tag:blogger.com,1999:blog-2595455932654799850.post2041440288586566650..comments2023-11-02T10:55:07.208+01:00Comments on The Monetary Future: Why Are Libertarians Against Bitcoin?Jon Matonishttp://www.blogger.com/profile/04111660030028727950noreply@blogger.comBlogger24125tag:blogger.com,1999:blog-2595455932654799850.post-73209355949236563112012-12-04T16:44:03.938+01:002012-12-04T16:44:03.938+01:00No matter why some of the people out there are aga...No matter why some of the people out there are against the idea, but there is no doubt that e-currency exchange services for bitcoins are becoming more and more popular. I have recently found another website which is offering e-currency exchange services which includes exchange bitcoins as well as <strong><a href="http://www.xmlgold.eu" rel="nofollow">exchange webmoney</a></strong>.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-19460108974250141792012-11-21T21:18:10.923+01:002012-11-21T21:18:10.923+01:00Good post, despite the idea that bitcoins (or rath...Good post, despite the idea that bitcoins (or rather, anything) could have intrinsic value. In reference to this binary corollary of the regression theorem - the value of the gold unit (for example, although it could be any material) is based on its use on that first day - but a second unit of gold also has a use - that is, the value of using gold instead of trading it for money is clearly correlated to its volume. Bitcoins do not have that luxury - the prices of bitcoins to other goods are not based on their use EACH, bitcoins' use value does not increase proportionally with the volume of bitcoins in use. <br /><br />To use an example - on the first day of commodity X's use as money, it has two possible uses - its original use as a commodity and its use as money. The choice to use for use 1 or use 2 is of course based on the needs of the possessor at that time, and basically regulates the value in exchange - if commodity x is desperately needed for some other use than that of money, it will be turned to that use. The second unit of X could be used as money, whilst the first unit of X is used in its primary use (perhaps an industrial use of some sort.) The second bitcoin does not possess this luxury. For this reason it is important not to confuse bitcoin's qualities that make it useful as money as the source of its value in some other use, since it has no other use. The confusion between inherent value and its utility in other uses is something to be avoided.Unknownhttps://www.blogger.com/profile/08557420974674487893noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-30455557661306826312012-11-01T13:10:44.957+01:002012-11-01T13:10:44.957+01:00Stephen Williamson of "New Monetarist Economi...Stephen Williamson of "New Monetarist Economics" blog had this article on Bitcoin (June 24, 2011) http://newmonetarism.blogspot.com/2011/06/bitcoin.htmlJon Matonishttps://www.blogger.com/profile/04111660030028727950noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-40949712444968709932012-10-01T17:28:03.789+02:002012-10-01T17:28:03.789+02:00"Software can have inherent properties that g..."Software can have inherent properties that give it value in and of itself."<br /><br />Yes, the old school Austrians are missing a very simple point - information can have value.<br /><br />Bitcoin is a type of information that can only be transferred once and then becomes un-spendable. This, combined with the cap on supply imposed by the algorithm gives it scarcity.