Bitcoin drops again

Miscellaneous Current Events
61

Well I guess then we should also abandon internet banking and goldmoney.com, because they, like Bitcoin, use public key cryptography which was only invented in 1978.

Also this “sound theoretical basis”: Gold is just an element. It has some physical properties and these influence its uses with respect to needs of potential users. Bitcoin is just a bunch of math formulas. It has some mathematical properties and these influence its uses with respect to needs of potential users. You don’t think math has sound theoretical basis? Well then stop using computers.

In other words, you admit that your argument is empirical rather than praxeological. That’s all I wanted to know becase it exposes the fundamental error in your approach and contradicts the claim just above that it is based on a “sound theoretical basis”.

Gold spiked and fell in 1980 much more dramatically than now. So what? That on its own does not mean anything. Compared to, say, a year ago, Bitcoin is still about 5000% up. That does not mean anything on its own either.

62

Well I guess then we should also abandon internet banking and goldmoney.com, because they, like Bitcoin, use public key cryptography which was only invented in 1978.

Yes, guys, this is the kind of thinking you can expect from bitcoin believers, comparing apples to oranges.

Nobody is using internet banking or gold money.com as a currency. Bitcoin is being passed off on the fools as a money, which it never was and never will be. As oppsed to gold, which was used and coveted for thousands of years, and still is coveted.

Also this “sound theoretical basis”: Gold is just an element. It has some physical properties and these influence its uses with respect to needs of potential users. Bitcoin is just a bunch of math formulas. It has some mathematical properties and these influence its uses with respect to needs of potential users. You don’t think math has sound theoretical basis? Well then stop using computers.

Another example of the muddledheadness bitcoin cultists either have in their heads, or think you do. Since Petes vocabulary is passable, I suspect the latter. He thinks that if you are stupid enough to fall for this nonsense, you are also stupid enough to buy his worthless bitcoins.

Yes, bitcoin is just a bunch of math formulas. Meaning it has no intrinsic value. Math formulas have existed since man had a brain, and nobody has ever used them as money. Gosh, how stupid he expects you to be to fall for his specious argument. Math has a sound theoretical basis for getting correct math answers, but what has that to do with bitcoins having a sound theoretical basis for being money? Nothing.

Compared to, say, a year ago, Bitcoin is still about 5000% up.

Yes, it was pumped and dumped, which you can get away with once. Once dumped it has only gone down. Hey. go ahead guys. Buy bitcoins. Throw caution to the winds. You don’t need your money, do you?

In other words, you admit that your argument is empirical rather than praxeological.

He expects you guys not to know the difference between “and” and “rather than”. I have two arguments, one empirical, one praxeological. In other words, bitcoin buyers are fools from every possible angle.

Now there are two possibilities. Either Pete is so foolish he thinks there is some validity in his arguments, or he is so smart he thinks everyone else a fool. In either case, there is no point continuing this discussion with you, Pete. Say what you wish; maybe you will trick some idiot or other. I’m done with ya.

63

Why do you think I’m a “bitcoin believer”? I merely pointed out the logical fallacies in your claims. I did not make any claim regarding future price or market share of Bitcoin with respect to gold or anything else. If anything, this proves that you are the one substituting beliefs for arguments.

Both goldmoney.com and internet banking are money-substitutes which public key encryption makes possible (or at least practical). You can transfer balances between two paypal accounts, and between two goldmoney.com accounts, and you can use PKI to transfer balances between two Bitcoin addresses. The balance of paypal/goldmoney.com refer to units of fiat or gold, the balances of BTC addresses refer to a fraction of time after January 2009. While you can manipulate the supply of fiat, you cannot manipulate the weight of gold just like you cannot manipulate the amount of time that passed after January 2009.

First of all, is Austrian approach is based on the subjective theory of value, i.e. nothing has intrinsic value. You fail at the very basics. Furthermore, since you consider immaterial goods worthless, maybe you should stop using not only math but language, and start telling all the language and math teachers how what they are doing has “no intrinsic value”. Also burn all books and delete all files on your computer.

