Money and State
Money and State
"Give me control of a nation's money, and I care not who makes its laws."

Posts tagged "bitcoin"

The Parable of Alpha – A Lesson in Network-Effect Game Theory

This is a followup to my recent post on the True Cost of Bitcoin Transactions. A legion of Twitter trolls has been yelling at me, proclaiming that “since people are willing to pay higher prices, that proves Bitcoin’s value is growing.” This is actually a common sentiment among those who believe that blocks filling up is “no big deal.” As space gets tight, the argument goes, the transaction fees rise...

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The True Cost of Bitcoin Transactions

It seems the Bitcoin community is not correctly tallying the true cost of Bitcoin transactions. The belief is that Cost = Miner Fee. We’ll show why this is wrong, but the fee is of course part of the cost, so let’s examine it first… Fees are currently averaging in the range of $0.30 to $1.00 per transaction. Here’s an anecdotal sample as I’m writing this: Block #451871   $1,287 in fees...

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The Cryptobond and AutoPublic Companies

The Bitfinex hack and subsequent release of BFX Coin is a seminal moment in cryptofinance. BFX Coin is a promise of Bitfinex to pay $1 in the future. If their exchange recovers from the hack, and grows, then it's feasible they pay this. The value of the coin will rise toward its $1 par value. If their exchange stagnates or fails, then it's not feasible. The value of the coin...

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The Importance of Bitcoin Not Being Money

For years, many in the Bitcoin industry have eagerly defined and advocated “Bitcoin as money” to a skeptical world. I share the blame: with certainty I argued that Bitcoin was not only money, but was the best money mankind had ever seen. But in our haste, we misled ourselves and others. Bitcoin isn't money after all. Our mistake, as Bitcoin advocates, was that in our excitement over an early, popular...

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Bitcoin, Value, and Ponzi Schemes

It appears that Gary North has used the falling Bitcoin price as an opportunity to reacquaint us with his condemnation of Bitcoin as a Ponzi Scheme. No doubt others will do the same in the coming days and weeks. http://kernelmag.dailydot.com/issue-sections/staff-editorials/11338/bitcoin-ponzi-scheme/ And while many casually-ignorant skeptics have called Bitcoin a ponzi scheme, Gary North is one of the only professionally-ignorant individuals to still hold this view. Sure, there are smart, professional...

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Reflections on the NYDFS Bitcoin Proposal and the Right of Privacy

Today, as human society progresses onward, Coinmap broke 5,000 global business listings, South African payment processor Payfast enabled their 30,000 merchants to accept Bitcoin, and the NY Dept. of Financial Services made financial privacy a crime, supported (at least superficially) by some leaders in the Bitcoin industry. Let's review... The proposed digital currency regulation from Benjamin Lawsky, the Superintendent of 20 million/6 billion people's financial decisions, has been on the...

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