<br /><br />Therefore Bitcoin's intrinsic value grows from its peculiar properties as information:<br />- can be transferred P2P<br />- works on any Internet connected device<br />- it is fungible and divisible<br />- scarcity (similar to gold's scarcity, more can be created but only at the expense of great work)<br />- difficult to trace (high relative privacy)<br />- international - works across political boundaries<br /><br />The only conceivable downfall to Bitcoin would be if a mathematician found a short cut to solving the problems that are used as proof-of-work for the Bitcoin system.Ken Ghttps://www.blogger.com/profile/03442775171294114618noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-6328836299997794852012-09-17T21:59:08.950+02:002012-09-17T21:59:08.950+02:00No, Austrian Economics is not based solely on the ...No, Austrian Economics is not based solely on the axiom that value is subjective. One of the tennets is though that value is subjective and context dependent. As Ayn Rand (an Austrian sympathizer but not an economist) said: "The concept of value presupposes answers to the questions of value to whom for what." What things have is intrinsic, objective properties. To these properties of things, individuals, having unique value criteria and facing unique circumstances, impute value.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-28119918349377195992012-05-29T19:22:39.725+02:002012-05-29T19:22:39.725+02:00From the article "criticisms of bitcoin stem ...From the article "criticisms of bitcoin stem from ... (2) it fails to satisfy Mises' regression theorem of primary use value prior to becoming money." - - I'm not an economist, but...<br /><br />What is a bitcoin before its metamorphosis into a bitcoin? Electricity. Electricity has a "primary use value prior to becoming money." Bitcoin can be thought of as a battery, a place where energy is stored. Because of the nature of its storage, this energy is easily trade-able, much more so than a fully-charged battery. While the electricity that makes up this "battery" or "store of valuable product" has already been expended, the Proof-of-Work behind the creation is a trade-able product. Ultimately, this value will "stick" to the price of electricity needed to create it (and perhaps visa-versa as well.)bouf425https://www.blogger.com/profile/13069662931485226045noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-10538326336538931792012-02-20T10:47:24.081+01:002012-02-20T10:47:24.081+01:00Continuation of the Mises Regression Theorem debat...Continuation of the Mises Regression Theorem debate: http://mises.org/Community/forums/p/27611/458209.aspx#458209Jon Matonishttps://www.blogger.com/profile/04111660030028727950noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-58099511196043957032012-01-11T12:03:02.118+01:002012-01-11T12:03:02.118+01:00This certainly shows that Austrian Economics is no...This certainly shows that Austrian Economics is not quite as pro market as is suggested by some of them.<br /><br />If they want a free market for currency, why would they reject Bitcoin?<br /><br />But unfortunately, the free market for currencies is just a ruse for most Austrians. It is a Gold Standard they want and their portfolio's will testify to it.<br /><br />They think they can get away with a free market for currencies, because they argue would win in such a market. <br /><br />It wont. Nobody is going to pay with Gold, it's far too good a store of value.<br /><br />In a free market Gold will be irrelevant (as will Bitcoin, for the same reason). <br /><br />Because it will have to compete with depreciating paper based currencies and everybody will love paying with paper, exactly because it is losing value.<br /><br />It is called Gresham's Law.<br /><br />I've had a very nice discussion with the people from Daily Bell and Gary North on the same issue:<br />http://realcurrencies.wordpress.com/2011/12/29/discussing-interest-and-gold-with-the-daily-bell/<br />http://realcurrencies.wordpress.com/2011/12/23/gary-north-on-interest/<br /><br />I'm all for a free market for currencies, by the way.<br /><br />Interest free Mutual Credit based units will dominate such a market.<br />http://realcurrencies.wordpress.com/2012/01/03/mutual-credit-the-astonishingly-simple-truth-about-money-creation/Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-57578492422402335382011-10-16T23:46:54.395+02:002011-10-16T23:46:54.395+02:00The term "Intrinsic Value" is in direct ...The term "Intrinsic Value" is in direct contradiction with the "Subjective Theory of Value".Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-26006382384888140962011-07-03T17:17:56.868+02:002011-07-03T17:17:56.868+02:00Very nice article.