They also have not used it as computers until recently. But people have been earning their living with math ever since math was useful.

You can say the same about gold. The only thing speaking for gold is historical data. But praxeology is ahistorical.

The price of Bitcoins has fluctuated. You are trying to mix exchange rate analysis into the topic. That not only isn’t praxeology, that’s not even economics, it’s financial economics. Furthermore, I’m not telling anyone to buy Bitcoins. You’re attempting to wiggle out of the logical errors by ascribing views to my position which I clearly never expressed.

The empirical ones are dubious (plus you have not defined a normative scale to evaluate them upon), and you have not addressed the objections I brought towards your “praxeological” arguments. Instead you started deflecting, distracting and derailing the conversation into irrelevant topics. And if that doesn’t shut me up, you switch to ad hominems.

Your behaviour and the lack of willingness to engage in a serious debate should be sufficient reason to conclude that this is just a baseless ad hominem. I’m not mentioning because it would somehow offend me, merely to point out that it’s just another logical fallacy.

64

Amidst the hysterical cries that all is well, yet the truth cannot be hidden:

Bitcoin at $4.03.

804×558 37.4 KB

The top car is bitcoin less than six months ago, at $30.

The middle car is now, $4.

The ocean is where bitcoin is headed, zero.

Let the buyer beware.

65

Smiling Dave,

gold dropped about 8% (against USD or EUR) in the last 30 days according to goldprice.org. Silver dropped 20%. Are you going to be consistent and rant against them too, or prefer to remain at the level of a child giggling at fireworks? Also, when you shift the scope to one year, Bitcoin is still up 4000% while gold/silver only 20%/40% respectively. None of this mean anything.

Also, the organisers of the European Bitcoin Conference are looking for anti-Bitcoin people for debates. Are you willing to go, or prefer the comfortableness of your keyboard where avoiding confrontation does not lead to public blamage?

66

I’m great fun at parties, if invited correctly.

You’re going to pay for my plane ticket, hotel and all expenses? what kind of speakers fee are we talking about?

As for gold, it is not following a classic pump and dump pattern, but bitcoin is. Starts off at zero, is pumped to 30, then dissapears down to 4 almost right away. We’ve discussed the matter before.

We meet again when bitcoin drops below $3.50

67

Smiling Dave,

we have not discussed it, you presented a monologue full of appeal to emotions and other logical fallacies. Furthermore, everything starts at zero, until it’s traded for the first time, when it gets a non-zero price. You can’t even formulate a coherent argument. Also, assorted pundits (whose opinion I consider equally confused as yours) claimed the “pump&dump pattern” for the behaviour of gold too. Maybe you should remain at your keyboard then.

As for the conference, I’m not involved in it, I just noticed it. Here’s the conference link: http://conference.bitgroups.org/ and here’s the loking-for-link: https://bitcointalk.org/index.php?topic=47786.0

68

That was quick.

Bitcoin at $3.37.

16% in five days.

We meet again when it’s under 3 bucks.

69

Look out below.

Under 3 bucks, at $2.91.

Oh where will it all end?

Next message when it’s below $2.50

70

Smiling Dave,

I’m happy you’re having fun, when you’re done, don’t forget to brush your teeth and go to bed early.

71

Didn’t take very long. $2.34!

[my bitcoin fell down there somewhere]

Next message when it’s under 2 bucks.

Pete, now is the time for you to make a killing. Buy your bitcoins on margin at $2.34 and wait for it to hit 30 dollars again.

72

lol I am beginning to see the point of this thread :smiley: hehe. well, as for gold, at least it is worth something as a metal, but bitcoins? You must have faith in them in order to “hold a value”. It’s practically religious curency.

73

Smiling Dave,

if you’re so sure that the price of Bitcoin will fall, why are you not shorting it?

I don’t speculate on the market. I’m more an economist than a speculator. Furthermore, based on my analysis I think that in the near future the downward trend on the Bitcoin price will continue, but of course I could be wrong because the market is so small and any bigger player can influence it.

