More on Bitcoin:

From: Tyler Mittan 
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Looks like Bitcoin is being recognized as "private money" by Germany:

http://www.cnbc.com/id/100971898

For those that don't take Austrian economics seriously, notice the name
drop of F.A. Hayek.

=============================================================== From: Stephen Kraus ------------------------------------------------------ Yeah, guess what it means. You have to report any profit you make from Bitcoin on your taxes. Have fun!

=============================================================== From: Matt Keys ------------------------------------------------------ Yeah, have fun... Have fun trying to keep track of who's behind the IP in each transaction... have fun trying to "regulate" a peer-to-peer network with no central authority. Downloading copyrighted material using bittorrent has been deemed illegal and has been "regulated" by various authorities... does it still happen? Do the authorities know exactly how often this happens, from where, to/from whom? The usual political fear mongering won't work. I think what's happening is that governments are starting to wrap their heads around this gigantic problem -- "how the hell are we going to continue business as usual if this really takes off worldwide?" This guy quoted on the cnbc article has the right idea, but he's thinking about it in the wrong direction : "If the euro does go belly up the German authorities could potentially still collect tax if everyone started using the bitcoin - that's a good example of German forward-thinking!" -- http://www.cnbc.com/id/100971898 . If the Euro goes "belly up" nobody is going to give a shit about German taxes. They're going to dump their Euro money, as fast as possible, to bitcoin and another forms of money. Think Cyprus crisis v2.0 on an exponential scale.

=============================================================== From: Stephen Kraus ------------------------------------------------------ No, Matt that is wishful thinking if I've ever heard it.

=============================================================== From: Stephen Haywood ------------------------------------------------------ If the Euro, or Dollar go belly up, the most usable currency for a few = weeks or months will be water, food, shelter, and protection, not = bitcoins. Now, after things stabilize, bitcoins might rise up to be the = new Euro/Dollar but it is very unlikely. -- Stephen Haywood Owner, ASG Consulting CISSP, GSEC, OSCP 423.305.3700 stephen@averagesecurityguy.info transaction... have fun trying to "regulate" a peer-to-peer network with = no central authority. Downloading copyrighted material using bittorrent = has been deemed illegal and has been "regulated" by various = authorities... does it still happen? Do the authorities know exactly how = often this happens, from where, to/from whom? happening is that governments are starting to wrap their heads around = this gigantic problem -- "how the hell are we going to continue business = as usual if this really takes off worldwide?"=20 thinking about it in the wrong direction : "If the euro does go belly up = the German authorities could potentially still collect tax if everyone = started using the bitcoin - that's a good example of German = forward-thinking!" -- http://www.cnbc.com/id/100971898 . If the Euro = goes "belly up" nobody is going to give a shit about German taxes. = They're going to dump their Euro money, as fast as possible, to bitcoin = and another forms of money. Think Cyprus crisis v2.0 on an exponential = scale. Have fun! wrote: name drop of F.A. Hayek.

=============================================================== From: Matt Keys ------------------------------------------------------ Bitcoin is already an accepted form of payment. Some employers like the Internet Archive already give that option to their employees. In other words I see bitcoin as a stabilizing factor in a crisis like that. In order to keep food, water, shelter, etc. you'd need to pay those employees that keep those utilities going... so you're gonna pay them in sandwiches, water, and bullets -- or bitcoin? How would you collect payments if you're an employer? What happened in Cyprus is a fact. Another fact that took place around 80 years ago... "executive order 6102". Governments historically try to seize or ban when they're loosing control or wanting control of something -- land, water, shelter, guns/ammo... even money.

=============================================================== From: Stephen Kraus ------------------------------------------------------ If it happens, I'll be waiting for the flying pigs.

=============================================================== From: Matt Keys ------------------------------------------------------ http://www.cnbc.com/id/100923551

=============================================================== From: Stephen Haywood ------------------------------------------------------ I'll be shooting the flying pigs for supper. :) -- Stephen Haywood Owner, ASG Consulting CISSP, GSEC, OSCP 423.305.3700 stephen@averagesecurityguy.info On Aug 22, 2013, at 10:57 AM, Stephen Kraus = wrote: the Internet Archive already give that option to their employees. In = other words I see bitcoin as a stabilizing factor in a crisis like that. = In order to keep food, water, shelter, etc. you'd need to pay those = employees that keep those utilities going... so you're gonna pay them in = sandwiches, water, and bullets -- or bitcoin? How would you collect = payments if you're an employer? 80 years ago... "executive order 6102". Governments historically try to = seize or ban when they're loosing control or wanting control of = something -- land, water, shelter, guns/ammo... even money. weeks or months will be water, food, shelter, and protection, not = bitcoins. Now, after things stabilize, bitcoins might rise up to be the = new Euro/Dollar but it is very unlikely. transaction... have fun trying to "regulate" a peer-to-peer network with = no central authority. Downloading copyrighted material using bittorrent = has been deemed illegal and has been "regulated" by various = authorities... does it still happen? Do the authorities know exactly how = often this happens, from where, to/from whom? happening is that governments are starting to wrap their heads around = this gigantic problem -- "how the hell are we going to continue business = as usual if this really takes off worldwide?" thinking about it in the wrong direction : "If the euro does go belly up = the German authorities could potentially still collect tax if everyone = started using the bitcoin - that's a good example of German = forward-thinking!" -- http://www.cnbc.com/id/100971898 . If the Euro = goes "belly up" nobody is going to give a shit about German taxes. = They're going to dump their Euro money, as fast as possible, to bitcoin = and another forms of money. Think Cyprus crisis v2.0 on an exponential = scale. Have fun! wrote: name drop of F.A. Hayek.

