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Bitcoin

Investment discussion for beginners. Why you should invest your money, get help getting started
Bubblesofearth
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Re: Bitcoin

#334872

Postby Bubblesofearth » August 21st, 2020, 11:45 am

Mike4 wrote:Quite. Apart from all the industrial uses, wedding rings crafted from bitcoins don't seem to have quite the attraction as gold rings.

You don't need a nuclear reactor to make gold, I noticed in a news report a few weeks ago. You just get copper bars and gold plate them. American banks accept them as security for loans as though solid gold, apparently.

https://www.scmp.com/business/companies ... ted-copper


Jeez, have they never heard of Archimedes? Gold plated tungsten would have be more difficult to detect.

BoE

Mike4
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Re: Bitcoin

#334888

Postby Mike4 » August 21st, 2020, 12:33 pm

Bubblesofearth wrote:
Mike4 wrote:Quite. Apart from all the industrial uses, wedding rings crafted from bitcoins don't seem to have quite the attraction as gold rings.

You don't need a nuclear reactor to make gold, I noticed in a news report a few weeks ago. You just get copper bars and gold plate them. American banks accept them as security for loans as though solid gold, apparently.

https://www.scmp.com/business/companies ... ted-copper


Jeez, have they never heard of Archimedes? Gold plated tungsten would have be more difficult to detect.

BoE

I know, it's laughable innit!

They probably thought to themselves "screw Archimedes...."

Gilgongo
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Re: Bitcoin

#334893

Postby Gilgongo » August 21st, 2020, 1:04 pm

GrahamPlatt wrote:Not quite accurate that, GS. The mining aspect is the ‘creation’ of new bitcoins. The transactions are another matter.


I don't want to be "that guy" as the Americans say, but without bitcoin miners, no transactions could be processed and no confirmations could be given to validate your bitcoins were genuine:

https://www.buybitcoinworldwide.com/min ... oin-mining

Snorvey
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Re: Bitcoin

#335133

Postby Snorvey » August 22nd, 2020, 5:14 pm

https://www.physicalgold.com/insights/15-uses-gold/

Most of which are just pretty shiny thing pish. Currency? Well we already have plenty of that. Most of the rest can be done with other cheaper materials.

.....You lot haven't been swayed but the Currys salesman and his 'gold plated HDMI cables are better' claptrap have you?

Note. I'm not advocating Bitcoin either. To me It's just a way for crooks to shift 'value ' between themselves and the 'mining' thing is incredibly wasteful.

......But then there are a million other things on the planet that are far more wasteful.

Mike4
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Re: Bitcoin

#335157

Postby Mike4 » August 22nd, 2020, 7:02 pm

Snorvey wrote:https://www.physicalgold.com/insights/15-uses-gold/

Most of which are just pretty shiny thing pish.


Curiously that link does not mention the overriding value of gold to industry I heard mentioned on the radio the other day, being its remarkable ability to resist chemical attack of many types. Far more than any other easily available material. This alone give gold an intrinsic commercial value.

I agree with you about its uselessness as a currency though, as any decent currency these days can be printed in endless amounts by the govt of the day when it suits them, and I've yet to hear of a government printing it's own gold.

Bubblesofearth
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Re: Bitcoin

#335200

Postby Bubblesofearth » August 23rd, 2020, 7:30 am

Snorvey wrote:
Most of which are just pretty shiny thing pish. Currency? Well we already have plenty of that. Most of the rest can be done with other cheaper materials.



You mean like copper for example?

https://www.miningweekly.com/article/ch ... 2018-11-19

BoE

swill453
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Re: Bitcoin

#335225

Postby swill453 » August 23rd, 2020, 11:00 am

Interesting article about bitcoin and blockchains here https://thecorrespondent.com/655/blockc ... 5-f933fe63
Carrying out a payment with Visa requires about 0.002 kilowatt-hours; the same payment with bitcoin uses up 906 kilowatt-hours, more than half a million times as much, and enough to power a two-person household for about three months.


Scott.

johnhemming
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Re: Bitcoin

#335227

Postby johnhemming » August 23rd, 2020, 11:09 am

swill453 wrote:Interesting article about bitcoin and blockchains

Its quite a good article. I think the point about bitcoin is that
a) It is a bit complicated
b) Some people claim (and fewer probably have) to have made a lot of cash from it.

It still strikes me as being like tulips without the inherent value.

1nvest
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Re: Bitcoin

#335358

Postby 1nvest » August 24th, 2020, 12:55 am

Bubblesofearth wrote:Jeez, have they never heard of Archimedes? Gold plated tungsten would have be more difficult to detect.

For gold coins - simply measuring the size (diameter and thickness) and weight along with a ring test (balance the coin on the fingerprint of your index finger and tap with another coin - and it should ring rather than being a dull thud) is 'good enough'. Tungsten content could meet the size/weight properties, but will fail the ring test.

