Bitcoins (?!)

[Atticus]

So this 'cryptocurrency' surged over $19,000 yesterday before settling at $15K. It's based on . . . nothing . . . or to be more accurate . . . pure speculation.

Is this the new Dutch Tulip Craze, which must ultimately implode into nothingness? Perhaps it more closely akin to the Dot.com fizzle of the 00s.

Anyway, it's pretty darned interesting to follow. One of the first transactions (2010 in Jacksonville, FL) was for two Papa John pizzas, which sold for 10,000 bitcoins. That same amount of bitcoins is now worth over $150,000,000 (yes, 150 MILLION dollars). In March 2011 a bitcoin was worth exactly a dollar.

I'm flabbergasted. What's next for this 'concept'?

[Tuariki]

The NZ Herald reported that some guy sold his house and used the funds to purchase bit coins

[lonewolf]

I cannot grasp the concept of imaginary/non-existent bitcoins.. How does you go about exchanging real currency for a bitcoin and how do you redeem it for real money?

The Big Bang Theory had an episode on bitcoins purchased and stored on a missing laptop.

[Atticus]

I cannot grasp the concept of imaginary/non-existent bitcoins.

That's why its called CRYPTOcurrency. No one over the age of 30 can figure it out, so all the millennials can laugh at us when they buy us out.

[wamego relays champ]

Is this the new Dutch Tulip Craze, which must ultimately implode into nothingness?

Unless crypto-currencies like Bitcoin soon become widely accepted for goods and services, it seems that this bubble is likely to end badly. Most young investors are buying them not for use as a currency, but as an investment in an asset (like tulip bulbs or gold bullion or a share of public company stock).

Except that it has no inherent value like a physical asset, so driving the speculation is the belief that it will soon become widely accepted as a means to transact trade. (Rampant rumors that Amazon will soon be accepting it feed the frenzy). Although a few major online sites accept Bitcoin, it is apparently most popular as a currency with those who want to anonymously buy and sell illegal stuff (i.e. drugs or weapons), often on the Dark Web. My only brush with it was when a friend’s company had its network attacked, and they had to pay the ransom using Bitcoin.

How does you go about exchanging real currency for a bitcoin and how do you redeem it for real money?

There are Bitcoin ATMs out there (even in Oklahoma) that make it easy to convert cash to Bitcoin, and exchanges exist to both buy and sell.

I am a financial guy, not an IT guy, and the subject has fascinated me of late. Some Wall Street brains are very keen on the technology behind Bitcoin (you may have seen the term “blockchain” in recent ads from IBM) which is expected to change the world in many ways even after the crypto-currency bubble bursts.

[xw]

Paper money also has no inherent value, currencies' value merely reflects the power that backs them up. Unlike most currencies whose strength are based on the muscle of their issuing government bodies, bitcoin is completely dependent on the non-organizational, interenet-based...people? I think unless the hackers' community collectively does something extraordinary to defend it, the bubble will burst.

[lonewolf]

True, but paper money is not as volatile and is universally more spendable..

[18.99s]

Paper money also has no inherent value, currencies' value merely reflects the power that backs them up. Unlike most currencies whose strength are based on the muscle of their issuing government bodies, bitcoin is completely dependent on the non-organizational, interenet-based...people? I think unless the hackers' community collectively does something extraordinary to defend it, the bubble will burst.

And even if there is a cryptocurrency that manages to gain long-term stable value and widespread acceptance for goods and services, how do we know if it will be Bitcoin and not something else? There are literally dozens of them out there, and some of them have superior characteristics compared to Bitcoin, particularly those that were designed to avoid Bitcoin's long transaction times, which run from hours to multiple days.

[18.99s]

Paper money also has no inherent value, currencies' value merely reflects the power that backs them up.

A power which the makers of Bitcoin et al don't have. Even if you earn your entire income in gold, the government is going to demand income tax payments in its own currency. It's also going to demand property taxes, sales taxes, vehicle registration, driver's license fees, business license fees, and traffic fines in its own currency, so you're forced into acquiring and spending that currency to some extent. Bitcoin doesn't have the power to legislate its own demand like that.

