
Bitcoin breaks 30 USD - SlipperySlope
http://bitcoincharts.com/charts/mtgoxUSD
======
drcode
I think most people think the only reason bitcoins are useful is that they're
not controlled by a government. However, I've recently started using bitcoins
for some tiny transactions and found out something I didn't expect: They're
EASY PEASY to use... much easier than papal, credit cards, or even cash!

For those of you who don't know. A bitcoin "bank account" can be conjured out
of thin air using randomness and some crypto algorithms. It consists of only
two numbers, a public "bitcoin address" and a "private key". (kinda like an
RSA key pair).

The moment you've created these two numbers, you can say to someone "hey, send
your $$$ to my address". Then, any time in the future you can withdraw money
out of the account via your private key. This last step (withdrawing your
money) is actually the ONLY step that requires any real effort at all
(installing software on your PC, or trusting an online wallet site) and that's
STILL super easy.

EDIT: I think I ended up sounding too much like a cheerleader in this post...
I'm talking purely about easiness from a theoretical standpoint. In the real
world, there are clearly still many obstacles making bitcoins a PITA to deal
with.

~~~
moxie
Whenever I engage with BTC, "easy" is the last thing that I experience. Let's
say that someone wants to start using bitcoin: it's as simple as downloading
the software, double clicking on the icon, and... waiting 24hours or _more_
for the block chain to sync, while the i/o volume on their disk goes through
the roof.

Once you finally accomplish that, you can purchase some bitcoins, which
involves... this: [https://support.mtgox.com/entries/20490576-Withdrawals-
and-D...](https://support.mtgox.com/entries/20490576-Withdrawals-and-Deposits)

A few days later, you finally have BTC in your wallet, so it's time to start
your bitcoin client again and use them. You double click on the icon and...
wait 30min to 1hr for the block chain to sync.

Finally, you're ready to send them. Let's say you want to buy some music
online, so you send BTC to an address that was generated by the site you're
purchasing from and... wait _50 minutes_ to get enough verified transactions
before they finally send you the music.

All of this would be completely impossible on a mobile device.

There are plenty of ideas for making bitcoin more usable, but they all
unfortunately involve mitigating the strengths of the bitcoin as a concept.

~~~
lectrick
Blockchain.info gets you a free wallet. Signed client-side so they can't mess
with it. You don't need to run the "client" (which is really a "node") at all.
The fact that this is not communicated well is a communication problem more
than a technical one.

localbitcoins.com if you want to buy some from anyone in the neighborhood.

~~~
moxie
The thing that makes bitcoin different than other online payment systems or
virtual currencies is that it's _distributed_. That property, however, is also
what makes it difficult to use.

It's true that if you re-centralize things by trusting someone else with your
wallet, or outsourcing block chain verification to a central party, then it
can be quite usable.

From what I can tell, nobody is entirely comfortable with the direction that's
headed, which is why there's a lot of handwaving about things like javascript-
based cryptography, which just doesn't work.

localbitcoins is cool, but a friend bought some BTC off me the other day, and
it took over an hour (for the above reasons).

Don't get me wrong, I think all of this is really interesting and amazing in a
lot of ways, but not "easy peasy" as the parent commenter was saying.

~~~
patrikr
> javascript-based cryptography, which just doesn't work

LOL... Blockchain.info has over 120,000 users which disagree with you.

As the old saying goes, "the dogs bark, but the caravan goes on".

~~~
moxie
Please see any of the very many recent in-depth discussions about the security
of webapp-based cryptography. Sure, it "works" in the sense that it's very
easy to use, but it is by no means secure.

I'm sure all of those other "online wallet" services that lost or disappeared
with everyone's BTC also had plenty of users.

~~~
Charybdis
Moxie, given your background in cryptography, do you have any ideas on how the
Bitcoin community could improve the user experience without compromising
security?

------
eof
There is much, much, more merchant acceptance, transaction volume, etc. for
Bitcoin compared to the last time there was a big rise; not to mention
production is only half of what it was before; ASICs are here/on the horizon,
YC has funded a bitcoin startup, it's mentioned basically daily in the blogs
of major publications, etc.

