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BitCoin hið nýja gull?

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Hvað segiði?

Það er nokkuð í þessu sem mér finnst áhugavert:

1) Nafnlaus gjaldmiðill

2) Hægt að eiga í viðskiptum beint án milligönguaðila á netinu

3) Ekki hægt að framleiða að vild, takmarkað hve mikið af bitcoins verður til með tíð og tíma

4) Ekki hægt að falsa

Hljómar ansi vel.

Ég efast um að þetta verði gjaldmiðill þjóðríkis, en ég held að þetta verði einskonar milligöngugjaldmiðill, í staðinn fyrir t.d. visa-kort.

Það sem gefur þessum gjaldmiðli virði sitt er einmitt þessi eftirspurn eftir milligöngugjaldmiðli. Nafnleysi, það að eiga í viðskiptum beint, þetta eru stórir faktorar.

Bitcoin í stað krónu?

Sveinn Valfells ræðir um gjaldmiðilinn Bitcoin.

http://visir.is/section/MEDIA98&fileid=CLP19655

Ég spái því að það komi samkeppni við þetta. Tel ég að VISA muni koma með sinn eigin cryptography-gjaldmiðil, þannig að fólk geti keypt svona gjaldmiðil og átt á VISA kortinu sínu eða VISA-accountinum sínum.

Erum við að horfa á einkagjaldmiðla rísa upp og taka yfir? Munum við fá greidd laun í VISA-kredit og BitCoin rafmynt í framtíðinni?

Edited by appel

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Ég er nokkuð hrifinn af CryptoCurrency. Hvort Bitcoin muni virka sem þjóðargjaldmiðill veit ég ekki, en það eru margir kostir.

1. Takmarkað magn. Prentuninn verður ekki miðstýrt af mjög þröngum hópi manna sem getur auðvitað leitt af sér gríðarmikla spillingu. Ala federal reserve.

2. Viðskipti milliliðalaus. Engin þriðji aðili sem heimtar prósentu eins og VISA.

3. Nafnleynd.

En síðan eru kannski ókostir líka

1. Hann er dulkóðaður en verður lykillinn einhverntímann brotinn ? og ef svo er hægt að hafa einhverskonar plan B ?.

2. Hann hefur verið frekar óstöðugur síðustu mánuði (http://bitcoinity.org/markets), örugglega því að fólk kaupir hann fyrst og fremst vegna spákaupmennsku (eins og gullið).

Edited by Gormurinn

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Þetta með hvort lykillinn verði einhverntímann brotinn, það er góð pæling.

Ég held reyndar að cryptography styrkleikinn verði sífellt bættur eftir þörf. Þannig að alveg sama hve hraðvirkar tölvurnar verða eftir 10-20 ár þá mun ætíð taka einhver þúsundir ára að brjóta lykilinn með öllum tölvum heimsins á fullu.

Hitt er svo, hvað ef það kemur einhver quantum ofurtölva sem getur brotið þetta á einni sekúndu?

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Finnst allar svona umræður og hugmyndir á ská og skjön við það sem er raunverulegt og undirliggjandi.

Það er ekki gjaldmiðli að kenna að gutta-trix til hægri og vinstri falsa peninga. Það er ekki einu sinni gulli um að kenna að menn búi til bólur með því, ekki frekar en það er Túlipönum að kanna hér fyrir einhverjum hundruðum ára þegar bólur byrjuðu fyrir alvöru.

Undanfarin 15-20 ár hafa menn verið ötulir við að kenna krónunni um verðbólgu og gengisfall hér á landi. Krónan er samt sem áður 100% saklaus af því.

Sá seki er einmitt helst þeir aðilar sem mest kvarta og kveina. Heimta hærri laun, hærri lífskjör.. sérstaklega af því að þeir eru svo "menntaðir" Þessi stétt manna hefur farið offari í því að hækka ráðstöfunartekjur landsins og alltaf uppfyrir það sem landið ræður við, enda hefur þetta fólk meira aðgengi að fjölmiðlum en flestir. Hinsvegar hefur þetta fólk ekki aukið kaupmátt landsins með eigin framlagi. Sú aukning kemur alltaf annarstaðar frá.

Einasta leiðin út úr svona rugli var og er að lækka gildi gjaldmiðils. Og þegar þessu fólki var settur stóllinn fyrir dyrnar upp úr 1990 (Þjóðarsátt) þá var bara farið á næsta stig. Einkavæða. Skuldsetja landið. Búa til fléttur sem bjuggu til peninga og er Gjafakvótinn líklegast sú byrjun sem markaði endalokin.

