A while back, Rick asked me about Bitcoin. Along with the rather alarmed look on my face, I shook my head and said “stay the fuck away from it.” That said, I wasn’t in a position to explain all the reasons why, or the history of it and all that. I just muttered “stay the fuck away” again. Conveniently, David Gerard has a book all about that! Many of you are familiar with Mr. Gerard from Rational Wiki. I got this for Rick, but of course, I had to read it too, because book.
It’s excellent, covers what you need to know, and is informative, entertaining, and sometimes, horrifying. So if you’ve been curious, or thinking maybe you ought to “get in on that”, read first. You can read select excerpts from the book here.
I’ve been told by a relyable sourse that bitcoin is the way of the future. I have my doubts, but no proof -- will have to look into this book!
No, it most certainly isn’t. It’s all tied up with Ayn Rand libertarianism, decentralization, a profound lack of knowledge regarding economics, and other idiocies. It’s also set to expire -- there will only ever be 21 million bitcoins. It’s also an insane waste of energy, and if widely adopted, would be a compleat disaster.
Governments will not tolerate bitcoin; there is ample reason to believe that the US government was behind the electronic break-in at Mt Gox, which temporarily cratered bitcoin values, as well as compromising the identities of a bunch of bitcoin traders.
It’s a bubble. I know a guy who was in early and made a fortune -- several million dollars -- but that’s how bubbles work.
Yeah, Gerard gets to the bubble business early on, as well as the constant conspiracy theories about big government hating bitcoin. I don’t personally buy into those, I don’t see why government would fucking bother. The value is quite low now, and quite frankly, I think you have to be more than a bit on the bent side to go mining.
There is also a deep-seated goldbugginess about the bitcoin fanatics. These are often the same people who talk about “fiat currency” because governments can (and do) manipulate the values of currency -- they want bitcoin values to be subject to the free market, just like gold. But they ignore the fact that gold prices are also manipulated: that’s what the gigantic pile of gold at Ft Knox does: it keeps the stuff from being worth a lot less. It’s weird to me because their anti-currency arguments apply equally well to be anti-bitcoin. (and now that the CIA stole a ton of bitcoin, they can manipulate that currency as much as they want, if they don’t spend it all paying hackers for exploits)
Caine@#4:
the constant conspiracy theories about big government hating bitcoin.
Nah, they love it. It’s a currency they can eradicate any time they want, and anyone using it is painting a great big neon sign on their back that says “I am being a naughty boy.” They’re much more concerned about cash. Not that they’re concerned about cash. The police state has other concerns, which are more important.
I think you have to be more than a bit on the bent side to go mining
Now, yeah. There’s a few guys doing “smash and grab” on AWS accounts, using other people’s nickel to mine a couple bitcoin, then moving off to somewhere else. If you’re using someone else’s compute cycles, it’s doable. The guy I know was smart: he built one of the first GPU-based miners, mined a couple million dollars (in current value; at that time it was only about $50,000) worth of bitcoin, then sold his rig to a gomer for about $50,000 and invested the whole thing and let it ride. He’s doing other things for a living, now, but he’s got a nice retirement from betting on the stupidity of others.
Marcus:
That was my primary reason for telling Rick to stay away from it. I told him it’s been tainted by drug dealers and other assorted criminals, and that it’s just asking for trouble.
All that said, I wouldn’t have a problem with a digital form of money, but this is not the way to do it. This is all about what they think is “stickin’ it to the man”.
Thanks, glad you liked it :-)
As I note in the book (see excerpt), government conspiracies about Bitcoin are pure goldbug paranoia and lack of understanding how the world works. The way governments actually responded to Bitcoin was the way they responded to every other innovation in finance: give it room to run, make it very clear that regulation still applies, give it a bit more room to run, repeat. But ideological libertarians aren’t very good with history.
You can see this with how the SEC is dealing with ICOs, after their public warning shot in July. Any reasonable person would consider most ICOs just straight-up scammy as hell -- but the SEC seems to be trying to gently get the proponents to be better behaved.
Thank you so much for stopping by, David! There’s been a good deal of interest in this post, so it’s obvious people are, at the very least, curious about all this, and if you just go by stuff you find littered on the ‘net, you’ll probably end up doing something very stupid.
I heard someone was selling bitcoins made of 24k gold. Possibly a prank, or not.
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