License to print money... BitCoin?

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March 3rd, 2013 at 6:24:46 AM permalink
Fleastiff
Member since: Oct 27, 2012
Threads: 50
Posts: 5124
So what is this BitCoin stuff.... someone can simply declare that they too will create BitCoins and credit them to various accounts.

So what stops someone from forming a BitCoin Exchange and charging humungous fees to international drug dealers for a few electronic adjustments to the database?
March 3rd, 2013 at 12:06:14 PM permalink
TheCesspit
Member since: Oct 24, 2012
Threads: 23
Posts: 1929
Quote: Fleastiff
So what is this BitCoin stuff.... someone can simply declare that they too will create BitCoins and credit them to various accounts.

So what stops someone from forming a BitCoin Exchange and charging humungous fees to international drug dealers for a few electronic adjustments to the database?


A bitcoin itself contains a answer to a mathemetical problem, then encodes all the transactions it's been in through, using (what is meant to be) an an unbreakable encryption. So you can't just make a unique coin.

There is a bitcoin exchange (or at least one) where you can change a bitcoin to cash and vice versa : MtGox (https://mtgox.com/) 1 bitcoin is worth $34... it's not the most stable of currencies, I though it was around the $8 mark not so long ago.
It is said that your life flashes before your eyes just before you die.... it's called Life
March 3rd, 2013 at 6:00:14 PM permalink
Pacomartin
Member since: Oct 24, 2012
Threads: 753
Posts: 8881
Quote: Fleastiff
So what is this BitCoin stuff.... someone can simply declare that they too will create BitCoins and credit them to various accounts.


It seems that BitCoins are safer than some fiat currencies, because they increase according to a formula. No government can artificially increase the money supply. In the age of "quantitative easing", the bitcoin may be a better investment.

As of March 2013, the monetary base of bitcoin is valued at over 360 million US dollars.

An article about online gambling with bitcoin. The article implies that it seems legal and nobody has raided the site yet.
March 5th, 2013 at 12:34:41 AM permalink
1nickelmiracle
Member since: Mar 5, 2013
Threads: 16
Posts: 549
I think it gets more expensive to "create" or discover bit coins, the more which are discovered much like any other resource. I think the governments could easily crash the system if they considered it barter( as the IRS is draconian on) or consider it a collectible causing getting cash for them difficult tax wise.
March 5th, 2013 at 8:59:25 AM permalink
Pacomartin
Member since: Oct 24, 2012
Threads: 753
Posts: 8881
Quote: 1nickelmiracle
I think the governments could easily crash the system if they considered it barter( as the IRS is draconian on) or consider it a collectible causing getting cash for them difficult tax wise.


I was under the impression that local currencies are perfectly legal, as long as you pay taxes.
March 5th, 2013 at 10:47:57 AM permalink
whatme
Member since: Oct 24, 2012
Threads: 0
Posts: 21
Quote: Pacomartin
I was under the impression that local currencies are perfectly legal, as long as you pay taxes.


NO NO NO

NO WAY

Local currencies in the US are NOT legal, unless special laws are passed. I believe 1 or 2 small towns got special laws passed.
March 5th, 2013 at 11:19:25 AM permalink
Pacomartin
Member since: Oct 24, 2012
Threads: 753
Posts: 8881
Quote: whatme
NO NO NO

NO WAY

Local currencies in the US are NOT legal, unless special laws are passed. I believe 1 or 2 small towns got special laws passed.


I read articles that say that local currencies are entirely legal and becoming more popular. It is doubtful if such currencies cross state lines.



I understand that cards similar to our metro cards are becoming local currencies in Japan.


People are experimenting with online gaming with bitcoin and so far no one has stopped them. It may be simply that the scale is so small that it hasn't seemed worth the effort.
March 5th, 2013 at 11:43:46 AM permalink
whatme
Member since: Oct 24, 2012
Threads: 0
Posts: 21
The new places can't legally print "currency". What the new places are doing (assuming they don't belong in jail) is printing "Gift certificates" that can only be used @ select shops.

You should not that gift certificates and giving someone a bonus for having store credit is not the same thing as a currency.

What is funny about the article is how they don't mention how people pay. I know of a group of stores that give charities a deal they pay (I believe) 95₵ to the $, however they pay by check so there is no credit card fee. These charities then sell them @ face value to raise some $.
March 7th, 2013 at 9:04:45 PM permalink
Pacomartin
Member since: Oct 24, 2012
Threads: 753
Posts: 8881
Quote: whatme
The new places can't legally print "currency".

What is funny about the article is how they don't mention how people pay. I know of a group of stores that give charities a deal they pay (I believe) 95₵ to the $, however they pay by check so there is no credit card fee. These charities then sell them @ face value to raise some $.


The Bank of England uses the term "alternative currency", but points out that they are not legal tender.

I think people pay $95 in cash to buy $100 in local currency. As I understand it the stores cannot return the vouchers for real cash, so they have to give them in change to people willing to accept them. I assume that they will redeem worn vouchers.

Since part of the incentive is the $95/$100 exchange the stores may not be able to give enough of them in change without offering their own incentives (possibly an inexpensive freebie). I don't know if eventually the stores will build up a stock of vouchers they can't get rid of.
March 24th, 2013 at 10:01:24 AM permalink
Fleastiff
Member since: Oct 27, 2012
Threads: 50
Posts: 5124
If all over the world even street vendors can display and sell Genuine Counterfeit merchandise ... why can't I make and sell Genuine Counterfeit Bitcoins?
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