The devastating bit coin bubble

[quade 3]

Talk about something that's even dumber than buying gold to protect against the apocalypse. What I love so much about the BitCoin story is nobody actually knows its origin and, in theory, nobody controls it. Sounds like a solid investment to me.

quade -
The World's Most Boring Skydiver

[Rick 67]

how many bitcoins for a six pack of good beer??

You can't be drunk all day if you don't start early!

[ManagingPrime 0]

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Talk about something that's even dumber than buying gold to protect against the apocalypse. What I love so much about the BitCoin story is nobody actually knows its origin and, in theory, nobody controls it. Sounds like a solid investment to me.

I was actually entertaining buying some a little over 6 months ago. Would have seen a good ROI if I did....story of my life.

As far as the origins go. A number of investigative journalists have looked into the creating of bitcoin and there is a high degree of certainty as to who the programmer(s) behind the code are.

In theory, it's a great alternative to other currencies. The creation of new money is algorithmic as opposed to by decree from a central authority and the supply is finite.

I've been interested in the concept for sometime. I think we'll be hearing more about this and other crypto-currencies in the coming years.

That said, as far as "investment" quality goes, it's about as speculative as it gets.

[ryoder 1,381]

Probably a better investment that keeping your money in a Cypriot bank.
Heck, I have a friend who lost a bundle of money he had in a Cayman bank a few years ago.

"There are only three things of value: younger women, faster airplanes, and bigger crocodiles" - Arthur Jones.

[Skyrad 0]

it is without doubt the most stupid investment idea since the dot com boom.

When an author is too meticulous about his style, you may presume that his mind is frivolous and his content flimsy.
Lucius Annaeus Seneca

[ManagingPrime 0]

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Probably a better investment that keeping your money in a Cypriot bank.
Heck, I have a friend who lost a bundle of money he had in a Cayman bank a few years ago.

I want to know how to SHORT it, not buy it.

Find someone who will lend you bitcoins. Say an agreement where you borrow 1k bitcoins and at the end of a 1 month, 6 month term you repay the laon in full plus a 10% premium. You could use your home as collateral.

[ryoder 1,381]

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Talk about something that's even dumber than buying gold to protect against the apocalypse. What I love so much about the BitCoin story is nobody actually knows its origin and, in theory, nobody controls it. Sounds like a solid investment to me.

It reminds me of another supposedly secure scam: SSL Certificates.

"There are only three things of value: younger women, faster airplanes, and bigger crocodiles" - Arthur Jones.

[wmw999 2,119]

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Say an agreement where you borrow 1k bitcoins and at the end of a 1 month, 6 month term you repay the laon in full plus a 10% premium. You could use your home as collateral

Maybe you can...

Wendy P.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[ManagingPrime 0]

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Say an agreement where you borrow 1k bitcoins and at the end of a 1 month, 6 month term you repay the laon in full plus a 10% premium. You could use your home as collateral

Maybe you can...

Wendy P.

Thay would be an example of dealing with a single counterparty. Apparently there are p2p bitcoin loan programs already in place.

I'm a fan of people putting their money where their mouth is. If you think it's a good short, go for it. Baring any future Cyprus type events I think it could be a great short candidate.

The fact we are even having this exchange demonstrates that it's a potentially viable alternative currency. I don't doubt there are some decent size shorts out there already.

How many people ten years ago "would never give" thier credit card info online? Times change.

[grimmie 173]

It will be interesting to see what governments do with bitcoin in the near future. Drug dealers and other criminals use bitcoins. And what about taxing bitcoin transactions, international money laundering, transfers, etc?

I'm reading about it being accepted by more business entities each day.

Maybe it will be the currency of the world. Who knows...

[ryoder 1,381]

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How many people ten years ago "would never give" thier credit card info online? Times change.

I never give my CC info online. BoA lets me generate a temporary number that is locked to one vendor with a different expiration and dollar limit. Citibank offers the same option.

I learned the hard way not to give real CC numbers online.

"There are only three things of value: younger women, faster airplanes, and bigger crocodiles" - Arthur Jones.

[ryoder 1,381]

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Probably a better investment that keeping your money in a Cypriot bank.
Heck, I have a friend who lost a bundle of money he had in a Cayman bank a few years ago.

I want to know how to SHORT it, not buy it.

So how is that short working out?
http://finance.yahoo.com/news/bitcoin-hacked-price-stumbles-buying-103848677.html

"There are only three things of value: younger women, faster airplanes, and bigger crocodiles" - Arthur Jones.

[Rick 67]

1 of my project managers left at the beginning of the year. He and his partner have built some high speed servers/processors(??) so they can host the exchange of bitcoins. I am not sure exactly how all this works but I believe they process the transactions for a percentage.

It is a big gamble but I hope it works out for him.

You can't be drunk all day if you don't start early!

[base698 1]

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Talk about something that's even dumber than buying gold to protect against the apocalypse.

As an idea it's pretty fucking brilliant. The most world changing ideas usually aren't understood at first. Think about when the internet started gaining traction and you'd hear pundits saying it was a fad that would be gone by 2004. Tech dot coms survived their bubble and generated quite a few billion dollar businesses that immense practical value.

From the NY Times today:

http://www.nytimes.com/2013/04/08/business/media/bubble-or-no-virtual-bitcoins-show-real-worth.html?pagewanted=all&_r=0

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In conversations about the project with scholars who study it, the word that comes up as often as “bubble” is “genius.”

