How To Use Bitcoin – The Most Important Creation In The History Of Man

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Leif Roar said:
Doesn't matter. For bitcoins to have value, it must be possible to reliably convert them to real world currencies. That means exchanges, and exchanges can be found and shut down.
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Not necessarily, though. Bitcoins have value as soon as I can buy stuff with them. It is highly unlikely for this to be so without a means to convert bitcoins to other currencies, but not necessarily impossible.

And if bitcoins are not legal tender, not a real currency, then the exchanges aren't illegal on grounds of exchanging one kind of money for another, are they?
 
What would be the law's position on these things being stolen? Let's say that someone does steal 500 Bitcoins, and for some reason the transaction/s can't be rolled back, but it can be proved who did it. Would this legally be theft, or... I don't know?
 
Rasmus said:
And if bitcoins are not legal tender, not a real currency, then the exchanges aren't illegal on grounds of exchanging one kind of money for another, are they?
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Exchanges are regulated because they would need to take deposits, keep funds, keep accounts, transfer funds, etc. All of these activities can only be performed by authorised institutions, so if the exchanges are not registered at the moment, they are running an illegal financial operation.
 
Sledge said:
What would be the law's position on these things being stolen? Let's say that someone does steal 500 Bitcoins, and for some reason the transaction/s can't be rolled back, but it can be proved who did it. Would this legally be theft, or... I don't know?
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It really depends on what Bitcoin is from a legal perspective. This is an open question at the moment, but I don't think it's useful to think of theft. If someone hacks your account and "steals" your Bitcoins, it would be covered under hacking laws that forbid an unauthorised person to enter your account and make any modification. This applies to everything, from email to World of Warcraft, so you might be better off pursuing it that way.

If Bitcoins are illegal, then there would be no theft.
 
Rasmus said:
Not necessarily, though. Bitcoins have value as soon as I can buy stuff with them. It is highly unlikely for this to be so without a means to convert bitcoins to other currencies, but not necessarily impossible.
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While it might be theoretically possible, I don't think it's possible in practice. A business has expenses which must be paid in dollars (or whatever the real-world currency of their country of operation is): wages, sales tax, insurance premiums, utilities, interests on loans, postage, custom duties and so on. Without a way to convert bitcoins to dollars, they won't be able to cover their expenses.

Now, granted, they could do a mix economy, selling in both dollars and bitcoins, using their dollar sales to cover "hard currency expenses" and using their bitcoins sales to buy services and goods available in bitcoins. The trouble is, it's not going to be worth it, because you can't use a surplus of bitcoins for anything. You can't pay it out in wages, you can't invest it in another company, you can't use it to pay dividends; in short you can't use it to make more dollars (or even to make more bitcoins). Your business is still dollar-driven: it's your income in dollar that determines how well your business is doing and whether you will swim or sink.

Basically, every single sale you do in bitcoins carries with it a massive opportunity cost. Where the income from a sale in dollars can be used for anything you want or need, an income of bitcoins can only be used for buying whatever goods and services a) you require and b) are available for sale in bitcoins.

Now, while it's true that it's sometimes worth taking an opportunity cost in order to expand into a new market, that's not the case in this situation. Your business is dollar-driven, so you can't expand without an increase in dollar income. An increase in bitcoins income is just going to make you accrue bitcoins in excess of what you can use.

And if bitcoins are not legal tender, not a real currency, then the exchanges aren't illegal on grounds of exchanging one kind of money for another, are they?
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They may not be illegal today, but if bitcoins ever grows to the point where it shows up on the political radar, it would be a simple matter for a government to amend the legislature to make them illegal.
 
Leif Roar said:
While it might be theoretically possible, I don't think it's possible in practice. A business has expenses which must be paid in dollars (or whatever the real-world currency of their country of operation is): wages, sales tax, insurance premiums, utilities, interests on loans, postage, custom duties and so on. Without a way to convert bitcoins to dollars, they won't be able to cover their expenses.