=============================================================== From: Stephen Kraus ------------------------------------------------------ All you are doing by proposing replacing a regulated form of currency with a limited by design crypto currency is introducing the same problems we ditched by leaving gold backed currency. It is deeply ironic that bitcoiners decry regulation without fully understanding that is exactly what large, monopolistic buisnesses want, or a magical free market thatwe technically had in the early 1900s and only led to massive worker and market abuses. It is with even deeper irony that you decry government manipulation of markets, when the exact opposite led to massive and disastrous market fluctuations. It is with the deepest irony that you decry manipulation of markets without realizing that studying and learning to manipulate markets is the ENTIRE point of economics. Like I said, when pigs fly. On Aug 22, 2013 11:12 AM, "Matt Keys" wrote:

=============================================================== From: Bret McHone ------------------------------------------------------ http://www.youtube.com/watch?v=3DxmFXEcI

=============================================================== From: Aaron welch ------------------------------------------------------ Agreed. Lets stop arguing about its merits and downfalls and focus on the important parts... Make the money now before they figure out how to devalue it. -AW

=============================================================== From: Lynn Dixon ------------------------------------------------------ Aaron, This is something I have been doing for the last couple of years. Bitcoin mining, and trading has been very profitable for me. I can't say for certain that it will always be this profitable, but I am damn sure going to ride this curve for as long as its making me money.

=============================================================== From: Aaron welch ------------------------------------------------------ Me too, me too. -AW

=============================================================== From: Chad Smith ------------------------------------------------------ It's like POGs. Remember POGs? BitCoins are like POGs. Really, in and of themselves, that have absolutely no value. But, for a while in the 90s, some people got RICH off of POGs. Why? Because they were able to convince people they needed to have them. People bought into it - and some of *those *people also got rich - because they collected and traded and sold them. Eventually, it all came crashing down, because it is very hard to keep convincing people they need to spend actually real-world money on little cardboard discs. BitCoin is POGs for the Twenty-Teens Tech Geek. It won't last. But there will be people who make money off of it. To them I say "Enjoy it while it lasts." *- Chad W. Smith*

=============================================================== From: Lynn Dixon ------------------------------------------------------ Chad, I disagree. Bitcoins are just like anything, the value of it is determined by the demand/supply for it. The supply is very fixed by the network, and cannot be manipulated. Therefore the value is directly linked to the demand of the currency. The exception with Bitcoin is that people are actually using as a medium of exchange for goods, services, and even currency exchange. I use it for all 3 of these. I don't think people used POGs as a medium of exchange.

=============================================================== From: Stephen Kraus ------------------------------------------------------ POGs crashed entirely. The dollar crashes but pretty much always bounces back as the global economy follows the market cycle. Thats the problme with your criticism of Chad's argument. Also, no matter how devalued the dollar is right now, I can buy my lunch with it. If I offered pogs or even bitcoin alll I'd get is funny looks or a heartfelt apology and rejection

=============================================================== From: Stephen Kraus ------------------------------------------------------ I think you summed that up well Chad

=============================================================== From: Randy Yates ------------------------------------------------------ What's humorous with Chad's entire argument is that the same could be said about the dollar.

=============================================================== From: Randy Yates ------------------------------------------------------ Give the dollar time. "Eventually, it all came crashing down, because it is very hard to keep convincing people they need to spend actually real-world money on little cardboard discs." This is criticizing any fiat currency, and I agree with it. The dollar is only worth something as long as people are convinced it's worth something. It's had a good run as a standard world currency, but all world currencies reach their end, and the results are not fun.

=============================================================== From: Stephen Kraus ------------------------------------------------------ Lynn, while you may MAKE money off bitcoins, the value of the traded bitcoins and the inherint value you get from them is.....in dollars. While some (very few) retailers may accept bitcoin, even their expectation is to either gain more bitcoins which they can then launder into dollars or exchange them as well for another service, but even THAT service expects the value of the bitcoins they pay to transfer to dollars somehow. Until you can go to a local grocer or gas station and directly pay with bitcoins, its going to remain a neat, yet niche idea.

=============================================================== From: Stephen Kraus ------------------------------------------------------ Randy: a fiat currency implies it only has an inherint value due to the direct control of an interested party, and is only spendable within a very likited number of markets. Thats not the dollar or the Euro. They are equivilently exchangable with one another across broad markets. Fiat currency is literally what Bitcoins are. But, at the same time you are correct, the dollar may in the future lose all its intended value, but I guarentee when that time comes, its unlikely it will jusy be a matter of transitioning to another currency....most likely because the world will be in chaos and civil wars, if not a world war breaking out.

=============================================================== From: Tyler Mittan ------------------------------------------------------ Randy and Lynn are right on. The more important part of this is that we ought to have competing currencies to keep whomever the issuers are honest. No one wants bad money. This criticism of no one taking Bitcoins is totally off base. First, not everyone knows about bitcoins or how it works. Secondly, the dollar is propped up for two reasons.. People have to use dollars because that's what the government forces banks to accept and because people think the government's handling of the money supply us trustworthy because most people don't understand the political motive to devalue currency

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen, Actually no. The inherit value I get from them is the ability to trade them for goods, services, or even other currencies. The dollar is not the only currency of value in this world. I have bought Euros, Yen, CAD, and others. The Euro has been much stronger than the dollar for a while now (Nearly 10 years now?) even during the financial crisis in Europe. I am not sure why you keep making the assumption that everyone wants dollars. I have gotten alot of utility (the true value of ANY currency) from my Bitcoins by trading/using them natively without any laundering into other currencies. I do this daily.

=============================================================== From: Stephen Kraus ------------------------------------------------------ Go to a gas station. Right now. Pay for gas and a soda with bitcoins. Don't take out your credit card. Don't use cash. Use bitcoins. Why can't you? Because they don't understand its value? I could say I have sea shells. I believe they have some value to me, but people don't understand their value, so I can't use them to pay for products immediately. But maybe I can trade someone else who values sea shells in trade for cash. Suddenly my sea shells have worth, despite the apparent lack of actual value as a wide currency. But that does not mean I can magically declare the major currency accepted globally as dead becauwe my sea shells hava negotiable value among a select group On Aug 22, 2013 1:26 PM, "Tyler Mittan" wrote:

=============================================================== From: Stephen Kraus ------------------------------------------------------ Lynn. Doesn't matter. Its still a fiat currency and non-negotiable at any major retailer that cannot convert it to cash. Its like you went to the arcade and cashed in for some tokens and expect everyone to accept them because of the value the arcade places on the token

=============================================================== From: Chris Mowery ------------------------------------------------------ If you take pesos to a gas station, do they take those?

