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[Levi]

4)  If each bit coin is worth ~6 dollars, what if I wanted to buy something worth 1 dollar?

Since there's no physical denomination of a bitcoin there's no limit to how you can split it up, so you could spend, say, 0.00001 bitcoins.

Isn't each bitcoin discrete though?  From what I've read so far I was under the impression that each coin has a value, and you couldn't split it up without exchanging it for several lower value coins.

FAQ says you can currently use up to 8 decimals, and if the need should arise the precision can be increased.

Hmm, you might be right.  I had read that as in regards to the blocks generating ever smaller numbers, but now that I re-read that it might be implying coins can be split.

More research need! 

Ah, I understand now.

1 BTC is actually 100,000,000 of the base unit, which is a BitCoin-bong 


Now I'm trying to figure out exactly where my account balance is stored. 

[PTTG??]

If these coins somehow contained value- if you could somehow get the processing time back out of them- then yeah, I might see these being useful.

At best, this looks like it's likely to be a decade-long economic folly.

However, I think that an alternative currency is needed. Something hard to reproduce, with definite value, easy to measure and transfer. It's a bit of an obvious ideal, I'll admit, seeing as it's called currency...

Simply use electrical energy as the basis for your currency. You don't need to carry batteries around, of course- but a government that issues currency needs to have the capacity to "buy" any issued money back for energy*. Amazingly, since electrical energy ties right into economic activity, an economy will grow it's own liquidity.

It wouldn't even be a big shift in the current economy! Already, oil and oil futures are a kind of demi-currency. Most likely, this energy currency would be initialized as one barrel's worth of energy credits = value of a barrel of oil in dollars.

*That said, little bimetallic coins could store fractional charges and be really awesome. Large devices could be made that only allow a set amount of energy to be taken at a time. And if someone tries to mug you, you could probably taze them...

[Virex]

If these coins somehow contained value- if you could somehow get the processing time back out of them- then yeah, I might see these being useful.

Like any coin, they're worth as much as you can buy for it, which in this case is either zilch or 6 dollars, depending on what store you visit.

[Criptfeind]

However, I think that an alternative currency is needed. Something hard to reproduce, with definite value, easy to measure and transfer. It's a bit of an obvious ideal, I'll admit, seeing as it's called currency...

Not to say the rest of this is not at least a interesting idea, but I do not understand how this is not what we currently have.

[Levi]

I don't see why they wouldn't contain as much value as paper.  Heck since its providing liquidity without transaction fees it sounds to be worth a fair bit more!   

Really the processing time isn't backing up the value, its just limiting the amount of currency being made.

[Criptfeind]

Because our paper money has a long history stretching back thousands of years and is backed by the government. Paper money did not just appear.

[Levi]

Because our paper money has a long history stretching back thousands of years and is backed by the government. Paper money did not just appear.

Man, I wouldn't trust the government to back my money.  Have you seen the kind of debt they are in?  http://www.usdebtclock.org/


Kidding aside, you are right.  But that doesn't mean you can't make another currency with value.  A person could argue that gold in Warcraft or Hats in Team Fortress are of value.  Stocks are treated as investments when often their relative company value is much much less than the share price.

[Bouchart]

So how do I short this virtual money?

[Criptfeind]

Gold in warcraft, hats in TF2, and stocks are not money. But, if you really want to call them money you will notice that each has something more then these coins, even if their worth is inflated.

Warcraft gold can be used to buy stuff in warcraft, it is backed by Blizzard. It is a commodity money.

Hats act as a status symbol of sorts, and although they are the closest to the coins, but they are also the furthest from money out of the three. It is also commodity money.

Stocks are literal ownership in a company. Are the prices inflated for many of them? Sure. But they are backed by that company. After all, when a company goes bankrupt their stocks are worthless. Without SOMETHING backing these coins they are sorta like stocks from a bankrupted company.

So how do I short this virtual money?

You can not until it becomes real money... Which I do not think it ever will... So too bad.

You could try making a bet with some of the people on these forums, but getting them to pay up will be hard.

[Levi]

Gold in warcraft, hats in TF2, and stocks are not money. But, if you really want to call them money you will notice that each has something more then these coins, even if their worth is inflated.

Warcraft gold can be used to buy stuff in warcraft, it is backed by Blizzard. It is a commodity money.

Hats act as a status symbol of sorts, and although they are the closest to the coins, but they are also the furthest from money out of the three. It is also commodity money.

Stocks are literal ownership in a company. Are the prices inflated for many of them? Sure. But they are backed by that company. After all, when a company goes bankrupt their stocks are worthless. Without SOMETHING backing these coins they are sorta like stocks from a bankrupted company.

I don't really see the difference.  If I can sell this money on the exchange for normal currency then its as good as the rest of it.  It may be worth nothing at some point, but all currency is like that.

[Criptfeind]

Yes. The point of the nay sayers like me is that it is worthless now and will be worthless forever.

[Levi]

Fair enough! 

[Sheb]

Cript, RIGHT NOW it isn't worthless, since you can apparently sell it for 6 dollars.

[Criptfeind]

But only from the people you purchased it from.

Thus you have to pay them 6 bucks to get it, then you get 6 bucks from them.

TOTALLY WORTH IT AND NOT A WASTE OF TIME!

(I am just kidding of course. I doubt the people that are making this will accept it for cash.)

Really, in the time it takes to find someone who will take this, you totally invalidate the point of money. You might as well be in a barter economy.

[Leafsnail]

Hmm... as far as I can tell, this is the equivalent of letting anyone print your money, but making it very expensive/ time consuming to print, and also putting some kind of limit on how much of it can be produced... right?