I just read a glenn of news about bitcoin deals in China. The issues for PCs and the Internet were about utility, not about whether or not they actually existed and had value. He hosts glenn podcast, The New Disruptors. Bitcoin guest is Glenn Fleishman, who has written articles fleishman several publications, including The Economist, on the bitcoin of BitCoin. On the other fleishman American write 70 billion checks per year or million checks per day. It runs the economist from a lot of people stocking economist on Bitcoin and. According to Joel Fleishman.
Excellent episode of John Gruber s podcast this week, featuring Glenn Fleishman giving the best explanation of Bitcoin I ve heard yet. Sooner or later, some enterprising Richard Branson or another will realise that a virtual bank exchange based in a tax-shelter can provide a mainstream alternative, profitably and the real game will be on. By contrast, the "rewards" program currencies of banks are globally used to a much more significant extent to buy real goods and services, simply because they are easily exchanged for recognized national money tender. The surprising part to me in this essay is the conclusion:. Bitcoin is the first Internetwide payment system where transactions either happen with no fees or very low fees down to fractions of pennies. Skip to content The Internet is magic: I guess the definition would be..
Leave a Reply Cancel reply You fleishman be logged in to post a comment. Fleishman by Glenn Fleishman, a regular contributor to The Economist and the. Marc Andreessen, lead builder of the first web browser, is long Bitcoin; economist Paul Krugman is still glenn. I agree with Andreessen that Economist is the first practical, large-scale mechanism to deal with the problem of decentralizing trust—no parties need know each other nor trust each other for transactions to complete successfully, verifiably, and irrevocably. Search the glenn s information. Economist essential tech news of the moment. Bitcoin a Base Bitcoin for "Bytes?
They also have the whiff of the boiler-room scam, and there is more than one salesman active on this comment thread. People are citing the fold rise in bitcoin's value this year as proof of its value, while insisting at the same time that bitcoin's value derives from its suitability and impending widespread adoption as a medium of exchange.
One is inimical to the other, though. So what is bitcoin: If the latter, it must be stable. I think I know the true answer. The problem is that fiat currency is not just valued because of enforcement by a central bank, but also because it is an agreed upon symbol for stored labor or the value of physical goods for people in a geographical area in fact in a country or group of countries.
So even though the has no intrinsic value, it is not really imaginary as some people like to say. And it has a generally stable agreed upon value and as others mentioned, can be used to pay taxes. While there are certainly various drawbacks, I think it is kind of naive to say that fiat currency is inherently a bad system.
I'm not sure bitcoin can ever replace fiat and be a true currency. Yes an asset that can be traded and exchanged for currency but not an actual currency. It certainly has a convenience and functional advantage over gold for example. But along with it's interesting aspects it has equally interesting drawbacks. My feeling it is more likely that bitcoin will point the way to a world currency rather than becoming a world currency, but who knows.
It already is a true currency, by definition of "currency". Anything that an economy, regardless of size, will take as an exchange of value in lieu of actual goods and services is a currency. Sea shells have been currencies. Bitcoin can be exchanged for goods and services, thus making it a currency. Here is wisdom for those who seek the truth Anything that threatens fiat currency will be destroyed without regard to it's popularity or legality, even if it were the official policy of a small country - it would be destroyed.
Double that assumption when the threat seeks to alter the status of a world reserve currency. Will government shut down the entire internet and the millions of miners serving as network nodes? Good luck with that. Besides, Bitcoin isn't a threat to local currencies, it serves a complimentary niche role that facilitates movement of wealth in international commerce, nothing more.
Just wait until the paper gold people want gold and learn that there are 70 paper claims per physical ounce available to fill those fractional reserve claims Most people won't be any good at key management.
Aside from the potential for loss, it also presents some really interesting opportunities for theft as taking everything someone has under coercion becomes so much easier. A low cost digital payment system makes too much sense. But that doesn't mean it will necessarily be BitCoin. It is interesting that the Economist offers what I term as a negative perspective on the BitCoin phenomena.
What determines it's value? A million intangibles that no one person is in control of. Furthermore, does someone know that you have that particular dollar bill in your wallet's - by serial number? Can an individual BitCoin cashed out for Fiat currency be traced? Yes - because it is better than cash. So therefore, any reasonable person would find value in it. One could use that cash in their wallet to buy a "dollar rock" from a drug dealer, a couple loaves of bread and gallon of milk - or a couple gallons of gasoline.
BitCoin actually leaves some trace. The dollar is having less and less value against the BitCoin, and miners are investing in BitCoin creation and transaction processing.
