Bitcoin price plunges

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Professor Emeritus
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Re: Bitcoin price plunges

Post by Professor Emeritus »

Leeraar wrote:
Professor Emeritus wrote:
Leeraar wrote: My sister lives in South Africa. She can go online and transfer money from her bank account to any other bank account in the country. Then, she e-mails proof of the transaction to the recipient and she is done. (To the recipient the bank transaction is only identified by a transaction ID, not by the sender's name or account number.) It costs nothing in bank fees to do this.

It is basically impossible for me to send money to a bank account in South Africa. (I am a book collector and also need to pay people to do research at the state archives.) Believe it or not, I have to resort to Western Union. Pay Pal does not work either.

L.
You sister is transferring South african RAND South Africa does have exchange controls
You cant just send dollars to someone in South africa

I pay my south African travel agent every year on a secure payment site that will take paypal, credit cards debit cards or almost anything else. It acts as the foreign exchange compliance point.
Professor,

You are missing the point. It has nothing to do with exchange controls. It has to do with Paypal (until recently) not being able to send funds to ZA, and with the stupidly archaic attitude of the USA banking system to the rest of the world. My problem is sending ZAR 200 (USD 20) to some individual to buy a book, or ZAR 4000 (USD 400) for a week's research in the archives. In ZA (or, I believe, in Europe) I can just make a no-cost transfer to their bank account.

Let me ask: We are both in the USA, I presume. How do I send you an amount of about $20? In ZA, if I know your bank account number, it is done in a few seconds at no cost to either of us.

I could rant on: In the USA you pay to use an ATM. In other parts of the world they have figured out that ATMs are far cheaper than live tellers. At my local bank (I only ever go there to get signature guarantees) they have greeters and free coffee and donuts, but they charge for the ATM. Go figure.

L.
I am well aware of the deficiencies of the US banking system I have taught it. I am a dual national USA -EU and maintain a UK bank account for the easy banking transfers.
But you are still confusing the issues when you talk about South Africa. I can maintain a dollar bank account in the UK or a Euro account in the USA. You can't do that in South Africa.
That is what "exchange controls" are. its why you cant say ZAR200 = USD 20 You can't freely keep rand outside the country or dollars in it. Your transaction HAS to go through the exchange control system. Your sister cant (without special permission) send 20 USD from her bank to anyone.

Nothing new about this
Until very recently and under a lot a pressure the German banks charged a fee to transfer Euro to another Euro country Political pressure and EU regulation stopped that

Bank of America lets me send money to any email account . the recipient has to have it set up (this is how I send money to my daughter)
I pay my housekeeper by direct bank transfer at Bank of America. I pay my insurance with electronic checks.
I can send you an electronic check without fee.

Here are the regulations from Standard bank in South africa


Accepting foreign currency
What do I do if a customer/guest wants to pay me in foreign currency?
If your business is related to tourism, such as hotel, retailer or restaurants, you may accept foreign currency.

What do I need to do for my business to be able to accept foreign currency?
You do however need to sign an undertaking with us. We will pass this on to the South African Reserve Bank as stipulated by the Exchange Control Rulings.

Click here for a copy of the declaration to accept foreign currency. Please complete it, print it on your letterhead and hand it to a consultant at a Standard Bank foreign exchange, bureau de change or Money Change outlet.

How long can may I keep the foreign currency?
You must convert the foreign currency into rand on the next business day after receiving it.
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FNK
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Re: Bitcoin price plunges

Post by FNK »

Alex Frakt wrote:
FNK wrote:Sigh.

May I suggest that we ban bitcoin discussions at this forum?
If you'll admit that they are not investment products :-)
Admitted. Done?
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FNK
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Re: Bitcoin price plunges

Post by FNK »

georgewall42 wrote:There's nothing to prevent a future crypto-currency from either convincing a crowd of miners or from being "10x better", whatever that means.
...except, you know, being convincing.
georgewall42 wrote:That doesn't by itself mean that bitcoin is or will be a failure; it does mean that the hard limit on the number of bitcoins is not really a hard limit.
It's not a hard limit on the amount of cryptocurrency units, it is a hard limit on bitcoins. There's a soft limit on all currencies, something about size of economy.
georgewall42 wrote:My guess is that the NSA will figure out how to hack the algorithms in 5 years anyway :D
Since the algorithms underpin a lot of mainstream economy, that will be scary.
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roymeo
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Re: Bitcoin price plunges