Allt í allt. Hefur ekkert með krónuna að gera. Í stað þess, þá hefur þetta allt með græðgi og sérhagsmuni að gera. Fólk í stórum kippum ryðst fram eins og enginn sé morgundagurinn. Hefur aldrei unnið ærlega vinnu en kann að heimta og orga. Heimtar og heimtar þar til allt er komið í óefni og þá.. heldur það bara áfram að heimta.

Aðeins þegar þroskastig mannsins er komið upp úr þessum hjólförum sem það verður hægt að sameina mynt fyrir allan heiminn. Þá þarf myntin ekkert að vera dulkóðuð, hægt að notast við bankakerfið eins og það er í dag með þokkalega öflugu tölvukerfi. Það þyrfti hinsvegar ekki að vera nema 1/50 af stærð þess sem það er í dag, þar sem lang mest af því í dag gengur út á öll trixin og blöffin.

Edited by feu

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Aðeins of djúpt Feu. Ég vil kannski halda þessari umræðu meira við BitCoin og cryptography-gjaldmiðla og þá þróun.

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Aðeins of djúpt Feu. Ég vil kannski halda þessari umræðu meira við BitCoin og cryptography-gjaldmiðla og þá þróun.

Hvernig er hægt að ræða þróun gjaldmiðla án þess að ræða um undirliggjandi þætti sem stýra því hvernig þessir gjaldmiðlar virki?

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Hvernig er hægt að ræða þróun gjaldmiðla án þess að ræða um undirliggjandi þætti sem stýra því hvernig þessir gjaldmiðlar virki?

Mannlegt eðli er hægt að rökræða til endaloka heimsins.

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Og tengist ekki öll mannana verk, hinu mannlega eðli?

Er þá ekki hægt að ræða eitt eða neitt afþví að snertiflöturinn er, mannlegt eðli?

Ágætis dæmi er einmitt umræðan um Gull. Þar slepptu ákveðnir menn alveg snertifletinum við hið mannlega eðli. Hvað kom svo í ljós?

Jú, hið mannlega eðli eða græðgin var það megið afl sem öllu stýrði. Það verður alltaf ægi bil á milli þess að taka hluti úr samhengi og þess að ræða hluti í fullu samhengi, annað væri nú líka.

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Þetta er auðvitað rétt hjá þér Feu, að krónan sem slík er auðvitað ákveðið verkfæri sem ílla hefur verið farið með. Fífl í bankakerfinu ræna beinlínis arði beint af fólki í landinu með því að valda verðbólgu með braski sínu. En gæti gjaldmiðill eins og Bitcoin komið í veg fyrir það ?. T.d að ekki að hægt að prenta hann með allskonar brögðum ?.

Edited by Gormurinn

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Þetta er auðvitað rétt hjá þér Feu, að krónan sem slík er auðvitað ákveðið verkfæri sem ílla hefur verið farið með. Fífl í bankakerfinu ræna beinlínis arði beint af fólki í landinu með því að valda verðbólgu með braski sínu. En gæti gjaldmiðill eins og Bitcoin komið í veg fyrir það ?. T.d að ekki að hægt að prenta hann með allskonar brögðum ?.

Þá þarftu að svara því hvað muni gerast ef öll lönd væru með BitCoin og ný veð yrðu til. Fyrst, raunveruleg veð eins og nýjar olíu-auðlindir, síðan óraunveruleg veð, eins og allskonar bólur og ný-nöfn á vöðlum.

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Ég held að það sem komi helst í veg fyrir miklar vinsældir á BitCoin er hversu erfitt er að kaupa og skilja hvað þetta er.

Hvert fer maður og kaupir? Hvernig kaupir maður? Hvað fær maður í hendurnar? Hvernig geymir maður þetta? Fólk einfaldlega skilur þetta ekki enda byggir skilningur fólks á gjaldmiðlum á þeim sem eru til í dag.

Þegar þetta er orðið auðvelt fyrir flestalla að stunda, og skilja, þá giska ég að eftirspurn eigi eftir að stóraukast, og verðið hækka.