Now, granted, they could do a mix economy, selling in both dollars and bitcoins, using their dollar sales to cover "hard currency expenses" and using their bitcoins sales to buy services and goods available in bitcoins. The trouble is, it's not going to be worth it, because you can't use a surplus of bitcoins for anything. You can't pay it out in wages, you can't invest it in another company, you can't use it to pay dividends; in short you can't use it to make more dollars (or even to make more bitcoins). Your business is still dollar-driven: it's your income in dollar that determines how well your business is doing and whether you will swim or sink.

Basically, every single sale you do in bitcoins carries with it a massive opportunity cost. Where the income from a sale in dollars can be used for anything you want or need, an income of bitcoins can only be used for buying whatever goods and services a) you require and b) are available for sale in bitcoins.

Now, while it's true that it's sometimes worth taking an opportunity cost in order to expand into a new market, that's not the case in this situation. Your business is dollar-driven, so you can't expand without an increase in dollar income. An increase in bitcoins income is just going to make you accrue bitcoins in excess of what you can use.
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I was going to explain a counter example but then realized it wouldn't work for more than a small part of the bitcoin-economy. Yes, one would need a whole economy running on bitcoins if no exchanges for dollars should ever be needed. (FWIW, I thought a business might need enough of one resource to always be able to spend all available bitcoins on it whilst sales would never exceed the demand for the resource. But that would be rather rare and the problem of what to do with the bitcoins would then lie with the provider of the ressource.)

They may not be illegal today, but if bitcoins ever grows to the point where it shows up on the political radar, it would be a simple matter for a government to amend the legislature to make them illegal.
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Possibly. I was really just doubting the claims that they were already illegal and specifically that using bitcoins would amount to counterfeiting.
 
Rasmus said:
Possibly. I was really just doubting the claims that they were already illegal and specifically that using bitcoins would amount to counterfeiting.
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Yes, I think those claims are wrong. I was arguing against the view that bitcoins are somehow bulletproof against government control or regulation. It seems obvious to me that even if the government can't affect the transfer of bitcoins between holders, they don't need to: they just need to be able to shut down the "interfaces" between bitcoins and normal currencies and bitcoins will end up effectively valueless.
 
Amir Taaki said:
The supply of bitcoins is 21 million. The supply of money is infinite. A bitcoin can currently be divided to 8 decimal places.
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I do not think he knows what "infinite" means.
 
I first discovered these Monday and was fascinated by just about every video I watched and article I read. I have a Bitcoin wallet now with an astonishing 1 and a half cents in it and will probably be giving it a try with some disposable income in the near future.

I'm also fascinated by the way these fairly quickly surpassed the U.S. dollar in value and what we'll be able to learn about a currency that operates under sheer supply and demand forces without "helpful" oversights and regulations. The $500,000 "theft" on one of the exchange sites caused a pseudo-crash that lasted mere minutes before the currency rebounded on its own.

In many ways I would think this a libertarian wet-dream. And a great way to test some free-market theories that have been debated endlessly with a shortage of objective, modern examples.

On top of all that, it's also evidence that the internet's free trade possibilities will eventually destroy any government's ability to stop its citizens from participating in voluntary private transactions. Bitcoin seems to "fund" a lot of black market activity, including drugs and online poker, but obviously this new spike in "evil" crimes against the self has had no apparent negative effect on society. We shall see if one emerges, since many people love to claim that these sorts of things must be controlled by well-meaning overseers of people's personal freedoms...but of course, regardless, it appears that the nanny-wand is being forcefully removed from big-government and big-government voter's hands...and individual freedom is going to take over whether they like it or not. We can only stand back and observe the results. I wouldn't have it any other way.
 
Leif Roar said:
Yes, I think those claims are wrong. I was arguing against the view that bitcoins are somehow bulletproof against government control or regulation. It seems obvious to me that even if the government can't affect the transfer of bitcoins between holders, they don't need to: they just need to be able to shut down the "interfaces" between bitcoins and normal currencies and bitcoins will end up effectively valueless.
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As has already been mentioned, assuming that governments still exist, (pokes head out of door, fails to notice anything unusually on fire,) the bitcoin, even if used extensively and securely for transactions, will fail the instant that a major economic power decides not to honor them. You want to secure land? Well, the US decides that loans secured by bitcoin don't meet the requirements to be protected by all the government assurances and protections that make "your land" definable in the first place. Bitcoins immediately lose value.
Of course, Libertarians deny that "their land" is in any way protected by any sort of governmental authority, it is merely bounded by awesomeness.
 
