Quote:
Originally Posted by Hawkeye
Now I am treating it as it is, a gamble. It will either go to a very significant amount and I will cash out or I will lose it all first.
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[QUOTE=Hawkeye;22528821]
I totally agree with you, and have said to people since it was trading at $5k that it's a "black or red" proposition (ie. like roulette). I left my money in because (back then, a whole month ago), I thought it was equally likely to hit $25k as it was to hit $300.
I didn't put more in because I don't have money to gamble. If I did, I'd be rocking a seibon hood and quad exhaust in my mods list below.
Quote:
Originally Posted by Hawkeye
What do you think Bitcoin is backed by?
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Utility value.
I used bitcoin before it became a bubble as a merchant. Transaction fees were same/better than visa/mastercard, there was no chargeback (so when you got your money it couldn't be clawed back because of fraudulent activity - like cash, it's yours) , it's liquid and easy to turn into AUD, CAD or USD, and has third-parties who've made it easy and accessible to use instead of credit card payments on websites, and it was very easy to transfer directly between people via email or QR Codes.
While not actually anonymous, many people thought it was - so it is a perfect way of carrying out transactions over the Internet that used to be done in person via cash.
It's also very easy to travel in and out of the country with millions of dollars of bitcoin, and turn it back into local currency without too much drama. There aren't many alternative ways of doing this.
To give you a practical & legal example: Say I'm selling a rare 'M car' in the USA to a Canadian buyer. I wouldn't want cheque because it might bounce, They wouldn't want to rock up with $200k USD in cash because of fear of violence; and doing a bank transfer from CAD to my bank in USD is both slow and expensive, using PayPal has the risk of 'clawback'.
But if they turned up today and transferred me ~20BTC, I could confirm the cash was received after a short time, give them the car, then cash it out into USD that day and all is sweet.
Finally - if the price of BTC settles down and becomes predictable, as an Aussie, I'd be just as happy holding BTC for foreign transactions as I am today using USD. Thus making it as useful as Gold or USD for storing wealth, not just transferring it.
That is what BTC is "backed by".
Now, other coins have features which might trump BTC eventually. BTC is not anonymous, clearing (apparently) takes more than 10 minutes or more, and apparently transaction fees are becoming significant. BTC might fix some or all of these as it grows, or they might lead to its demise and the rise of another coin.
Now, what's the value over ethereum, dash or 'CoinZ by Dr Dre' - popularity.
People are buying and selling stuff with BTC today, and have been for five years. If you have a woo-commerce/big-commerce or shopify website, accepting BTC is as easy as accepting Visa. And people have BTC to spend.
I expect some of these merchant providers will become multi-coin, so you can just as easily transact in ethereum, dash, litecoin etc - and the rise of one may mean the fall of the other. ... or the market might be rising in general such that BTC and [some other coin] are equal market leaders worth $100,000 or $1m per coin. I don't know.
But I wouldn't be going near ICO's, they're scammers in the extreme. There doesn't seem to be anything to me that's not possible with the current top 5 coins, and given the dominance of BTC I think it's crazy to believe any new ICO is going to pip it from first place.
But here's the thing, the big concession - I don't know if 1 BTC is intrinsically worth $1, $300, or $1m. And unless you're speculating in the market, I don't think it matters. For it to be useful for all the things above it needs to be stable or rising in value, trusted and secure. At the moment it's all of those things.
What could cause your BTC to go from $15,000 to $0 overnight? If someone finds a flaw in the encryption that lets them 'corrupt' the block-chain or steal or counterfeit BTC.
That's the risk you're taking having real money wrapped up in this bubble.
Otherwise, I'd say it's a bit like US Property in 2007. It might be worth half or a quarter of what it's trading for, but it does have
some inherent value.