Annar faktor sem þarf að íhuga er hugsanleg boð og bönn stjórnvalda. Munu svona gjaldmiðlar verða bannaðir? Það gæti reynst erfitt að tæknilega banna svona gjaldmiðla, en það væri hægt að gera það nægilega erfitt að stunda lögleg viðskipti með þá.

Samkeppnin gæti splundrað svona crypto-gjaldmiðlum. Á morgun gæti komið nýr ennþá betri gjaldmiðill og þá hrynur BitCoin í verði þegar allir flykkjast í hinn nýja. Svolítið einsog þegar allir fóru frá MySpace yfir á Facebook.

Svona gjaldmiðla eru ekki endilega flóknir tæknilega, hver sem er gæti búið til sinn eiginn crypt-gjaldmiðil.

Allir gjaldmiðlar byggja trúverðugleika sinn á einu, hve margir vilja taka við honum í skiptum fyrir eitthvað.

Hve margir vilja taka við honum í skiptum fyrir eitthvað er sú trú að hann haldi virði sínu.

Það að hann haldi virði sínu byggir á því að framboð hans er takmarkað, og að menn vilji taka við honum í skiptum fyrir eitthvað.

Þetta er svolítil hringavitleysa.

Það sem vantar í svona crypto-gjaldmiðil er eitthvað sem "bakkar" hann upp, eitthvað hagkerfi, t.d. ríki, þjóð og milljónir manna sem eru reiðubúnir að vinna fyrir.

En jú, vissulega, þetta byggir allt á mannlegu eðli. En það er óútreiknanlegt og erfitt að rökræða.

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Þá þarftu að svara því hvað muni gerast ef öll lönd væru með BitCoin og ný veð yrðu til. Fyrst, raunveruleg veð eins og nýjar olíu-auðlindir, síðan óraunveruleg veð, eins og allskonar bólur og ný-nöfn á vöðlum.

Ég þarf ekkert að svara því.

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Ég þarf ekkert að svara því.

Hmmm... eitthvað að misskilja.

Þú ritaðir: "En gæti gjaldmiðill eins og Bitcoin komið í veg fyrir það ?. T.d að ekki að hægt að prenta hann með allskonar brögðum ?."

Og til að fá svar við þeirri spurningu þá þarftu að geta svarað því hvað muni gerast ef öll lönd væru með BitCoin og ný veð yrðu til. Fyrst, raunveruleg veð eins og nýjar olíu-auðlindir, síðan óraunveruleg veð, eins og allskonar bólur og ný-nöfn á vöðlum.

Það sem ég er í raun að benda á, er að nýr gjaldmiðill muni engu breyta. Þú getur ekki sagt að það séu til x-mikið af BitCoin í dag og þar við sitji. Það þarf alltaf að auka magn peninga á sem eðlilegustu forsendum.

Vandinn liggur einmitt þarna grafinn. Eðlilegustu forsendur í dag eru langt, langt, langt í frá það sem er rétt. Á meðan fræðimannasamfélagið skilgreinir trix sem eðlilegan hagvöxt, þá mun hvaða töfra-mynt engu breyta.

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Getur verið að svona opnir frjálsir gjaldmiðlar muni á endanum útrýma ríkisgjaldmiðlum?

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Getur verið að svona opnir frjálsir gjaldmiðlar muni á endanum útrýma ríkisgjaldmiðlum?

Erfitt að segja.

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[skrifað um miðjan apríl]

Let's begin at the end.

Why? Well, because all anybody wants to know these days, it seems, is where you stand on the Bitcoin phenomenon.

The virtual currency has spawned a whole new label to bestow upon people who have bought in: 'bitbug'. And whether you are a believer or more prone to pooh-pooh the hottest topic in global finance right now, people are happy to stick a nice, tidy label on you and move on.

Many think Bitcoin is a bubble the likes of which we haven't seen since US housing or NASDAQ stocks or even tulips, while others think it is the future. Certainly, the behaviour of Bitcoin this past week has given the advantage to the naysayers, but to dismiss the virtual currency out of hand is to miss the point entirely.

Personally, I think Bitcoin is much more than a carnival sideshow, as it has frequently been portrayed. For what it's worth, I happen to think Bitcoin is one of the most important things to happen to the world of finance (and, indeed, to the numerous worlds that orbit it — which is to say, pretty much all of them) in several decades.

That being said, I think there are enormous problems with the virtual currency, which may well ultimately defeat it. However, now that the trend has started, if Bitcoin does crash and burn, something more robust will inevitably rise, phoenix-like, from the ashes.