I have for quite some time wondered how to deal with fanatics. You cannot argue with them, because they do not want to argue. You cannot persuade them because the prefer to believe in fairy tales. I think I’ll just stick to point-by-point refutation and leave the mud games to others.

74

based on my analysis

Would you kindly share your analysis with us?

75

Smiling Dave,

I am actually having a presentation about my findings later today, will see what sort of feedback I get, and the paper will be published within a couple of weeks. Besides, I already made some arguments here on the forums, maybe you can reread them for starters.

76

You have argued here on the forums that bitcoin will drop in the short term?

how low do you think it will drop before it goes up again?

how high do you think it will rise?

77

Smiling Dave,

  1. I have argued here why your arguments are wrong. I have not made any statement about what I expect the price to be.

  2. I don’t know

  3. I don’t know

These are empirical questions and I try to avoid those. The only thing I’m willing to say based on empirical data is that there is no sign of a change in any measured variables that appear to correlate with price (I matched google trends, mining difficulty, relative money velocity), so probably the price will also continue falling. Why the big spikes occurred today I’m not sure. The MtGox trade volume spiked too. Slush’s pool started merged mining Namecoin payouts today, the mining difficulty fall increased dramatically in the last couple of days, Macaraja vs. CIC hearing starts tomorrow in France. There are also pro-speculators on MtGox toying with the noobs, maybe they just decided to make money today. Any of those or something else could be behind the big spike.

78

The bitcoin crash is so noisy it’s reverbrating all over the world, to wit;

http://www.economicpolicyjournal.com/2011/10/crash-of-bitcoin.html

http://www.betabeat.com/2011/10/17/price-of-bitcoin-still-dropping-falls-below-the-price-of-mining/

“It now appears the $3 to $33 prices for Bitcoin were due to speculation. “At the moment there is no need to use Bitcoin, as anything that can be bought for BTC can be bought for ‘real money’ elsewhere,” a Redditor writers.”

Yes, it now appears to even the blind, but we here at mises.org told ya so right away.

OK guys, time for confessionals. Anyone who bought it at $33, or any amount above the current $2.26, chime in.

P. S. The site that gives away free bitcoins is up for auction, as is that fun bitcoin marketplace.

79

I realize this essentially became a troll thread a long time ago, but I figured it was worth it to post this from the Mises Blog:

Mises.org has been pushed very hard to comment on the Bitcoin issue, and I’ve probably read and sent 10 articles around for review. We’ve run nothing on it just because the right piece that takes full account of both the technology and robust monetary theory just hasn’t been written. In the meantime, it seems that Bitcoin is tanking.

Any libertarian has to have some sympathy for any effort to create an alternative currency, and the state has narrowed the options so much that we can fully expect a long series of nonviable projects to emerge in the future. It is part of the terrible struggle of our times to find ways of living free in an age of government omnipotence.

I figured that was about the sentiment. I’m hoping Murphy will finish his piece. I would assume that would be the one to be published.

80

The only reason for Bitcoins brief meteoric rise was that it was being reported as a “safe” way to buy illegal things (drugs, kiddie porn, whatever) over the Internet while maintaining buyer/seller anonymity. Sensational stories of LSD being purchased and recieved from trustworthy sellers were published on reason.com (a veritable Pied Piper of an organization whose music lures libertarians away from the NAP). Anyway, this sort of thing generated great interest and subsequent demand among, ahem, “enthusiasts” shall we say?

Once these fantasies were debunked, interest waned.

[ETA: Additionally, Bitcoins don’t even exist as physical things. A Dollar, as bad as it is, at least exists as physical pieces of paper with the title “dollar” printed on it. It’s pretty hard to get people to trust money (or a “wallet”) that doesn’t physically exist for very long.]

Gold, on the other hand, had an entirely predictable price spike following the S&P downgrade of US debt. It has, however found a new baseline from which it will continue to rise, albeit at a much slower rate than the August-September skyrocket.