why bitcoins are just like gold.
 

the key arguments from the article::::::::

The only reason gold has value is because one day,... long before recorded history, society simply decided that this yellowish precious metal should represent “money.” From that day forward--as that idea spread virally across the globe ...gold came to be worth something in the eyes of the people.

As a representative (and thus store) of value, it became a universal intermediary between goods and services. This was the natural, inevitable economic evolution of the barter system. As it retained its value over time--and eventually throughout human history--gold gained cultural credibility.

Why the chemical element Au? There’s its obvious aesthetic qualities. But gold’s longevity comes from scarcity; its limited quantities were never able to keep up with demand. Since the beginning of human history, a total of 171,300 tonnes of gold have been mined.

Bitcoin, in its present form, has a stark resemblance to gold. Both are backed by no one. Both are, relative to fiat currency, inconvenient for day to day use. Your gold coins or bitcoins (yet) won’t do much good at the grocery store. Both lack intrinsic value. If the apocalypse arrived tomorrow, your gold and BTC won’t help you survive against the zombies. Both have value only because society has confidence that they will maintain said value over time.

BUT the supply of bitcoins, like gold, is also constrained, built into its elegant mathematical model. There’s hard limit of 21 million bitcoins to be mined, which is predetermined to be reached during the year 2140. So as bitcoin demand and adoption continue to outpace its supply, its price will increase in lockstep.


As long as Bitcoin exists, it will grow. So ignore the warnings of hype and talk of a bubble, in the long run, it’s all more or less irrelevant. The value of bitcoin could crash again, like it did in the summer of 2011. Or it could keep skyrocketing. Whatever happens, neither gold nor bitcoin are going anywhere anytime soon. In the end, that’s all that really matters.


http://motherboard.vice.com/blog/why...just-like-gold

Better fucking believe it.

Depending on how it plays out it could be more convenient than gold if more companies start accepting it as a payment method, it's very easy to transfer.

Ever try selling physical gold? Right fucking pain in the ass! :Oh crap

Yes I sold gold for the first time recently. Had to know all kinds of info too when I sold it

FYI, you can actually buy gold with BTC :thumbsup

take some gold coins
take some bitcoins

go to cuba, spend, and get back to us
go to china, spend, and get back to us
go to the mall, spend, and get back to us
go buy some pussy, and get back to us
bribe the border guards between Ecuador and Peru, an get back to us

tell us which "currency" works best

Bitcoins are a construct instrument of one type of civilization in one short time span, just as credit default swaps, SPDRs, naked puts, or corn futures. They rely on agreements to have value.

Gold, you don't need theories. Civilizations collapse, empires fall, and gold endures.

Did you hear the joke about the bitcoin?

A bitcoins walks into a bitcoin, one bitcoins says to the other bitcoins. Bitcoin!!!!


ahahahahahha

Gold endures for sure but its not a very good currency. Maybe if gold was as easily divisible as bitcoin, couldn't be counterfeited, and it wasn't a pain to transport it would be better. Bitcoin solves alot of these problems and in only 4 years, I can buy just about anything I want at least online with Bitcoins. Gold um not really anything

:thumbsup:thumbsup Didn't PBBC do a study on BitCoins recently?

because of the anonymity of bitcoins you can buy hookers in any US state with no financial trail. If the cops try to bust you, there is no proof of payment and thus there's nothing they can do. But of course it's legal in some states anyway, :)

It's clear that most people don't know what bitcoins are really used for. They've been around for over 4 years and you're just now hearing about them?

i would assume that gold would work best, certainly, but your point is valid, bitcoins still can work in those situations, all of them, it just hasn't been used in all of them, again, assuming.

but i tell ya what, a border guard between ecuador and peru would be silly to not take bitcoins as payoff.

bitcoins are a construct, they don't exist. Gold doesn't corrode and does exist. That said, if you are making money on the suckers who buy bitcoins, more power to you. Like Mardi Gras beads, they have value in their time and place.