Now you know my conclusion: you know where I stand on Bitcoin, and so those amongst you who think the whole thing is some kind of joke have just had fifteen minutes of your lives handed back to you, because you can stop reading, put me in the file labeled'bitbug', and get on with your day.?

For those of you still with me — either out of mere curiosity or a burning belief in Bitcoin, let's go back to the beginning and see if we can make some kind of sense of this virtual phenomenon.

The history of Bitcoin has everything you could ever want from an underground cultural phenomenon, including a mysterious, shadowy figure at the heart of it, whose true identity remains a mystery.

In November of 2008, a man (or men, or women — nobody is quite sure) named Satoshi Nakamoto published a research paper outlining his ideas for a new digital currency.

All that was known about him was that he supposedly hailed from Japan and had an email address that originated in Germany.

However, though Nakamoto was (and remains) a mystery, his creation managed to solve a problem that had been causing cryptographers sleepless nights for years: the issue of double-spending.

(The Wire): If a digital dollar is just information, free from the corporeal strictures of paper and metal, what’s to prevent people from copying and pasting it as easily as a chunk of text, “spending” it as many times as they want? The conventional answer involved using a central clearinghouse to keep a real-time ledger of all transactions —ensuring that, if someone spends his last digital dollar, he can’t then spend it again. The ledger prevents fraud, but it also requires a trusted third party to administer it.

Bitcoin did away with the third party by publicly distributing the ledger, what Nakamoto called the “block chain.”

What does that mean to you and me? Well, The Economist takes up the story:

(Economist): For a new block to be deemed valid, some computer on the network must create a transaction log for it that dovetails with the previous blocks. To prevent acceptance of bogus logs, giving it a seal of approval has to be prohibitively costly to any individual user, but relatively cheap for the network as a whole. This is done by making it into a forced-work task, which involves using the valid blocks and the new transactions to generate a digest consisting of 256 bits (ie, any number between 0 and 2256). The task is complete when the system's algorithm spits out a hash value below a preset target. The target is set so that the puzzle is solved by someone on the network, and a new block approved, every 10 minutes. To keep this rate constant as the network's ranks swell and its combined computing power grows, the target is lowered in order to make generating a value below it harder. (Conversely, if the network were to shrink, it would get easier again.)

Part of the genius of this system lies in how difficult its complex structure makes it for anybody to cheat. Creating bogus 'blocks' requires the would-be counterfeiter to have control of over half the computing power of the entire Bitcoin system in order to outflank it and get his knock-off blocks validated in time. Yes, it's possible, but only theoretically rather than practically.

So there is the indisputable beauty of Bitcoin: it is the anti-fiat currency, completely decentralized and unable to be created at whim by thirsty central banks. It is also, of course, inherently deflationary — anathema to central bankers around the globe.

As it grew quietly amongst a small, tech-savvy internet fringe group, Bitcoin began to be used in real-world transactions (the first of which was a pizza, delivered in Florida but paid for in bitcoins through an English volunteer who accepted the coins and then called in the order from the other side of the pond). Prophetically, when Wikileaks suggested they might adopt the viral currency in 2010, the mysterious Nakamoto emerged from the shadows with these words:

The project needs to grow gradually so the software can be strengthened along the way. I make this appeal to Wikileaks not to try to use Bitcoin. Bitcoin is a small beta community in its infancy. You would not stand to get more than pocket change, and the heat you would bring would likely destroy us at this stage.

We will revisit Nakamoto's prophecy in a moment.

Shortly after he conveyed this message, Nakamoto sank back into the shadows once again, saying he had 'moved on to other things'; and he has not been heard from directly since.

In October of 2011, Bitcoin entered the mainstream when a lengthy article appeared in The New Yorker, entitled 'The Crypto-Currency: Bitcoin and its mysterious inventor', in which the mechanics of the new frontier in monetary transactions was explained:

(New Yorker): The Bitcoin software encrypts each transaction — the sender and the receiver are identified only by a string of numbers — but a public record of every coin's movement is published across the entire network. Buyers and sellers remain anonymous, but everyone can see a coin has moved from A to B, and Nakamoto's code can prevent A from spending the coin a second time.

Nakamoto's software would allow people to send money directly to each other, without an intermediary, and no outside party could create more Bitcoins. Central banks and governments played no role...