@ EGarrett,
You say, "the nanny-wand is being forcefully removed from . . . big-government voter's (sic) hands...and individual freedom is going to take over whether they like it or not." (emphasis mine)
So, to be clear about this, you are against democracy or republicanism, prefering powerful individuals to be able to control society as they see fit, with no checks on their power?
 
EGarrett said:
I first discovered these Monday and was fascinated by just about every video I watched and article I read. I have a Bitcoin wallet now with an astonishing 1 and a half cents in it and will probably be giving it a try with some disposable income in the near future.

I'm also fascinated by the way these fairly quickly surpassed the U.S. dollar in value and what we'll be able to learn about a currency that operates under sheer supply and demand forces without "helpful" oversights and regulations. The $500,000 "theft" on one of the exchange sites caused a pseudo-crash that lasted mere minutes before the currency rebounded on its own.

In many ways I would think this a libertarian wet-dream. And a great way to test some free-market theories that have been debated endlessly with a shortage of objective, modern examples.

On top of all that, it's also evidence that the internet's free trade possibilities will eventually destroy any government's ability to stop its citizens from participating in voluntary private transactions. Bitcoin seems to "fund" a lot of black market activity, including drugs and online poker, but obviously this new spike in "evil" crimes against the self has had no apparent negative effect on society. We shall see if one emerges, since many people love to claim that these sorts of things must be controlled by well-meaning overseers of people's personal freedoms...but of course, regardless, it appears that the nanny-wand is being forcefully removed from big-government and big-government voter's hands...and individual freedom is going to take over whether they like it or not. We can only stand back and observe the results. I wouldn't have it any other way.
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I'm not sure how trading in bitcoins instead of cash can prevent the government from prohibiting things.
 
autumn1971 said:
@ EGarrett,
You say, "the nanny-wand is being forcefully removed from . . . big-government voter's (sic) hands...and individual freedom is going to take over whether they like it or not." (emphasis mine)
So, to be clear about this, you are against democracy or republicanism, prefering powerful individuals to be able to control society as they see fit, with no checks on their power?
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No, I'm not prefering (sic) that. Just like civil rights, I don't think basic human personal freedoms should be up to a vote. What you do in your OWN home, without harming anyone else, is your own business and not up to public scrutiny or the will of someone else in a voting booth.

Political parties (both democrat and republican) LOVE to try to use the hand of government to reach into your pocket or your underwear and grab at your money or your sexual organs and try to take them over...trying to force you to give your income away to others, or force you to only fall in love with certain groups of people, and so on. No matter which major US party gets power, they WILL be trying to take away certain private freedoms...it was and is a sort-of Catch-22, inescapable situation. But what we're seeing here is a major sign that the internet, almost like some kind of electronic-messiah, is going to come in and neuter this sort-of behavior by the government and the voters, permanently.

I think this is why michaelsuede and so many others are basically creaming their pants over this little viral currency program. I didn't realize that there even COULD be a way out. But Ian Malcolm was right. Life finds a way. Life, liberty, intelligence, and good (the way I see it) is finding a way...despite all the old-fashioned and obstinate bureaucrats, third-world regimes, entrenched government institutions, naive and ignorant voters convinced by charismatic speeches, riot police forces, doomsday military weapons...and trillions of unearned dollars backing all of it. It can (and probably WILL) be overpowered by people's urge to be free. What a millennium.
 
gnome said:
I'm not sure how trading in bitcoins instead of cash can prevent the government from prohibiting things.
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I want to buy something the government doesn't like. You want to sell something the government doesn't like. I anonymously send you bitcoins. You send me a non-descript package. How does the government stop this?
 
