I do feel a bit like kicking myself for not seeing that bitcoin would end up where it is today. I first heard about bitcoin on HN when they were worth around .01 each, and could be generated fairly easily by simply running the mining software in the background. I was so busy spotting the flaw in the electricity cost creation argument I missed the fact it wouldn't matter, because the algorithm gets harder so only "professional" miners likely end up generating the majority of new coins, and also that there is a cap at 21 million, so generating coins was planned to stop anyway. (http://news.ycombinator.com/item?id=1655202)
I was looking at bitcoins as they might compare to an established currency model, like dollars, where the rate of creation has to be controlled smartly (not that I'm saying it is) and indefinitely. Satisfied I had spotted a money creation flaw preventing bitcoins becoming a dominant new currency I dismissed them quickly, never noticing the other aspects of brilliance it has.
I still see problems with bitcoin becoming a fully fledged sustained and mature currency. Some of these have been articulated here on HN (notably by jerf). However, I believe bitcoins still have developmental stages to go through before failing, and because of this I actually still see upside for them as a speculative (still risky) investment. I doubt I would do anything with them now, but if I had got in at .01 cent, now that would be different.
I just found out about bitcoins last weekend, and ran the bitcoin miner, and then found out that it will take my 2.4GHz dual-core laptop 10 years to generate a bitcoin at the currently-established difficulty (without using my GPU, presumably).
I know, right? Now that everyone's excited about Bitcoin, the exciting part is over. Kind of a bummer.
I see a unique opportunity here for a company with an existing virtual goods economy or something similar such as Listia.
They create a new genesis block and new Bitcoin-protocol clients and publicly announce they're going to turn the spigot on (announce the genesis block) a few days later. The twist being that they will accept the new chain's currency within their existing economy.
They not only get a lot of publicity but effectively become a central bank for their forked currency, which allows them to compete with Classic Bitcoin via the par value they establish.
I haven't thought this through, it's just a wild idea. What are the flaws in this plan? Would this just actually destroy value? Is this the expected long-run for Bitcoin anyway?
I was looking at bitcoins as they might compare to an established currency model, like dollars, where the rate of creation has to be controlled smartly (not that I'm saying it is) and indefinitely. Satisfied I had spotted a money creation flaw preventing bitcoins becoming a dominant new currency I dismissed them quickly, never noticing the other aspects of brilliance it has.
I still see problems with bitcoin becoming a fully fledged sustained and mature currency. Some of these have been articulated here on HN (notably by jerf). However, I believe bitcoins still have developmental stages to go through before failing, and because of this I actually still see upside for them as a speculative (still risky) investment. I doubt I would do anything with them now, but if I had got in at .01 cent, now that would be different.