Everything is based on crypto-proof instead of trust," Nakamoto wrote in his 2009 paper.

But, though Bitcoin grew rapidly, spawning multiple exchanges around the world where owners of 'wallets' could transact in the virtual currency, it did so on the fringes of society and failed to garner the attention of either the media or the public as the world strained to make sense of a financial system turned upside down after 2008 — never mind something called a 'cryptocurrency' that was being 'mined' in the basements of computer nerds around the world.

Naturally, there were teething issues — exchanges were hacked and wallets full of Bitcoins stolen after being left unprotected on users' computers, and much bad press was generated by Bitcoin's association with the underground website Silk Road, on which the anonymous currency could be used to pay for everything from drugs to pornography. But slowly and steadily the marketplace weathered its growing pains and, as more and more merchants began accepting payment in Bitcoins, the community broadened into something more than just a weird underground movement.

The list of places willing to accept Bitcoins as payment will be surprising to many (you can check it out HERE), but it wasn't until the likes of Reddit and Wordpress began transacting in Bitcoins late last year that the fears expressed by Nakamoto began to become very real indeed.

In fairly short order, the world's first Bitcoin ATM (picture, previous page) was installed in Nashua, NH, but it was more a curiosity than anything else, and Bitcoin remained firmly under the radar.

However, after the ham-fisted attempts by authorities to steal depositors' money in Cyprus, the Bitcoin concept was catapulted into mainstream consciousness and onto the front pages of just about every newspaper in the world, as fascination with an alternative to fiat currency gripped the world (even though many purchasers of Bitcoins didn't have the foggiest idea what they were dealing with). The chart below shows a Google Trends search for the term 'Bitcoin', and as you can see, interest in it has gone ballistic.

Remember this chart. It's not the last one like it you're going to see before we're done here.

Source: Google Trends

That surge in interest led to an extraordinary sequence of events over the past few weeks as Bitcoinmania struck in full force, overwhelming the exchanges upon which it trades and causing shutdowns, outages, and wild swings in price that have had even the most seasoned bubble-watchers scratching their heads.

Mt. Gox, the largest Bitcoin exchange, which claims to facilitate 80% of Bitcoin transactions made in dollars and 70% of those made in other currencies, halted trading on Thursday after a wild week of price fluctuations and a staggering surge in account openings was capped by a denial of service attack.

In a statement, the exchange accentuated the positive:

(Mt. Gox): As expected in such a situation people started to panic, started to sell Bitcoin in mass (Panic Sale) resulting in an increase of trade that ultimately froze the trade engine! To give you an idea of how impressive things were here are some numbers that we would love to share with you guys: – The number of trades executed tripled in the last 24hrs. – The number of new account opened went from 60k for March alone to 75k new account created for the first few days of April! We now have roughly 20,000 new accounts created each day.

But this is what the last week looked like, viewed through the dispassionate medium of a chart:

Source: Bitcoincharts.com

Remember that chart we looked at a few minutes ago of Google Trends inquiries into 'Bitcoin'? Well, if we step back and look at a longer-term chart of Bitcoin performance, we see a very familiar pattern — one that has occurred many times in the financial sphere over the centuries and that was the foundation for my presentation on 'Extraordinary Popular Delusions' last year:

Source: Blockchain.info

Yes, it's our old friend the classic Bubble Wave chart. But it was the recent moves within that longer-term trend that were truly extraordinary, particularly on April 11:

(Bloomberg): According to Mt. Gox, the largest Bitcoin exchange, the currency started out at $230, spiked to $266, touched a low of $105 and then settled at just above $170 (it’s now $123). That’s, in the course of the day, a 15 percent jump followed by a 60 percent plunge off the day’s high and ending with a substantial loss.

And during the day, it wasn’t even clear where bids and offers were, or what the price was at any given moment. Joe Weisenthal of Business Insider reported seeing Bitcoin prices of $90, $170 and $225 on different sites.

Naturally, many were quick to leap upon the crash in Bitcoin to declare it dead and buried, among them Vanity Fair's Kurt Eichenwald:

(Vanity Fair): In the aftermath of the oh-so-predictable crash, the Bitcoin fanatics have begun marshaling out excuse after excuse for why this non-investment investment lost so much of its value so fast. One was that hackers attacked some of the exchanges for Bitcoins and crippled it. Really? A hacker can wreck an entire market? More of a reason not to buy these things.