Post by roymeo »

nisiprius wrote:
roymeo wrote:...And after spending 5 minutes reading the top hits for MtGox, I see that the flaw in the system appears to be that you could fool their system into duplicating a withdrawl transaction...
Which is exactly what all of the bitcoin advocates assured us was impossible. If I recall correctly, we were told that the bitcoin algorithm rendered such a thing impossible unless you could convince miners controlling more than half of all the computing power in the bitcoin ecosystem to collude together, and I don't think anyone has said that is what occurred.
I'm not sure who these 'advocates' are that were assuring 'us' that sort of thing. I suppose absolute statements about code should be avoided. I suppose absolute statements about currencies and economies should also be avoided.

As has been pointed out, the bug's been known since 2011.

"Worse, according to a document entitled “Crisis Strategy Draft” that is circulating on the web and appears to come from Mt Gox, 744,400 Bitcoins are also missing, the result of “malleability-related theft” that may have been going on since the exchange began operating. When Bitcoins are traded, each transaction is recorded in a log known as the “blockchain”. But a software bug—which Bitcoin’s developers have known about since 2011, but done little to fix—creates a brief time period in which the unique ID (or TXID) of each transaction can be changed." from http://www.economist.com/blogs/schumpet ... oin-s-woes
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georgewall42
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Re: Bitcoin price plunges

Post by georgewall42 »

Well, certainly if you google "bitcoin hack", you will see a whole bunch of folks making statements that bitcoins are essentially "hackproof". Their statements are quite absolute. As the article mentioned, lots of bitcoiners were worshiping at the temple of Mt. Gox not too long ago.
Since the algorithms underpin a lot of mainstream economy, that will be scary.
Not really sure how the mainstream economy is reliant on the same algorithms. In any event, while the chances of someone being able to successfully "counterfeit" a bitcoin or any similar cryptocurrency are certainly remote, it is certainly feasible that an agency such as the NSA could determine the identities of the folks in the transaction history in the blockchain. I wouldn't be surprised if the spooks are indeed looking at this, especially as folks have been using bitcoins for illegal activity due to their so-called anonymity, a characteristic that is hardly anywhere near "hackproof".
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FNK
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Re: Bitcoin price plunges

Post by FNK »

georgewall42 wrote:
Since the algorithms underpin a lot of mainstream economy, that will be scary.
Not really sure how the mainstream economy is reliant on the same algorithms.
SHA? ECDSA? They are popular on that internet thingy.
georgewall42 wrote:In any event, while the chances of someone being able to successfully "counterfeit" a bitcoin or any similar cryptocurrency are certainly remote, it is certainly feasible that an agency such as the NSA could determine the identities of the folks in the transaction history in the blockchain.
Absolutely; it's pseudonymous not anonymous.
WhiskeyJ
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Re: Bitcoin price plunges

Post by WhiskeyJ »

When does the patent on the algorithm is expire? If the algorithm is unique and the only way create a good virtual currency, wouldn't the value plummet once the patent has expired?
Wolkenspiel
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Re: Bitcoin price plunges

Post by Wolkenspiel »

beammeupscotty wrote: I'm all ears -- please tell more more about an IBAN equivalent of PayPal or http://authorize.net with < 1% e-commerce fees.
I'm not sure if I'm missing something here. In any SEPA country (http://en.wikipedia.org/wiki/Single_Euro_Payments_Area), all I need is the recipients name and account number (IBAN or SWIFT/BIC + account number) and I can transfer funds from my regular bank account to their regular account for free (or essentially free) for amounts up to 50000 Euro. If my brother needs 1000 Euro in his French checking account I can send it to him essentially instantly (may take a day to settle) from my German checking account for free. If I sent money from my Swiss account, I was charged 3CHF for each transfer to a foreign EURO account. I don't see where PayPal or authorize.net come in, other than to provide an escrow function (which was not part of the discussion), and I certainly didn't pay any "e-commerce fee" for transfers to pay merchant bills in the same way. PayPal as a fund-transfer system is a bad joke that charges for functionality that in the rest of the world is integrated in the banking system as a basic and free service. As a corollary, and coming back to the topic of the thread, it is not clear which problem Bitcoin is supposed to solve here. All that is needed is for everyone to get with the program and adopt a standard for electronic bank transfers.
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Re: Bitcoin price plunges