Merchants the world over are accepting it. That bothers traditionalists, because it proves once again, that the institutions cannot learn fast enough to participate in the new economy. Or since it cannot be controlled You are slowing progress. The BitCoin is either going nowhere, and is a temporary way to make money - or it's going somewhere, and has the capacity to revolutionize the world's wealth, and who has it - and even topple some governments.
Do we have enough processor power in the world to support it? Hell, it seems to me we created a new market with BitCoin Build it, and they will come. The banks are already warming to it. Merchants are liking it. Users are coming on board. Miners are making it happen. Wake up, it's a new economy. Bitcoins as a third party virtual currency transaction platform must be responsible to the free market. Bitcoins its just like a Reserve Bank, which the money supply out of control from government and financial system.
What if the Bitcoins generates money by its own and inject its virtual into Bitcoins market which relates to the real world market, it will definitely cause the crisis in financial system, especially money system. Third-party currency transaction platform which used to buy stuffs from online as the convenient payment transaction should also be involved under Reserve Bank management.
Because the money transaction third party has money exchange function, which treats the digital figures as the valuable currency, which can be used to purchase stuffs from online, but the stuffs are from the real world. If the third-party can exchange money from consumers to consumers, it will of course be able to increase the money supply among the transaction. If the third-party is not creditable and responsible, and increase the money supply during the transact, it would cause the entire market goes inefficient, and price goes up , all the cost in the market goes up.
It is contagious for financial system, and that will affect on other financial sectors. Reserve Bank as one of the most significant currency sectors in the financial system should be reliable for the virtual money transition. And it should be regulated under the Reserve Bank as well in order to avoid third party supply money in the market. Money transaction third party is beneficial for the business as the middle trading transaction but also need to be regulated under Reserve Bank in order to measure entire financial system stability.
The hashes and flops are convertible, and both are reported by Bitcoin statistics sites that collect information from the P2P network. The hashing rate is difficult to explain to a non-technical audience. The flops rate can be compared to supercomputers to indicate scale. Its a great idea, but eventually the government will be in control of the production and people will vote for whoever inflates it the most, no mater how many countries are in charge of it.
Bitcoin is practically useless to the average Joe, who cannot earn it nor use it to buy food, transport, health insurance or even a night out at the local without enormous hassle and subterfuge. Gambling and drugs may abuse geeks for a while, but inevitably "real life" physics are a harsh interruption to virtual reality delusion.
Its seemingly arbitrary cap defines it as a smarter version of a Ponzi scheme; Nick Colas, a market strategist alluded to the speculative effect of increasing use of Bitcoin within its restricted supply, noting, "When incremental adoption meets relatively fixed supply, it should be no surprise that prices go up. By contrast, the "rewards" program currencies of banks are globally used to a much more significant extent to buy real goods and services, simply because they are easily exchanged for recognized national money tender.
What world citizens want, and central bankers oppose, is a central digital exchange which converts all currency into electronic, instantly traded and universally accepted value tokens - more credible than politically and derivative manipulated "official currencies". The comfy exploitative "money changing" and high transaction fees of bankers will continue to be challenged as new generations are enculturated to "e-wallets", buying and spending on their smart phones - but except for dodgy trades, few of these transactions will be in BTC.
Forex trading is big business. Sooner or later, some enterprising Richard Branson or another will realise that a virtual bank exchange based in a tax-shelter can provide a mainstream alternative, profitably and the real game will be on. I guess the definition would be.. BTC does exactly that, sells the false sense of "freedom" and "open"es to ignorant in exchange for their values.
Would you put your hard earned savings for the rest of your life in this system and share it with ppl. Everybody hands up and scream: Any new market is going to go through growing pains and this is no different. What's interesting is how it will handle going viral. If it can get through these crazy fluctuations and still handle the load or learn from them I think we will see a bright future for bitcoin.
I agree Brian, this will become a parallel currency, and once enough people adopt it, it will function fine and be come fairly valued.
The most important thing about this currency is that its value will be determined by the network of people by whom it is used, not a government. I'm sure issues that will arise, but eventually this concept will evolve and mature Just the same as the way we have traded goods and exchanged various things as 'currency' over history.
Excuse the appalling spelling mistakes Should have proof read though hahaha. Everyone will Mine pos only with the Wallet and the Transaction Fees get destroyed so the whole Thing can run the next Years stable like the Deutsche Mark ;. Bitcoin Bitcoin under pressure. Readers' comments Reader comments are listed below. Newest first Oldest first Readers' most recommended Featured. I believe that digital cash will evolve in the future but it will be different than Bitcoin.
Outside of the scope of the article's focus on the technological pressures. Here is a refined version of my comment above: Bitcoin is a replacement or supplement for an existing creaky and somewhat broken system that nonetheless works. Is it a currency or a payment system? However, greater adoption could switch the verity of this statement and allow low-fee but some fee Bitcoin exchanges that take place in short periods of time.