=============================================================== From: Randy Yates ------------------------------------------------------ The dollar and euro are most definitely fiat currencies. They have been since 1971. http://en.wikipedia.org/wiki/Nixon

=============================================================== From: Randy Yates ------------------------------------------------------ Also, bitcoin is less of fiat currency than the euro or the dollar. There's no government backing it. All value of a fiat currency comes from someone saying it's worth such and such. Who's doing that with bitcoin? It has purchasing power and no one whatsoever telling us that it should.

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen, I also don't think you understand what fiat money is either: http://en.wikipedia.org/wiki/Fiat

=============================================================== From: Stephen Kraus ------------------------------------------------------ Oh good., so I can go to Brazil and get my lunch. Awesome. Did you even bother, in that very wijipedia article, to scroll down to the monentary economics section on fiat currency?

=============================================================== From: Stephen Kraus ------------------------------------------------------ And Lynn: China and Brazil are STILL assuming rhey can trade your bitcoins for some hard currency. Just because you traded with a small party doesn't mean that was the end of the line

=============================================================== From: Stephen Kraus ------------------------------------------------------ I do see that the dollar is defined as a fiat chrrency, so I was wrong there. However,nobody here is buying groceries and gas with direct bitcoins yet. If you do, let me know where

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen. Yes I did. You mean this: *In monetary economics

=============================================================== From: Randy Yates ------------------------------------------------------ Unfortunately that's not the definition of fiat currency. The term refers to where the currency get's its value. There's a limit to the number of bitcoins in existence, just like there's a limit to the amount of gold we have here on earth. There's no limit to the number of dollars. That's why gas costs $4 today when it was around $1.65 15 years ago.

=============================================================== From: Stephen Kraus ------------------------------------------------------ ....randy, you realize in the same sentence you declared the dollar is a fiat currency while at the same time the bitcoin is not despite the fact that they are both inherintly exchangeable to nothing?

=============================================================== From: Lynn Dixon ------------------------------------------------------ Chris, This is an excellent point! Peso are a "world recognized currency", but yet, I can't buy my lunch with Pesos. Well I probably could here in Dalton (local yocals will get that joke), but in Benton, probably not.

=============================================================== From: John Aldrich ------------------------------------------------------ Quoting Stephen Kraus : Stephen, I've seen several websites that say that you can pay with Bitcoins, so I think your argument is a bit weak.

=============================================================== From: Randy Yates ------------------------------------------------------ No one was buying anything online two decades ago either. Now there are a lot of mom and pop stores out of business because of e-commerce. Do you know think that bitcoin could be the next step for online transactions?

=============================================================== From: Chad Smith ------------------------------------------------------ You could buy lunch with Pesos if you're Pesos were in the bank and you had a debit card that automatically converted for you (like I paid for software in Euros yesterday through PayPal without ever owning a Euro in my life). The same cannot be said for BitCoins - or POGs - or Beanie Babies - or Baseball cards - or Star Wars action figures - or Yugioh cards - or Pokemon - or Level 80 WoW characters... All of those things have some value to some people - and they will gladly trade with you for them - but they are not actual currency. You can't take your comic book collection to the bank and ask them to give you the equivalence in Pounds Sterling. *- Chad W. Smith*

=============================================================== From: Chad Smith ------------------------------------------------------ *sigh* no one ever pays me in Gum! *- Chad W. Smith*

=============================================================== From: Stephen Kraus ------------------------------------------------------ Websites. Tell me the difference, between a website, grocer, gas station, and a car dealership. (Hint: all of them trade in the dollar, only ONE accepts bitcoins)

=============================================================== From: Randy Yates ------------------------------------------------------ http://www.coindesk.com/bitcoin-debit-card-ibtcard-will-offer-lower-processing-fees-for-merchants/ It's coming :)

=============================================================== From: Lynn Dixon ------------------------------------------------------ Chad, I am not sure how this relates? You bought a product using an exchange service. You exchanged your USD for EUR. I can do that all day long with my BTC. www.mtgox.com www.coinbase.com www.campbx.com Those are just a few. There are even Bitcoin ATM's being produced. What would you have done if that vendor did not accept Paypal? You would have had to go and buy EUR somewhere else. Whe I buy using BTC, I don';t have to have an antique debit card. I can use my phone, scan a barcode, use NFC, or enter their address. This argument seems invalid as you are trying to discredit bitcoin because you cant swipe an old debit card?

=============================================================== From: Randy Yates ------------------------------------------------------ So now the fault of bitcoin is that it has an exchange rate with dollars, euros, pounds, and francs? Don't those currencies also have exchange rates with each other? What's your point in that statement, Stephen?

=============================================================== From: Stephen Kraus ------------------------------------------------------ Randy. On the top of the very site you just linked to. Guess what those exchange rates establish? And the only reason payment processors might be interested in bitcoins.

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen, I have no clue why you still insist everyone uses the dollar. Surely a grocer in Spain doesnt accept dollars. Maybe the ones you deal with trade in dollars. When working on a global level, its a pain in the ass to have to deal with trading your dollars to euros, or yen, or anything else. With bitcoin, I don't have to worry with exchange rates changing due to the whims of the local governments. There are also alot of coffee shops, and retailers in the US that are beginning to accept Bitcoin, and they do it by scanning a barcode, or using NFC.

