would fall. I happy to help corrected on this if wrong.

The money banks create is not the same as what a central bank creates. It is denoted the same is very different. It's s common misunderstanding about the fact that banks create money.

Central banks create money banks use, commercial banks create money people use. (with paper money being an arguable exception but only a small % of money in circulation).

Banks gave always only kept a small amount of cash on hand, but can convert reserves on demand from central banks. Worth noting that if the seller only wanted cash he would not be accepting bitcoin either.

originally posted by: ScepticScot
I am not sure you are correct about amount of electricity being used as irrelevant as my understanding is that while the complexity of mining changes on a schedule the actual creation isn't. So if the amount of processing power was to decrease then the rate if creation would fall. I happy to help corrected on this if wrong.

The creation rate remains static. Though it does drop off over time. When Bitcoin first came out 50 coins were awarded per block solved, today it's 12.5 and next year it will drop to 6.25. The difficulty in solving the block varies based on the total computational power being used on the network. Your chance of solving the block is your computational power/total power. When there's less on the network it's easier to create. $20k per bitcoin is average right now, but it's possible to get it as low as about $6000 during lulls. Difficulty is basically purely market driven and favors places with cheap electricity.