Here are a couple of things that made me realize it had immense practical value. An acquaintance was recently selling a software library online. He was accepting PayPal, and had made about $200K in short order. PayPal froze the account and made him jump through a ton of hoops to get it back, which took him months. He was terrified as it was to be his money to live off on. This can't happen with Bitcoin. You can send and receive with no risk of chargeback or account freeze. Taking more than $10,000 in and out of the country requires red tape, not so with this. If you want to buy prescription drugs or illicit drugs through the mail you can do that to. Visa wants to say you can't donate to Wikileaks? Tough shit. Want to send a donation to a war torn village in Africa but the transfer fees eat up all the money? bitcoin to the rescue.

Granted it's highly probably this is all speculation and could be another dutch tulip, but the use case and the tech is compelling.

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I want to know how to SHORT it, not buy it.

Shorting would be good as a hedge for those who already made a lot of money with it and are afraid of the tax implications of selling off half a million in bitcoin, but given that there isn't much history for how to set the options it would be a wash. There are however exchanges that you can short.

[quade 3]

Besides being simply stupid, there are legitimate reasons to hate bitcoins.

http://qz.com/71813/malware-turns-hacked-computers-into-slaves-that-mine-new-digital-currency/

quade -
The World's Most Boring Skydiver

[skinnay 0]

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Besides being simply stupid, there are legitimate reasons to hate bitcoins.

http://qz.com/71813/malware-turns-hacked-computers-into-slaves-that-mine-new-digital-currency/

I'm not sure why that's a reason to hate bitcoins. Perhaps you can also elaborate on why bitcoins are "simply stupid"?

[base698 1]

That's like saying cash is stupid because people steal ATMs.

Bitcoin is something specific. It isn't the exchanges that sell them or the hackers that try to steal bitcoins.

[quade 3]

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Besides being simply stupid, there are legitimate reasons to hate bitcoins.
http://qz.com/71813/malware-turns-hacked-computers-into-slaves-that-mine-new-digital-currency/

I'm not sure why that's a reason to hate bitcoins. Perhaps you can also elaborate on why bitcoins are "simply stupid"?

Because the process used to create them is the computing power required to make a transaction. It's completely artificial with no relationship to work performed by humans. They are going up in price due to speculation, but that has nothing whatsoever to do with their actual value. They are not only used in criminal activities, but actually encourage it due to their untraceable nature.

Further, you have no idea whatsoever what other nefarious activities might be hidden in the processing power of the transactions. If people are setting up bitcoin malware to "mine" bit coins, then what other malicious code might be involved? I would not be surprised to learn bitcoin mining are an enabling technology of world wide cyber war.

quade -
The World's Most Boring Skydiver

[quade 3]

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Bitcoin is something specific.

So is Monopoly money. That doesn't mean it's actually worth anything.

quade -
The World's Most Boring Skydiver

[ManagingPrime 0]

The amount that be created is finite...21 million I belive. Quite unlike the fiat currencies we now know.

The code is open source. Do you trust linux based systems? If the project continues to gain more interest it will become more secure. The fact that we are not seeing devestating attacks on the system speaks volumes...the project is a threat to existing schemes and there are a number of parties that would like to see bitcoins just go away.

[ManagingPrime 0]

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Bitcoin is something specific.

So is Monopoly money. That doesn't mean it's actually worth anything.

Same could be said of the usd. It's worth what the market participants think it's worth.

Edit to add: what would you rather have, a million dollars, a million euro or a million bitcoins?

[quade 3]

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The fact that we are not seeing devestating attacks on the system speaks volumes...

O'rly?

http://www.independent.ie/business/technology/cyber-attack-on-bitcoin-exchange-exposes-flaws-in-virtual-currency-29175639.html

quade -
The World's Most Boring Skydiver

[ManagingPrime 0]

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The fact that we are not seeing devestating attacks on the system speaks volumes...

O'rly?

http://www.independent.ie/business/technology/cyber-attack-on-bitcoin-exchange-exposes-flaws-in-virtual-currency-29175639.html

Old news. That's not a flaw in the bitcoin system, its a flaw in the exchange servers. It was a ddos attack on their servers...that would be like saying stocks are worthless because a hacker group attacks the NYSE servers.

[quade 3]

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Bitcoin is something specific.

So is Monopoly money. That doesn't mean it's actually worth anything.

Same could be said of the usd. It's worth what the market participants think it's worth.

Actually, that's not true.

A country's currency is valuable because of the trust you put in the country to continue to exist. That might not be what an economist might say, but it's true. That's way gold was the standard for so many centuries, because pretty much no matter what you do to gold, it still exists. Same thing with shares of stock in a company. Same thing with real estate.

The same can NOT be said for bitcoins in any way, shape or form. If tomorrow the international banking industry convinces the governments of the world to outlaw it OR if cyber criminals figure out how to easily counterfeit, it doesn't matter how many bitcoins you have, they'll all be completely worthless.

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Edit to add: what would you rather have, a million dollars, a million euro or a million bitcoins?

A million dollars. See above.

quade -
The World's Most Boring Skydiver

[skinnay 0]

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Besides being simply stupid, there are legitimate reasons to hate bitcoins.
http://qz.com/71813/malware-turns-hacked-computers-into-slaves-that-mine-new-digital-currency/

I'm not sure why that's a reason to hate bitcoins. Perhaps you can also elaborate on why bitcoins are "simply stupid"?

Because the process used to create them is the computing power required to make a transaction. It's completely artificial with no relationship to work performed by humans. They are going up in price due to speculation, but that has nothing whatsoever to do with their actual value. They are not only used in criminal activities, but actually encourage it due to their untraceable nature.

Further, you have no idea whatsoever what other nefarious activities might be hidden in the processing power of the transactions. If people are setting up bitcoin malware to "mine" bit coins, then what other malicious code might be involved? I would not be surprised to learn bitcoin mining are an enabling technology of world wide cyber war.

You're wrong in just about everything you mention here. The rest of it makes absolutely no sense and I don't even know how to respond. You should just read up on the bitcoin specification.