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen, Did you even read the article? No where did it mention anything about USD or exchange rates. There are only two ways to get BTC. 1. Mine them 2. Buy them. Since most folks dont want to mine, they will buy BTC. The website just listed the most recent exchange rate. Heres another site for exchange rates: www.bitcoinwatch.com

=============================================================== From: Aaron welch ------------------------------------------------------ Stephen, the sad part of your "argument" against BTC is that you are in fact pointing out more examples of how NEW currencies are formed. Think about this, World of Warcraft uses VIRTUAL currency with no value outside of the game to transfer wealth (to the tune of $3 BILLION dollars) from first to third world economies in Asia. http://utopianist.com/2011/04/world-of-warcrafts-virtual-economy-worth-3-billion-in-non-virtual-dollars/ http://en.wikipedia.org/wiki/Virtual

=============================================================== From: Stephen Kraus ------------------------------------------------------ Good thing everyone has mining equipment. Oh wait, investment costs! As for buying them....do I even have to explain the cognitive dissonance? 'The dollar is worthless we should replace it....but you can freely purchase bitcoins with it, thereby implying that the dollar we say has no value HAS value, because we are willing to accept it in trade'

=============================================================== From: Chad Smith ------------------------------------------------------ "A Lot"? Really, well there are about 20,000 coffee shops in the United States of America. (I looked it up.) How many of those 20,000 will accept BitCoin? You said "A lot" so that would be more than half, right? so 10,000? No? Well, it would have to be at least 10% then, right? so 2,000? Not even that many, huh? 1%? Can you list 200 coffee shops that will accept bitcoin? so... what? like 20 then? You think 0.1% qualifies as "a lot"? Maybe you meant "alot"? http://hyperboleandahalf.blogspot.com/2010/04/alot-is-better-than-you-at-everything.html I have no doubt that you could walk into any one of those 20,000 coffee shops and pay using the US Greenback. Ok, so maybe there's a handful inside of themeparks that only accept Mickey Money, (which is bought using dollars), but other than that.... *- Chad W. Smith*

=============================================================== From: Lynn Dixon ------------------------------------------------------ I would also like to point out that Bitcoin currently has a market cap of around 1.25 BILLION dollars. I use Dollars so Stephen can understand. There is an average of 2600 transaction of BTC every single hour. There is nearly 900,000 bitcoins sent every single day. Bitcoin is freaking huge.

=============================================================== From: Stephen Kraus ------------------------------------------------------ That is without even mentioning the cognitive dissonace of saying this: 'The dollar has no value because there is nothing backing it beyond the word of the government. So trade in bitcoins....which also have nothing backing it beyond our personal guarentees' Its the same thing. Meet the new boss, a clone of theold boss

=============================================================== From: Aaron welch ------------------------------------------------------ Also keep in mind that for all intents and purposes of Stephen's argument, Paypal is also a new form of currency as it can be converted to any other currency by the system. The money in your Paypal account is just 1's and 0's and not like the money in your bank account. It is represented in value by my local currency, but can be shown in any number of values for other currencies. -AW

=============================================================== From: Randy Yates ------------------------------------------------------ I didn't say the dollar had no value. $102 will buy you a bitcoin right now.

=============================================================== From: Stephen Kraus ------------------------------------------------------ Its funny that, Aaron a good comparison. Because if I sell something on Ebay, I set a price in USD. And if paypal doesn't give my bank my USD, I get cross

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen, again, I think you and Chad fail to understand how Bitcoins actually work. The value (like anything in trade) is set by the parties involved in the transactions. If you ONLY think in USD then you are only thinking very simple. This is a global economy, I do business in more than just the US. The value of ANY currency is set by supply/demand. With USD the supply is artificially manipulated by the Fed, which in my opinion is absolutely horrid. The Supply of Bitcoin is controlled by the peer-to-peer network. No one individual or entity can change the supply, therefore the value backing the currency is the sheer demand for it. I honestly have no idea how to continue this debate if we only focus on the simple minded-ness of assuming everything is done in US Dollars only. The world doesnt revolve around the dollar.

=============================================================== From: Lynn Dixon ------------------------------------------------------ Randy, Indeed it will!! So, when you compare the USD to the BTC, the USD is INCREDIBLY weak.

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen Maybe you should try selling on better sites then. hehe (sorry had to jab). Heres one that lets you use a flexible currency: https://www.bitmit.net/

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen, I have already told you what my bitcoins are worth. I have bought and sold several prodcuts and services using my Bitcoin, and none of them invovled the USD. Just recently I bought 100G of Copy.com storage for .15 BTC. I am also thinking about buying a BlockEruptor for around 1 BTC, just for poops and snickers. Tell me, what "backs" the US Dollar? I would imagine the essence of your reply will be the same things that "backs" my BTC....the utility of it.

=============================================================== From: Randy Yates ------------------------------------------------------ It's worth $102, or 0.08 ounces of gold http://coinmill.com/BTC

=============================================================== From: Stephen Kraus ------------------------------------------------------ No, Lynn I think its safe to say youbare severely overthinking bitcoins. Tell me right now: outside of the processing cycles, invested piwer bill, and an algorithm, what backs your bitcoin? What is one bitcoin worth? A gpu cycle? A power bill? Gold?

=============================================================== From: Chad Smith ------------------------------------------------------ I understand how it works, I just don't care. I wanted to make my POG joke, which I did. As I said then, people will make money off of BitCoin, and they have, but it's not going to be around in 10 years. Make your money (as in, make the dollars you can by "trading" in BitCoin) and be happy. Just don't invest so much in it that when it does inevitably burst like a DotCom bubble - that you suffer for it. If you haven't caught on to my subtle implications, BitCoin is a Fad. *- Chad W. Smith*

=============================================================== From: Chad Smith ------------------------------------------------------ By the way, Lynn, no response to how many places take BitCoin, huh? Must have been too spot on with my 20 guess. I'd say more coffee shops accept Disney Dollars than BitCoin. *- Chad W. Smith*

=============================================================== From: Stephen Kraus ------------------------------------------------------ Nothing backs the dollar, except the consumer price index. But nothing backs bitcoins either. Guess what Lynn? Ask the retailer you purchase from what the end pont of their bitcoins you give them are? Also, ask them how they set their values for bitcoin purchases are set? I'm assuming the company didnt buy their servers, rackspace, in are paying their power bill in bitcoins

=============================================================== From: Stephen Kraus ------------------------------------------------------ Thats right Randy...its worth $102 dollars, or the equivilent dollar purchase in gold.

