Miscellaneous Rumbles

Bitcoin - WTF?

1

About 4 or 5 years ago I turned to Mrs Deke and said "Mrs Deke, these Bitcoin doohickeys look like a good prospect or a good way to waste money". We chatted it over and decided it was too flaky so left them alone. They were about $6 at the time. Today they hit $10,000.

2

If you bought at $6, there was an more than equal chance they would have fallen to $3 as to climb to where they are now. And they’re still just as likely to go back to $6.

3

My daughter worked for time as the office manager at a Bitcoin mining company in SF. Her name is Valerie; both of her bosses were also named Valery, but they were Russian nationals and she never met them.

They'd developed custom daughter boards to optimize PCs for the rigorous and speed-dependent job of mining bitcoins; they ran in server farms at seriously-cooled data centers all over the world. The company both sold the hardware and mined coins themselves.

She gave me a scholarly-enough book examining the history, development, and inner workings of the Bitcoin phenomenon (and mentioning the Valerys' company). Very interesting reading, and pretty fascinating stuff.

She was paid in normal US currency, but got bitcoins every now and again as bonuses. Last I checked, she appreciated their steady appreciation.

The world goes on and on developing in surprisingly and seemingly alien ways, living in the future, while we hold pat obsessing about the favorite (but possibly fading) musical instrument of a couple generations past.

4

A friend of my wife had a boyfriend who convinced the poor girl to invest $15,000 in his "Bitcoin business"

She gave him $15,000

A couple of years went by and on paper she looked like she was worth hundreds of thousands of dollars.

Then she found out that the boyfriend never invested the money....or invested it and kept the profits for himself.

At any rate he broke up with her after bilking her out of 15 grand.

I'm glad I didn't take my wife's advice to invest with him.

5

Sad story. But let's recognize that this scam had everything to do with the boyfriend and nothing to do with bitcoins...

6

Some of us are still trying to filter the logic of bitcoin. I'm not sure what it's use is or how it is valued as it seems a bit ethereal to me...

7

Sorry.

I never got the concept of bitcoin.

What's it actually?

8

Some of us are still trying to filter the logic of bitcoin. I'm not sure what it's use is or how it is valued as it seems a bit ethereal to me...

– Parralax View

Things are worth only what people will pay for them, nothing more, nothing less. Bitcoins and other virtual currencies have no real value, they are not tied to anything. A US dollar is backed by the US government and can be exchanged easily for any product or service anywhere in the world. That's true of the Euro or Pound or Renminbi. Bitcoins can only be sold within the bitcoin world.

10

Sorry.

I never got the concept of bitcoin.

What's it actually?

– crowbone

In very basic terms it is a currency not backed by any national bank (like the US Treasury or the Bank if Canada). Instead it relies on two things to guarantee that when someone pays you with bitcoin it is good: 1) blockchain technology. Imagine a ledger that says that you have 100 bitcoins, I have 50, and so on and so on, and that this ledger tracked the movement of every bitcoin in the system. Obviously criminals would want to corrupt this ledger so it looked my money is theirs. With regular currency, you pay a bank to guarantee this for you, and PayPal fees to manage transactions, etc. Blockchain enables this ledger to be chopped up into millions of pieces and stored around the world. 2) Advanced encryption that scrambles Everybody’s data on that ledger so that even if they were able to reassemble the whole ledger, it would be near impossible to decode.

The benefit is that this advanced technology means you no longer need a bank to guarantee your money and transactions. This is hugely beneficial for millions of people in the developing world with smartphones but no access to banks and reliable currency. Hey can no conduct transactions around the world using bitcoin.

It has some major problems. First, there are serious questions about who manages bitcoin. Second, it doesn’t exist in a vacuum. Thus, if you want to turn your bitcoin into US dollars, you need a bank to manage that transaction... for a fee. So the benefits of bitcoin in the developed world begin tthe disappear because we aren’t paid in bitcoin and we can’t buy groceries with bitcoin. Last, the exchange market for bitcoin has led to wild speculative investment in it making fortunes for some, but undermining the idea of bitcoin as a stable currency. Would you accept payment in bitcoin if it might plummet in value tomorrow?

11
The world goes on and on developing in surprisingly and seemingly alien ways, living in the future, while we hold pat obsessing about the favorite (but possibly fading) musical instrument of a couple generations past.

Very well written and the sentiment within those words is dead on accurate.

But, hey, as long as we hold on to our big hollow bodied relic-from-the-past guitars, we still matter (at least to ourselves). At times I feel like Winston in "1984." I have to hold on to something, even if it is my Gretsch, because I-phones and Facebook and twitter and Tinder are just so non-human and impersonal to me. My guitar with a Bigsby is real to me, my car with a carburetor is real to me. Getting likes on Instagram is, to use your word, alien.

