In another conversation I’m having on another site about bitcoin’s, someone brought up the question about the ability for someone to write a virus or worm to create a coordinated attack on the Bitcoin network. The questions was addressed primarily at the “double spending” problme of the benign network outcomputing the malicious network. Is this a possibility?
Are there any other possible issues with a co-ordinated virus attack?
Also, is it possible to initiate a “malicious transaction” on a wallet you don’t own? Meaning, taking a victim’s wallet and transferring it to your own with a malicious and co-ordinated attack?
The only thing that ultimately “backs up” currency is not it’s weight or chemical composition, but the expectations of both parts in a transaction involving it.
Of course when it has clear physical properties it is easier to form expectations about it, but ultimately the only thing that matters are the expectations.
That’s why most transactions today are executed on fiat currency, which are not convertible to any fixed amount of a graded commodity, and are backed only by governments and/or government-like enforcement agencies.
To deny that something widely used in transactions “really is” money, relying on ridiculous criteria for “realness”, seems like a self-inflicted episode of cognitive dissonance some people engage when their theories about the world are collapsing.
Are you claiming that bitcoin is widely used? For example, if I attempted to buy 100 random things off craigslist and offered bitcoin, how many would you expect would accept it?
If you attempt to use Euros (the currency adopted by most European Union countries, like France, Italy and Germany) in America’s craigslist you may find it difficult to find willing counterparts as well, because most people there are not willing or able to make currency exchanges themselves.
That criterion of yours (100 random items on craigslist) is perhaps a sufficient condition but doubtfully a requirement for something to be considered currency.
I was just going by what you said. I’m also not sure why your example of using another country’s currency is relevant. If you’re implying that bitcoin is like the Euro and the USA is not its home country, what country is bitcoin widely used in transactions?
There are millions of dollars worth of bitcoins transactions every day.
Just exchange transactions between dollar and bitcoins by a large broker in the last month amounted to more than 100 million dollars in volume. (see: http://bitcoincharts.com/markets/mtgoxUSD.html )
It’s not a geographical country, but a non-local community of internet users.
But in essence it’s like a country currency, not in the sense that it is enforced by a government agency or something like that, but in the more practical sense that these people are willing to trade in bitcoins and they can find easily their counterparts in their own market.
And then again, incidentally, they might be numerous in U.S. craigslist if they are that way inclined. Or not.
Bitcoin is backed by watts, its storing facilities need wattage, to utilize the bitcoin market one needs watts. When an indidvidual farms bitcoins (solving incremental rigourous algorithms = more watts) one utilizes wattage. It is not a fictitious currency similar to estatist currencies.
For the none-technical to farm one needs specialized eqiupment which also adds to the expenses which includes glass, gold, heavy metals, lead etc. So yes, for you liberal arts majors, bitcoin has intrisinc value.
*Someone needs to update this website and create a reply button without the need to click on the previous statement. Why can’t someone just make a statement?
It’s actually “backed” by hashing operations within parallel cryptographic algorithms.
Of course, to perform these arithmetic operations inside real world computers you need “watts”, in terms of electric bills. But you also need the processor itself and the subsidiary computer components, you need internet connection, and you need time.
And the government “backed” currencies need all government infrastructure that serves to the purpose of enforcing its acceptance, detecting counterfeits and stabilizing its perceived value.
The whole point again with “backing” a currency is not the physical property of any incidental commodity being used to create it, but the general expectations of the community of users of such currency.
Yes, thanks for clarifying my point. I guess internet monopolies inflates its value.
“The whole point again with “backing” a currency is not the physical property of any incidental commodity being used to create it, but the general expectations of the community of users of such currency.”
Are you stating that bitcoins has no subjective value?
@Similing Dave
You’re the one who brought up the subject, so please what “research” are you referring .
You’re still haven’t answered my question. Whose language are you referring to? Mises? Marx? Bowerk? Keynes? The Dictionary? I’m using the dictionary. Please utilize the ground rules of debate. I’m here to focus on the subject not get into a flowery debate about definitions. Once I figure out who you are referring to I’ll gladly rewrite my sentence to meet your needs.
I’m here to focus on the subject not get into a flowery debate about definitions.
You are out of focus because you don’t have the definitions correct. You are saying, “I want to build a castle on this spot, not get into debates about some quicksand here.”
…I’ll gladly rewrite my sentence to meet your needs.
I’m doing fine, no need to meet my needs. But if you want to write only true things, you’ll have to erase your sentence, not modify it.
Anyway, stimulating as this back and forth has been, I think I have nothing more to gain by it. The horse has beed led to water. I can do no more.
So good luck, Curius and Toxic. You guys are on your own.
The Instawallet service is suspended indefinitely until we are able to develop an alternative architecture.
Our database was fraudulently accessed, due to the very nature of Instawallet it is impossible to reopen the service as-is.
In the next few days we are going to open the claim process for Instawallet balance holders to claim the funds they had stored before the service interruption.
Important information on claims submission:
For the first 90 days we will accept claims for individual Instawallets. Your wallet’s URL and key will be used to pre-populate a form to file the claim.
After 90 days, if no other claim has been received for the same url, your Instawallet balance under 50 BTC will be refunded. If several claims have been filed for the same url, we will process those claims on a case by case basis, under the presumption that the claim we received first belongs to the legitimate balance holder.
Claims for wallets that hold a balance greater than 50 BTC will be processed on a case by case and best efforts basis.
Okay Smiling Dave, I still stand by my statement. Point me where I failed at interpreting Mises’s Theory of Money and Credit. Chapter and Page number. Tell me your opinion why I’m wrong since it seems you are trolling.
Okay I will now stop at correcting grammar in my posts and will spam replies.
I don’t know about that. You are apparently confusing value with cost.
The market value of an item is not equal to the cost of its creation.
What happens is that rational people usually don’t create things if they expect the costs of doing so to be higher than the market value of that thing, or the price of some other thing of equivalent or higher value.
All value is subjective. Value is the rank occupied by something given one’s priorities.
Yes, value is subjective. Technically you are right in a trollish manner. My point here is to refute the point that Bitcoins backed by nothing. Which many here point out that bitcoins is a fiat currencys.