:helpme I can only imagine a bitcoin supporter wrote that.

And that is exactly why it is worth something. Because THE ENTIRE WORLD agrees that it is, and they have agreed on this since before recorded history. Bitcoins have been around for like 4 years and are mostly owned by geeks, druggies, and tech savvy pedophiles seeking child porn. That alone should be enough to end the debate.

Perhaps in the western world. Not true in Asia.

Again, this shows the writers lack of global understanding of it all.

Again, not correct. Well, it won't help you against zombies, but if you research any financial collapse, gold was used for bartering and currency in every one of them. But he is correct in saying btc won't help you, because btc is over should the power ever go out.

At least you can hold a metal like gold. It exists in the real world. You can even kill someone with it if you need to. There is something to be said for that, and that is why the entire world trusts gold, and always has.

When Russia, China, India, the USA, central banks, and the global elite start stocking up on bitcoins, then the argument can be had that it is as good as gold. Until that happens, it's an online phenomenon that could end tomorrow or in 10 years. Make money while you can, as much as you can, and kudos to you for doing it, because the odds are not in its favor for long term survival.

That said, the concept is brilliant. We should have a competing currency. Maybe it's not btc, maybe it will be, but something needs to happen. Somehow the gov finds a way to shut down every one that even tries. :Oh crap

To be clear, western governments have set up the system and brainwashed the people into NOT using gold. Asia (1/3+ of the world's population) is the opposite. Gold can be used and is often used to buy many things, especially among the Chinese and Indians.

certainly good points made.

what do you think about the scarcity comparison, the author seems to think that is a critical component to the success of both gold and (potentially) btc?


also, can you really buy at a local store with gold? how do they check the gold content?
not doubting you, just curious.

Don't get me wrong, there are a few comparisons. I am only debating the statement of "bitcoins are just like gold."

Regarding what you can buy in Asia, it depends on who you are dealing with and how you are doing it. I can't walk into 7-11 and buy stuff with gold. I can however buy items from (mostly Chinese / wealthy Thais) stores simply by having gold stamped from known and trusted gold shops. That said, I wouldn't go buy a soda with it. But if I wanted to buy a condo or a car, even a scooter, something large, I could use gold easily. One of my friends bought a condo with gold last year. He did have to have it verified by the shop it was stamped by.

When people think "gold" they think giant bars that weigh a lot. That is picture the media has painted into everyone's head. In reality, those (the big ones) are for only very wealthy people. Normal people buy small ones, or tiny pieces. For example, a piece of gold worth around $800 is no larger in width than my pinky fingernail. On the Thai gold scale that is 1 Thai baht of gold. You can also get 1/2 baht, 1/4 baht and so on. So you can take those smaller ones to the shops in Chinatown and buy pretty much anything, as the Chinese are hip and use gold themselves.

Let me find some pics or take some and you can see just how small it is. BRB....

apppreciate the reply, no need for scrounging up pics though, i know peeps don't walk around shaving gold off bricks. :-) it does sound like small local networks or what-have-you that allow the gold trading such as you describe to work.

i can see the same thing happening with btc.

http://i.imgur.com/T3sHJJe.jpg

That little thing is approx $760 USD based on today's price. See the tiny stamp on it? Each gold shop stamps its own gold, just like elsewhere in the world. If it's a small amount they will take it after knowing what shop it is from, or they will just walk across the street or down the block and have it checked at another shop. Gold shops are EVERYWHERE in Asia. Think McDonalds, but with gold. If it's a large amount they will for sure have it checked out. There are not so many people faking it here like elsewhere. Yes, it happens, just not like it does in the western world.

What I've found is it is a heck of a lot easier to have a lot of little ones than to have big ones. If it's big, everyone wants to check it as that is what people do fake when they fake them. If it's small, they usually just take them.

that's pretty cool man

It's mostly the Chinese driving it. They are gold crazy. In Thailand, the wealthiest Thais are usually Chinese / Thais. Same with a lot of other SE Asian countries. We literally have streets full of gold shops, one after another.