12

Bitcoin took a 20 percent dive today before it recovered somewhat. There are around 130 or more virtual currencies now, trying to copy Bitcoin's success. Blockchain technology is very interesting because it intends to make the whole ledger and transfer of Bitcoin transparent but I still do not trust virtual currency. A currency created by someone who remains in the shadows and without any government guarantee or hard commodity backing it up just seems so crazy. Unfortunately, its dramatic climb is sucking a lot of people in now. With stocks or bonds or gold, there are fundamentals that can help give you clues as to what a person should do...buy, sell, hold. With Bitcoin, I don't see anything fundamental except demand is exceeding supply so it goes up. That can reverse itself just as quickly, it seems to me.

13

Thanks for the explanation.

It still sounds like digital monopoly money to me.

I guess I'm old school and prefer a stack of hundreds under my mattress instead of an intangible thing which may or may not increase in value.

15

Options trading in Bitcoin is expected to begin in 2018, so a person can leverage a bet on whether Bitcoin will rise or fall. There is a sort of mutual fund (symbol GBTC) that allows a person to trade on the value of Bitcoin. GBTC was trading at $390/shr on July 1, 2017. Today's price is $1563/shr (hit $1823/shr at the high today). I was tempted but hesitant at $390. Coulda woulda shoulda.

I have heard that at halftime during the last Superbowl, some LV sports books were giving 30 to 1 odds against the Patriots coming back and winning the game outright. A ballsy $2000 bet would have gotten you 60K. Bitcoin is a bet like that.

16

Bitcoin is a learning experience. Aspects of Blockchain are an advancement.

The "herd" chasing Bitcoin is as normal as humanity.

Be careful.

17

Guys, let's recommend each other and share our real experience of working with cryptocurrency funds or brokers. I mean those organizations to which you transfer bitcoins into ""trust management"", they trade them and bring you profit. At the same time, they receive their percentage from the traded and do not disappear with your money. If you have any good advice based on real experience, please share. I have experience of cooperation with this Switchere service. I Buy crypto on Switchere. How do you like the idea?

18

The reason for the idea of bitcoin appeals to me,but at my age I just don't trust the technology all that much. Then again,I don't trust the U.S. dollar post Brenton Woods, but the USA does have the largest military budget and stockpiles of nuclear bombs to back up their phantom dollars. Let's see with all these trillions of monopoly $ being created just how long the world continues using them . Hyperinflation anyone?

19

I realise I must be completely thick, but the whole concept (is it a concept?) of bitcoin totally eludes me. You 'mine' it? What, like coal or iron ore or black pudding? I've had it explained to me on several occasions but it registers in my pea brain just like differential calculus did when I was 16 -- i.e. not at all. Mind you, when I was 16 just about the only thing registering in my brain was a Fender Stratocaster -- oh, and a young lady called Stella who lived about a mile away.

20

So they aren't easily exchanged for currency? I'm out.

So I'm trying to understand but I do have a question about how it's value is determined and who determines that value?

21

When the whole shebang crashes, the only thing that will have any value is Portable Property. The stuff that you can carry or put in your pocket.

Gold, silver, guns, ammunition, food, and other more tangible things, are the only things that will have value. Barter and services will always have value as well.

This may seem like a 'preppers' mentality, but our resent experience with a particular not so deadly virus has shown just how much a disease can throw a wrench into the works. Imagine what a very deadly virus could do.

Wars are another thing that can reduce us to using only Portable Property for exchange. The modern world is hanging on a thread, that can easily be cut and descend us into chaos. Bitcoin and paper money will be worthless. History has shown all of this to be true when governments fail.

22

Not being investment savvy, I would avoid investing in something I can't see, feel or understand. So, Bitcoin has scared me and I've avoided it. Probably for the best. But, 25 years ago I left Waste Mgmt and they gave me my accrued pension funds as a lump sump payout, so I got a check for $36K I had to do something with to avoid taxable income, so ... I opened a little Schwab self-directed stock portfolio (IRA). I put 50 shares of these, and 100 shares of those and just basic well known blue chip stock in it, and bought 300 shares of a little high tech upstart which cost me a whopping $900. Without touching that IRA much over 25 years I can now say I got kinda lucky, and that little tech startup is doing pretty well, and simply by normal stock splits that 300 shares is now 8400 shares and it only cost me $900. And YES I do have an Apple cellphone.

23

I would say that's sufficiently investment-savvy.

24

Can't buy a pizza with Bitcoins.

– wabash slim

you can buy gas and shop at many stores with it here in san diego. I wouldnt spend my investments on pizza, the only dividend that pays is heartburn at 1am.

25

Also, actually the very first Bitcoin transaction, years ago...was for a pizza.

Personally, I don't think currency will ever catch on. Nothing like having shells and wampum in your saddlebags. Don't even get me started on "automobiles." I don't trust computers either. I'm posting with my abacus.


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