Post by Alex Frakt »

WhiskeyJ wrote:When does the patent on the algorithm is expire? If the algorithm is unique and the only way create a good virtual currency, wouldn't the value plummet once the patent has expired?
Mathematical algorithms are not generally not patentable and bitcoin's anonymous founder didn't even try. Anyone can copy bitcoin's method to create their own virtual currency and many people/groups have already done so.
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Random Musings
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Re: Bitcoin price plunges

Post by Random Musings »

Alex Frakt wrote:
WhiskeyJ wrote:When does the patent on the algorithm is expire? If the algorithm is unique and the only way create a good virtual currency, wouldn't the value plummet once the patent has expired?
Mathematical algorithms are not generally not patentable and bitcoin's anonymous founder didn't even try. Anyone can copy bitcoin's method to create their own virtual currency and many people/groups have already done so.
So, if there are many different virtual currencies out there, can a better mousetrap render certain ones to the dump heap?

RM
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Waba
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Re: Bitcoin price plunges

Post by Waba »

WhiskeyJ wrote:When does the patent on the algorithm is expire?
There is no patent. The algorithms are well known, widely published and freely usable,
Good cryptography derives it strength from peer reviewed math, not from secrecy or proprietry.
Bitcoin is build on top of very solid cryptography.

But you need to distinguish the bitcoin technology from the Bitcoin currency.
The currency depends on the technology, and the technology is essential for the currency to maintain its value, but the technology itself does not provide the currency with implied value.

Apart from Bitcoin, there are many other crypto currencies build on top of the same technology each with their own value, or lack thereof.
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FNK
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Re: Bitcoin price plunges

Post by FNK »

Random Musings wrote:So, if there are many different virtual currencies out there, can a better mousetrap render certain ones to the dump heap?
Yes it can, but it has to be significantly better.
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Re: Bitcoin price plunges

Post by Waba »

Random Musings wrote: So, if there are many different virtual currencies out there, can a better mousetrap render certain ones to the dump heap?
I think the dynamics are comparable to the dynamics of social network sites, ones a single crypto currency has achieved sufficient momentum the network effect will make it more desirable than any of the others. History will tell if Bitcoin was Facebook or MySpace.
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Sheepdog
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Re: Bitcoin price plunges

Post by Sheepdog »

The troubled MtGox bitcoin exchange filed for bankruptcy protection in Japan Friday after claims of a multi-million dollar theft from its digital vaults, media reports said.
http://news.yahoo.com/mtgox-bitcoin-exc ... 04460.html
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beammeupscotty
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Re: Bitcoin price plunges

Post by beammeupscotty »

Wolkenspiel wrote:
beammeupscotty wrote: I'm all ears -- please tell more more about an IBAN equivalent of PayPal or http://authorize.net with < 1% e-commerce fees.
I'm not sure if I'm missing something here. In any SEPA country (http://en.wikipedia.org/wiki/Single_Euro_Payments_Area), all I need is the recipients name and account number (IBAN or SWIFT/BIC + account number) and I can transfer funds from my regular bank account to their regular account for free (or essentially free) for amounts up to 50000 Euro. If my brother needs 1000 Euro in his French checking account I can send it to him essentially instantly (may take a day to settle) from my German checking account for free. If I sent money from my Swiss account, I was charged 3CHF for each transfer to a foreign EURO account. I don't see where PayPal or authorize.net come in, other than to provide an escrow function (which was not part of the discussion), and I certainly didn't pay any "e-commerce fee" for transfers to pay merchant bills in the same way. PayPal as a fund-transfer system is a bad joke that charges for functionality that in the rest of the world is integrated in the banking system as a basic and free service. As a corollary, and coming back to the topic of the thread, it is not clear which problem Bitcoin is supposed to solve here. All that is needed is for everyone to get with the program and adopt a standard for electronic bank transfers.
I'm talking about business-to-business commerce (order forms, shopping cart integration, address verification, etc.).
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3CT_Paddler
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Re: Bitcoin price plunges

