KING OF FUD! DISCLAIMER: I own .05 bitcoins.


  1. David Wendt
    January 24, 2013 @ 11:32 am

    ITT: Idiots that don’t know how math, computer science, economics, disaster recovery, business continuity, sociology, hyperinflation, pillow talk, Ponzi schemes, electrical engineering, prostitution, holiday ceremonies, investment, stock markets, game consoles, entrepreneurship, faith, religion, bank deposits, guns, or Bitcoin works, telling the world that Bitcoin is the future of all economic transactions ever.

    It’s sad too. I kinda like the idea of anonymous electronic commerce, and Bitcoin does have some good functionality, but the idiots running the community are going to ensure that anybody that knows how anything works will stay as far away from the libertarian shithole that Bitcoin has become.


    • ithinkerer
      January 25, 2013 @ 8:55 am

      “Bitcoin does have some good functionality”
      — Exactly what might that good functionality be? It looks like the author of this website will disagree with you, it’s all just butt money to him. So why do you think it’s good?


      • David Wendt
        January 25, 2013 @ 1:33 pm

        The way that electronic commerce works means that a small number of extremely powerful intermediary banking corporations control the world’s payment systems. There’s no requirement that these payment intermediaries treat merchants neutrally, and they don’t – leading to absolutely stupid situations where I can use a credit card to donate to the KKK but not to Wikileaks.

        Or in other terms, there’s no real equivalent to cash on the Internet. There’s things that come close, like PayPal, but they have their own problems, like having the worst policies on the planet. At one point I thought Bitcoin could fill this role, but I realized it can’t, because everyone wants it to be “ultimate unprintable Ron Paul Fun Bux”. Or, well, “butt money”.

        For the record, I don’t see Bitcoin ever gaining popularity again. The main problem is that Bitcoin is a separate currency. Most people who are going to be buying or selling with Bitcoins are still going to be doing 99% of their transactions in local currencies, which means Bitcoins are only as valuable as the currency exchanges will buy them for. Someone who sells, say, hosting services in exchange for Bitcoins is going to be hard pressed to find someone willing to sell them server hardware for Bitcoins, an ISP willing to let them buy transit for Bitcoins, or support staff willing to work for them in exchange for Bitcoins.

        In fact, the labor issue is a particular sticking point. If someone tried to pay workers in Bitcoins, they would likely fall foul of anti-scrip laws. 150 years ago it was common practice for certain industries to pay their poorest workers in currency only redeemable in company-owned stores which intentionally priced goods at extreme markups with the intent of keeping workers impoverished. This practice was known as “scrip”, and it’s illegal in a large number of countries because it’s the most literal form of “wage slavery”.

        All of this is scratching the surface of the issue, which is a fundamental misunderstanding of what currency and hyperinflation is. Often times in austrolibertarian circles, existing, institutionally backed currencies are described as “fiat” money, because it’s created by fiat. This is to somehow contrast it with the “gold standard”, which is “backed” and “can’t be printed”. The fundamental misconception is the idea that currencies are selected for their resistance to inflation; the faulty evidence given to support this is that gold used to be a widespread currency in pre-industrial times.

        Many historical empires did use gold as a form of currency. But this ignores the fact that gold itself is a fiat currency. Gold at that point in time was considered valuable because kings and emperors said it was. In fact, there are plenty of other precious metals which were at one point used as currency because political leaders said they were valuable. Ultimately gold became valuable by fiat, because all currencies are fiat currencies. Gold wasn’t used as money because it’s hard to print, it was used as money because people said it was money and merchants went along with this.