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EGarrett said:
I anonymously send you bitcoins. You send me a non-descript package.
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If you're anonymous, how do I send you a package? If you're not anonymous to me, why not just use cash? Cash doesn't leave a transaction path.
 
EGarrett said:
I tell you my address. The bitcoin transaction can be anonymous, that doesn't mean you have no way of knowing me.
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Yes, but in that case you'd be better off just using cash. So what's the point of bitcoins again?
 
By the way, one of the noteworthy things about Bitcoin transactions, and you see this on the Bitcoin scam threads, is that it's nigh impossible to prove the purpose of a transaction and whether or not it was voluntary. Even the people who start the threads to claim that they were stolen from can't actually prove that that's what happened. If one of the people actually involved in the transaction, who knows you and doesn't like you, can't prove that you did something wrong, imagine how astonishingly difficult it is for someone outside the transaction who don't know either of you. Think of Silk Road, they are an organized, public institution that blatantly trading in illegal drugs, not even attempting to conceal it, using bitcoin transactions.

Leif Roar said:
Yes, but in that case you'd be better off just using cash. So what's the point of bitcoins again?
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I mean tell you over the internet or phone. There's tons of ways to make my information accessible without it being associated with any kind of transaction or even realistically knowable. You can share your information publicly, with your business partner being of many who has access to it, you can have encrypted Skype conversations, you can even have a BS chat over some random instant messenger about the weather or your birthday party plans in which innocuous-seeming info is mentioned.

One of the noteworthy things about Bitcoin transactions, and you see this on the Bitcoin scam threads, is that it's nigh impossible to prove the purpose of a transaction and whether or not it was voluntary. Even the people who start the threads to claim that they were stolen from can't actually prove that that's what happened. If one of the people actually involved in the transaction, who knows you and doesn't like you, can't prove that you did something wrong, imagine how astonishingly difficult it is for someone outside the transaction who doesn't know either of you. Think of Silk Road, they are an organized, public business that's blatantly trading in illegal drugs, not even attempting to conceal it, using bitcoin transactions.
 
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It seems clear to me that the payment transfer is not the most vulnerable part of the transaction--it is getting the contraband from point A to point B that exposes one most to law enforcement interdiction. Bitcoin offers no protection in that realm.
 
If the package is non-descript, and done on a small-scale, it would be like a teardrop in the rain. Hidden in such a tidal wave of other packages and mailings, 99.999% of which are boring and legal, and which the government can't exactly go tearing through.

And I see that in my attempt to clarify my previous post, I apparently copy/pasted a paragraph instead of cut/pasting it, making it appear twice. Lovely.
 
And yet busts are still made all the time, that changing from cash to bitcoin wouldn't prevent. I'm not disagreeing that it might present a new challenge, but it's hardly a game-changer.

DEA: Oh no, they're using bitcoins. We might as well fold up shop, folks. See you on the unemployment line.
 
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EGarrett said:
If the package is non-descript, and done on a small-scale, it would be like a teardrop in the rain. Hidden in such a tidal wave of other packages and mailings, 99.999% of which are boring and legal, and which the government can't exactly go tearing through.
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In other words, transactions using bitcoins can stay safe from government oversight and control in the exact same way that transactions using money can stay safe from the government. So where is the added benefit?
 
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Maybe EGarrett hasn't noticed, but it was the US government that forced civil rights onto the southerners in the 60's.
 
gnome said:
And yet busts are still made all the time, that changing from cash to bitcoin wouldn't prevent. I'm not disagreeing that it might present a new challenge, but it's hardly a game-changer.

DEA: Oh no, they're using bitcoins. We might as well fold up shop, folks. See you on the unemployment line.
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What type of busts are you referring to when you say "busts are made all the time?" You have to be much more specific.

Leif Roar said:
In other words, transactions using bitcoins can stay safe from government oversight and control in the exact same way that transactions using money can stay safe from the government. So where is the added benefit?
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No, because distance transactions using instant and convenient payment require financial institutions with public records, which the government squeezes to try and control what you can and can't buy. I've had first-hand experience with this as an online poker player.

