Bitcoin

cbphoto

Gold Member
I think it can be used to hedge against inflation and fiat currency. I also think it can be hacked. After all, it’s merely a string of binary digits in a bank of transistors (i.e., memory), and if Stuxnet did what it did, then it seems hackable.

Has anyone here bought anything with Bitcoin or other digital currency?
 

MrInsanePolack

Platinum Member
I dont understand the legality of it. The citizenry is not allowed to create our own currency. How did this even get off the ground? And what is preventing me from creating my own cryptocurrency (aside from lack of computer know how)?
 

PorkPieGuy

Platinum Member
I saw a Bitcoin ATM in Atlanta last year. Crazy.

I don't like the connotations of Bitcoin. I feel that its primary purpose is to pay for things which aren't terribly legal.

I've never used it, but I did use Paypal that one time.
 

cbphoto

Gold Member
I dont understand the legality of it. The citizenry is not allowed to create our own currency. How did this even get off the ground? And what is preventing me from creating my own cryptocurrency (aside from lack of computer know how)?
It's just another currency, like the Peso or Euro. It is not the construct of a government, but of supposedly one man, Satoshi Nakamoto, who remains anonymous (or is fictitious). People use it because it is anonymous. It's value varies from minute-to-minute and day-to-day as people use it and exchange it for their own country's currency.

If you were to buy some Bitcoin, use it to make something and then sell it for a profit, the IRS expects you to pay taxes on your profits. The US Treasury was forced to recognize it as a mode of currency when millions began using it around the world. When you convert Bitcoin to dollar, the tax man expects his cut.

As we enter into a time of high inflation, I was wondering if anyone here is using it to hedge their dollar holdings.
 

larryace

"Uncle Larry"
I don't know a whole lot about crypto currency. I do understand that the blockchain is a truly innovative self regulating concept. I don't see how it can be hacked because each transaction has to be verified by many other unconnected transactions to be legitimate. It self-checks. Has it been hacked yet? IDK. If not, that says a lot.

I don't see how it's legal either. It's the Wild West. I can't believe the banks are allowing it.

I am glad there's an alternative to the bank/slave arrangement.

But like I said, I don't know a lot about crypto. Maybe it's more of the same, (bank/slave) but it doesn't seem like it.
Monetary decentralization...on the surface, sounds like a good idea. That last sentence could be naive of me for sure.
 
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someguy01

Well-known member
China doesn't accept it as currency, so it's still questionable in the global marketplace. Contrary to popular belief, crypto transactions can be traced.
China won't accept it as they see it as a means to corruption and illegal activities. Wonder where they got that idea. :unsure:
 

cbphoto

Gold Member
Can I pay my taxes in Bitcoin??
Not yet, but if you had all your money held in the form of Bitcoin and had to pay taxes, you would simply convert the currency to the dollar, like any other.

China doesn't accept it as currency
But they hold the most Bitcoin in the world, more than any other country or individual.

Most Bitcoin mining occurred in China, according to IP addresses from so-called hashers that used certain Bitcoin mining pools in 2021. Likely this is connected to energy prices worldwide: Electricity costs in Germany were over 10 times more expensive than in China. Bitcoin requires energy for hashing, or the PC processing power needed to build the blockchain. Simply put, the more hashing occurs, the more Bitcoin is being mined. These figures attempt to show where most of this hashing - and, consequently, Bitcoin mining - occurs. Note that mining figures are different from figures on Bitcoin trading: Africa and Latin America were more interested in buying and selling BTC than some of the world's developed economies.How much Bitcoin is mined in every country per day?

Due to the cryptocurrency’s design focus on privacy, there is no indicator of how many new coins are created from which location – hence why the figures provided here look at PC processing power, and not Bitcoin themselves. There are figures for the current and maximum supply of Bitcoin, but these do not include the location where the currency was mined. The closest figure would be to look at the hashrate from so-called mining pools – places where miners can dig for Bitcoin – and how much they hashed in the last 24 hours.

In 2021, the world's top Bitcoin mining pools all came from China, with five pools being responsible for over half of the cryptocurrency's total hash. Can Bitcoin mining be profitable?Bitcoin mining could lead to profits for some, but there are several things to consider. Mainly, the maximum supply of Bitcoin is getting closer, so the algorithm requires more and more processing power. This is reflected in the steady growth of BTC mining difficulty – a metric that looks at how much effort miners are putting in to get a Bitcoin. Indeed, mining firms bought so much hardware capable of mining that prices of these mining rigs grew by roughly 10 percent each week in 2021 as supplies worldwide had sold out.