This is just one tiny part of the street, one side of the street, but this is just one gold shop area in Chinatown in Bangkok. All of the red signs are big gold shops, all the others are either something else or smaller gold shops. This street goes on for like 1/2 a mile and has a lot of side streets shooting off of it, also full of gold shops. It's just crazy.

http://i.imgur.com/AkMXS5u.jpg

DWB how close to market value do you get for your gold in Asia? Most places in the EU when selling it, if you sell it back to a dealer you're lucky to get 85% - 90% of it's current market value.

Not true at all. Gold has tons of industrial use.

the article goes on the mention this specifically as *limited* industrial use. I looked it up in wiki, i don't know if it's official but it's states only 10% of gold mined is used for industrial purposes.



http://en.wikipedia.org/wiki/Gold

Not really. Yes it could be but mostly jewelry and investment. Silver on the other hand is used very much so in industry

i too was under the impression that there are many application of gold in industry, not the amount of gold used, but the wiki doesn't seem to mention anything significant in that regard either

http://en.wikipedia.org/wiki/Gold#Industry

learn something new everyday!

it's damn expensive so that limits it's research and uses... if the price was the same as copper lets say, magically 1000s of different great uses would emerge...

which to me is the same as scarcity.. copper is used more because it's cheaper, it's cheaper because it's easier to get/there's more of it.

that is the part about btc that i think slips under the radar- until 2140when production ceases, the production is already predetermined, the algo can't change.

gold is scarce in some "real" sense, bitcoins scarcity is completely made up...

I could announce that there will only be 10 thousand wojcoins, would that make them more scarce than bitcoins? and so more valuable?

When you sell Thai gold, take it to any gold shop - they weigh it and pay you market price.. So you pretty much get 100%, if not 90-95% depending on the piece (bar, ring, bracelet, etc). Gold is better than cash in Thailand.

FYI a lot of bitcoin users are gold/silver bugs. Not a coincidence :winkwink:

Yes certainly no surprise that a group of people would trust PMs & Bitcoin versus fiat currency that governments can just print more of and inflate away it's value, especially considering the current economic uncertainty and horror stories like the one this week concerning Cyprus.

http://www.markenting.me/wp-content/...feld-Quote.gif

Wow! That means Stinkyfingers probably retired with that gold supply he offered as an affiliate prize a few years back, and then never issued... :upsidedow

Anyway, that got me to thinkin', and I came up with a creative new concept:

http://i.imgur.com/E8r5w.jpg

Our Slogan: Money Up Your Ass! :2 cents:

Don't write a check that your butt can't cash... :thumbsup

:stoned

ADG

how does one actually convert their cash into bitcoins in their wallets? this doesnt seem to be discussed very much. I would think that if the feds or wall street get in the mood to crack down on bitcoin, doing the conversion will be beyond the desire of average consumers to deal with, assuming one needs to hand cash to a local dealer.

i think you are asking how to begin exchanging bitcoins. it's simple just sign up

https://mtgox.com/signup

actually its not made-up right? the supply is much less than demand.

I have not bought BitCoins myself, but I have friends who did it at $5 per coin - one of them just bought a big sailboat and is headed out for the oceans for a couple of years because of it. IT being mini-rich from BitCoin.

The way I see it, if you are already in - golden. If not, it is edgy now, but could explode with time. Your risk... Have fun!

I would totally buy wojcoins.