Post by 3CT_Paddler »

FNK wrote:
Random Musings wrote:So, if there are many different virtual currencies out there, can a better mousetrap render certain ones to the dump heap?
Yes it can, but it has to be significantly better.
Maybe, maybe not. It's a lot like Facebook vs MySpace. A competitor doesn't have to be clearly better as a platform. They just need to be more appealing than Bitcoin for a host of reasons (promise of greater riches?, better security?, easier for laymen to use?, no mining?, faster transaction time?). I don't think most Bitcoin holders realize how quickly the value of their Bitcoins would go to zero if/when a better alternative comes up. One of the big issues that the next tier of cryptocurrencies may perfect is near instant transactions... right now its on the order of ten minutes to confirm transactions in the Bitcoin blockchain. That would be a major advantage for a cryptocurrency to solve that problem.

There is a reason that many Bitcoin holders are openly hostile to alternative cryptocurrencies. Its a direct attack on the value of their Bitcoin, and it represents cryptocurrency monetary inflation.
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Rainier
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Re: Bitcoin price plunges

Post by Rainier »

Regarding mt gox, I thought there were two parts to a bitcoin. The code behind the coin plus a password. Is that true? If so, how can they be stolen if you don't have a password? Any good sites to explain this?
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FNK
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Re: Bitcoin price plunges

Post by FNK »

3CT_Paddler wrote:
FNK wrote:Yes it can, but it has to be significantly better.
They just need to be more appealing than Bitcoin for a host of reasons (promise of greater riches?, better security?, easier for laymen to use?, no mining?, faster transaction time?).
Uh, yes, that counts as significantly better.
3CT_Paddler wrote:One of the big issues that the next tier of cryptocurrencies may perfect is near instant transactions... right now its on the order of ten minutes to confirm transactions in the Bitcoin blockchain. That would be a major advantage for a cryptocurrency to solve that problem.
More like an hour for six verifications. Yes, that's one of the real issues with bitcoin. Another is a single chain for all transactions in the world. A block weave would be scalable.
3CT_Paddler wrote:There is a reason that many Bitcoin holders are openly hostile to alternative cryptocurrencies. Its a direct attack on the value of their Bitcoin, and it represents cryptocurrency monetary inflation.
Never heard of such hostility, but I can imagine. ;-)
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FNK
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Re: Bitcoin price plunges

Post by FNK »

Rainier wrote:Regarding mt gox, I thought there were two parts to a bitcoin. The code behind the coin plus a password. Is that true? If so, how can they be stolen if you don't have a password? Any good sites to explain this?
As I understand it so far, it's primarily Mt. Gox itself being stupid and secondarily a stupid aspect of the protocol. Apparently the signature on the transaction does not protect some fields (like anybody can write on the memo line on a check before depositing it, and it will go through). After issuing a transaction, Mt. Gox was looking for an exact match in the blockchain. The attacker would intercept the transaction, slightly modify it and try to get the modified version confirmed. Mt. Gox would not see an exact match and go "oops, didn't go through, let's reissue" and would send the coins again.

It's mind boggling that they handled huge sums of money (virtual and army-backed kinds) and didn't cross-check everything many times over.
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JupiterJones
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Re: Bitcoin price plunges

Post by JupiterJones »

Seemed appropriate for this thread...

Image
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Valuethinker
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Re: Bitcoin price plunges

Post by Valuethinker »

FNK wrote:
Rainier wrote:Regarding mt gox, I thought there were two parts to a bitcoin. The code behind the coin plus a password. Is that true? If so, how can they be stolen if you don't have a password? Any good sites to explain this?
As I understand it so far, it's primarily Mt. Gox itself being stupid and secondarily a stupid aspect of the protocol. Apparently the signature on the transaction does not protect some fields (like anybody can write on the memo line on a check before depositing it, and it will go through). After issuing a transaction, Mt. Gox was looking for an exact match in the blockchain. The attacker would intercept the transaction, slightly modify it and try to get the modified version confirmed. Mt. Gox would not see an exact match and go "oops, didn't go through, let's reissue" and would send the coins again.

It's mind boggling that they handled huge sums of money (virtual and army-backed kinds) and didn't cross-check everything many times over.