But exchange operators have come out and said no, there weren’t hackers. Instead, the excuse they offer is that the price of Bitcoins fell because so many new accounts had opened and so many people wanted to buy them. That is something that could be advanced only by an investment fool — if more demand causes a lower price, then Bitcoins are either not ready for prime time or simply do not act like any other financial instrument in the history of the world.

Here is reality: Bitcoins are not an investment. They are an investment fad that someday could be a real digital currency, but if they continue to behave as they have, they will instead be nothing.... Here’s the bottom line. Bitcoins are not a real investment; they are bets inside a casino. If the price goes back up, don’t be fooled. In the parlance of popping investment bubbles, it’s something called a “dead-cat bounce.” People who are desperate to keep the game going rush back in, hoping to bring the price back up, but it never lasts.

Then Slate's Eric Posner brought out the big guns:

(Slate): Bitcoin is a fantasy. The Internet’s currency — a secure, private, decentralized type of money that makes possible anonymous and virtually costless transactions across borders — contains the seeds of its own destruction. More than anything else, it resembles a Ponzi scheme — and the wild claims made on its behalf reveal a great deal about a libertarian strain of thinking with deep roots in the American psyche.

However, a quick trip back in time shows the remarkable resilience of Bitcoin. As this October 2011 article from The Economist demonstrates, a burst Bitcoin bubble is nothing new:

(Economist): Bitcoin, briefly the world's favorite cryptocurrency, is in trouble. It plummeted from a peak of around $33 per unit in June to just $2.51. In May Rick Falkvinge, the founder of the Pirate Party in Sweden, famously blogged that he was converting all of his Swedish-crown savings to Bitcoins. Five months on, he tweeted that after “hoarding” Bitcoins until they hit $18 or so, he had moved to a “buy-and-sell pattern”. Mostly sell, it seems. “I currently don't hold any,” he admitted.

It is hard to say for sure why Bitcoin crashed the way it did. One plausible hypothesis holds that the currency's rise was the result of a speculative bubble. As the currency made more headlines around the globe (including in The Economist), less techie types wanted in on the action. Then, like Mr Falkvinge, they decided to cash in, and the bubble burst.

One thing isn't in dispute, however: a lot of real virtual wealth was both made and destroyed last week, and that has led to yet more sensationalist headlines. Time managed to put the gyrations into a real-world perspective:

(Time): The scale of the recent boom and bust has been staggering indeed. At the start of the year, a Bitcoin was worth $13.51. Earlier this week, it traded as high as $266. And on Thursday, it plummeted to less than $100, as one of the exchanges where Bitcoins are traded closed temporarily. This would be comparable to the exchange rate for the British pound soaring from $1.62 (where it was on Jan. 1) to $31.90 and then falling back to $12.

This, in my opinion at least, is Bitcoin's Achilles' heel (at least for the time being): no viable currency can display such volatility and be acceptable to the masses.

The perfect example of this flaw is Alvic Property Management, a company that specializes in the management of condominiums, cooperatives, and multifamily rentals in the New York metro area, and that announced to much fanfare last week that it was going to be accepting rent and maintenance payments in Bitcoins. The company certainly got all the publicity it could have hoped for; but, if they weren't light on their feet, that publicity might have cost them a small fortune had they accepted Bitcoins and not immediately converted them into dollars.

So what now for Bitcoin?

A couple of months ago, at an investment conference, I had a fascinating meeting with Trace Meyer, one of the leading figures in the Bitcoin phenomenon. He outlined both the simplicities and complexities of Bitcoin to me beautifully, so I emailed him this week to get his views on what had transpired. His reply was speedy and forthright:

This recent crash is a very unusual event. All of the major exchanges had coordinated DDOS attacks while the bots were going crazy on the downside and the trading lag on MtGox was in excess of 1,000 seconds. I think it was orchestrated to hit confidence and 'shake the trees'. Anytime a material amount of bitcoins come on the market, like 5k+ blocks, they get snapped up almost regardless of the price. In some cases I have seen people hit the offers when they are $20 over the current trading range just to pick up bitcoins in blocks. And coupled with the trading lag, which may be exchange induced?, it can really impact stuff as I saw some trades that moved $750k from the volatility. This is the Wild Wild West!