There are pocket sized 'devices' such as https://www.thefisch.com/howitworks - but a basic £15 vernier caliper and £20 electronic scale does the job. The fisch is just a modern day version of the sovereign/half sovereign testers that were around in Victorian times

Image

When you have electronic/accurate scales you can also perform a specific gravity test relatively quickly/easily https://youtu.be/vYkfIAk8AMI

India/Asia has much greater interest-in/ownership-of gold as faith in domestic paper currencies can be a lot lower. Bitcoin falls into that 'dubious' potential vapour-ware category IMO.

Physical gold also doesn't have to be physically conveyed for instance from one country to another and can also be electronically transferred relatively easily - i.e liquidate into currency and electronically transfer that currency to buy physical gold at the desired target destination. As such bitcoin is more for those that perhaps don't want to leave a trail - which is more usually due to illegal reasons. Better to have a full audit trail and accountability of physical gold or otherwise be at risk of confiscation on the perceived belief of being the proceeds of illegal activities.

1nvest
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Re: Bitcoin

#335359

Postby 1nvest » August 24th, 2020, 1:13 am

Snorvey wrote:Currency? Well we already have plenty of that. Most of the rest can be done with other cheaper materials.

The Pound was originally based on a Saxon pound weight of silver back in 750 - had tangible value. Sovereigns being a £1 face value were again worth its weight in tangible gold. The progressive trend to replace tangible currency value with paper/electronic value has led us to where we are - where hard currency is worth near nothing. Even the copper penny coins changed from being 97% copper to being copper plated steel since late 1992.

When money had tangible value, such as a Pound note being exchangeable for gold at a fixed constant rate, investing was easy. Lend money to the state (such as buying gilts) in exchange for a interest payment, and when redeemed/sold that could be received as more gold than what you held before. Was very much a case of the state paying you for it to securely store your gold. Where typically you could accumulate gold at a 4% type annualised rate. Wealth/costs/retirement/spending could be planned with reasonable accuracy. Nowadays the state expects you to pay it for lending to the state, and it raids the likes of pension funds as/when it so desires. Instead of providing a platform of relatively stability, it induces instability (is a liability rather than a asset).

1nvest
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Re: Bitcoin

#335361

Postby 1nvest » August 24th, 2020, 2:14 am

Mike4 wrote:Widening the discussion, how does mining work please? I've never understood. I can see the need for a supply of new bitcoins, but mining is presumably jargon for creating new bitcoins, yes?

Complex computational maths problems that tax even super computers i.e. take time to solve, with the reward of bitcoin(s) for solving that expands the supply. Think of a simile being along the lines of where if you're the first to figure out the decrypted content of a encrypted file you get a prize. Where there's a different encrypted file for each new bitcoin. If the password is relatively short/easy then prizes will be handed out often, but to slow down that rate making the password/encryption (hash) that much harder takes more time to 'solve' and the prize rate slows.

Top of the ponzi Satoshi is believed to have around 1 million bitcoins, so worth around £9 billion at recent price levels. Many others have made vast wealth out of bitcoins - where the 'trick' is to offload the value and get out before the ponzi system crashes, as with any other ponzi system. But a carefully crafted system so as to not be classified as a illegal ponzi system. Potential massive rewards for those in at the early phase, many others can do well whilst the enthusiasm is on the rise. Many lose when it does finally blow-up.

johnhemming
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Re: Bitcoin

#335373

Postby johnhemming » August 24th, 2020, 7:40 am

1nvest wrote:But a carefully crafted system so as to not be classified as a illegal ponzi system. Potential massive rewards for those in at the early phase, many others can do well whilst the enthusiasm is on the rise. Many lose when it does finally blow-up.

I think it is probably wrong to describe it as a ponzi system. I would expect it to fall apart under the weight of its own contradictions over time, but I don't think it has the same sort of intent as a ponzi system.

It is more of a pure value less bubble. I would expect over time more to be lost in the US tech bubble even though the underlying businesses have value.

Mike4
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Re: Bitcoin

#335425

Postby Mike4 » August 24th, 2020, 10:06 am

johnhemming wrote:
1nvest wrote:But a carefully crafted system so as to not be classified as a illegal ponzi system. Potential massive rewards for those in at the early phase, many others can do well whilst the enthusiasm is on the rise. Many lose when it does finally blow-up.

I think it is probably wrong to describe it as a ponzi system. I would expect it to fall apart under the weight of its own contradictions over time, but I don't think it has the same sort of intent as a ponzi system.

It is more of a pure value less bubble. I would expect over time more to be lost in the US tech bubble even though the underlying businesses have value.


I'm inclined to agree. Ponzi schemes set out with deception in the minds of the originators as only a fool cannot see the eventual outcome. Bitcoin set out I suspect, as a technical experiment in creating a viable currency out of computing power and the originators had no idea what would happen. Bitcoin could just as easily settled at a value of 0.001p each. The several £k that bitcoin are currently worth is a result of the idea catching the public imagination and a rump of demand from naïve people who simply like the idea. A bit like my dear old departed Dad investing in the channel tunnel back in the day as he admired the feat of engineering. Bad move!

I once encountered someone who acquired 43 bitcoin right at the start of the experiment for minimal cost. She sold some a few years ago and bought herself a £60k narrowboat to live on.


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