Quote from: RobCayman on May 23, 2011, 08:36:46 AM

Hi, i'm completely new to BitCoin and am completely baffled by the concept, I'm also not 100% sure I'm asking these questions in the right place, but i will ask, and hopefully be pointed in the right direction.

Welcome here! This is a perfectly good place to ask these kinds of questions.

Quote from: RobCayman on May 23, 2011, 08:36:46 AM

1. is the 21 million bitcoins equal in value to the sum of global resources (including both physical, and intellectual)?

Bitcoins vary in value according to supply and demand. But if you mean will 21 million bitcoins be enough for global-level trade, then the answer is almost certainly yes. As they currently stand bitcoins can be subdivided down to the eighth decimal place so that, as an example, even if the entire present-day U.S. economy ran solely on bitcoins, it would still be practical to buy small items with 0.00000001 btc. Long before bitcoins would ever run into this problem, however, they could be easily "upgraded" to allow even smaller denominations. So for all practical purposes bitcoins are infinitely divisible. But it's unlikely that bitcoins will ever be the only currency or means of exchange on the planet. Does this answer your question?

Quote from: RobCayman on May 23, 2011, 08:36:46 AM

2. according to what i've read, everything is transparent. Coupled with the fact that almost every country in the world considers it illegal not to pay tax on transactions, do i have any security from prosecution? or alternatively, why have governments not clamped down on bitcoins already?

Are you saying that you plan not to pay taxes on bitcoin transactions or income? Bitcoins are very much like cash: even if your transactions aren't centrally stored somewhere, you are still expected to pay taxes. Cash is used extensively to try and avoid taxes, so it's likely that bitcoins can be used for that as well. But in both cases you're going to have to explain to the IRS agent where the money came from to buy your new yacht. Trying to avoid taxes by using bitcoin is both illegal and ill-advised.

To answer your second question, governments have not clamped down on bitcoins already because they haven't needed to. If bitcoins start to be used to fund illegal activities, launder money, evade taxes, etc. then they will simply pursue the people who do these things as they would if these things were being done with cash, gold, or expensive art. It would be fairly impractical to shut down the BitCoin network itself, as it doesn't appear to be illegal in most countries, and has no central point where it could be blocked or turned off. Consider the example of another peer to peer technology: file-sharing. P2P file-sharing has enabled activities that some governments have considered harmful, and so both civil and criminal prosecution has been used against companies or individuals participating in them. But there's no way to shut down P2P file-sharing itself, and it would be ridiculous to make file-sharing technology illegal when it has so many legitimate uses. Similarly, unless BitCoin devolves into some sort of black market crime tool, it won't get shut down. But if people use it to break laws, you can be certain governments will prosecute them--both individuals and organisations.

Quote from: RobCayman on May 23, 2011, 08:36:46 AM

3. Am i correct in saying that BitCoin is essentially a global unified on-line autonomous resource tracking system?

Yes, if I understand you correctly.

Quote from: RobCayman on May 23, 2011, 08:36:46 AM

4. assuming that the answers to the previous questions are all positive, can BitCoins be extended to function globally as a complete replacement for the current credit based economic system?

In theory, yes. In reality, however, people tend to use different tools for different things so that they can take advantage of contrasting features. So it's highly likely that BitCoin will only ever be one of many tools for measuring and transferring value. Just like many people use cash, credit cards, and PayPal, there will probably be many different products that offer different features and services. It's conceivable that all of these could end up being built on BitCoin in a similar way to how many world currencies are based on the U.S. Dollar, but we're a long way off from that happening so that would be pure speculation.

Quote from: RobCayman on May 23, 2011, 08:36:46 AM

I hope that someone can either assist me or point me to someone who can

thanks

You're very welcome. I hope my answers were helpful--feel free to ask or explain more if you need to.