Mode of payment

[brothers]

Recently there was a posting that mentions Bitcoin as a means of paying for stuff. I've heard of it, probably even read something about it, but my one track mind keeps going back to the question: If I have some bitcoin, how do I buy stuff with it? If I don't have any bitcoin, how do I get it? Can I issue bitcoin and set my own value for it? You see where I'm heading here. If I want to buy/sell something, how on earth do I know what a bitcoin is worth? Where do I keep my bitcoin when/if I get some?

[texquill]

What a great question!

I'm not a highly educated guy, but I, too, have to question the validity of a payment methodology that isn't backed by the full faith and credit of a government or (even better) by "hard" value reserves. I'm probably entirely too skeptical, but, like with other things I've been told I'm not smart enough to understand (for example, Enron's business model), I wouldn't be entirely shocked to find that a lot of folks dealing in Bitcoin find themselves holding an empty bag.

[John Parker]

All I know is what I learned by googling bitcoin and reading what came up under Wikipedia, and in other internet news. Probably worth checking there first if you have an interest. Personal opinion is that it all looks very shaky.

[Squire]

Paypal works for me.

[Nitrox]

I've read up a little on Bitcoins and can't believe it even exists.
You earn Bitcoins by 'mining' for them. What you actually have to do is solve very complex mathematical problems with very expensive and high end computer hardware.
If you solve the problem, you're awarded Bitcoins. It's not as easy as you think since there are countless others solving the same problem and with better higher end equipment than the average person can afford. You can 'group' yourself with others and solve the problems together and therefore earn a share of the Bitcoins. This is only a part of it, as I didn't read up on the whole scheme. I know that AMD video cards that sold for $400 are now fetching close to double that since they are good at doing complex graphical calculations. Very strange stuff if you ask me...............

[brothers]

So it's literally impossible for two people who don't have any bitcoins to enter into a transaction. If bitcoins ever become the only recognized currency, a whole lot of people who couldn't buy and sell without it would be absolutely screwed, and a very select few would be in control of it all. Sounds strangely familiar.

[jww]

In theory, the bit coin is at least interesting. In practice, however, isn't really readily available to the masses. Who knows what the future will bring, 20 yrs ago when Imworked for a bank, one of our executives revealed that he never saw the notion of debit cards ever taking,off. And look where we are now with internet banking. It's kind of difficult to see the future on this stuff for me.

[texquill]

It appears that one of the major problems in dealing with a payment methodology that isn't backed by the full faith and credit of a government or (even better) by "hard" value reserves has reared its ugly head.

In today's (25 Feb 2014) news, AP reports that a major Bitcoin exchange has gone dark, resulting in losses that the article quantifies as "hundreds of millions of dollars."

Link to AP article carried on excite dot com:
http://apnews.excite.com/article/201402 ... B7QO2.html

[Gene]

Ken, I agree with this...my son and I argue about the value of Bit-coins - with nothing solid to back them. He has done some mining, and may hold a few...but how you spend them eludes me. I hear there may be a second, or third form of E-Currency emerging, too...more on that I I can't say.

I did read that video cards make better engines to solve the problems than traditional CPU's - so if you want to get started you need a major card in your system, for sure.

Lastly - I have heard that organized crime has taken an interest in this - making me nervous.

[function]

Bitcoin was/is known as the only payment taken on silk road, which is the internet black market selling everything from slaves to grenade launchers.

Personally when I think of the method by whuch they are earned it comes off as a pyramid scheme as each equation is more complex than the last, making those first few bitcoin both more valuable and earned with less effort.

[Gene]

I do know that the value of a bit-coin on any given day rises and falls, like the stock market...but the why and how are a mystery.

Also - there are a finite number of them. Several million have been mined, but as I understand it - there are only something like 24 million of them that can actually be mined. Where you go from there is anybodies guess.