        Incidentally, yes, Bitcoin could conceivably become a currency if enough merchants decided to transact in Bitcoins. The problem with this is that Bitcoin would be inevitably pushed out by the dollar because two-currency zones are inherently unstable. Part of the idea of currencies as fiat is the idea that standardization provides economic benefits. An economy where the workers are paid in Bitcoins but have to buy services in USD means that exchange markets would be a complete mess, with every payday pushing Bitcoin prices skyward as employers hurriedly bought Bitcoins to pay their employees with, only to fall back down again as those Bitcoins were then hurriedly sold by their employees to buy USD again and continue the cycle anew. The only people who would make money would be the currency exchangers, adding a deadweight loss to the economy by taking their spread each payday. The economy would eventually abandon either Bitcoin or USD because doing so would be more optimal. But they would likely abandon Bitcoin. USD has the fiat of the largest military power on the planet behind it, Bitcoin has a bunch of idiots with overheating video cards.

        And in fact, that’s exactly what’s happened to the Bitcoin economy, albeit on a smaller scale. You simply can’t promote a traditional capitalist currency without being a government with guns on your side and a claim to power. (More exotic Mutualist-style labor dollar schemes are different, but the proponents of Bitcoin are the last kind of people to touch something so left-wing.)


        • ithinkerer
          January 31, 2013 @ 9:35 am

          It’s true that for now the majority of people still operate with local currencies, but that’s why you have payment processors like BitPay. They take care of the Bitcoin -> Local Currency problem quite efficiently and for a low cost. Even with BitPay, the merit of using Bitcoin is not lost: you can still pay anybody that accepts Bitcoin (even Wikileaks), transfer the money anywhere in the world in less than 1 hour, no chargebacks, etc. As more and more companies start using Bitcoin, e.g. WordPress, then converting Bitcoin to local currency will become less frequent.

          Scrip-laws are completely irrelevant here. Correct, the companies paid workers in currency only redeemable in company-owned stores, but Bitcoin is redeemable at any exchange and it can easily be converted for a fair dollar price. If the only qualification for scrip money is where you can spend it, then gold should be considered scrip money because nobody really accepts gold as a form of payment these days. Obviously there are other factors which are considered, not just where you can spend it but can you fairly/easily exchange it.

          If we have an economy where workers are paid in Bitcoins, then Bitcoin has become so popular that every employer is paying in them… if every employer is paying in them, then it seems pretty obvious that the employers are getting paid in Bitcoin too. So where is the dollar involved when the employers are accepting Bitcoin as a form of payment and the employees are getting paid in Bitcoin? Therefore, we hardly need to address the question of recurring exchange transactions: firstly, because they wouldn’t be necessary and secondly, because recurring transactions have been happening for a long time and people have already figured out how to avoid the price spikes.

          “USD has the fiat of the largest military power on the planet behind it, Bitcoin has a bunch of idiots with overheating video cards.”
          — I’d love to see how the largest military power would use their guns against a bunch of idiots with overheating video cards. What are they going to do, send the military to kill every person whose video card is overheating? The implications of of government action to push out Bitcoin are just too damaging to society, it would have such drastic impact that it would amount to self-destruction of the government. It’s even worse than trying to stop torrents or ask Wikipedia, Google, Youtube, etc to police all of the content (you saw how well that worked out when those websites got together and asked every visitor to call their local representative).

          “You simply can’t promote a traditional capitalist currency without being a government with guns on your side and a claim to power.”
          — We’ll see how it all turns out I guess… I just don’t think that a prosperous government can effectively exist when it’s using its guns to stifle freedom.


        • seahen
          May 2, 2014 @ 3:41 pm

          Not all currencies are fiat currencies. I think I saw in a documentary once that ancient Japan had used rice as a currency, with granaries acting as central banks. And how much could you buy in prison with cigarettes if none of the inmates smoked?


  2. Fluxity
    January 24, 2013 @ 11:59 am

    Those comments…


  3. A List Of What Bitcoiners Actually Believe
    January 24, 2013 @ 4:53 pm

    […] is a list of many of the quotes gathered by Buttcoin, which were gathered by Bitcointalk and […]


  4. Trogdorbad
    May 1, 2014 @ 8:50 am

    I can answer that last one: Not enough.


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