I would like to add that Bitco...Very nice article.<br /><br />I would like to add that Bitcoin's technology does not necessarely overwhelm the theories from XIX and XX centuries.<br /><br />For example, I think that Bitcoins certainly fit on Menger Theory of Money.<br /><br />And more recently, Bitcoins also fit within the Monetary Theory of the Austrian economist Carlos Bondone (http://www.carlosbondone.com) who demonstrates how the Regression Theorem (RT) is unnecessary and also an unfortunate return to the Theory of Objective value.<br /><br />http://eleconomistaprudente.wordpress.com/2011/06/06/bitcoins-and-mises%C2%B4s-regression-theorem/Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-46010830567951985832011-06-29T13:54:21.873+02:002011-06-29T13:54:21.873+02:00@junomoneta
The point of the corollary is to allo...@junomoneta<br /><br />The point of the corollary is to allow free-market cryptocurrencies to exist within the Austrian economics monetary framework. It is agnostic towards which specific flavor of digital money so it does not exclusively refer to bitcoin. Primarily, the corollary accounts for currency decentralization via distributed p2p systems, because that is the current methodology to avoid the fate of a centralized nonpolitical monetary system.<br /><br />The risks of spotting and blocking btc transactions, as you state, can be mitigated to a large degree with safe bitcoin practices. On the government supercomputer threat, the combined power of the current network is equal to one of the world's most powerful supercomputers. In the unlikely event of any single entity gaining control of more than half of the bitcoin network's computing power, the compromised unit would become untrusted and a new genesis block would most likely take its place. It remains to be seen whether all future cryptocurrencies will be preventable even with overbearing processing power. I tend to think not, because you can't put the genie back in the bottle.Jon Matonishttps://www.blogger.com/profile/04111660030028727950noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-69896404990287935412011-06-28T22:02:11.452+02:002011-06-28T22:02:11.452+02:00"a digital money is exempt from the regressio..."a digital money is exempt from the regression theorem specifically if: (a) the network can be demonstrated to be immune from State enforcement and termination; and (b) the monetary unit can be defensible against State confiscation."<br /><br />These are rather bold assertions. With advances in deep packet inspection its probable to spot and block btc transactions. As for confiscations, once mining is no longer as profitable it may be that as independents exit they are replaced by gov't servers that target specific clients or transactions (e.g. by size of payment) to prevent them from becoming part of the mainstream hash chain.<br /><br />Juno MonetaAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-6246131071519777032011-06-28T13:13:29.822+02:002011-06-28T13:13:29.822+02:00Update: Doug Casey responds to his critics regardi...Update: Doug Casey responds to his critics regarding his recent bitcoin opinions http://t.co/DK9HQnmJon Matonishttps://www.blogger.com/profile/04111660030028727950noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-26387762506857959582011-06-28T13:12:59.628+02:002011-06-28T13:12:59.628+02:00The Ethernet card in your computer and a cable att...The Ethernet card in your computer and a cable attached to it has around zero value in a world where you're the only one that have it. Just becasue you can touch it does not mean it's not useless.<br /><br />However -- being able to communicate in the Internet is very valuable. Because many people can participate and exchange information, and benefit -- you're willing to pay for cables, router, cards and optic fiber services.<br /><br />This is what synergy is in an essence.<br /><br />Bitcoin as a whole is a system (network) allowing secure exchange of some abstract units. This units (Bitcoins) are shares of this system. As Bitcoin as a whole has some value, these shares have proportional value as well.dpc.ucore.infohttps://www.blogger.com/profile/08067804314281148738noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-28106295001285300412011-06-28T07:34:10.600+02:002011-06-28T07:34:10.600+02:00much as when the "supreme court" disguis...much as when the "supreme court" disguises totalitarian impulses and constitution contravention with jukebox phrases (e.g., "clear and present danger", "compelling interest"), i nearly laugh out loud whenever i see "store of value" and the like as supposed refutations of bitcoin. "store of value" is a highfalutin substitute for the direct "not a physical object", to which i reply, "so?"<br /><br />if that virtual object is a unique placeholder for something that may be traded easily and reliably, it's a store of value, and <em>no explanation is necessary</em> for its successful operation. listening to bitcoin pooh-poohing, you'd think economists came before economies. absurd.