Almo said:
Maybe EGarrett hasn't noticed, but it was the US government that forced civil rights onto the southerners in the 60's.
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...by repealing laws passed by state governments. That's a bit like telling me I shouldn't worry about a dog ******* on the carpet because every now and then they eat their own feces.

(I apologize if that's too strong an analogy, but when it came to me I had to say it)
 
EGarrett said:
What type of busts are you referring to when you say "busts are made all the time?" You have to be much more specific.
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Any arrests made by investigating other than the payment in an illegal transaction.

No, because distance transactions using instant and convenient payment require financial institutions with public records, which the government squeezes to try and control what you can and can't buy. I've had first-hand experience with this as an online poker player.
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If we're talking about physical packages, as you did, it is just as easy to send a package of cash as it is to send a package of goods.

In the case of online gambling it may represent a significant obstacle, but I can't think of many other industries that the government watchdogs, that could run with impunity just by switching to bitcoins for transactions.

Bear in mind I don't deny the effect in some cases--I only disagree with where you seemed to say that it represents an overwhelming change in the government's ability to regulate our activities.
 
gnome said:
Any arrests made by investigating other than the payment in an illegal transaction.
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I can't tell if you're talking about drug-dealers working in cash, people doing illegal transactions online with payment processors, people buying in hookers in Vegas or what...nor do I know exactly what methods you're referring to. I'm saying that Bitcoin makes it much, much more difficult for the government to control online free-market purchases and exchanges of money...so if you're going to say that the government does bust people, I need you to be more specific so I can see exactly which methods you're referring to that you feel will still work.

If we're talking about physical packages, as you did, it is just as easy to send a package of cash as it is to send a package of goods.
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Not instantly and conveniently.

In the case of online gambling it may represent a significant obstacle, but I can't think of many other industries that the government watchdogs, that could run with impunity just by switching to bitcoins for transactions.
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Silk Road is the most prominent and timely example. Imagine what would happen if you tried to charge an order of cocaine on your credit card?

Bear in mind I don't deny the effect in some cases--I only disagree with where you seemed to say that it represents an overwhelming change in the government's ability to regulate our activities.
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Well, the online gambling industry is a multi-billion dollar business, and I think it's safe to say that the drug trade is a multi-billion dollar business as well. So, just for starters, we immediately have several multi-billion-dollar industries that will skyrocket (whether we like it or not) if Bitcoins become largely accepted. I would consider that a major change.

Secondly, and this is probably far more important...Bitcoin could potentially shutdown the income tax. If they can't tell which string of characters corresponds to which person, business, or purpose (and it appears that you can change your personal string of characters at will)...it would be the same as if everyone involved suddenly started doing business in person, in cash. The government can no longer know how much money you made, and for what.

The entire notion of double-taxation (tax your income, then tax your spending) would fall apart...government revenues would be crippled. It would be a massive shrink of the government, by dramatic, abrupt starvation instead of the decades of polite requests that have resulted only in a slower-rate of fattening. I'm sure you see the incredible potential implications of that.
 
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autumn1971 said:
As has already been mentioned, assuming that governments still exist [...] the bitcoin, even if used extensively and securely for transactions, will fail the instant that a major economic power decides not to honor them.
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I think you're unintentionally implying that major economic powers already honor Bitcoin; they don't. So, to be more accurate, the only way Bitcoin can succeed is if major economic powers decide to honor them.

And not even "major" economic powers, either. Bitcoin isn't going to get very far if your landlord refuses to accept them for your monthly rent, your local car dealership refuses to accept them as a down payment on a vehicle, or your local grocery store refuses to accept them as payment for the food you take from their shelves.
 
gnome said:
It seems clear to me that the payment transfer is not the most vulnerable part of the transaction--it is getting the contraband from point A to point B that exposes one most to law enforcement interdiction. Bitcoin offers no protection in that realm.
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Not necessarily. It depends on how the law is worded. If the law draws a distinction between mere distribution and distribution for profit (selling) then the use of bitcoins might make it harder to prove the selling aspect. (OTOH I am aware that in many jurisdictions, mere possession of more than a minimum amount automatically makes you a dealer).

