Satoshi Nakamoto's dangly bits

[Lost Leopard Spot]

Hmmm. Not convinced at all, Spotty. In that diamonds and gold are tangible, physical, naturally occurring rarities, whereas this bitcoin appears to me to be something that somebody's decided exists.

Well Bruce, there are a number of things that actually exist in bitcoinage.
There is code, a blockchain, a bitcoin, and a nonce. The code is equivalent to a diamond market, the blockchain is similar to the ledgers in which merchants record their diamonds, the bitcoin is the currency exchange just like krugerrands or pounds, and the nonce os the equivalent of the actual diamond. There are differences of course, for example each nonce is the same 'size' whereas diamonds vary, but there are more similarities than differences, and as Prufrock pointed out, all currencies exist on the basis that those using it must believe it works, once that's in place it works like magic and not like science.
Science tells us diamonds a just a collection of carbon atoms, but diamond dealers use economic magic to assign a value to that collection of carbon atoms.

[Lost Leopard Spot]

Apparently Visa has just withdrawn its precharged cards from a number of bitcoin operators. Oh, hum.
My initial £550 is now worth £645. And that's just day's worth. Makes my pension provision, savings accounts, housing investment, and ISA interest look like crumbs, never mind peanuts...
However, I'm still sticking out for an entire year's worth.

[TANGODANCER]

Meanwhile, on the real money scene: I've been collecting the different 50p coins of the realm. So far I have 25 different and quite a few twicers. Big money market player me...

[Bruce Rioja]

Science tells us diamonds a just a collection of carbon atoms, but diamond dealers use economic magic to assign a value to that collection of carbon atoms.

And reality tells us that some are rarer than others - ergo, more sought after - more valuable.

[jimbo]

Meanwhile, on the real money scene: I've been collecting the different 50p coins of the realm. So far I have 25 different and quite a few twicers. Big money market player me...

I'll give you £12.50 for the lot!

[Bruce Rioja]

Meanwhile, on the real money scene: I've been collecting the different 50p coins of the realm. So far I have 25 different and quite a few twicers. Big money market player me...

I'll give you £12.50 for the lot!

Reminds me of an ad once in the Sunday Times Magazine. 'Diana Memorial £5.00 coin. £10.00 inc p&p'.

Struck me as being rather a poor deal

[TANGODANCER]

Meanwhile, on the real money scene: I've been collecting the different 50p coins of the realm. So far I have 25 different and quite a few twicers. Big money market player me...

I'll give you £12.50 for the lot!

Ha, worse thing that can happen is I can get my face value at any time. No risk money marketing....

[jimbo]

Meanwhile, on the real money scene: I've been collecting the different 50p coins of the realm. So far I have 25 different and quite a few twicers. Big money market player me...

I'll give you £12.50 for the lot!

Ha, worse thing that can happen is I can get my face value at any time. No risk money marketing....

Ah, on the contrary. They'll be losing their value year on year due to the joys of inflation!

[TANGODANCER]

Meanwhile, on the real money scene: I've been collecting the different 50p coins of the realm. So far I have 25 different and quite a few twicers. Big money market player me...

I'll give you £12.50 for the lot!

Ha, worse thing that can happen is I can get my face value at any time. No risk money marketing....

Ah, on the contrary. They'll be losing their value year on year due to the joys of inflation!

I'll double your "Ah" and say the whole point is collector items. Even totally ignoring the daft sums claimed, time will make scarce items even scarcer still, and all at very cheap cost if you work at it...

[Lost Leopard Spot]

Meanwhile, on the real money scene: I've been collecting the different 50p coins of the realm. So far I have 25 different and quite a few twicers. Big money market player me...

I'll give you £12.50 for the lot!

Ha, worse thing that can happen is I can get my face value at any time. No risk money marketing....

Ah, on the contrary. They'll be losing their value year on year due to the joys of inflation!

I'll double your "Ah" and say the whole point is collector items. Even totally ignoring the daft sums claimed, time will make scarce items even scarcer still, and all at very cheap cost if you work at it...

And you are correct. But you usually have to work at it.

[Beefheart]

"Someone that somebody has decided exists" is a pretty spot on description of fiat currency and many of the fundamentals of a modern economy. That bit of paper in your wallet that says "£20" on us absolutely no value unless we all decide it does. Bitcoin itself is clearly a massive bubble, but it seems inevitable to me that some sort of cryptocurrency that can be used to buy and sell widely is going to come about. That the person buying it knows he'll be able to spend it is where is value comes from, like all currency.

