Anyone a Bitcoin owner?

[roadrunner]

It is actually more secure than a bank with the cryptology, but you have to really understand how it works to see that. The fact that it is not a physical entity is very unsettling for many people. As I write this, one bitcoin is worth $6568 Dollars. A year ago at this time, one bitcoin was worth $707, and if you bought one last Nov 14 and wanted to cash it out today, the money would land in your bank account today. (Bitcoins can be bought/sold in fractions of a coin.)

With such a changing conversion rate, I wonder how those changes are reflected in the places (you mentioned above) which accept bitcoins -- do they change as quickly... I read one article where someone bought a sub at subway for 0.006 BTC, but that converts to $42.20

The fact that this is digital money doesn't concern me, this is really no different than traditional money, i.e. it's worth whatever people as a whole determine it's worth. Just because it has seen some fantastic growth is more of an indication to me that it's a fad and will not have any real lasting worth. That's the scary thing about money, one day it can be the most coveted thing in the world, the next it's nothing but TP...

I'm not being critical of anyone buying bitcoins, I'm just saying that's how I see this thing.

 

[MoonShadows]

Most of these places accept Bitcoin on their websites, and being an ecommerce website owner, I have looked into this. When you accept payments on your website they are handled through what's called a "gateway". Think of a gateway as something that "talks" to the source the money is coming from (Bank A) and where the money is going to be deposited for the product being bought (Bank B). Probably the most recognized gateway is authorize.net. Gateways usually accept payments like Credit Cards, Debit Cards, ACH Checks, PayPal, etc. Those that accept Bitcoin actually charge the buyer so that the selling price is paid in the Bitcoin conversion rate at the time when that person clicks the buy button. So, if the person spends $20, the seller will get $20 worth of Bitcoin at the value when the sale was made.

Exactly, digital money has a value because those using it agree on the value. Likewise, the US Dollar isn't worth the paper it is printed on anymore, but the government, and everyone using it, agree that it is worth it's face value. That is why both are called a fiat currencies...and, are doomed to failure at some point. Bitcoin will fail at some point, probably much later than the Dollar, one reason why so many people are embracing it, but cryptocurrencies are here to stay as the next medium of exchange.

Bitcoins growth has been due to it being used by more and more people, businesses and economies, and because it is the next logical step in a technology driven economy. Will it reach the heights that some say? Not sure. But, for the foreseeable future, it will continue to increase in value.
If you have the time, or interest, here are a few references that might be of interest.

https://cointelegraph.com/news/five-reasons-why-bitcoin-is-here-to-stay
http://fortune.com/2015/09/21/bitcoin-here-to-stay/

 

[alp]

@MoonShadows

If you have time, read this story

'I was left with £29,300 of special Royal Mint coins after HSBC refused them despite being legal tender': How a ruse to earn credit card points came unstuck

Read more: http://www.thisismoney.co.uk/money/...ank-s-refusing-accept-them.html#ixzz4yWffQEbc

 

[MoonShadows]

Well, that stinks, especially since they were minted by the Royal Mint as legal tender. Not sure why he was buying commemorative coins, though. They usually sell for more than face value anyway when they are minted, and surely while he was taking them back and cashing them in at the bank, he was only getting face value. He must have been losing some money in the transaction. I didn't see in the article how much silver they had; he could have sold them for their precious metal value if it was high. Here in the US, silver coins were 90% silver before 1965. Since then, they only contain 40% silver. You can still buy silver coins here pre 1965 for cents over the silver spot value.

 

[alp]

He certainly has lost a lot of money and has his money tied up in these cheap tats which had been billed as legal tender. The silver and gold contents have decreased over the year. Even the Olympic metals have decreased in their gold and silver contents over the years..

Banks have now been instructed by the Royal Mint not to accept these coins as legal tender.. Cry him a river.. But I must say this has been a blatant lie.. as they were marketed as such .. LEGAL TENDER! Now when someone wants to use it, no, they are NOT, says who? Certainly, the poor bloke has a case... but with the word, ROYAL and its associations with family .. the poor bloke can only hope the coins appreciate in value in yeeeeeeeaaaaaarrrrrssss to come!

 

[MoonShadows]

Amazing how much power the banks have.

 

[alp]

Well, it's the Royal Mint instructing them to NOT to accept it. You know those coins ?? .. all fronted by the firm's boring heads .. their 25 anniversary, 30, ... wedding and new borns .. all those ..

 

[roadrunner]

It seems like we did have to get away from the gold standard as backing paper money. Seems to me with the exploding population of the world, if we kept to the old ways of backing money there would be an even larger divide between rich and poor with not much of a middle class. But then again the subject of economics kinds of bores me and I don't give a lot of my time to the subject.

However, I do think we need to evolve away from the money system, but that seems like it's going to take a long time, just like it will take a long time for globalization, i.e. the end of nationalism, to come about.

Although, with respect to bitcoin, I will make one observation, but I could be wrong, so please don't skewer me

It seems to me that bitcoins use traditional money as their standard/measure of worth, not simply the value placed on by the users. Sort of in the same way that some paper monies use to use gold as their standard.

 

[MoonShadows]

I think Bitcoin and other fledgling cryptocurrencies use traditional money as their standard/measure of worth because that is what we are so accustomed to or that it is what is the predominant method of exchange...US/Dollar...UK/Pound...and so on. I think we will see a day in the future when cryptocurrency becomes mainstream across borders and something like what happened when the world began moving to a standard measurement system (metric) will happen. The metric system, while it took decades, slowly became adopted by all but 3 countries (Myanmar (Burma), Liberia and the United States), but on this one, I don't think the US will be a holdout like we have been with the metric system.

 

[DirtMechanic]

As a tool function, the abililty to exchange value is critical to valuation of any asset, money included. Square mc/visa is evaluating BTC, and that fact alone drove up pricing of BTC, which has a huge problem in the exchange area.

 

[DirtMechanic]

@MoonShadows how have your hodlings improved? I am ahead on BTC but not LTC

 

[alp]

Make sure you sell at a good time. Make hay whilst the sun shines. Good luck, guys!

 

[MoonShadows]

@MoonShadows how have your hodlings improved? I am ahead on BTC but not LTC

@DirtMechanic My original investment of $685 made on November 2nd (1/10th of a Bitcoin) is worth $1902 as of this morning, so I have had a gain of $1200 in about 50 days.

 

[MoonShadows]

Make sure you sell at a good time. Make hay whilst the sun shines. Good luck, guys!

I'm in no hurry to sell @alp. I think the value will continue to rise for some time. At some point I will take out my original $685, so the worst I can do is break even.

 

[DirtMechanic]

That is pretty good @MoonShadows! I came late to the party and only put in 400.00, so if I pulled it I would have my money back, maybe, after the fee.