It is also worth taking a look at a log-scale chart to see that the rise isn't
_quite_ so steep as before:
[http://www.bitcoincharts.com/charts/mtgoxUSD#tgSzm1g10zm2g25...](http://www.bitcoincharts.com/charts/mtgoxUSD#tgSzm1g10zm2g25zvzl)

Clearly a lot of speculation going on here; but I very strongly doubt we will
see a crash anything like we saw last time (how many people were preaching
that the end of bitcoin had come?); though a significant correction when
people start taking their profit seems almost inevitable.

Anecdotally, a number of people I have been telling to buy bitcoins for
_years_ now are finally like, "well okay, I am just going to wait till it
drops to $xx or so (where xx is ~40% less than whatever it is at the moment we
have the conversation).

~~~
Steko
"I very strongly doubt we will see a crash anything like we saw last time"

This assumes that all crashes are built the same. In fact they are not. An an
example, increased usage and profile also greatly increase the likelihood that
governments come in and panic investors.

~~~
conroe64
Another thing to worry about is something better coming along. As soon as it
does, bitcoins will crash and never recover, since their only worth is they
are better than anything else for making anonymous secure trades. If Ripple or
soemthing else begins to take off, that may change.

------
jaredstenquist
The rising price just makes me laugh. I "invested" $1,000 in BTC during the
early hype as it was approaching $32.00. I told my co-workers how cool of a
concept it was and that my investment was sure to pay off with a skyrocketing
price.

After months and months the price drops and drops. My $1,000 is worth $200. I
go through a ridiculously long process of proving my identity to Mt. Gox and
Dwolla just to get real USD back at 1/5 their original value.

Now if only I had kept it in there for the long haul, I'd have my $1,000 back.

It's precisely this volatility that personally makes me skeptical of it truly
reaching a critical mass of any sort.

~~~
enraged_camel
You made the cardinal mistake of investing: you bought high, and sold low.
Many rookie investors make this mistake because they are unable to control
their emotions when the value of their investment takes a downturn. It can be
nerve-wrecking to imagine all your money evaporating.

Fortunately, your mistake cost you only $800. So it was actually a good
learning experience. From now on, buy low and sell high. For example, the best
time to buy is when a (recoverable) disaster or sensationalized story cause a
financially strong company's stock price to dip. That's the perfect
opportunity to buy some of that stock.

~~~
jaredstenquist
What is high and what is low is of course speculative.

When investing in the stock market I of course use that basic logic by
analyzing the KPIs of the securities. This was less of an investment and more
of an experiment in modern technology, prompted by some skeptical comments
from my friends. For that reason it was more like purchasing a lottery ticket.

My $1000 lottery ticket didn't perform well, but due to my real investments
paying off well over the years, I can handle the loss without much thought.
Win some. Lose some.

------
vijayboyapati
This reminds me of the great article by Mencius Moldbug on monetary
restandardization: [http://unqualified-reservations.blogspot.com/2011/04/on-
mone...](http://unqualified-reservations.blogspot.com/2011/04/on-monetary-
restandardization.html)

"If Bitcoin becomes the new global monetary system, one bitcoin purchased
today (for 90 cents, last time I checked) will make you a very wealthy
individual. You are essentially buying Manhattan for a quarter. There are only
21 million bitcoins (including those not yet minted). (In my design, this was
a far more elegant 2^64, with quantities in exponential notation. Just
sayin'.) Mapped to $100 trillion of global money, to pull a random number out
of the air, you become a millionaire. Wow!"

~~~
redblacktree
My guess is that it's more likely to be another cryptocurrency that becomes
the standard. Once the right people figure out how to be the main
beneficiaries. Also, I'm not sure that a depreciating currency is good for
society as a whole, since it encourages hoarding, rather than investment.