Cl1mh4224rd said:
I think you're unintentionally implying that major economic powers already honor Bitcoin; they don't. So, to be more accurate, the only way Bitcoin can succeed is if major economic powers decide to honor them.
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All you need are money merchants who are willing to trade in bitcoins and bitcoin becomes currency.
 
psionl0 said:
All you need are money merchants who are willing to trade in bitcoins and bitcoin becomes currency.
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Willing and legally able to trade in bitcoins. It would be simple enough to legislate against such use, and then what would bitcoins be worth? A drug-dealer isn't going to sell you drugs for bitcoins if the only thing he can use bitcoins for is buying drugs from other drug dealers. At some point, bitcoins would have to connect into the economy proper -- and that interface would be simple enough to shut down.
 
EGarrett said:
Not instantly and conveniently.
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Yes, bitcoins are slightly more convenient (for the buyer -- it's less convenient for the seller) for buying stuff online than cash is. But that's all -- it doesn't bring anything new to the table. (Well, except a paper trail which gives the police a little more to work with than cash does.)
 
Nobody uses Bitcoin as a currency except a handful of criminal enterprises, small-time webdesign firms, and hippie beadwork merchants. Why is that? If it's such a great currency, why isn't it being used as a currency by many online businesses?

Bitcoin doesn't work as a currency. It doesn't do a good job at any of the proper functions of a currency. It's far too unstable and volatile to be practical for business. There's no protection or legal recourse against fraud and theft. The exchanges are untrustworthy and unreliable. The runaway deflation (read: overvaluation) punishes spending, so it strongly hinders trade. Despite its overvaluation, there's no consumer confidence in it. Worst of all, Bitcoin is hardly accepted anywhere for all those reasons.

The only way to even obtain Bitcoin these days is to receive an online payment in it, do the "mining" thing (the creators' pyramid scheme setup, which is prohibitive to private citizens by this point), or deal with the unreliable, insecure and untrustworthy exchanges.

Of those 3 options, accepting Bitcoins as payment for goods or services is the only reasonable option; but why would anyone accept payment in Bitcoin, when they can't even spend it anywhere. You still have to use the shady, unprofessional and unreliable Bitcoin exchanges to cash it in for your local currency.

Though it admittedly employs some impressive math and crypto, Bitcoin is just pathetically badly conceived as a currency. Where it really shines, though, is as a platform for Ponzi games and other scams.
 
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Muldur said:
... People choose to be members of their society on an ongoing basis by continuing to live in and receive the benefits of that society. ...
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The choice is pretty limited. There is not a place on earth where I can go instead and live under no state's jurisdiction. So one's choice is (in mst cases) either the country they were (involuntary) born to, or some other state with rules and benefits and drawbacks. But can I pick any state, can I pick the best among them? No, because many states just won't let me choose to live there. Often, a 3 months tourist visa is the most I can get. Even if I get a long term visa or residence permit, almost everywhere I am subjected to discriminations that neither my home country nor the citizens of the chosen country suffer. Some of these are state-imposed (restrictions on my right to work, for example), imposed by the population (plain old xenophobia), or arise as practical matters (such as language barriers). The choice is thus heavily geared and biased towards the state I originate from.
 
The_Animus said:
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You mentioned enforcing its acceptance as legal tender. If I own a business and decide I only want to accept bitcoins and refuse to accept dollars, are you saying the government has the ability to force me to accept dollars?
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I don't know about the legal situation in the USA, but I understand that at least in Germany, this is so: Any business is, in principle, required to accept the official currency of the land (the Euro as we speak) in cash. There are probably exceptions that arise from practical considerations: For example, many gas stations do not accept 500 Euro bills; I don't know if that is because of the risk of forgeries, or because they don't guarantee to have enough change in the drawer. Also, I guess bills exceeding certain cash sums ("millions") may be excempted.
 
