Wednesday, December 18, 2013

Bitcoin – sounds sketchy to me

Terrorist money? Anarchy? A scam? Or real value? 

I see some of my liberty minded friends getting worked up over Bitcoins, but personally I never got it. Not the technology part, I got that pretty well figured out, but what I do not get is why it is such a good idea to basically let the people with the most computer power run the show...
Bitcoin is open for hacking, fraud, bots etc etc. Sure, our regular, everyday Fiat money is counterfeit legalized by the powers that be and it too can be subjected to those things and government(s) do their best to make sure that our notes are turn into toilet paper – but, at least in theory, fiat money has intrinsic value; your hard work and the country it’s based/made in. As long as a government can keep the scam rolling and extract enough founds from subservient idiots and as long as they can pawn the country with big banks and other countries, you could argue that there is value behind our money - a dwindling value subjected to a hidden tax sure, but a value of sort nevertheless.
Bitcoin? Where is the value in that? A few 1´s and 0´s? Code? I keep seeing harden spokespersons of bitcode arguing it is just like gold and there is only one specific amount that cannot (pfff!) be tampered with. This is of course complete nonsenses. Gold has not just monetary value; it’s also a very usable metal that can be used in both technology and for jewellery. Gold hold its actual value over time (although the price might change), it does not fluctuate up and down like bitcoins and gold has both historical and factual existence that should not be ignored.
If you look at graphs of selling and buying volumes the volume only seem to be going up whenever those “insiders” (smart money, experienced traders, Goldman Sachs… whoever…) is selling bitcoin, otherwise its going down – which is very weird for a commodity with a (supposed) fixed amount of “real” value. Also the prices are impacted severely, both negatively and positively, by political decisions. Latest we saw a dip in bitcoin prices because China introduced restrictions in trading. If bitcoins really holds real intrinsic value and the number of bitcoins stays about the same regardless, I would assume that such a Chinese decision would increase bitcoin value/volume (and price), not the opposite.
But enough about my arguments, both technical (probably in some parts wrong - am not a computer wizz) and economically factual and instead I will say this: bitcoins make me nervous.
My reasoning is twofold.
Firstly I do not trust government(s) to keep their filthy mittens of this, or any other similar project. I guarantee that there are already super computers logged in keeping track of the “anarchy” of bitcoin with Government stooges closely following the, in the eyes of our politicians, horrible users of this currency. Likewise I guarantee that there are far along plans to take over the entire system, topple it, or turn it into another government owned controlled idiocy. What I mentioned about volumes, prices and political decisions above seem to, already now, verify this notion.
It would not even surprise me if the entire thing was invented in a CIA bunker somewhere in Guam.
Conspiracy nut? Moi?
When it comes to things like this; yes.
Government of all colours and from all countries has a long, very long history of messing things up, striking down on any unbelievers and trying to take things over.
Oh, but we can start over and do it again! Bitcoin will live on as bitcoin 2.0, 3.0 etc!
Yea, and what about the cash thrown in? And how many times can you start something like this over until no one uses it anymore?
I do get it, in a limited space and for a specific purpose bitcoins or any equivalent works, probably a lot better, than any other payment or currency. In games for example, on specific websites, localized and for a specific audience it’s a great idea. If you know what you are doing it may even be a good, temporary, investment. As a currency however, as a real I-can-buy-both-pizza-and-a-car for this money currency - no.
Honestly I would rather “trust” my government, at least with them I know they will mess it up, bring in hyperinflation and crash the economy – that is implied, built-in and expected. Any virtual mumbo-jumbo with a setup that guarantees that the biggest computer wins while dragging lots of fools into a weirdo situation that can be taken over (or already has) by government at any second, that, that feels scarier to me. Of course government, in such a situation, will also blame the freedom and the “anarchy” of the system. It is never government’s fault that something crashes and politicians are never to blame for people losing their money; it was the Jews, the market, the rich, the hackers….
The second reason I feel very uneasy about this is that the entire system seem to rely on the “community” and that the inhabitants, known or unknown to each other, will confirm any transactions and new “mining” of complementary bitcoins – and this over time, with a lots of fluctuations in price and with an ever growing size of the “community”. I do not think such a system can work, not even if you set it up with (only) three friends, so why would it work with thousands of people across the world sitting behind their computer screen confirming transactions? Not a chance! People are not cuddly and nice; they do not want the best for their fellow man. Also, in general, people are idiots and they look after themselves and this especially when it comes to money.  Do you really think that someone sitting behind a screen across the world actually care about someone they never have to see, even if that other person jump from a window after their account was ransacked?
I do, sort of, like the idea of bitcoins and the basic is pretty sound, and perhaps I am a bit “old” in the sense that I do not trust things I cannot touch, see, and physically interact with, but in the end my conclusion is not only based on feelings but also the way this commodity act (and is traded) on the market – it simply do not act and react in a way that calms my objections, quite the opposite.
I stay as far away from bitcoins as I do bonds and stocks. The world economy will soon crash, burn, implode, explode and after that the real mayhem will start. Bitcoin is not a safe haven from this, not even close. I suggest that if you have made money from bitcoin then take your winnings and invest them in tangible intrinsic values such as gold, silver, real-estate and farming. Also make sure to buy guns to protect it and any cash over should go to cans, dried-up food packages, batteries, oil etc.