~~~
drcode
I believe this question is hotly debated among economists. I think deflation
is probably fine: In the end, money isn't any good if you don't spend it, so
hoarding has a natural limit.

~~~
kamaal
>>In the end, money isn't any good if you don't spend it

The money that you hoard, invest and which grows itself is the best kind of
investment.

I know of a few people who saved through their life to buy real estate and
rent it out. The next generations have practically slept through their lives
without ever working and yet continued to live like millionaires.

------
jere
I'm interested to see it pass $32, which should have symbolic significance if
nothing else (the peak happened at $31.91 and crashed to $10 days later).

------
polshaw
Well, this is going to be an interesting watch!

The fundamental issue is that holding is what increases the value (because,
really, it is an exchange medium; the world still ultimately prices pegged to
their respective local currencies, no matter what any bitcoinite insists), and
as the value increases, you are incentivised to hold.

It is going to be interesting to see what happens when the bubble bursts (and
it will, to _some_ extent), and how big it gets, as most of the bitcoins held
will probably be owned by users who have been through a crash before. This
could mean we are only just starting the bubble-- increased confidence may let
it grow far beyond the previous one.

------
geuis
So the 10 btc I bought a couple years ago for ~$2 are now "worth" $300 USD. Do
I sell them now, or wait 20 years until they're worth more?

How do you know when to wait longer, and when to sell? Its not like a company
where you can at least get some information on their past and future
performance, whether they are growing or shrinking, etc.

~~~
josephagoss
Well to be honest if you cash out now all you have is $300, which is a
fantastic rise but not a lot of money.

This is the way I see it, its only a days earning or even less, so I would
hold on to it for the next decade as a experiment and see what happens.

Would you pay $300 to be in on this game for the next 10 years? :)

------
venus
Whenever BTC spikes like this I think of the first pizza sale a couple of
years ago:

<https://bitcointalk.org/index.php?topic=137.msg1195#msg1195>

Probably the most expensive pizza in history, in hindsight.

------
lectrick
1) BTC is a perfect fit for porn websites

2) Porn websites, for some reason, have not gone BTC yet

3) Pornographers are a tight knit community. When a couple go, I think they
will all go to stay competitive

4) Google how big the porn industry is.

~~~
winthrowe
Point 1 is not entirely true; sites of that nature rather like recurring
billing, which bitcoin doesn't do out of the box.

------
niggler
Are there any POS systems that use bitcoins? Any other way in which small
transactions can be conducted en masse with BTC?

~~~
jonwaller
Yes. BitPay has one.

------
free652
It somewhat a surprise for me, it was a pretty quick rise. Reminds me of 2011,
I wonder if it will crash the same way.

~~~
drcross
I think the present time is completely different from the 2011 bubble. The
range of services offered have grown dramatically and the Bitcoin protocol has
shown it's resilience.

~~~
free652
I agree. I had few sales now on bitmit.net, I already migrated a bunch of my
long term fixed price listings there.

I list like old xbox 360 games

Some PC hardware

Other stuff I have lying around

------
BrokenPipe
I love bitcoins, easy to use, no middle man, quick. I can travel with them yet
nobody can take them from me.

------
mmanfrin
Didn't it hit $20 like a week ago?

Bubble?

~~~
sp332
The first ASICs started shipping recently. This made bitcoins harder to mine
(for anyone who doesn't have those ASICs, which is most people). This also
demonstrated that bitcoins are here to stay, since people have made large
investments in hardware that basically doesn't do anything but mine bitcoins.
So the perceived future value has skyrocketed.

~~~
polshaw
Some people believe in the success of bitcoins. They bought custom hardware.
This proves bitcoins are going to be a success.

Circular logic at it's finest!

~~~
sp332
That's true of _all_ commodities and currencies.

Some people believe in the success of gold. They invested heavily in the
future of gold. This proves gold is going to be a success.

Some people believe in the success of US dollars. They invested heavily in the
future of US dollars. This proves US dollars are going to be valuable.

Edit: ok so to be clear, it's not just wishful thinking at work, but the fact
that people are _working_ toward making bitcoins successful and stable that
makes them successful and stable.

~~~
encoderer
> Some people believe in the success of US dollars. They invested heavily in
> the future of US dollars. This proves US dollars are going to be valuable.

You realize that you're sorta making his point? US Dollars are not going to be
successful _because_ some people have "invested heavily in the future of
dollars." But that's the reasoning given 2 posts up that was poked-fun at in
your parent.

------
achalkley
BUY!