And now you understand why financial institutions have a thicket of regulations around them.

Plus capital requirements. International agreements on same.

Hordes of regulators. Thickets of laws. Tens of billions spent on compliance and IT systems and security.

People are stupid. They do dumb things. Computer systems multiply the potential damage by 1 millionfold. A computer error has not yet brought down a bank, but I am sure there have been close calls.

Virtual currencies? Assumes that all away. Not even the protection Paypal offers us.

Virtual currencies might yet be the end of the current banking system, but let's say the case is 'not proven'.
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FNK
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Re: Bitcoin price plunges

Post by FNK »

http://i.imgur.com/RJpSpvt.gif

[Embedded image to distracting animated GIF image removed by admin LadyGeek. I left the link.]
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FNK
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Re: Bitcoin price plunges

Post by FNK »

Valuethinker wrote:Virtual currencies? Assumes that all away. Not even the protection Paypal offers us.
So far bitcoin has been working on a better dollar bill. It was stupid for people to keep their bills in a cardboard box in a back alley, but that's not the bill's fault.

Ripple is working on a better virtual exchange. Let's see how that fares...
rongos
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Re: Bitcoin price plunges

Post by rongos »

Rainier wrote:Regarding mt gox, I thought there were two parts to a bitcoin. The code behind the coin plus a password. Is that true? If so, how can they be stolen if you don't have a password? Any good sites to explain this?
When you send bitcoins to somebody's else's bitcoin wallet, you don't need their password. Mt Gox did not use best practices to verify the transfer, and was tricked into sending the transfer twice even though the first one went through. Apparently, Mt Gox did not even have basic and fundamental accounting procedures and practices in place to detect they had sent the money twice.
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Re: Bitcoin price plunges

Post by Wolkenspiel »

beammeupscotty wrote: I'm talking about business-to-business commerce (order forms, shopping cart integration, address verification, etc.).
What I'm missing is what that does have to with Bitcoin, which doesn't seem to make any of this easier than using the existing banking infrastructure.
beammeupscotty
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Re: Bitcoin price plunges

Post by beammeupscotty »

Wolkenspiel wrote:
beammeupscotty wrote: I'm talking about business-to-business commerce (order forms, shopping cart integration, address verification, etc.).
What I'm missing is what that does have to with Bitcoin, which doesn't seem to make any of this easier than using the existing banking infrastructure.
What I'm missing is how to achieve something like https://bitpay.com/ at the same or lower cost, with the existing banking infrastructure. I'm not talking about sending money to my uncle Joe.
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TravelforFun
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Re: Bitcoin price plunges

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kenyan
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Re: Bitcoin price plunges

Post by kenyan »

TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Impossible. The potential problems with bitcoin are completely isolated to the mistakes made by one group of people at Mt Gox. No other problems are possible.
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Re: Bitcoin price plunges

Post by barnaclebob »

kenyan wrote:
TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Impossible. The potential problems with bitcoin are completely isolated to the mistakes made by one group of people at Mt Gox. No other problems are possible.
Again, these are issues of the exchanges which are unregulated which increases their risk greatly. Lets say you give your cash to a guy on the street who promises to keep it safe. If he gets robbed and you loose your cash, its not the cash's fault.
Last edited by barnaclebob on Wed Mar 05, 2014 11:04 am, edited 1 time in total.
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Re: Bitcoin price plunges

Post by Random Musings »

TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Is this a new version of "The Last Comic Standing"?

RM
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kenyan
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Re: Bitcoin price plunges

Post by kenyan »

barnaclebob wrote:
kenyan wrote:
TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Impossible. The potential problems with bitcoin are completely isolated to the mistakes made by one group of people at Mt Gox. No other problems are possible.
Again, these are issues of the exchanges which are unregulated which increases their risk greatly. Lets say you give your cash to a guy on the street who promises to keep it safe. If he gets robbed and you loose your cash, its not the cash's fault.
Thankfully, I don't keep my cash with guys on the street. I keep my cash at a bank, with FDIC insurance.
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Oicuryy
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Re: Bitcoin price plunges

Post by Oicuryy »

Here is another one. This guy explains how the theft was done. Makes you wonder if these guys know anything about online transaction processing.

