

The Bitcoin Economy: Something Is Wrong About The Way It Is Shaping Up - npguy
http://statspotting.com/bitcoin-economy-one-big-issue-with-the-way-it-is-shaping-up/

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rheide
You cannot possibly call this 'wrong' based on how things went in the past.
The current bitcoin economy is shaping up naturally, it's the way people are
making money from bitcoin. This post just seems like the author is trying to
put bitcoin in a little box and then gets confused when it doesn't behave the
way he thinks it should.

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npguy
I like the little box analogy. Maybe that is exactly what is happening - I am
confused, that it does not behave the way I think it should.

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mistercow
>The way this economy should have shaped up is this: Where it is difficult to
put a dollar value, transactions should happen in Bitcoins. Like in the early
barter days.

Is that how it works for new currencies, though? I mean, the barter days are
gone and done, and in the modern world, if it exists and is desired, people
_will_ agree on a dollar value. I find it hard to believe that _any_ new
currency could arise without the market immediately assigning it a dollar
value.

It sounds like the author is trying to compare BitCoin's initial progress with
the initial progress of currency itself, which would be very silly.

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npguy
The flaw in your thought process, I think, is this: "in the modern world, if
it exists and is desired, people will agree on a dollar value" - applies only
to currencies where 'Trust' is a given. Or, it should be a limited domain
(e.g. gaming currencies).

~~~
mistercow
>"in the modern world, if it exists and is desired, people will agree on a
dollar value" - applies only to currencies where 'Trust' is a given.

I don't think that's true. If a currency is untrusted, people will assign a
_lower_ dollar value to it, but it's still going to have a dollar value.

>Or, it should be a limited domain (e.g. gaming currencies).

I'm confused. Are you saying that gaming currencies don't have a dollar value?

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kiba
I have no clues what this guy is trying to implies or explain in six short
paragraphs.

The only thing I get is 'Middlemen are bad!" and "This will cause hoarding!".

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kenthorvath
Using Bitcoin is like paying for goods with shares of company stock... stock
that can be broken down into almost arbitrarily small subunits... and which
are immune to SEC regulation.

There's nothing wrong with the bitcoin economy - it's just very different than
anything that's ever existed before. If it were just like fiat money, there'd
be little use for it and no economy to speak of.

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patrickmay
I see this behavior as a validation of Bitcoin in particular and alternative
currencies in general. People horde the currency they feel is worth the most.
The dollar is being inflated significantly by the Federal Reserve. The
"horders" of Bitcoins are actually investors who believe it will rise relative
to fiat currencies.

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hamburglar
The problem with these middlemen is that they do absolutely nothing to
increase the legitimacy of bitcoin, and in fact undermine it a bit by shining
a light on the fact that you can't really buy much with bitcoins. When you pay
$10 USD for a good but convert it to bitcoins at the last second, you aren't
buying things with bitcoins, you're buying things with dollars and using the
instantaneous price of bitcoins for a marker.

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oleganza
TL;DR: The guy describes how economy should work from his point of view, then
says how it actually works and makes a statement that "something is wrong with
the economy" instead of revisiting his own ideals.

My opinion is this: Bitcoin enables exchange of things outside any particular
monopoly of law and violence. Chinese guy can buy something from Brazilian guy
for bitcoins without asking permission from anyone. Is it bad or is it good?
For these two guys everything is okay - they get what they want. Everyone
else? Does not really matter because they cannot do anything about it. Even if
it is awful and immoral from your point of view, it does not give you power to
interfere: these guys are somewhere on the internet, you cannot easily come
and stop them. Whether you like it or not, Bitcoin payments approximate
mythical "free market" as close as possible. You can reason about trade on
this market in purely economical terms without mixing it with politics
(because your political opinion is very hard to enforce). So you either focus
on what other people genuinely want, or you expose your egoism by pointlessly
telling everyone what's your opinion about someone else's transaction.

