I'm not understanding the advantage to Bit Coins. Suppose I want to buy a car. What are the steps if I want to use Bit Coins and how would it be an advantage over cash?Originally Posted by Steven Douglas
I'm not understanding the advantage to Bit Coins. Suppose I want to buy a car. What are the steps if I want to use Bit Coins and how would it be an advantage over cash?
One advantage - the police can't steal your bitcoins on your way to make the deal by claiming you were "probably" involved with drugs.
What if I use my debit card?
When you buy the car and you pay with bitcoins you don't risk ID theft because you don't need your ID to send or receive them. You send bitcoins directly to me so you avoid fees of middlemen.
Also if you were from another country you'd avoid dealing with international transfer fees as well as conversion fees as well as save time.
On the other hand:
If I want to sell you that car, and you want to pay me online and I insist on Bitcoin I protect myself against you taking the car and then claiming you got defrauded and demanding a chargeback being done by paypal or mastercard.
Also if I sell a lot of cars I significantly cut down on fee costs and risk of fraud costs as well as eligibility compliance costs for using online money processors.
There are ample benefits in using Bitcoin. And it's Bitcoin(the system) and bitcoins (the units), not BitCoin, or Bit Coin, or bit coins or w/e.
My personality type: INTJ - please forgive my weaknesses (Not naturally in tune with others feelings; may be insensitive at times, tend to respond to conflict with logic and reason, tend to believe I'm always right, tend to be unwilling or unable to accept blame )
Steven summed up the situation reasonably well. And as JWZguy said:
However, keep in mind, that is the situation for now.
Exchangers are, as always, the weak link in this "super-strong state-proof" system. Think about it. If I still own some e-gold or, to make it a more perfect analogy, 1mdc, good on me, so I guess the police will never steal my 1mdc. If the company hadn't taken down the website, I could log in forever and gaze longingly at my balance of 1mdc. But what can I do with it?
Likewise, if the law leans on all the exchangers sufficiently (wouldn't take much) that it becomes impossible to form a link between the banking system and Bitcoin, what happens? You are no longer able to quickly and easily convert bitcoins to dollars in your bank account, or a balance on a debit card.
You can still print out your hash and have it framed and hung on the wall. Then you can just gaze at it longingly every day.
Last edited by helmuth_hubener; 03-24-2012 at 10:28 PM.
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Right.. So I send you the bitcoins, whats stops you from keeping them and not giving me the car?
What is my recourse now that you have my bitcoins?
My 2 questions about "Bitcoin", to those of you in the know, apply to super computers and government/corporate networks:
1)
When you read online articles about "mining" bitcoins you find references to network admins that have access to 20 or more machines who use them to mine for profit.... what happens when this concept is applied at the corporate or government level? What happens when someone with admin access to thousands of computers sets them to mining bitcoins?
2)
Bitcoin is based on cryptography, what happens when one of these petaflop super computers run by the NSA is tasked with hacking the system?
presence
Last edited by presence; 03-25-2012 at 09:00 AM.
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Escrow services or reputation systems.
This is not rocket science. Just because the current status quo has spoiled everybody with chargeback doesn't mean there aren't alternative solutions, much friendlier to merchant costs, and also much fairer with dispute resolution services.
Last edited by hazek; 03-25-2012 at 10:24 AM. Reason: added "or reputation systems"
My personality type: INTJ - please forgive my weaknesses (Not naturally in tune with others feelings; may be insensitive at times, tend to respond to conflict with logic and reason, tend to believe I'm always right, tend to be unwilling or unable to accept blame )
No. That's the situation forever. The more adoption we have the less reason to have exchanges at all. It only gets better from here.
Difficulty of mining goes up and if the price doesn't follow it drives out the weaker miners. But even if these entities gain the majority in mining, the rest of the users can still ignore their blocks they find but aren't following the original rules. In other words if those who mine want to keep making a profit by keeping everyone accepting their blocks they must avoid forking the chain which means they must follow the rules. And if they don't follow the rules, their blocks will get simply ignored by everyone else and honest miners will pick up the pieces in a new fork. Or so goes the theory. (It's an ongoing experiment..)
With todays technology it is impossible to effectively brute force strong encryptions and when that changes, Bitcoin can be upgraded with new stronger encryptions to stay ahead. Remember if anyone can start cracking encryption, they'll be able to crack most of encryptions used in finance or protecting government secrets before they'll break SHA256.
My personality type: INTJ - please forgive my weaknesses (Not naturally in tune with others feelings; may be insensitive at times, tend to respond to conflict with logic and reason, tend to believe I'm always right, tend to be unwilling or unable to accept blame )
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