=============================================================== From: Lynn Dixon ------------------------------------------------------ Chad, So mote it be, we agree to disagree. I think bitcoin is a sustainable and very viable global exchange medium. It eliminates the mongering of local and foreign government and establishes a functional way to buy and sell goods. All the while, the network is not reliant on a single bank or federal Reserve or processor ad the entire network is distributed amongst those that use the currency (and those that have stakes in the medium).

=============================================================== From: Randy Yates ------------------------------------------------------ Or you could say a dollar is worth around 0.01 bitcoin. You don't have a point to your argument. The dollar isn't based on gold. $35 used to be backed by an ounce of gold. If the dollar were equivalent to gold, you could still buy an ounce of gold for $35.

=============================================================== From: Stephen Kraus ------------------------------------------------------ Except that I cannot go to a bank and ask for a dollar with bitcoins. At least not any normal bank. I'm just going to agree to disagree, its a lot of Austrian School of Economics, great theory terrible practice and considered by everyone outside of Austrian School to be utter bunk. I mean no offense to any of you, of course, but I am going to continue to consider bitcoins a scam and a fad.

=============================================================== From: Lynn Dixon ------------------------------------------------------ Stephen, I sincerely hope you do not think the CPI backs the US Dollar. The CPI is a lagging indicator of the rate of inflation. It is a measure of the change in price of a set basket of goods. It has nothing to do with the value of the USD, moreover it simply echoes the current value of the USD in relation to this set basket of goods. Here, educate yourself: http://www.bls.gov/cpi/cpifaq.htm The value of the dollar is quite simply controlled by monetary policy of the Federal Reserve, which is ran by small group of men. If I remember my econmics lessons from college correctly, there are three things that determinse the value of the dollar. Our National debt has a huge impact on the demand for this currency and conversely its value. 1. Treasury Notes -- The tresuray controls the supply of these notes and investors will auction for them. Sometimes for more than face value (demand is high) sometimes for lower than face (Demand is low). Those investors then re-sell those notes in a secondary market 2. Foreign Reserves -- When other countries import and export, they sometimes end up with an excess or shortage of USD which also affects the demand for it. When the value starts to decline, these foreign countries will dump their reserves (because who wants to hold worthless notes?). ANd just like any market, this causes people to buy and sell. 3. Exchange rates with other currrencies (since not everyone wants the USD). How the USD measures up to the value of other currencies. Alot of times, the GDP of the countries are analyzed and sometimes the government stability is taken into consideration to detemine the actual value of one currency to another. The coutnries central bank interest rates, debt levels (to both domestic and foreign bodies) GDP, and other factors are what set the value. A retailer or supplier would set the value of his products based upon the demand for his products and the costs to make those products (time value of money also included). I would also quip that I did indeed buy a portion my servers, rackspace and hardware to mine my BTC with BTC. However, I will admit, that when I pay my power I have to use my BTC to buy US dollars since my electic company only accepts USD. I can't even use Chad's paypal example, since they refuse to accept Paypal or even AMEX. To Randy's point, and to argue against yours, I have no idea why you had to assume One would take BTC, convert to USD, and then buy gold. That is plain stupid. 1 BTC is worth about .08 ounces of gold, and there are vendors online that will trade their gold for your BTC. You dont have to go through the crazy process of converting to USD, unless you simply like converting currency for the hell of it. I really wish you would realize there is more to this world than the USD. Also to Randy's point, the Dollar hasn't been backed by gold for a long time now. See my points above to learn how the value of the dollar is truly set (spoiler alert: It has absolutely zero to do with gold anymore).

=============================================================== From: Stephen Kraus ------------------------------------------------------ I KNOW it has nothing to do with gold. I've said this three times in this exchange. Randy pointed out that the price of one bitcoin was $102 or 15 ounces of gold. I pointed out he was correct, while being sarcastic. I was being sarcastic for a reason because Randy basically pointed out exactly what I meant: Without the USD or Gold (In its USD equivalent i.e. the amount of gold you can buy with amount of USD) you are basically establishing worth. Its the only way to establish the worth of a Bitcoin. Nobody is going to take gold and give you a product, you still must trade in cash. Lynn, even those at the top of a pyramid scheme swear their system works.

=============================================================== From: Lynn Dixon ------------------------------------------------------ Again Stephen you are thinking on an extraordinary small plane. I certainly can take gold to many parts of the world (including in the US) and buy products with it. Once you think outside our small country, the world does things in many different ways. The worth of anything is established by the parties in the transaction. For example: 1. Is my wifes BMW worth trading even for a newer model accord? Will the seller agree to an even trade? 2. Is my antique rifle worth trading to my neighbor for 2 of his pistols? 3. Is my 1 ounce of gold worth buying 100 sheep for my farm? 4. Is the 10 pelts I hunted worth trading for 20 bushels of corn from the farmer whom is needing pelts to clothe his family? Notice there was never any need for the USD in those examples? So, the value of anything is determinded by is scarcity and demand. If I have good you want, and you have goods I want, the value is the equlibirum at which we are both happy with the trade. If it was just you and I, that value maybe 1:1. For example: You have 100 bushels of corn. I have 100 pelts. I need corn for my family and you need pelts for the winter. We could do a 1:1 trade, and both have 50 pelts and 50 bushels, and be happy. Now, here comes Randy. He has pelts to trade as well, and offers you 2 pelts for 1 bushel. The value of your corn has just increased to 2 pelts because Randy lives further north where there is less food. I have to pay you at least 2 pelts to get you to even consider. Thus the value is controlled by the supply and demand (scarcity of supply). The same applies to Bitcoins, and it does with USD, or EUR, or Yen or pelts, or corn, or anything.

=============================================================== From: John Aldrich ------------------------------------------------------ Quoting Lynn Dixon : I believe there's one coffee shop in downtown Chattanooga, right next to Coolidge Park that accepts Bitcoins. :D

=============================================================== From: Stephen Kraus ------------------------------------------------------ See, you are talking about REAL, PHYSICAL things there Lynn. Comparing Bitcoins to real things I can physical offer someone (like a dollar bill) is laughable.