I think Bitcoin is in a 'melting-up' period and the price discovery is going to be very erratic. Coupled with the weak infrastructure, DDOS attacks and potentially other attacks it should be very exciting from a trading perspective. Plus, MtGox is processing about 1,000 new accounts per day, that want more than the $1,000/day limit, and are currently backlogged by about 18,000 accounts. They added 57,000 new accounts in March bringing the total to over 400,000.

I think the bottom line is very few know how to value a bitcoin (there is so much information asymmetry) but everyone seems to want some and the nascent economy is having growing pains. Not unlike June 2011 except this time the economy is a lot more robust and the capital pools are a lot deeper. And I doubt this is the end of the upleg.

(Incidentally, Trace's website is a fabulous resource for those amongst you who wish to understand this Bitcoin phenomenon a little better.)

The teething troubles being experienced by Bitcoin are not surprising for such a complex, fledgling enterprise; but make no mistake about it, Bitcoin presents a clear and present danger to established fiat currencies, and that means it does likewise to governments and central banks.

They will undoubtedly be watching it very carefully, and should it eventually manage to iron out the wrinkles and establish itself, they will at some point make it illegal. That will be technically impossible for them to do because of its architecture, but it will at a stroke be rendered 'monetæ non grata' amongst the law-abiding citizens of the world.

Whether the threat of banishment is enough of a deterrent to keep people from using Bitcoin is going to depend upon the stewardship of the fiat alternative. Right now, there is absolutely nothing to suggest that governments and central banks are reliable guardians of their own currencies, so we await the verdict with interest.

It is clear that Bitcoin is the start of something, not the end, but what that something is we cannot be sure just yet. One thing I am quite certain of, however, is that any predictions of Bitcoin's demise are likely to be dragged out for republication in years to come, much like Paul Krugman's famous 1998 critique of the Internet, which graces the front cover of this week's Things That Make You Go Hmmm....

As I said off the top this week, I think the appearance of Bitcoin is incredibly important and could well hold the key to the evolution of our monetary system in years to come; but for now, I'd rather have another alternative to fiat currency in my portfolio — one that coincidentally also took a battering this past week: gold.

Edited by jóhannes björn

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Hmmmm :) áhugavert.

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Bitcoin er takmörkuð 'auðlind' , það munu ekki verða til fleiri en 21 million bitcoins, það mun taka marga áratugi fyrir þann fjölda að verða allan til

Hvert bitcoin inniheldur 100 million Satoshi sem undireiningu

- þetta er merkilegt fyrirbæri og spennandi að sjá hvað gerist

Total_bitcoins_over_time.png

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[skrifað um miðjan apríl]

Let's begin at the end.

Why? Well, because all anybody wants to know these days, it seems, is where you stand on the Bitcoin phenomenon.

8< --- --

Ég kann alltaf betur við þegar þú skrifar á Íslensku.

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Ég gæti búið til takmarkaða auðlind núna, 100 appelkrónur. Ég mun gefa hverjum sem vill leysa fyrir mig heimadæmin í skólanum eina appelkrónu, en heimadæmin verða sífellt erfiðari eftir því sem fleiri appelkrónur eru búnar til.

Málið er að það er ekkert á bakvið þennan gjaldmiðil nema sú trú manna að hann sé hægt að nota í skiptum fyrir vöru og þjónustu.

Hví BitCoin frekar en eitthvað annað? Til eru aðrir svona crypto-gjaldmiðlar, t.d. LiteCoin (https://litecoin.org/), og örugglega fleiri. Í raun getur hver sem er búið til sinn eigin gjaldmiðil, sem lýtur alveg sömu lögmálum og BitCoin.

Í raun lýtur þetta sömu lögmálum og vinsældir samfélagsmiðla. Facebook er svona vinsælt einfaldlega útaf því að þar eru allir. Sama gildir um Twitter. Sama gildir með leitarvélar á borð við Google. Það eru til aðrar sambærilegar lausnir sem gera það sama. Eina sem notandinn þarf að gera til að skipta um eru örfá músarsmell.

Þannig að eina akkerið, eina sem bakkar upp svona gjaldmiðla, er sú trú manna að allir aðrir séu að nota þá, og taki við þeim sem greiðslu.

Kannski tekur þetta yfir heiminn, en kannski gufar þetta upp líkt og MySpace gufaði upp og aðrir miðlar sem voru vinsælir.

Hvar sem maður stendur í pólitíkinni gagnvart ríkistilskipunargjaldmiðlum þá er ljóst að maður þarf að hafa varann á, caveat emptor.

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