Bitcoin crashes, losing nearly half of its value in six hours



scottspfd82 said:
1. Say I have $10k in cash. I want to buy gold, privately. The guy I want to buy from is on the other side of the planet. So I exchange cash for bitcoin, pay the guy, get the gold (or whatever) shipped and the entire transaction is pseudo-anonymous. I value privacy. Because I couldn't make this transaction anonymously without bitcoin, would that give it intrinsic value just based on utility?
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Say I have a coke in a glass bottle. I let you drink the coke. Then I take the glass bottle and shove it up my ass. Then I film this for YouPorn.

Doesn't this mean the glass bottle has intrinsic value as a dildo or butt plug?

Being a little silly here, but obviously the definition of money (which requires ubiquity) isn't that someone, somewhere, sometime gets utility, because by that definition, anything and everything could potentially be money.

All value is subjective. You like chocolate cake, I like shortbread. Neither value is necessarily "better" than the other, objectively.

Money is a good which many, most or nearly all people value subjectively the same way AND has the qualities of money (divisibility, malleability, durability etc etc)

scottspfd82 said:
2. Assuming the answer to the above question is "no"... Do you think there could ever be a sound currency similar to bitcoin? There are a lot of digital commodities that do have intrinsic value. Links, traffic and domains come to mind. Could a cryptocurrency ever become sound money if somehow backed with a digital commodity? Maybe links. Maybe credits on a traffic network, or bandwidth/data, I dunno.
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Since my above answer was more nuanced than "no" let me try this one on too.

I think people confuse abstraction with the actual thing. In other words, let's say gold is money. You and I trade gold coins.

One day, I suggest, instead of moving our gold back and forth, which is dangerous, hard work and a hassle, we just write down on pieces of paper, who has which gold, and then once a week we can get together and settle up, instead of transacting hard money at every deal.

So now I have the physical gold in my home, and I have receipts for all that gold. I trade the receipts with you. By making the receipts (abstractions) have I actually doubled the amount of gold I have? Of course, not. They are only REPRESENTATIONS of the gold in my possession. Each piece of paper, is linked to a real thing, a gold bar or coin.

Hoppe calls these receipts property titles.They are different than the property itself. For example, you would never confuse the deed for some land, with the actual land itself.

The paper is the currency, the gold is the money.

So now we come to Bitcoin or any virtual coin. Is it a thing, a real thing, or is it an abstraction?

There is no effective scarcity in the digital realm. Bitcoin thus far is like fiat money, except the government isnt involved. It has none of the attributes of sound money. It is entirely an abstraction. The minute BTC becomes unpopular it will become relatively worthless because it has only one purpose, and that is that it is a currency. The minute silver becomes unpopular as money it will still be used in industrial manufacturing. Or in jewelry, or in medical instruments.

This duality of value between a "real" application and the application as currency is what protects someone who uses a currency to store value in.

scottspfd82 said:
The whole digital aspect of everything is where it gets complicated for me.
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Abstractions are very fucking confusing. Very few people try to unravel them (let alone acknowledge them).

hth
 
I personally love the concept of currency that no one government controls, however I also fear that it's going to be very difficult for such a currency to withstand sabotage.

I don't think it would be far fetched for major treasuries to drop a pretty penny and obtain a ton of bitcoins. Enough bitcoins that if they pulled out it would create ripples in the marketplace and start a panic like we're seeing now. Rinse and repeat enough times and you've successfully created enough doubt about the currency that it no longer is something of interest to the masses and slowly dies.
 
guerilla said:
Say I have a coke in a glass bottle. I let you drink the coke. Then I take the glass bottle and shove it up my ass. Then I film this for YouPorn.
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Xyr4v5s.gif
 
guerilla said:
So now I have the physical gold in my home, and I have receipts for all that gold. I trade the receipts with you. By making the receipts (abstractions) have I actually doubled the amount of gold I have? Of course, not. They are only REPRESENTATIONS of the gold in my possession. Each piece of paper, is linked to a real thing, a gold bar or coin.

The paper is the currency, the gold is the money.

So now we come to Bitcoin or any virtual coin. Is it a thing, a real thing, or is it an abstraction?

There is no effective scarcity in the digital realm. Bitcoin thus far is like fiat money, except the government isnt involved. It has none of the attributes of sound money. It is entirely an abstraction. The minute BTC becomes unpopular it will become relatively worthless because it has only one purpose, and that is that it is a currency. The minute silver becomes unpopular as money it will still be used in industrial manufacturing. Or in jewelry, or in medical instruments.

This duality of value between a "real" application and the application as currency is what protects someone who uses a currency to store value in.


Abstractions are very fucking confusing. Very few people try to unravel them (let alone acknowledge them).

hth
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errr...

Nixon Shock - Wikipedia, the free encyclopedia
 
guerilla said:
Say I have a coke in a glass bottle. I let you drink the coke. Then I take the glass bottle and shove it up my ass. Then I film this for YouPorn.
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I'll give you 10 BTC to keep it private and let me have the only copy.
 
I've been receiving lots of PMs interested in acquiring lukecoins. Some, asking for proof of ownership. Others, asking for exchange rates.

Just mspaint'd a lukecoin to prove that it is currently in my posession. And because this is virtual currency, it can look like whatever I want it to look like. I also hereby state that I am the only authority in the ever-changing physical representation of a lukecoin.

Proof below:

ooo6bEP.jpg


*Disclaimer: Crying duck is a paid actor. Not actually lukep*

Current exchange rate:
1 LC = 10 USD


edit1: 1 LC = 15 USD
edit2: Media has caught wind of lukecoin. 1 LC = 35 USD
edit3: 1 LC = 75 USD
edit4: Holy shit! This currency is INFALLIBLE! DOWN WITH OBAMA!
1 LC = 200 USD
edit5: 1 LC = 300 USD
edit6: 1 LC = 4 USD
edit7: We are no longer taking lukecoin orders.
edit8: Anyone know if Smaxor is looking for a new Affiliate Manager?
 
guerilla said:
Instead of rolling eyes, demonstrate my error.
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google's search engine exists entirely in the digital realm, is scarce, and has value.

rare Diablo swords exist entirely in the digital realm, are scarce by definition, and have value.

.com domain names matching single short common english words exist entirely in the digital realm, are relatively scarce, and often have great value.

There totally different things, existing completely in the digital realm, and having demonstrable scarcity.
 
By the way, the minute gold becomes unpopular, like during the late 90s - early 2000s, it also drops in value like a fucking rock. Anybody else remember $300/oz?
 
ly2 from WF said:
I hope it does drop to $300. I'd spend every dime I have and buy like 100 or so grams. Ballin, bro.
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Well that "sound money" is dropping in value against massively inflated QE influenced fiat right now.

Turns out supply and demand affect the price of all commodities, digital or otherwise.
 
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