Poloniex Loses 12.3% of its Bitcoins in Latest Bitcoin Exchange Hack

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Re: Bitcoin price plunges

Post by chaz »

kenyan wrote:
barnaclebob wrote:
kenyan wrote:
TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Impossible. The potential problems with bitcoin are completely isolated to the mistakes made by one group of people at Mt Gox. No other problems are possible.
Again, these are issues of the exchanges which are unregulated which increases their risk greatly. Lets say you give your cash to a guy on the street who promises to keep it safe. If he gets robbed and you loose your cash, its not the cash's fault.
Thankfully, I don't keep my cash with guys on the street. I keep my cash at a bank, with FDIC insurance.
Smart to not invest in binary code.
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greg24
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Re: Bitcoin price plunges

Post by greg24 »

barnaclebob wrote:
kenyan wrote:
TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Impossible. The potential problems with bitcoin are completely isolated to the mistakes made by one group of people at Mt Gox. No other problems are possible.
Again, these are issues of the exchanges which are unregulated which increases their risk greatly. Lets say you give your cash to a guy on the street who promises to keep it safe. If he gets robbed and you loose your cash, its not the cash's fault.
Maybe its best not to invest in a currency whose financial institutions are the banking equivalent of a guy on the street.
manwithnoname
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Re: Bitcoin price plunges

Post by manwithnoname »

Autumn Radtke, the CEO of an upstart online currency exchange, died last week under mysterious circumstances at her home in Singapore. First Meta bills itself as a clearinghouse for the purchase and exchange of virtual currencies, including bitcoin.

http://www.nbcnews.com/business/busines ... ore-n45101

This is not good Maverick.
Wolkenspiel
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Re: Bitcoin price plunges

Post by Wolkenspiel »

Oicuryy wrote:Here is another one. This guy explains how the theft was done. Makes you wonder if these guys know anything about online transaction processing.

Poloniex Loses 12.3% of its Bitcoins in Latest Bitcoin Exchange Hack
"Due to its current bitcoin shortage, Poloniex indicated that all customer balances would temporarily be reduced by 12.3% “out of absolute necessity”. D’Agosta suggested that this was the only way that bitcoins could be distributed fairly among affected users." I think there may still some ways to go before this will replace the $ and traditional banking system.
technovelist
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Re: Bitcoin price plunges

Post by technovelist »

georgewall42 wrote:
FNK wrote:...
technovelist wrote:What makes (made?) Bitcoin unique such that no one could create something just as "secure" and "cool"?
Convincing a crowd of people to run mining operations. The larger the mining pool, the more secure the currency. Whatever comes to displace bitcoin has to be 10x better.
There's nothing to prevent a future crypto-currency from either convincing a crowd of miners or from being "10x better", whatever that means. That doesn't by itself mean that bitcoin is or will be a failure; it does mean that the hard limit on the number of bitcoins is not really a hard limit.

My guess is that the NSA will figure out how to hack the algorithms in 5 years anyway :D
I think you're off by about 6 years.
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barnaclebob
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Re: Bitcoin price plunges

Post by barnaclebob »

chaz wrote:
kenyan wrote:
barnaclebob wrote:
kenyan wrote:
TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Impossible. The potential problems with bitcoin are completely isolated to the mistakes made by one group of people at Mt Gox. No other problems are possible.
Again, these are issues of the exchanges which are unregulated which increases their risk greatly. Lets say you give your cash to a guy on the street who promises to keep it safe. If he gets robbed and you loose your cash, its not the cash's fault.
Thankfully, I don't keep my cash with guys on the street. I keep my cash at a bank, with FDIC insurance.
Smart to not invest in binary code.
But pieces of paper and rocks are legit.
ensign_lee
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Re: Bitcoin price plunges

Post by ensign_lee »

kenyan wrote:
TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Impossible. The potential problems with bitcoin are completely isolated to the mistakes made by one group of people at Mt Gox. No other problems are possible.
Your sarcasm is unwarranted. Bitcoin makes it so that way you don't have to trust a third party to ensure that you don't get stolen from. If you choose to do so anyway, well...Bitcoin is about the same as the old wild wild west.

