Bitcoin

Who wants to learn about Bitcoin and how to invest. I will help you step by step so you can start.Email me [email protected] or txt me (202)903-6336. Leo

Posted via the PriusChat mobile app.

 

Lots of sites/people are willing to help me buy bitcoin. What I need to actually do that is to feel comfortable with the infrastructure that I access. And all I've got so far is "there be dragons" issues.

 

when you mine the underground, expect pitfalls.

 

Unlike most bitcoin purchasers, I'm interested in it as a currency. The advantage of using something like bitcoin is that the maximum exposure is the amount of the purchase. Use a credit card and you're open to charges that you never agreed to. My wife used a bank debit card to get some cash at a bank in Italy. Someone then used the debit card info to clean out our checking account. The bank covered the fraud, but it was a real hassle.

Right now it looks like bitcoin is just a ponzi scheme. Everyone wants to sell their bitcoin to cash in. If it were as good an investment as we're told, people should be holding it.

 

But people are. There is a lot of trade volume, but there is also a lot of people holding.

Unlike the tulip bubble that people keep comparing it to, these aren't future bitcoins of unknown type like tulips. You get exactly what you buy and its immediate. Due to the granularity of bitcoin and maximum number, I see it topping out around $1m to $5m a coin a loooooooong time from now. And then it stays there.

 

Forget the tulip bubble, what about the Dot Com bubble more recently?

 

I don't think you can equate bitcoin to stocks. Anyone who tries, fails. It is definitely a commodity (like tulips). The stock bubble is again betting on the unreal value of the future performance of a company. A stock itself is worthless and must be converted to a currency so there's the bubble and crash.

Bitcoin is a currency. No conversion necessary. When you buy a coin you are just trading one currency for another, like going to the currency exchange. It may go down or up compared to some other random currency like the USD, but it is still a currency in its own right. The problem then becomes things like inflation. Which can definitely happen, but having a limited supply that can never be increased helps prevent Zimbabwe levels of inflation.

 

ponzi scheme, see @#10

 

Cost to purchase mining equipment doesn't equate to value of object mined. Remember why it is called mining.

If I go down to Home Depot and buy a shovel for $20, then start digging about 10 miles away from here where there are still smallish gold nuggets from wasteful 1800's gold mining, when I find $10k in gold, it is not worth the $20 shovel. It is worth $10k.

The mining hardware has actually gone way up in price because you can only purchase some of them with cryptocurrencies. My Antminer S9's and S7's basically cost $1K each and require a 10A 220VAC circuit each. The S7's now only mine about $250USD a month, but the S9's are still in the $1K range. At the time of purchase it was much less. And of course mining hardware, like a shovel, has no value related to what is being mined, but has value in its own right.

My ETH mining rigs are much more general purpose because they use consumer grade video graphics cards. Just 12+ of them connected a single server. If ETH goes away, I still have actual hardware that can be sold to PC gamers and I can always use spare servers. But Nvidia doesn't accept cryptocurrency right now. So I pay in USD to get hardware which I put to work to collect a commodity that I could then sell on an open exchange to someone else for other currencies like BTC, ETH, LTC, or USD, YEN, GBP, etc.

 

when the buyers run dry, the holders will cry.

 

Same thing can be said for a typical fiat currency.

For example, I travel the world all the time. In my daily wallet I carry US dollars, Canadian dollars, Euros, and Mexican Pesos. If I go down to the local Walmart, they won't accept anything other than USD. My non-USD currency is completely worthless inside the US. Unless I go to a specialized buyer, like a big bank or currency exchange where they will buy below market rate and charge transaction fees into the local currency which is essentially a devaluing of the other currency. And that's if they will even take it. My local bank won't even take some currencies. I came back from Mauritius with Mauritian Rupees and they didn't even know Mauritius was a country. I say rupee, they say "India". No, no, no. Mauritian rupees... Another currency that has zero value, and I can't even exchange it into local currency anywhere near me. I would have to travel elsewhere to exchange. I see that as no different.

If people don't accept your currency, then its value is zero at that time at place. And when I go to India for example the USD is worthless. Nobody wants that crap, good luck getting anyone to take it.

If the exchanges decide that the bitcoin to USD rate is $10 per BTC than so be it. But I still have BTC. I can trade my BTC to others for goods and services. That's what gives it a value. And like any currency, even the USD, it is all about trust and acceptability.

 

trust, @#7.

 

We considered this when we went to Iran in April. US sanctions mean you can't use credit cards* (unless you're buying something from a shopkeeper who has a "cousin" in Dubai who can do the transaction over the phone), either to withdraw money or to make payments to people such as your travel agent or hotel. Bitcoin was a way around this: there are bureaux de change in big cities that will swap Bitcoins for Rial. So I looked into it, but it all just looked way too dodgy. We ended up just taking Australian Dollars and Euros in cash, and changing them for Rial as we went along.




*UnionPay is starting to get into the market now.

 

Most mining hardware is still general purpose. For example the Antminer S9's are not "Bitcoin miners". They're SHA-256 miners. Bitcoin is a SHA-256 cryptocurrency so it can mine bitcoin. But it can also mine any other coin that uses the same blockchain algorithm. Here's a list: SHA 256 Coins — Steemit

And many people are doing that. Remember as more people mine, the hardness goes up so you get less. Lots of people are mining currently worthless coins with really expensive equipment. That would be equivalent of people who mined BTC when it was worthless. You hedge your bet that eventually it will be worth something when you do that. But it is a multi-purpose tool. Most are using it to mine BTC right now because it is so profitable. But that's akin to me choosing to use my shovel to mine gold instead of quartz because gold is so much more valuable. But both require the use of my general purpose shovel.

And ETH mining will always (in the forseeable future) use normal off-the-shelf equipment because the algorithm requires lots of RAM. Talking about 6GB+ of RAM on the video cards. It is not currently feasible to make an ASIC with 6GB of RAM on it, but a video card fits the bill. And again I could mine anything with those video-cards, I just choose to point to one specific coin.

 

It seems that the best way to profit from Bitcoin and other cryptocurrency operations may be the very same way to best profit from the old era gold rushes -- sell goods and services to the hordes of miners.

 

That is true, but my comment was directed towards the bubble principle and not the subject. So, it could just be another bubble, despite your convincing subsequent arguments.