=============================================================== From: Lynn Dixon ------------------------------------------------------ You realize that the dollar bill as a physcial item is pretty damn worthless right? Its intrinsic value is the same as a Bitcoin....its utility.

=============================================================== From: Chad Smith ------------------------------------------------------ Our country is not small. Carry on. *- Chad W. Smith*

=============================================================== From: Stephen Kraus ------------------------------------------------------ And honestly, the fact that you keep trying to tie supply and demand to a crypto currency whose worth is set by its total worth compared to a physical currency backed by a government... ...I don't think you even understand how my 'thinking on a smaller plane' is comparable to 'magical space elves who beam money into my face' Lynn, I'm going to assume outside of purchasing online services, your bitcoins have bought things worth money. Why would someone allow you to purchase something from them if they could not exchange bitcoins for a financial medium that is more easily tradeable on the open market (and not matter how much you say it is, Bitcoins are not easily trad-able on the open market) Trying to make it sound important by tying it to things that its NOT actually tied to is attempting to over-advance bitcoins.

=============================================================== From: Chad Smith ------------------------------------------------------ a Penny, on the other hand, is worth more than one cent. (Materially) *- Chad W. Smith*

=============================================================== From: Lynn Dixon ------------------------------------------------------ Chad, indeed it is: US population: 300 Million China Population: 1.344 billion World Population: 7 billion We only contain about 4% of the worlds population. We are incredibly tiny.

=============================================================== From: Chad Smith ------------------------------------------------------ Um, we are the 4th largest country in the world, physically (land mass), and 3rd in population. Hardly qualifies as "small" by any definition. *- Chad W. Smith*

=============================================================== From: Stephen Kraus ------------------------------------------------------ "He's broadly right in that anything is worth the largest amount that someone will pay for it, sorta. But that's tautological to the point of being meaningless. During a market bubble shares in monkeyscrotum.com were "worth" a thousand dollars each, because people were buying and selling them for a thousand dollars, but at the same time they were worth nothing at all because Monkeyscrotum.com was one guy at a rented desk with a stupid idea that had no chance of actually becoming a viable business. It had perceived value and thus trading value but no backing." "The thing is, in all of those examples, there is *mutual demand*, i.e., you can only trade 10 pelts for 20 bushels if the bushels-owner needs pelts. That's the reason money (USD) is useful=97there is a near-infinite demand for it. It's also why BTC is useless=97absolutely nobody has any demand for it outside from an insignificantly tiny fringe group. Also, I like how those examples devolve in exactly the same way that society would devolve if we all became libertarians. Today we want cars, tomorrow we'll want guns, the next day we'll be offloading our worthless gold for sheep, and by day 4 we're all hunter-gatherers desperate for food.= " From two of my economics friends. More coming. S) e . e good ich e :1 1 Randy st 2 e eing at I of orth. : of the the USD in y member hat pact on lue e s the tries ). ANd Alot ual st her n me uy a to buy se EX. That are e to go ke ize e s above has et their of them e for .15 tility of parties are only n more than With USD pinion is er-to-peer refore the n US h also have llar we say trade' . processors er-lower-processing-fees-for-merchants/ e d for you (like I ut ever owning a or POGs - or igures - or Yugioh ot actual he bank and ask ll I probably could Benton, probably rt it to cash. he value the arcade ? e so I can't use them someone else who hells have worth, rrency. a shells hava are honest. No one ins is totally off it works. Secondly, to use dollars ept and because pply us trustworthy ive to devalue from them is.....in which they can then her service, but even y to transfer to , yet niche idea. e supply is very fixed the value is directly even currency people used POGs as e 90s, some people convince people they sold them. actually real-world

=============================================================== From: Stephen Kraus ------------------------------------------------------ Aaron, I just noticed your post about WoW. Guess how you pay for your monthly fees in WoW? If you want to buy something in WoW (illegally, since even Blizzard has even made it clear that exchanging real currency for something in game is not cool) Either way, Blizzard and their virtual economies worth is still set in the USD Blizzard can make out of it, not in the Gold value in the virtual economy, and while the virtual economy will of course have exchange rates similar to a real one, its a jump to say that somehow its eventually going to filter into real life and I can use my Blizzard Gold to buy the tank of fuel I need to get to Blizzon. Blizzard has made it pretty clear you are free to spend your money IN THE GAME. You are NOT free to take the money out of the game.

=============================================================== From: Chad Smith ------------------------------------------------------ d." : US) he have at at 1:1 e r 1 Randy ast 2 he s being hat I t of worth. e: e of the the e USD in If I e things uge s alue se y ts the ntries ?). ANd . Alot tual est ther ts (time buy a C to buy use MEX. u . That e are ve to go ike lize he ts above t has set their e t of them ge for .15 e utility of : e parties u are only in more than . With USD opinion is eer-to-peer erefore the in US ch also have ollar we say n trade' m. processors fer-lower-processing-fees-for-merchants/ verted for you Pal without ever BitCoins - or POGs tion figures - or . not actual the bank and ask d ell I probably could n Benton, probably ? ert it to cash. e the value the arcade a e? alue, so I can't use trade someone else sea shells have worth, urrency. ea shells hava s are honest. No one oins is totally off it works. Secondly, e to use dollars cept and because upply us trustworthy tive to devalue e from them is.....in s which they can then ther service, but even ay to transfer to t, yet niche idea. . The supply is very refore the value is y d even currency k people used POGs as , he 90s, some people o convince people they sold them. d actually real-world

