*

Offline SexWarrior

  • e
  • *
  • Posts: 5810
  • (◕‿◕✿)
    • View Profile
    • The Flat Earth Society
Re: Ask Rushy about Bitcoins.
« Reply #500 on: July 13, 2017, 07:09:41 PM »
If I want to make an anonymous purchase, how is Bitcoin better than cash in most cases?
I'll take a stab at this one, even though I'm not Rushy.

In order to pay for something in cash, you have to come in some sort of direct contact with the person you're paying. You're probably meeting up, or the payee is naming a location to mail/drop off the money. In a situation where neither the payee nor the payer want to be identified (say you're buying something dodgy from Silk Road), this can be an issue.

I realise you said "in most cases", but honestly it depends on how you define "anonymous" in the first place. If you only want to be anonymous from third parties, cash is probably fine*, but if you also want to be anonymous from the other party directly involved in a transaction, Bitcoin wins easily.

* - obviously banknotes can be marked, so if you use a banknote that someone previously gave you, you are kind-of-sort-of-maybe identifying yourself. Bitcoin can naturally also be tracked in a similar way, but you are not physically present to make the transaction, so it can only be corroborated with any other information that accompanies the transaction, rather than the transaction itself.
« Last Edit: July 13, 2017, 07:13:18 PM by SexWarrior »
<Parsifal> Jesus Christ
<Parsifal> Do I really have to write 6000-word sentences just to remove all ambiguity from everything I'm saying?

Where live, do the offer adult reading classes?

*

Offline Rushy

  • Planar Moderator
  • *****
  • Posts: 5782
  • Videmus Omnia
    • View Profile
Re: Ask Rushy about Bitcoins.
« Reply #501 on: July 14, 2017, 05:58:47 PM »
Because Bitcoin is made to limit itself to 21 million total coins, coin loss is greater than zero, and demand is increasing faster than coins are being produced, Bitcoin is pretty much doomed to be permanently deflationary. If I own Bitcoins, why would I be eager to spend them if I know that they pretty much constantly increase in value right now? What value does Bitcoin have if it's now being used as a currency because of this pressure to save them?

This seems like a strange sentiment. Why would I ever keep my savings in USD if I know it'll devalue over time? I think the easiest answer would be that USD is convenient (and required, if you're a US citizen, to pay taxes). You don't see me spending all of my USD because I know it will be worth less later, likewise, I haven't saved 100% of my Bitcoin simply by virtue of knowing that it will be worth more later.

The blockchain is ever growing in size. If Bitcoin is going to survive for decades, how do we address the issue of the blockchain size? If Bitcoin were suddenly the size of Visa, how would it manage transactions?

The rate of storage costs decreases far faster than the rate of blockchain storage increases. The Bitcoin Blockchain is still under two hundred gigabytes, which is nothing in terms of data storage in this day and age. Also, Bitcoin, as it currently exists, will never support Visa-level amounts of transactions. It simply isn't capable of doing so and the core developers don't seem intent on ever trying to change that.

If I want to make an anonymous purchase, how is Bitcoin better than cash in most cases?

Well first off I'd like to point out that Bitcoin is pseudo-anonymous, not anonymous. You can always view transactions between addresses, so if you find out Person A owns Address A, you can rather easily start tying together what their payment history is like. If you want to use a Bitcoin-like system that is fully anonymous, then I'd suggest using Zcash or Monero, both of which have obfuscated blockchain histories that make watching transactions difficult (or even impossible in many cases).

SexWarrior touched on a few issues with cash, but I think an important one is that carrying large volumes of cash across borders is illegal or requires declaration in most countries (where 'large volume' is usually defined as $10,000 or greater). You also avoid things like losing whatever is carrying your cash or having it stolen out of luggage. Bitcoin as a cash substitute is much more secure from theft, though it certainly isn't immune from being stolen.
« Last Edit: July 14, 2017, 06:00:20 PM by Rushy »

Re: Ask Rushy about Bitcoins.
« Reply #502 on: July 14, 2017, 08:41:35 PM »
This seems like a strange sentiment. Why would I ever keep my savings in USD if I know it'll devalue over time

Well, first off, US dollars are not nearly as volatile as Bitcoin is right now, so the effects of it's perpetual inflation are not very noticeable. However, the Federal Reserve still seems to think that inflation encourages consumers to spend.

You don't see me spending all of my USD because I know it will be worth less later, likewise, I haven't saved 100% of my Bitcoin simply by virtue of knowing that it will be worth more later.

Well I didn't say all of your Bitcoin. But I have encountered many people online who treat Bitcoins like an investment, hoping they'll increase in value. And for those that have Bitcoin but aren't really "investing," I'd still think that it's deflation would create incentive to save, not spend. What's to stop Bitcoin from entering a deflationary spiral? Is Bitcoin just betting on this not existing?

*

Offline Hollocron

  • *
  • Posts: 1573
  • The sloth of swag
    • View Profile
Re: Ask Rushy about Bitcoins.
« Reply #503 on: August 01, 2017, 08:08:14 AM »
I am now the proud owner of .05 bitcoin. Mostly to be used for exchanging into shitcoins for fun.

*

Online Rama Set

  • *
  • Posts: 3928
  • Round and round...
    • View Profile
Re: Ask Rushy about Bitcoins.
« Reply #504 on: August 01, 2017, 12:12:04 PM »
Slightly Tangential: Radiolab did a podcast on the creation of the Z-Coin cypher. Pretty interesting js
FE'ism requires suspension of disbelief...