Banks failed because they were incompetent when the US was a fledgling country and people weren't reimbursed (before FDIC). The US Dollar didn't die then. This is the same situation, but with Bitcoin.

Just because *people* are incompetent is not the fault of the currency.
chaz
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Re: Bitcoin price plunges

Post by chaz »

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Professor Emeritus
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Re: Bitcoin price plunges

Post by Professor Emeritus »

ensign_lee wrote:
kenyan wrote:
TravelforFun wrote:Another Bitcoin exchange folded.
http://news.yahoo.com/bitcoin-bank-flex ... ector.html
Impossible. The potential problems with bitcoin are completely isolated to the mistakes made by one group of people at Mt Gox. No other problems are possible.
Your sarcasm is unwarranted. Bitcoin makes it so that way you don't have to trust a third party to ensure that you don't get stolen from. If you choose to do so anyway, well...Bitcoin is about the same as the old wild wild west.

Banks failed because they were incompetent when the US was a fledgling country and people weren't reimbursed (before FDIC). The US Dollar didn't die then. This is the same situation, but with Bitcoin.

Just because *people* are incompetent is not the fault of the currency.
Whatever bitcoin "is" it is "not" a "currency" as that term is routinely used. No one is required by law to accept it in payment of debts, which is the normal fundamental requirement of a currency. Bitcoin is distinctly a matter of private law, not public law.
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Phineas J. Whoopee
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Re: Bitcoin price plunges

Post by Phineas J. Whoopee »

I made a mighty effort to stay out. Failure, thy time is now.

What functions of money does Bitcoin presently supply?

A medium of exchange? On silkroad maybe. Others immediately convert them into more ordinary media.

A store of value? The value fluctuates wildly, and storage means under one's own protection in private, non-networked memory.

A unit of account?

Maybe bitcoins or some other cryptocurrenc[ y | ies ] will eventually fill the roles of money, but they certainly don't today.

For now I'm sticking with that which does serve all three functions. Should the situation change I'll re-evaluate.

PJW
technovelist
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Re: Bitcoin price plunges

Post by technovelist »

Apparently someone must take it pretty seriously:

[OT article link removed by admin LadyGeek]

Or maybe this is just another coincidence?
In theory, theory and practice are identical. In practice, they often differ.
Leeraar
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Re: Bitcoin price plunges

Post by Leeraar »

I checked: Bitcoin has only partly entered the realm of The Onion.
IU: Are you familiar with bitcoins and this whole idea of digital currency?

The Onion: We’re interested in bitcoins, but we’re trying to figure out if they should even go in our portfolio. Where should they be stored? We think they should be stored in the backyard. Dig a hole, and bury your bitcoins in the backyard. Later you can dig them up and look at your bitcoins, and if they appreciated in value, then that’s fine. It’s still like, “Oh cool, look at this thing I found in my backyard.”

IU: Bitcoins are digital currency, which is actually more of an algorithm that you can’t hold in your hands.

The Onion: And that’s the other thing people say, they call it “digital currency.” It wasn’t enough for them to say “gold bitcoins.” Now they have to call it “digital currency.” Why do we have to come up with these stupid terms for things when we already have names for it?
http://www.etf.com/sections/features/20 ... =1&start=3

L.
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Re: Bitcoin price plunges

Post by Pacific »

Pretty interesting article on the maybe founder of Bitcoin and the programming (what the heck is a "reverse Polish notation"?)
http://mag.newsweek.com/2014/03/14/bitc ... amoto.html
Leeraar
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Re: Bitcoin price plunges

Post by Leeraar »

Pacific wrote:Pretty interesting article on the maybe founder of Bitcoin and the programming (what the heck is a "reverse Polish notation"?)
http://mag.newsweek.com/2014/03/14/bitc ... amoto.html
"Satoshi's style of writing code was old-school. He used things like reverse Polish notation."
I am outraged at the insult. Stupid youth, they have no idea what an HP-12C is.
http://en.wikipedia.org/wiki/HP-12C

Some of them even think reverse Polish is driving clockwise on a NASCAR oval. :annoyed

L. :D
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Re: Bitcoin price plunges

Post by LadyGeek »

I removed an off-topic comment. This thread has run its course and is locked (off-topic - not investing related, no added value to continue). See: Forum Policy
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