And because I was such a lousy computer programmer (in the 1970s) I firmly believe at least one digital currency will be hacked. After all, it's only a string of binary digits (just like the "dollar" in your bank account).
 

someguy01

Well-known member
Not yet, but if you had all your money held in the form of Bitcoin and had to pay taxes, you would simply convert the currency to the dollar, like any other.


But they hold the most Bitcoin in the world, more than any other country or individual.

Most Bitcoin mining occurred in China, according to IP addresses from so-called hashers that used certain Bitcoin mining pools in 2021. Likely this is connected to energy prices worldwide: Electricity costs in Germany were over 10 times more expensive than in China. Bitcoin requires energy for hashing, or the PC processing power needed to build the blockchain. Simply put, the more hashing occurs, the more Bitcoin is being mined. These figures attempt to show where most of this hashing - and, consequently, Bitcoin mining - occurs. Note that mining figures are different from figures on Bitcoin trading: Africa and Latin America were more interested in buying and selling BTC than some of the world's developed economies.How much Bitcoin is mined in every country per day?

Due to the cryptocurrency’s design focus on privacy, there is no indicator of how many new coins are created from which location – hence why the figures provided here look at PC processing power, and not Bitcoin themselves. There are figures for the current and maximum supply of Bitcoin, but these do not include the location where the currency was mined. The closest figure would be to look at the hashrate from so-called mining pools – places where miners can dig for Bitcoin – and how much they hashed in the last 24 hours.

In 2021, the world's top Bitcoin mining pools all came from China, with five pools being responsible for over half of the cryptocurrency's total hash. Can Bitcoin mining be profitable?Bitcoin mining could lead to profits for some, but there are several things to consider. Mainly, the maximum supply of Bitcoin is getting closer, so the algorithm requires more and more processing power. This is reflected in the steady growth of BTC mining difficulty – a metric that looks at how much effort miners are putting in to get a Bitcoin. Indeed, mining firms bought so much hardware capable of mining that prices of these mining rigs grew by roughly 10 percent each week in 2021 as supplies worldwide had sold out.


And because I was such a lousy computer programmer (in the 1970s) I firmly believe at least one digital currency will be hacked. After all, it's only a string of binary digits (just like the "dollar" in your bank account).
This is part of the reason they 1) don't accept it as currency 2) are having the power supply issues they're currently facing 3) put a stop to the mining.
Xi wants control like Mao and he's doing everything he can to assert his unquestionable authority.
They're super serious about stopping corruption and Xi sees crypto as the main mechanism for corruption of party officials.
 

AzHeat

Platinum Member
I’ve lost many coworkers to Bitcoin. They start dabbling in it and they are gone. Mentally is what I mean. They get so wrapped up in it they never do any work and eventually fired!

It’s adored by criminals on the dark web, they claimed governments couldn’t control it, but China and S. Korea block it. Our own congress was voting on controlling it. Now they tax it. How is it untraceable and taxed at the same time? They said it couldn’t be hacked, but someone made off with a bunch of it a while back making quite a stir.
I don’t understand where it comes from and don’t like that panic changes it’s value. Seems based on nothing, from nothing, but worth more than gold. They say it can’t be stopped or blocked, but the internet is fragile and can be shutdown. Happens with rogue governments all the time.

Gold and Silver are touted as the best hedge against inflation, but value is still determined by investors and panic greatly impacts its value. You need the real stuff and not paper notes and selling generally involves high commissions. Also, tough to turn into cash if things aren’t “normal” whatever that is. At least physical coins can be traded, but what sets the value then?

I hate that our dollar is losing value by reckless spending, continued printing and free handouts, but that’s part of the destruction plan and working quite well.

Don’t know. There doesn’t appear to be any good answers at this point. At least playing drums isn’t illegal or controversial…..yet!
 

s1212z

Well-known member
The market value of crypto is still extremely very small, only ~$2 trillion for worldwide usage…compare with just Google’s market cap, ~$1.5 trillion, more than Bitcoin itself (~$1 trillion). We are seeing Africa with heavy interest in cryptos…probably because their currencies have very little value. A country like Zimbabwe had horrible hyper inflation (%500) a few years ago and made it illegal to own dollars. So if you can get an international market in developing countries a fighting chance with a storage of wealth…just need a smart phone. Be fortunate if you live in a 1st world nation that magically creates wealth without real inflation concerns while keeping a currency quoted directly to oil. And we wonder why there are immigration issues worldwide with manipulated currency inbalances.

To compare value, the US ‘created’ $3 trillion just in covid relief alone…out of thin air, with nothing to back other than the largest military on earth. Currency markets haven’t run freely, probably since before WW1. We couldn’t leave the world to chance in a free market in a nuclear age so US became a policing nation…civilization required much higher money velocity too, so we and world turned into a ‘Creditopia’. But these manipulations created extreme in-balances both societal and international relations and cements places of power and class warfare, so it’s not surprising at all that something like crypto happened, seems like a pretty natural evolution to civilization looking for homeostasis. Ain’t no way we are going back to gold standard straight from fiat, way too deflationary in both concept and practical application in a globalized market.