<br /><br />consider how bitcoin is <em>superior</em> to physical "stores of value". the vaunted "commodity" aspect of gold is largely an excuse for those disposed to hold gold — a way to avoid saying the truth: "i value gold highly because other people do."<br /><br />complete joke listening to an "austrian economics" guy attempting to explain rationally why something valued doesn't have value. assume for argument that the value of bitcoin is 100% illusory. so?<br /><br />however, it isn't illusory. bitcoin-concept currency has scarcity, portability, divisibility, verifiability, accuracy, and transactional properties which are net superior to trusty gold the asset. theoretically, bitcoin could devalue gold back down to its pure commodity level, and even lower that.<br /><br />if only we could have the permission of blowhard "austrians" clinging to their dogma as if at sea in a leaking dinghy. please, "austrians", may we trade via a medium you declare deficient? may we, great guardians of all that is pre-bitcoin?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-15356415189527858802011-06-28T05:35:21.896+02:002011-06-28T05:35:21.896+02:00There is no 'untrusted central issuer' for...There is no 'untrusted central issuer' for a Real Bill either, nor a scramble to redeem certificates. Nor do Real Bills expire; they mature.<br /><br />At the end of the day with a bitcoin, you still have nothing of substance. While that may be of advantage in use as currency, and may be irrelevant to it's use as a unit of account, it neuters it as a store of value.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-90741647675285099872011-06-28T01:12:17.275+02:002011-06-28T01:12:17.275+02:00Great post. I've found most Libertarians don&#...Great post. I've found most Libertarians don't have the faintest clue about technology or engineering design so how could they come up with an informed opinion on bitcoin? If you don't know what you're talking about you could easily confuse it with any of a number of failed e-currency concepts.<br /><br />After seeing Doug Casey's article last week, I felt I had to straighten him out, with this response: http://porquenoargentina.blogspot.com/2011/06/gary-on-bitcoin.html<br /><br />Jeff Berwick, of the excellent Dollar Vigilante blog, reposted it here with some of his own comments: http://www.dollarvigilante.com/blog/2011/6/23/a-wild-few-weeks-for-bitcoin.htmlGaryhttps://www.blogger.com/profile/15738673029029470261noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-2149511900433139792011-06-27T10:28:34.676+02:002011-06-27T10:28:34.676+02:00@intuitivereason
the Fekete approach of enforcin...@intuitivereason<br /><br /><i> the Fekete approach of enforcing that all paper transactions made in gold are a) time limited and b) mature into actual gold coin; and the FOFOA approach where gold is physical, paper is paper and electrons are electrons.</i><br /><br />What this addresses in an oblique way, is the problem that Bitcoin solves; the Double Spending problem.<br /><br />Because it is not possible to completely trust a paper certificate for gold since the issuer cannot ever ultimately be trusted, an artificial constraint to counteract the issuer trust problem emerges in the form of expiring certificates in Fekete. This is, of course, an inconvenience and burden on the holder of the certificates.<br /><br />Why should I have to worry about the date on my certificates? And of course, if you want to spend them, they actually become worth less as the sell by date approaches, because you are passing on that inconvenience of enforced redemption to the person taking the certificates as money.<br /><br />They will have to scramble, musical chairs style, to redeem them, and in fact, these certificates will become worthless way before the redeem date the further away you are from a redemption point.<br /><br />With Bitcoin, since there is no untrusted central issuer, there is no need to create an inconvenient, artificial and money destroying infrastructure where all receipts have a 'TTL' (time to live) after which they expire.<br /><br />You do not ever have to rush to reclaim the gold, or anything else your Bitcoin can purchase, because it behaves exactly like cash, only better.<br /><br />By your own example then, Bitcoin has more to it than the sole aspect of freedom from state control, which is by the way, is of almost infinite value in the long run.<br /><br />Every time someone argues against Bitcoin in this way, they make it more attractive, and further expose its utility. Astonishing.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-46141832558226766512011-06-27T07:45:03.888+02:002011-06-27T07:45:03.888+02:00"Since gold can not be shoved down a transmis..."Since gold can not be shoved down a transmission wire, unless the gold standard advocates want argue that all transactions must be made with physical specie, they have no possible way of getting around this one fatal flaw with the gold standard."