Yeah but currency sprang up independently in lots of places because it serves a purpose. Primarily as a store of value as a means of exchange. It's value fluctuates based on things like interest rates or confidence in the performance of an economy. I don't really understand bitcoin, but it seems like it's increasing value is based on people's belief that it's going to go up in value and not much else. Certainly smells like a bubble, not least because it's got people who wouldn't otherwise invest involved, but I don't know how far the impact of it bursting would be.

[Lost Leopard Spot]

"Someone that somebody has decided exists" is a pretty spot on description of fiat currency and many of the fundamentals of a modern economy. That bit of paper in your wallet that says "£20" on us absolutely no value unless we all decide it does. Bitcoin itself is clearly a massive bubble, but it seems inevitable to me that some sort of cryptocurrency that can be used to buy and sell widely is going to come about. That the person buying it knows he'll be able to spend it is where is value comes from, like all currency.

Yeah but currency sprang up independently in lots of places because it serves a purpose. Primarily as a store of value as a means of exchange. It's value fluctuates based on things like interest rates or confidence in the performance of an economy. I don't really understand bitcoin, but it seems like it's increasing value is based on people's belief that it's going to go up in value and not much else. Certainly smells like a bubble, not least because it's got people who wouldn't otherwise invest involved, but I don't know how far the impact of it bursting would be.

It's increasing value is due to the reason you pointed out (belief) plus its increasing rarity - it is designed to get harder to mine. And while there are still people out there willing to 'pan' for bitcoin, then, similar to goldrushes, there will be coattail hangers on trading, exchanging, hoarding, and speculating.
And just like gold or tulips it's only worth what people will 'pay' for it. But while there are still 'free' bitcoins to be had, people will still try to find them, and therefore when the bubble bursts it will probably be more like the Californian model than the Alaskan one, and not at all akin to the Amsterdam one. (Or at least that's what I'm gambling on).

[Abdoulaye's Twin]

I just want Donald to keep his gob shut, as recently every time he has opened it, the Dollar has gone down and reduced my blighty kitty

[Lost Leopard Spot]

I just want Donald to keep his gob shut, as recently every time he has opened it, the Dollar has gone down and reduced my blighty kitty

Why've you got your stash in Dollars when you could have dirhams?

[Abdoulaye's Twin]

I just want Donald to keep his gob shut, as recently every time he has opened it, the Dollar has gone down and reduced my blighty kitty

Why've you got your stash in Dollars when you could have dirhams?

Dirhams are pegged to the Dollar I need Ronald to shut up and Boris to really deck up over the next few months...

[TANGODANCER]

I just want Donald to keep his gob shut, as recently every time he has opened it, the Dollar has gone down and reduced my blighty kitty

Why've you got your stash in Dollars when you could have dirhams?

They're dealing in Judiths' now?

[Lost Leopard Spot]

I just want Donald to keep his gob shut, as recently every time he has opened it, the Dollar has gone down and reduced my blighty kitty

Why've you got your stash in Dollars when you could have dirhams?

They're dealing in Judiths' now?

Whoosh. (I'm going to have to look this up, aren't I?).

[Lost Leopard Spot]

I just want Donald to keep his gob shut, as recently every time he has opened it, the Dollar has gone down and reduced my blighty kitty

Why've you got your stash in Dollars when you could have dirhams?

They're dealing in Judiths' now?

Whoosh. (I'm going to have to look this up, aren't I?).

OK..did a quick google. FFS, Tango, we're talking 1963!

[Montreal Wanderer]

I just want Donald to keep his gob shut, as recently every time he has opened it, the Dollar has gone down and reduced my blighty kitty

Why've you got your stash in Dollars when you could have dirhams?

They're dealing in Judiths' now?

Whoosh. (I'm going to have to look this up, aren't I?).

OK..did a quick google. FFS, Tango, we're talking 1963!

Seek 'er and ye shall find... Oh never mind.

[Lost Leopard Spot]

Well well... Who'd athunk it. Less than a month after my initial investment of £550 had hit less than £210, it is now resurgent once more. OK, it's current value of ~£420 is not exactly setting the world on fire, watch this space. Eleven months to go and I'm re-feeling a positive outcome.
(PS still have no idea of how to actually convert my bitcoinage back into Actual Currency, as in dosh...)