Bitcoins?

[Serenity Sinclaire]

Hi Serenity,

Please note that these services don't work with the country from which our business operates. For us to use these services we would have to open a bank account in another country, have to start filing taxes there, etc.

They do

https://bitpay.com/bitcoin-integration-partners

http://moneymorning.com/2014/05/14/inve ... 0-million/

http://dcmagnates.com/israel-gets-its-f ... tcoin-atm/


It's not coming...it's already here.

[Serenity Sinclaire]

Hi Serenity,

Bitpay may have an integration partner in Israel but they don't direct deposit USD (or any other currency) to Israeli banks: https://support.bitpay.com/hc/en-us/art ... tting-Paid

While nice, an ATM on some street corner is irrelevant for us. We need to have direct deposits to our bank account in USD for this to start becoming viable for us. We pay most of our bills in USD and needing to convert NIS to USD would cost us more money than the move to BitCoins would potentially save us.

We're well aware of BitCoins potential but it's just not relevant for us until there is a dependable service provider that serves our country and can offer us a transparent method to list prices in USD and have that amount transfered to our bank account without any Bitcoin-to-USD exchange rate risk.

[Deuce Halsey]

Why you'll inevitably be using bitcoin within the next year, same way you use internet

Hackers and thieves are already using Bitcoin the same way they use the internet. For reference I give you the collapse of MtGox in February 2014, which led to the "disappearance" of more than 700k Bitcoins, which were valued somewhere in the neighborhood of 250 million US Dollars. That's not the only Bitcoin exchange that has collapsed in the past few months, by the way, just the largest and most popular one.

It appears that the Bitcoin system software is riddled with holes big enough to drive a virtual armored truck through. Hackers have been doing just that on a regular basis. I find it hard to believe that people are still promoting what is a very flawed implementation of a good idea.

Please give it some thought!

I have done so, and I would not do business with any grid that actually supported Bitcoins.

I do agree that a worldwide virtual currency is a really cool idea that could solve a lot of international problems. The primary difficulty will be to be make such a virtual currency secure from hackers. Bitcoin has been proving recently that it doesn't fit the bill from a security point of view.

[Gavin Hird]

One of the more serious bit coin exchanges are https://btc-e.com where you can trade in multiple currencies and also withdraw to Visa and Mastercard.

Add to that Virwox accepts bit coin that can be exchanged into Linden Dollars. https://www.virwox.com/?stage=1

[Gavin Hird]

In March this year IRS made a statement that they would tax Bitcoin as property and not currency. This is probably where most western countries will land on the taxation issue, meaning bit coin is also legal and accepted. Many countries in Asia have outlawed bit coin and other crypto currencies, yet there is a significant transaction volume of bit coin going to China.

[Selby Evans]

As Gavin noted, there are 2 possible ways to treat bitcoins: property or currency. The practical distinction is that currency does not (over short times) fluctuate much in value relative to other things it might be exchanged for. That steadiness allows prices to be set in a currency with reasonable expectation of what the value of the payment will be when the payment is made in the future. Ilan has commented that the value of bitcoins fluctuates too much to allow reasonable pricing.

The value of any specific kind of property is set (in most cases now) by a market, based on supply and demand. It can fluctuate drastically relative to the local currency. That means you can buy and hold property in the expectation that the value will increase (again, relative to the local currency). The value may also decrease, so you can lose "money" in this kind of exchange. If you are have skills or special knowledge for predicting the future value of some kind of property, you may make money on speculation in that kind of property. Otherwise you are likely to lose.

I know nothing about bitcoins except what I read on the internet. My impression is that the value of bitcoins (relative to USD, my local currency) fluctuates a lot, so I would view bitcoins as property. I know nothing about how the supply is created nor what controls the demand. So I would expect to lose money if I speculated in that market.

The discussion here seems to focus mainly on using bitcoins as a currency. If many internet site that I have occasion to pay were accepting bitcoins, then it would serve as a currency from my viewpoint. I would not, however, buy and hold bitcoins beyond my immediate needs, anymore than I would hold USD beyond my immediate needs.

Maintaining a steady value for a currency requires a lot of attention from central banks and is not always done well even by them. I am skeptical of the potential for such steadiness to be achieved the free market process that seems to govern the pricing of bitcoins. I wish we had an internet currency, but I doubt that bitcoins will serve under the present arrangement. At any rate, I won't bet any USD on it.

[Gavin Hird]

Despite IRS wanting to tax Bitcoin as property, I think most people think of it, and use it as currency. It is to an increasing degree used as currency in bitcoin to bitcoin transaction accepted as payment for both goods and services, but also for exchange to real currencies, between crypto currencies where for instance the exchange rate between bitcoin and litecoin is very stable despite the fluctuations against real currencies, and also between crypto currencies and other virtual currencies like Linden Dollars.

Bitcoint is called crypto currency because it is essentially generated by decrypting blocks of information, upon decryption 25 Bitcoins are released to the market. This mining process has a built in mechanism that regulates the difficulty of decrypting a block that depends in the availability of decryption resources. Initially Bitcoin could be mined on general purpose CPUs, then on GPUs, then on single chip dedicated devices and now you can only sensibly mine Bitcoin by applying multi-chip devices (often a couple hundreds) in combination with pooling resources to decrypt the block. This essentially regulates the supply of Bitcoin over time and makes it less prone to inflation.

As pointed out we have seen wild fluctuations in the value against dollar over the last half year, but it has stabilized around $450 and is now seeing a slow increase past $500. Because of the constrained supply as described before, the expectation is that it over time will move to $3000 per Bitcoin unless we see regulatory intervention. Because of the constraint, we also see new crypto currencies like Litecoin that can be mined on general purpose computer equipment. Litecoin has even stronger anti inflation mechanism built into the coin.

As every virtual currency chances are it can crash and burn either because the company that drives the currency goes out of business (which could be the case with LL), or because of regulatory intervention that change the parameters of the currency. As a token for exchange between virtual currencies or for accepting payment in a virtual world, Bitcoin or one of the other established crypto coins could work well.

[Constance Peregrine]

I say we all use Rubles!!!

[Freda Frostbite]

What Deuce said! No bitcoins for this girl! I learned all about them on The Good Wife! LOL

[Shandon Loring]

For those that have access to CoastToCoast AM radio shows, and an interest in the particulars of Bitcoin and how it works and all...
Here is a show link: http://www.coasttocoastam.com/show/2014/01/15