Quote from: Ghepetto on February 02, 2015, 05:58:06 PM

Quote from: bitteeinbit on February 02, 2015, 02:49:53 AM

I have to admit that I'm sceptical about Bitcoin. I'll give you my reasons, then please convince me!

Bitcoin is not backed by anything. It would probably not exist in a free market. Money in a free market has always been some kind of commodity. Something that has value beyond its use as a currency. The problem with Bitcoin is that it has no value beyond its use as a currency. Why should it then be regarded as money? Money came into being as a medium of exchange, so that if you got stuck with it it was useful in some way. It wasn't just a piece of paper. It was something that was useful in and of itself. Like gold. Like silver. Bitcoin has none of that. It's just a string of 0s and 1s. Where does it get its value from? I don't think in a free market it would be valued.

Something like Bitcoin could be used as a currency if it was backed by some commodity to do anonymous/quick transactions, but there would be a standard, ultimately, for exchange. It would always be exchangeable into e.g. gold. So that the banks who issued the Bitcoins were contractually obligated to redeem them into gold. Then Bitcoin would serve as a currency, but the money would be the gold.

There's also the problem with Bitcoin of inflation. Yes, there's a fixed amount of Bitcoins qua Bitcoin, but anyone can create alternative cryptocurrencies. I don't see why Bitcoin has any unique features that cannot be replicated by others, and therefore you will create massive inflation in a digital coin space.

So why do I think Bitcoin is still valued today? I think it is because people are fearful of the dollar. They think it's gonna get useless, and they're looking for alternatives. Bitcoin is a product of this fear. Also, I think people are worrying about their privacy. And with good reason, given the growing government intrusion in our lives. People are looking for ways in which to remain private. In which to remain outside the government's abitily to monitor them. Bitcoin provides that. So right now it's providing a value. The value as privacy. The value that it's not paper money. But in a fre market, which we are all working to realize, I do not believe Bitcoin would exist.

You should buy Bitcoin because if humanity decides to rise above the state it is in now, blockchain technology will be one of the tools used to get it there.

This, decentralization is the future, anything else is death.