Oystein said:
I don't know about the legal situation in the USA, but I understand that at least in Germany, this is so: Any business is, in principle, required to accept the official currency of the land (the Euro as we speak) in cash.
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Here's a short US Treasury FAQ for US policy on currency as legal tender. Businesses in the US can determine what they will accept in exchange for goods and services and thus aren't required to accept US currency. This is at least true at the time of an exchange being made, so for example if I want to buy a candy bar, the merchant can ask that I pay with a dozen plastic buttons while refusing to accept a US dollar in exchange. It gets more complicated if one is attempting to resolve a debt, but the presumption would be that debts should be measured in US dollars unless otherwise specified in a legal contract.
There are probably exceptions that arise from practical considerations: For example, many gas stations do not accept 500 Euro bills; I don't know if that is because of the risk of forgeries, or because they don't guarantee to have enough change in the drawer. Also, I guess bills exceeding certain cash sums ("millions") may be excempted.
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Under US Federal Law, businesses can refuse to accept particular denominations of US currency in exchange for goods and services based on practical considerations such as not wishing to keep large amounts of money on hand in order to provide change for large bills (convenience stores, gas stations, and such) or not wishing to handle large numbers of coins for a high-dollar transaction (20,000 pennies is extremely inconvenient payment to accept in a $200 transaction).
 
Leif Roar said:
Yes, bitcoins are slightly more convenient (for the buyer -- it's less convenient for the seller) for buying stuff online than cash is. But that's all -- it doesn't bring anything new to the table. (Well, except a paper trail which gives the police a little more to work with than cash does.)
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That's like saying youtube is slightly more convenient for spreading videos than mailing VHS tapes is. The notion of instant, world-wide, fee-free connection and distribution is not minor.
 
EGarrett said:
By the way, one of the noteworthy things about Bitcoin transactions, and you see this on the Bitcoin scam threads, is that it's nigh impossible to prove the purpose of a transaction and whether or not it was voluntary. Even the people who start the threads to claim that they were stolen from can't actually prove that that's what happened. If one of the people actually involved in the transaction, who knows you and doesn't like you, can't prove that you did something wrong, imagine how astonishingly difficult it is for someone outside the transaction who don't know either of you. Think of Silk Road, they are an organized, public institution that blatantly trading in illegal drugs, not even attempting to conceal it, using bitcoin transactions.

I mean tell you over the internet or phone. There's tons of ways to make my information accessible without it being associated with any kind of transaction or even realistically knowable. You can share your information publicly, with your business partner being of many who has access to it, you can have encrypted Skype conversations, you can even have a BS chat over some random instant messenger about the weather or your birthday party plans in which innocuous-seeming info is mentioned.
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The scam threads are precisely the reason why nobody other than nerd circles, cybercriminals and rabid libertarians is using BTC. It is simply too risky for anyone else, too many scams, too many lost wallets due to hacking, weak exchanges. There are too many security issues.
 
EGarrett said:
That's like saying youtube is slightly more convenient for spreading videos than mailing VHS tapes is. The notion of instant, world-wide, fee-free connection and distribution is not minor.
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Fee-free? The constant risk of loss through hacking is a substantial fee, I´d say, and one which is completely unpredictable, in contrast to regular fees.
 
anduin said:
The scam threads are precisely the reason why nobody other than nerd circles, cybercriminals and rabid libertarians is using BTC. It is simply too risky for anyone else, too many scams, too many lost wallets due to hacking, weak exchanges. There are too many security issues.
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All you're saying is that it's desirable for someone to develop convenient security software or security sites to accompany the Bitcoin client. That's inevitable...and is probably so easy to implement that I wouldn't even be surprised if they're free and open-sourced.

Chaos said:
Fee-free? The constant risk of loss through hacking is a substantial fee, I´d say, and one which is completely unpredictable, in contrast to regular fees.
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That's not a fee. Fees and risks are two different things (for example, cliff diving is highly risky, but costs no money). The lack of fees in using Bitcoin is one of the major points in its favor, and is separate from the risk of theft (if the risk of theft were nearly eliminated, the lack of fees would still be a positive). Let's not change word definitions and mix categories because the conversation will become messy.
 
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