Bitcoin...the ultimate fiat?

RGJohn

What'n'ell is that Bitcoin thing?
Even traditional fiat is printed on paper or minted upon base rather than precious metals.
These are , ummm what?
Renegade electrons?
-------
At least you could plant the tulip bulb when the chimera had dissipated.
-----

secondrepublic

Bitcoin: a quick tutorial in how fiat currencies can die

JamesMurray

crackdown begins ?

jmski52

Bitcoin = fiat without the government's oversight and without the banking cartel's skimming operations.

If schumer doesn't like Bitcoin, it must be good.

Does anyone know where to obtain one of those tokens?

JamesMurray

There was a guy selling the tokens on Ebay UK , those are not actually Bitcoins obviously.

MsMorrisine

bitcoin transactions are fairly secure and ownership of bitcoins is fairly secure. there are electronic records of transactions and ownership.
supposedly bitcoins have been stolen, but supposedly again they can't be used because of the records would establish true ownership.
(think of it like having the denominaion, series and serial number of each of your bills registered. As they transact, they move from you to someone else.)

So, safety is one big thing bitcoin proponents talk about. The "Faith" is not in the us government but online security. Some argue this is enough to make it not fiat. I disagree.


They also like to talk about the limited number of bitcoins. The theorhetical maximum is about 25million, i think.

The other big thing bitcoin proponents mention is that fiat dollars can be printed in unlimited quantities, but there will only ever be 25million bitcoin.


The overall problem of fiat with bitcoin is that it is still backed by nothing. It has anti-hack features, so it is safer than your $45million in bank atms. But you can't convert them on demand to any fixed item or service.


Also, they are already subdividing bitcoins. Let's say they replace the us$ with bitcoins. While there are only 25,000,000 bitcoin to be created, to effectively transact business, they would need to infinitely subdivide bitcoin as their use and the economy grows.

So, while us$ are infinitely printable, think of subdividing bitcoin like stock-splits - 1 turns to 10 1/10, and so on. In essence, bitcoin can still be thought of a infinitely printable as people go from using 25,000,000 singles to 250,000,000 tenths, then 2,500,000,000 1/100ths and so on.

Luckily, to mitigate this, there are already competing currencies.
(The most ridiculous is Amazon coin which can be used for... buying on Amazon! Anyone remember Disney money?)


However, none of this fully addresses the fundamental fiat-ness of bitcoin. It's another thing without inherent underlying value or use whose value is determined by what some humans place on it (exchange rate done by algorithm).


Now, that doesn't mean it is worthless. For instance you could speculate on it and lose money or make money depending upon the varying exchange rate.


There are online sites that will point you into directions for purchasing them.


PS I forgot to mention that they are so safe, people store bitcoin records and ownership on flash drives plus print them out then keep all that in safe deposit boxes.

Julio

You can't beat them for gambling. Can't be traced??

MsMorrisine

ooops


reading some more info.

people have been hacked and their bitcoins laundered into cash.



can't be traced? that can have a downside.

derryb

next thing you know there will be all kinds of conspiracy theories about the gov. trying to shut them down.