What is Bitcoin for?

JohnD

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Its purpose is to provide a currency that can be moved digitally without the need for banks, clearing, payment services etc.

and is there a problem to which that is the solution?
 
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JohnD

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Salt was and still is a currency. It’s where we get the term 'salary' from.
if it had been true that roman soldiers were given an allowance of salt on payday, it would more accurately be called a "ration" rather than a currency.

One of the striking features of the bureaucratic Roman Empire was that they used written records and orders which still exist in great number.

that's how we know that the Christian myth of a Roman Census requiring Joseph and Mary to travel to Bethlehem is untrue.
(it is in fact reworking of an old Jewish myth, to provide credentials for Jesus, like the one that a Messiah would have King David as an ancestor)
 

JohnD

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what is that problem, and how did it impact you?
 
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There are many things in this world that solve problems or provide opportunities for people other than you or I. For Example I have no need for sanitry towels, but I would not be so daft as to say they are pointless.
 
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JohnD

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what is the problem to which bitcoin is the solution?
 
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have you hear the term "a dead cat bounce?"
Yes and the same can happen with normal currencies but they are generally more stable and more likely to fall in value and have problems gaining when they have. It's not supply and demand with these it's more "desirability" but relative value is still set by trading.

Actually that factor with conventional money may cause people to buy bitcoins. So the current world situation may cause people to buy and that will increase value. What has happened in practice is people have come to see them as a method of making money. The buying and selling causes price fluctuations. People may make or may loose. The fact that you see it as stupid doesn't matter really. It's just a more risky way of making money. If people continue trading the value will fluctuate. If they don't .......

The correct name for them is cryptocurrency anyway. Bitcoin is one of many. Some turn out to be fraud some just disappear.

Data mining creates the currency but on bitcoin for instance that gets harder and harder to do. A data miner gets free bitcoins but they will have costed something to get them. Say they sell them for £1 each. Trading might cause them to reach £10 so that buyer sells them if they want and get the buyers money less bank currency conversion costs. On the other hand they might turn out to be worth 1p each. Tough. This is why I suspect they will never become a true currency but the same could happen with conventional currency. I have never really been sure about what tends to regulate that with these since they went fiat. I assume it's the money market and maybe gov's foreign currency reserves figure in it as well. Some currencies do suddenly drop in value from time to time anyway.
 
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what is the problem to which bitcoin is the solution?
To divorce people from their local currency. It's as simple as that. Plus any other normal currency as well actually.
 

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can you reword that to show the problem you have in mind?
 
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can you reword that to show the problem you have in mind?
If you thought about why some people in some country or the other might want to do that I wouldn't need to. If you can't - tough.
 
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A Lives in Sri Lanka, B lives in Rwanda. They know each other. A would like to employ B to assist with the writing and testing of some software. A would like to wire B the payment upon completion of the service.

A goes to the bank to deposit Sri Lankan Rupees, in to Bs account. B must find a bank willing to accept foreign currency and then convert the rupees in to francs. The bank charges a fee, the bank also charges a fee for FX. A and B would like to do this regularly such that B gets a share of when the software is sold. This software gets sold quit a bit. A&B have a great business, but they realise its a 3-some as the banks get a slice of the action.

A decides to use a digital currency. B does the work, A pays... A can automate the payment for the future royalty. A & B are happy, the banks less so.
 
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I think it's a nice brave new world idea that has flaws. I can't see how it can stabilise as normal currency seems to do as the main aim seems to be money making. Tying to the USD sounds great but defeats one of the aims. LOL Tying to gold trading prices might prove interesting.

The appeal really comes down to citizens not really having any control on their countries currency value. I believe some countries have made crypto illegal. The senate has certainly discussed it related to petrodollars. I don't think that currently there is any concern but what would happen if some method was found of making it work?

There are no charges for crypto transactions. They can only occur when conversion to normal money is part of the transaction. So in the brave new world people would all be paid in crypto and spend in it as well. If some one buys into that with currency it has to go out somewhere in the same or a different currency. That can only happen if the crypto is sold.
 
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but that can already be done.

what problem does bitcoin solve?
It doesn't solve a particular problem. It's a money manufacturing scheme that allows financial transactions to be undertaken without an individual country's oversight.

The financial transactions bit can already be done, but its made a load of money for people that 'mined' bitcoins at the right time.

Does owning shares in a company solve a problem?
 
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