<br /><br />This is not not an unrecognised issue in the gold world. There are two approaches I have seen to it; the Fekete approach of enforcing that all paper transactions made in gold are a) time limited and b) mature into actual gold coin; and the FOFOA approach where gold is physical, paper is paper and electrons are electrons.<br /><br />So in that respect, the two best resolved 'gold as wealth' systems I've come across do recognise and resolve this issue, though in different ways.<br /><br />Bitcoin seems to have the potential to be a viable currency; it doesn't have the permanent physical embodiment to make it a useful store of wealth, nor the recognition at this stage to form a viable unit of account. So as a 'money' it leaves much to be desired, not being the best form devised for any one of the three roles.<br /><br />It's sole redeeming aspect seems to be the concept of freedom from state control which is interesting but of finite value.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-30205079937982407322011-06-26T22:36:22.631+02:002011-06-26T22:36:22.631+02:00Is it true that Austrian economics is based solely...Is it true that Austrian economics is based solely on the axiom that value is subjective?<br />http://www.youtube.com/watch?v=ihVSoVlkTGA<br /><br />If so, it's weird to see Austrians push the argument that money has to have intrinsic value.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-23282893357273131342011-06-26T21:02:03.006+02:002011-06-26T21:02:03.006+02:00saltypig,
Thanks for your comment. I always wonde...saltypig,<br /><br />Thanks for your comment. I always wondered how Kramer had garnered key/login access to the otherwise respected LRC blog and you've outlined it perfectly. No doubt, he won't be the last 'libertarian' to hate on bitcoin.Jon Matonishttps://www.blogger.com/profile/04111660030028727950noreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-75360587233121709892011-06-26T20:59:46.471+02:002011-06-26T20:59:46.471+02:00Bitcoin: Backed by Gold:
http://preview.tinyurl.co...Bitcoin: Backed by Gold:<br />http://preview.tinyurl.com/3n2lvrmAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-85555079301054250432011-06-26T20:35:54.149+02:002011-06-26T20:35:54.149+02:00having generally the same reaction as you, i like ...having generally the same reaction as you, i like that you've written this post. however, including david kramer in "noted libertarians" is possibly very misleading. kramer is of that longtime queer group of glaring noobs at LRC who are inexplicably given blog keys by lew and turned loose (e.g., cort kirkwood, jesse ogden, max raskin). he's notable only to the extent that he's obviously learning liberty ethics on the fly, very publicly, and evinces the cowardly habit of "refuting" sound detractors by referring them, with no specificity, to whole books by revered liberty writers he pretends to channel. he did it in the post linked above. you're supposed to find the connections yourself between his modern drivel and their general mastery — albeit mastery of a world that didn't include bitcoin. it's worse than standard fallacious argument by authority, since he won't even say with just context what relevant thing the authority supposedly said.<br /><br />kramer has apparently not yet figured out that many reading his regular nonsense are far more advanced than he, and i don't recall him ever responding to a bust with an honest, "ya got me." rather, he digs heels deeper, then in desperation throws it to H-cubed and the like. that'll teach ya to question an "austrian" economist! (who for most of his adult life spewed rank socialism with the same fervor)<br /><br />as one of the first bloggers at LRC, i know well how lew works. he generally keeps a light touch editorially, allowing idiots to wade far deeper than their content warrants (yes, happened to me), while explicitly discouraging "infighting" on the blog. thus, habitual fools like david kramer are led via local non-resistance to believe that what flows from their fingers is automatically superior to the thoughts of those who regularly read LRC. what's superior is lew's tolerance for letting unqualified idiots sound off brashly in "i'm in the LRC stable; you aren't" voice. soon after figuring that out, i bolted. no idea why lew doesn't boot tools like kramer after their first few embarrassments.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2595455932654799850.post-4711880606145994442011-06-26T20:22:55.597+02:002011-06-26T20:22:55.597+02:00Excellent post! Similar sentiments are reflected h...Excellent post! Similar sentiments are reflected here:<br /><br />Bitcoin: A New Commodity Created To Serve Market Demand - by Anthony Freeman<br />http://tinyurl.com/3dxzxuyAnonymousnoreply@blogger.com