For environmental crypto concerns, the manipulated dollar-yuan relationship has probably contributed to more environment dangers, deaths and long term dismal future more than anything else I can think of. Pollution contributes to 7 million deaths per year…which is the about the same as covid deaths if consider approx. under-reported deaths. And the environment continues to…well, you know.

Blockchain technology is here to stay and has evolved quite a bit since the silk road underworld...much like the internet has gone beyond porn. I think the security concerns would the entities that surround it rather than the blockchain itself...but technology moves quick too. Other cryptos have evolved since Bitcoin initial offerings.
 

MrInsanePolack

Platinum Member
To compare value, the US ‘created’ $3 trillion just in covid relief alone…out of thin air, with nothing to back other than the largest military on earth.
Why then is our currency not the most valuable? I'm not being snarky here. If military might defends the dollar value, and we have the most technologically advanced (so we're told) military, wouldnt that put our dollar at the top of the heap because we can forcefully back it up?

Interesting idea if nothing else.
 

Doraemon

Well-known member
I don't know a whole lot about crypto currency. I do understand that the blockchain is a truly innovative self regulating concept. I don't see how it can be hacked because each transaction has to be verified by many other unconnected transactions to be legitimate. It self-checks. Has it been hacked yet? IDK. If not, that says a lot.

I don't see how it's legal either. It's the Wild West. I can't believe the banks are allowing it.

I am glad there's an alternative to the bank/slave arrangement.

But like I said, I don't know a lot about crypto. Maybe it's more of the same, (bank/slave) but it doesn't seem like it.
Monetary decentralization...on the surface, sounds like a good idea. That last sentence could be naive of me for sure.
I agree, to me it seems more safe (technically). Also it's really not the that anonymous or free any more. You can't even buy much from an ATM, it needs your cell number and name and above a certain limit, will ask for your id. Converting it back to fiat is also nearly impossible without leaving a trail. Many exchanges have to follow state regulations or can't operate, and they will ask for your id/passport and even your photo to let you convert real money and will report it to the IRS. Maybe sophisticated cyber criminals can still find ways to play the system, but I think those days are long gone when you could just buy some and get rich tax free. It is very volatile and not for the faint of heart, but I think the technology's gonna stay.
 
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cbphoto

Gold Member
I agree, to me it seems more safe (technically).
Agreed. Especially since the total number of bitcoins in the ether is fixed (but no one knows the exact quantity).

But I don't trust anything in the digital realm as "perfectly secure".
 

s1212z

Well-known member
Why then is our currency not the most valuable? I'm not being snarky here. If military might defends the dollar value, and we have the most technologically advanced (so we're told) military, wouldnt that put our dollar at the top of the heap because we can forcefully back it up?

Interesting idea if nothing else.

I don't believe that would not be in our interest. If a currency is overly strong, it is highly deflationary and given the creditopia world of debt we created, there are already plenty of deflationary pressures already...plus a stronger currency makes debt stronger as well. It's really valued just to keep the world turning for another day IMO. If you look at the treasury yields on the bond market, it has no where to go but I'm sure we'll put on a good show of inflation concerns to look like a free market. Inflation is also tied to money velocity as well. But the dollar it is already manipulated pretty favorably, just mathematically in this fiat system it should be worth nothing.
 

Stroman

Platinum Member
I believe "currency" is a misnomer. Bitcoin bears a greater similarity to a commodity than a currency. It's an investment that must be converted to currency to be used. As such, it is risky, especially since it fluctuates much more widely than other common commodities like gold and silver. Still, it may be a way to hedge against inflation, IF it is up when you need it to be up.
 

Nictarine

Silver Member
I don't really understand cryptocurrency, when my little brother passed away he had $1000 in Ethereum that I got and I dropped another $150 ish on other coins and now it's "worth" $2200. I've seen my account fluctuate from as low as $987 up to $2500 in "value". I don't see it as a real currency if the fluctuation of value is that high, I also don't want to invest in something as flimsy unless I just have money to burn!
 

Icetech

Gold Member
I think it can be used to hedge against inflation and fiat currency. I also think it can be hacked. After all, it’s merely a string of binary digits in a bank of transistors (i.e., memory), and if Stuxnet did what it did, then it seems hackable.

Has anyone here bought anything with Bitcoin or other digital currency?

I have used crypto a lot, mainly to buy things i can't mention here (one of the mods gets really cranky over silly things) never had any issues.. i usually use litecoin but own a few others..
 
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