=============================================================== From: Chad Smith ------------------------------------------------------ btw - speaking of "Real World Machines" bought with "Real World Money" - did those butterfly bitcoin mining rigs ever actually ship? *- Chad W. Smith* n ote: e "worth" a thousand dollars each, because people were buying and h th It e od." , : US) the l m I have m at hat d 1:1 re or 1 e Randy east 2 the r n . I was actly he tcoin. te: e re of the h the he USD in If I ee things huge face w). Those affects n hless ell. s. Alot ctual rest other cts (time buy a . TC to buy use AMEX. gold. nd there nt have imply ld point, points lert: It set their and none of storage C....the he parties ou are only in more than d. With USD opinion is peer-to-peer herefore the in US ich also have t e dollar we say in trade' t processors ffer-lower-processing-fees-for-merchants/ nverted for you yPal without ever BitCoins - or POGs ction figures - or .. d not actual the bank and ask th Pesos. Well I hat joke), but in e? vert it to cash. se of the value the value, so I can't use n trade someone else sea shells have worth, currency. sea shells hava rs are honest. No one coins is totally off w it works. Secondly, ve to use dollars ccept and because supply us trustworthy otive to devalue you get from them ns which they can then other service, but even pay to transfer to d at, yet niche idea. t. The supply is very erefore the value is rvices, and even don't think people used a while in the 90s, y were able to convince d sold them. nd actually real-world

=============================================================== From: Stephen Kraus ------------------------------------------------------ We've done Free Market. http://en.wikipedia.org/wiki/Standard

=============================================================== From: Chad Smith ------------------------------------------------------ And yet I don't remember the section in my US History class where people were hoarding goats and gun and burning their useless gold just to stay warm at night. *- Chad W. Smith* On Thu, Aug 22, 2013 at 3:33 PM, Stephen Kraus wrot= e:

=============================================================== From: Stephen Kraus ------------------------------------------------------ It was a joke by my friend about him comparing bartering to Bitcoins. ote:

=============================================================== From: Chad Smith ------------------------------------------------------ Well, I hope BitCoin lasts long enough for the guy in #4 to get his version of Rapture/Columbia started. http://www.cracked.com/article

=============================================================== From: Lynn Dixon ------------------------------------------------------ Yes. they are shipping alot of them. I think there was someone on the list that received their Jalapenos a while back? And for the sake of all that is holy, buttcoin.org is a site akin to theonion. Since this thread has de-volved into childish things, I am going to bow out of it. Have fun everyone, no offense intended in any of my posts. e an rote: re "worth" a thousand dollars each, because people were buying and th ith . It eeds te , s ood." : e: e US) the I have um at that d do a w, here for 1 se Randy least 2 the c. I was xactly the itcoin. t ote: measure o do with of the . If I ree things huge n face ow). Those o affects gn thless sell. s es. Alot actual erest other ucts (time d buy a C. BTC to buy n use AMEX. y gold. and there ont have simply uld s point, y points alert: It y set their : and none of m storage , TC....the the parties you are only s in more than nd. With USD y opinion is peer-to-peer therefore the y e in US hich also have s n dollar we say in trade' e t nt processors offer-lower-processing-fees-for-merchants/ onverted for you ayPal without ever r BitCoins - or POGs action figures - or ... y are not actual o the bank and ask ith Pesos. Well I that joke), but in nvert it to cash. use of the value the e value, so I can't use an trade someone else y sea shells have worth, currency. sea shells hava ers are honest. No one tcoins is totally off ow it works. Secondly, ave to use dollars accept and because supply us trustworthy motive to devalue you get from them ins which they can then nother service, but even pay to transfer to a neat, yet niche idea. it. The supply is very herefore the value is ervices, and even don't think people used r a while in the 90s, ey were able to convince nd sold them. s end actually real-world

=============================================================== From: Chad Smith ------------------------------------------------------ My point is even if Stardard Oil was "true free market" (it wasn't) it didn't lead to the end of the world nor the collapse of society, or even our country. So, it was a poor example of such. *- Chad W. Smith* On Thu, Aug 22, 2013 at 3:46 PM, Stephen Kraus wrot= e: rote:

=============================================================== From: Stephen Kraus ------------------------------------------------------ Actually...no, while the Onion is TOTALLY fictional, Buttcoin is somewhat serious. e he han wrote: f ere "worth" a thousand dollars each, because people were buying and rth with s. It needs ite y s, ss food." : y : te: he US) , the , f I have rum at that ld do a ow, here for 1 use Randy least 2 y the ic. I was exactly the Bitcoin. m rote: a measure to do with e of the n. If I hree things a huge an face low). Those so affects ign rthless sell. urrencies. mes the actual terest d other ducts (time ed buy a TC. BTC to buy en use n AMEX. uy gold. and there dont have simply ould 's point, my points alert: It d ey set their , and none of om storage BTC....the g the parties you are only ss in more than and. With USD my opinion is e peer-to-peer therefore the is done in US t which also have ss t the dollar we pt it in trade' payment processors -offer-lower-processing-fees-for-merchants/ n converted for you PayPal without ever or BitCoins - or POGs action figures - or s... ey are not actual to the bank and ask with Pesos. Well I that joke), but in onvert it to cash. ause of the value the r value, so I can't use can trade someone else my sea shells have worth, e currency. y sea shells hava o uers are honest. No one itcoins is totally off how it works. Secondly, have to use dollars accept and because y supply us trustworthy motive to devalue e you get from them , oins which they can then another service, but even y pay to transfer to n a neat, yet niche idea. it. The supply is very Therefore the value is services, and even I don't think people used or a while in the 90s, hey were able to convince and sold them. o spend actually t

=============================================================== From: John Aldrich ------------------------------------------------------ Quoting Stephen Kraus : Yes, that's true, Stephen... but if someone in, say, Germany, wants to buy what you're selling, they will pay you via PayPal in DeutschMarks, which Paypal will CONVERT to $USD. Or if you want to buy something for your VW from someone in Germa ny, they are likely selling in DM, and you will pay in $USD, but THEY will receive DM from PayPal. Similarly, in theory, PayPal could start accepting Bitcoins and then convert them to $USD or whatever currency, or just bank them like you do with your local currency.