:2 cents:

I agree with this 100%. If you got in early, you cleaned house and good for you. Getting in now is super risky, but risk sometimes pays off big.

respectfully, i was asking how you do step 1 & step last, AKA converting your cash/equity to bitcoin & back. Do i mail cash to mtdox.com for bitcoin & they mail cash back to me when i cash out?

just seems that if you want to do conversions through a bank account in any way, the Man can knock this down, if the Man so desires. to be a legit above ground currency in the long run, it will have to be amicable with the Man. or else it will remain this speculative store of value that requires more legwork to utilize then an average consumer would be bothered with.

but the whole concept is fascinating.

how to do step #1 is where you do step#1, all the info you need you can get starting there. i know, i did it. there's a lot of good info here but it's mixed in and not always accurate etc. if you have decided to jump in, i suggest diving into the mtgox site and expanding out as you need to get an accurate grasp on enough of it to suit you.

yes, as L-Pink has stressed elsewhere, it is always important to follow your tax guidelines, especially when dealing with a cryptocurrency.

TBH, i have nothing but bad experience getting into stocks at the ass end of exponential growth curves. the time to get in was when it was going nowhere for months & months. I would think intelligent speculators look at the recent chart & take some profits, sell say half the bitcoin & maybe await a correction.

the thing about parabolas - they have 2 sides. :winkwink:

any jewelry store pretty much will buy your gold.

josh, i hear ya, thing is, if this is the cryptocurrency that does take off, that parabola is on a long timeline eh.

also, checkout this brand new beta open source p2p payment gateway that supports btc and their goal is to be the best way to buy and sell/exchange btc,

Simple, global, open, and practically free. ripple is an open source person to person payment network
https://ripple.com/bitcoiners/

it's a paypal for cryptocurrencies. this sort of infrastructure will go a long way to helping this maintain momentum imo.

You can buy gold contracts where it's stored in a secure location and you just have a contract that is proof of ownership, you typically pay a "storage fee" based on the amount you own.

Really easy to buy and sell.
Gold have a value in terms of status since its used in the real world.. bitcoins do not so I can't see how it compares ?

How will that momentum be "maintained" when 1000 other people start 10,000 similar currencies? What is the value of bitcoins when there are 10,000 similar currencies? What is the value of a bitcoin when its realized that anyone can just randomly wake up and start a currency using open source software and people are doing it daily? What is the value of a bitcoin going to be when millions of people lose money on similar currencies?

Money is religion. Nothing more. It's a deity in a sea of deities. It's faith. The value of a piece of paper lies in the understanding that others will accept that it has that value, both today and in the foreseeable future. Nothing more. Sharing or not sharing the same beliefs in the same deities does not make those deities more real or imagined, more stable or more unstable over the long term.

josh, check out this smartphone app

https://www.bridgewalkerapp.com/

Bridgewalker Bitcoin Wallet

Bitcoin wallet with a twist: Send and receive bitcoins, but hold US dollar. Bridgewalker converts back and forth between bitcoins and US dollar just when you need to send some or receive them. Minimize your exposure to the young currency's exchange rate risk, while taking advantage of its strength for fast and cheap world-wide money transfer with zero risk of identity theft.

Fiat money is religion.
Bitcoin is natural selection.

i like this idea of wallet.

all currency is based on faith. nothing more.

settle down.

since you quoted "momentum" i'l figure you were quoting me on that, if you doble-check, you will see that i was referring to the infrastructure provided by ripple.com, which is not cryptocurrency specific.

i've never said btc is the holy grail, far from it. in fact, you'll be hardpressed to find me doing anything around here re: btc that isn't supported with a link to where i retrieved the information. a lot of people are asking genuine questions here re: btc and i think it's important to at least try to provide factual replies.

so yeah, i fully understand that myspace was here before facebook, i get that, in fact, collegeclub was here before myspace and i happened to work for collegclub starting in 1998, so i know what it's like to be left standing during a game of high-tech investing musical chairs.

:)

yes, teh moneys = cult

I've really been trying to wrap my mind around Ripple. From what I understand its not just for cryptocurrencies but for all currencies. Its all based on trust. Bob wants to buy from me but I dont know Bob, but you know BoB and trust Bob and I know you and trust you, therefore I trust Bob and I can sell to bob. (or something?)