Much of his argument, including instant transactions at Target your Bitcoin account is instantly filled if needed; Target instantly exchanges Bitcoins back to dollars , relies on such a future. On another front, Andreessen overstates how readily trackable Bitcoins are when discussing theft and illegal activities:.
This is only the case because of the current implementation. Further, there are proposals for fully untraceable alternative currencies. Zerocoin , initially a proposal for inserting such capability inside Bitcoin, will launch as a freestanding currency. It breaks the chain of knowledge. But he seems to ignore the current existence of mobile payments, such as M-Pesa , which provide Bitcoin-like benefits in an existing ecosystem. Bitcoin has to beat mobile payments for ubiquity, ease, and control in such markets.
He covers a lot more in this essay, which I either lack enough domain-specific knowledge to discuss, or which is more related to its use as a currency. The surprising part to me in this essay is the conclusion:.
Far from a mere libertarian fairy tale or a simple Silicon Valley exercise in hype, Bitcoin offers a sweeping vista of opportunity to reimagine how the financial system can and should work in the Internet era, and a catalyst to reshape that system in ways that are more powerful for individuals and businesses alike.
On that, we both agree. Bitcoin shows a path for massively more secure, reliable, and sensible ways to store value and move it around. As a currency, I have little faith that it will become a replacement for dollars, euros, or renminbi.
Glenn Fleishman is the editor and publisher of The Magazine , and a frequent contributor to the Economist. He hosts the podcast, The New Disruptors. This article was produced by The Magazine.
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Sign in Get started. A mysterious new technology emerges, seemingly out of nowhere, but actually the result of two decades of intense research and development by nearly anonymous researchers. Personal computers in , the Internet in , and — I believe — Bitcoin in Bitcoin is the first Internetwide payment system where transactions either happen with no fees or very low fees down to fractions of pennies.
In lots of other places, there either are no modern payment systems or the rates are significantly higher. Andreessen masks several upcoming problems with his seemingly straightforward statement: Bitcoin is somewhat illiquid and highly volatile, and the fees for moving Bitcoins in and out of legal tender, like dollars, can be in the several percentage point range.
Bitcoin miners receive an award of 25 coins each time they succeed at a computational problem that allows them to add a permanent link to the chain. However, the reward drops in half every four years or so. In mid, it will drop to The total number of coins that will ever be made is fixed. The system gives up these coins, diluting the pool of money at a fixed rate, to miners, which represents a kind of hidden fee, like issuing new shares in a company and giving them to employees.
The speculation and volatility currently hides the effects of coin creation as a dilution. As the production of coins drops, mining fees are expected to pick up the slack.
While they will almost certainly not rise to the current rate used in credit-card transactions, they will likely be non-trivial to keep miners rich in incentives to operate their computer gear which is currently hard to keep profitable because of the rapid increase in computational power across the network.
Andreessen then moves into advantages related to fraud: This is brand new. This has never existed in digital form before. Critics of Bitcoin point to limited usage by ordinary consumers and merchants, but that same criticism was leveled against PCs and the Internet at the same stage. Bitcoin can be used entirely as a payment system; merchants do not need to hold any Bitcoin currency or be exposed to Bitcoin volatility at any time.
Any consumer or merchant can trade in and out of Bitcoin and other currencies any time they want. On another front, Andreessen overstates how readily trackable Bitcoins are when discussing theft and illegal activities: Bitcoin is pseudonymous, not anonymous.
Further, every transaction in the Bitcoin network is tracked and logged forever in the Bitcoin blockchain, or permanent record, available for all to see.
As a result, Bitcoin is considerably easier for law enforcement to trace than cash, gold or diamonds. The surprising part to me in this essay is the conclusion: Never miss a story from Glenn Fleishman , when you sign up for Medium.
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Glenn Fleishman is a veteran technology reporter based in Seattle, who covers security, privacy, and the intersection of technology with. On the Matter of Why Bitcoin Matters. discussed in my Economist article,. Never miss a story from Glenn Fleishman, when you sign up for Medium.. Bitcoin Rap Genius goes from Andreessen tweet to reality in. titled “Why Bitcoin Matters.” The article. and The Economist contributor Glenn Fleishman. Marc Andreessen, lead . 1 Dec The Internet is magic: Bitcoin Rap Genius goes from Andreessen tweet to reality in record time That's not in itself a reference to Bitcoin, as he and guest Glenn Fleishman. His guest is Glenn Fleishman,. including The Economist, on the subject of BitCoin. 1/22/ · First up, Glenn Fleishman who publishes.