But if a government decides to issue its own cryptocurrency, and accept tax payments and fees and fines with it, that changes things a lot.

[Tuariki]

Even though I am off the beaten track down here in NZ, I have a whole bunch of bit coins.

With the imprinted resentment of George Washington, they are sometimes called two-bit coins, sometimes quarters.

[lonewolf]

two bits, four bits, six bits, a dollar
All for ________ stand up and holler

Is this ubiquitous cheer now passe?

[bhall]

1. I don't own any Bitcoin. 2. I do own small amounts of a couple other cryptocurrencies purely as a speculative endeavor.

I am taking a risk with money I am willing to lose, not unlike stocks or gambling. I have a couple colleagues who have been into cryptocurrencies for a couple years now and made a killing. They did borrow from their retirement to fund the initial investment and have since paid themselves back. From what I know, it seems likely that more than one cryptocurrency will survive and that likely isn't going to be Bitcoin. The distributed ledger/blockchain and other concepts backing cryptocurrencies have a lot of other uses and are being widely adopted across industries, which increases the likelihood of a cryptocurrency or two being adopted. https://www.reuters.com/article/us-r...-idUSKCN1C237N is worth a read and https://www.npr.org/sections/money/2...lockchain-gang is worth a listen.

[Atticus]

1. I don't own any Bitcoin. 2. I do own small amounts of a couple other cryptocurrencies purely as a speculative endeavor.

I am taking a risk with money I am willing to lose, not unlike stocks or gambling. I have a couple colleagues who have been into cryptocurrencies for a couple years now and made a killing. They did borrow from their retirement to fund the initial investment and have since paid themselves back. From what I know, it seems likely that more than one cryptocurrency will survive and that likely isn't going to be Bitcoin. The distributed ledger/blockchain and other concepts backing cryptocurrencies have a lot of other uses and are being widely adopted across industries, which increases the likelihood of a cryptocurrency or two being adopted. https://www.reuters.com/article/us-r...-idUSKCN1C237N is worth a read and https://www.npr.org/sections/money/2...lockchain-gang is worth a listen.

I told my son to put $200 in Ripple for me and we'd split any return. I was chagrined to discover you can't outright buy many of the cryptocurrencies; you have to 'trade' for them.

[Conor Dary]

Don't lose your password...

Transacting in bitcoin requires two keys—one public, and one private. The paired strings of letters and numbers are part of a system that allows bitcoin to change hands without any middlemen. The private key is cumbersome and looks something like this: E9873D79C6D87DC0FB6A5778633389F4453213303DA61F20BD 67FC233AA33262. Protecting the private key is paramount—anyone who accesses it can transfer or spend the bitcoin, and transactions can’t be reversed or stopped.

James Howells, an IT worker in Newport, Wales, lost 7,500 bitcoin he mined in 2009 after a hard drive with his private key was accidentally thrown away during an office cleanup. His story went viral this month as the value of the hard drive’s contents rocketed to more than $100 million. Now he’s attempting to excavate the landfill and dig through four years’ worth of trash to find it.

Philip Neumeier bought 15 bitcoins for around $260 in 2013, when he was deciding whether to accept the virtual currency on his e-commerce site. Now that his cache is approaching $300,000 in value, he is hoping to recover a long-forgotten password. He’s considered hypnosis, but for now opted to build a supercomputer that tries to use “brute force” to crack the code.

The five foot-tall computer system is working so hard that it sits in a 270 gallon tank in special mineral water to disperse the heat it generates. Still, Mr. Neumeier figures it could take a couple hundred years to run through all the possible combinations of letters, numbers and symbols.

“I should probably be about 332 years old by then—hopefully bitcoin will be worth something,” he says.

https://www.wsj.com/amp/articles/goo...mpression=true

[gh]

I told my son to put $200 in Ripple for me and we'd split any return. I was chagrined to discover you can't outright buy many of the cryptocurrencies; you have to 'trade' for them.

200 bucks buys a lot of Ripple!

https://www.youtube.com/watch?v=ciR7Fq2tqJ0