=============================================================== From: Stephen Kraus ------------------------------------------------------ Lynn: https://bitcointalk.org/index.php?topic=3D249353.0 Yes. Totally a false report. On Thu, Aug 22, 2013 at 4:50 PM, Stephen Kraus wrot= e: - ange ber of were "worth" a thousand dollars each, because people were buying and orth with ss. It needs nite ny rs, ess food." e: : ote: I the US) y, the nd. If I qulibirum d I, that uld do a Now, here s for 1 ause Randy t least 2 by the n s tic. I was exactly . the Bitcoin. wrote: a measure to do with ue of the en. If I three things a huge . han face low). Those lso affects eign orthless d sell. currencies. imes the e actual nterest nd other d oducts (time eed buy a BTC. y BTC to buy ven use en AMEX. y buy gold. , and there dont have u simply would y's point, my points r alert: It ow they set n n, and none of com storage BTC....the d y the parties n you are only ess in more than mand. With USD my opinion is he peer-to-peer , therefore the is done in US ....which also at the dollar we ept it in trade' n payment processors l-offer-lower-processing-fees-for-merchants/ lly converted for you PayPal without ever for BitCoins - or POGs s action figures - or rs... hey are not actual to the bank and ask with Pesos. Well I t that joke), but in convert it to cash. cause of the value the e ir value, so I can't use can trade someone else my sea shells have worth, de currency. e my sea shells hava issuers are honest. No ing Bitcoins is totally s or how it works. s.. People have to use banks to accept and the money supply us the political motive to ue you get from them more bitcoins which they well for another service, tcoins they pay to in a neat, yet niche idea. r it. The supply is very Therefore the value is services, and even I don't think people used for a while in the 90s, they were able to convince e and sold them. to spend actually e

=============================================================== From: Stephen Kraus ------------------------------------------------------ Explain how it wasn't a 'truly free market' Or explain how we had to have press muckrackers point out that allowing businesses to do whatever the hell they feel like leads to BAD things. Also, from the FAQ on BFL Website: http://www.butterflylabs.com/faq/ We accept PayPal, Bitcoins and Bank Transfer. PayPal has a transaction limit of $10,000 US. Bitcoins are accepted by a third party vendor that handles the exchange. All of our machines are sold for US Dollars. Bank Transfers can take 3 to 4 days to appear in our system. We ask that you send a copy of the receipt for the transfer tooffice@butterflylabs.com = and include your order number. This will help us match your payment with your order. Once we confirm the payment, we will send you a confirmation email. There is a $550 minimum on bank transfers. So a transaction for one 5 GH/s machine would not be eligible for Bank Transfer.| Isn't it odd? A company that must believe in Bitcoins, or they wouldn't sell machines for mining bitcoins...only accepts USD through a third party bitcoin exchange? "In a gold rush, there is money in selling shovels. Cash only" ote: e wrote:

=============================================================== From: Stephen Kraus ------------------------------------------------------ John...that is called the exchange rate. It really doesn't make bitcoins any more legitimate as a REPLACEMENT for the USD or as even a strong competitor.

=============================================================== From: Chad Smith ------------------------------------------------------ It was a corporation. A Corporation, is - by (Google's) definition - "a company or group of people authorized to act as a single entity (legally a person) and recognized as such in law." That's not a free market - that's government intrusion on a free market. Recognization a non-human "entity" as having rights, ownership, suablity, etc. ... that's not free. That's placing restrictions on the market. That's gaming the system. In a truly free market, yes, people could work together in companies - but personal responsibility, personal ownership, would never be given up for "The Greater Good of the Corporation=99" - The Company wouldn't be able to "Own" anything. The owner (or owners) of the company would own things. That also means when you Toyota screws up and sends your daughter helplessly flying off a bridge with no brakes and a glued-to-the-floor accelator, somebody's (an actual human person) is going the frak to jail for manslaughter. *- Chad W. Smith* On Thu, Aug 22, 2013 at 4:03 PM, Stephen Kraus wrot= e: m and . s y rote: to

=============================================================== From: Tyler Mittan ------------------------------------------------------ There has a lot been said since I last checked so I haven't been keeping up, but I do think that this nonsense about REAL, PHYSICAL things is nonsense. Money is not all real, physical things.. Not unless you think a credit card swipe is somehow valuable. All credit is a transfer of, not funds, but credit it. It's really just a mark in a ledger. It is only when the bank goes to the other bank that it is fulfilled. It's virtually a credit. It strikes me as odd for someone who is so anti-gold standard to make claims like this which are so pro-gold standard it hurts. Second, value is subjective (you can think Menger and the Austrians who found this concept in which all modern day economics is built on except socialists). NOTHING IS INTRINSICALLY VALUABLE. It seems like this is something we all agree on. Given that money is not necessarily a physical thing, and that value is subjective, we can see how bitcoin could be considered money if valued by enough people. Now that we've established that, we should look at why bitcoin is not widely accepted which I mentioned before: 1. People don't know about it. Economists and computer geeks, but if you were to ask the average, say, psychology student whom has not interest in politics whatsoever (and there are plenty) or virtually anyone else, they most likely wouldn't know about it.. this begs the question: even if they did know about it, would they want it? 2. They might. The underlying point of me posting this was to show that competing currencies could be a thing. They could be a thing that work very well (as they have historically.. look up Richard Timberlake, Lawrence White, and George Selgin). We can't say for sure if bitcoins would be a very valuable thing, but we do know that it's getting very popular.. this begs the question, if it's so popular, why aren't businesses buying it? 3. This can be answered mostly by the fact that the legality of it is iffy at best. It can also be answered that people trust the backing of a government (whom obviously have a pretty poor track record, but people don't know better). So, there's no reason to think that bitcoins can't be money. I am not saying they are widely accepted. I am not saying if they were legal that they even would be widely accepted. I am saying that competing currencies can, and should, be a thing to keep the dollar honest.

=============================================================== From: Stephen Kraus ------------------------------------------------------ Well you are right about one thing at least: Money's intrensic value is not a physical item, its set by consumer and producer demand. Which is ironically why Bitcoin will never be a MAJOR currency or a replacement for the Dollar. I never said it couldn't be a currency, see my previous reference to trading se