Well, that puts bitcoin to bed then

Richard Murphy says:
December 1 2017 at 7:29 am
That, of course, is another reason why it is not a currency. It is not debt.

What is debt? A claim upon assets or effort, no?

Can assets and or effort be bought with bitcoin?

So it’s debt, right?

It takes real skill to get things even more wrong than David Graeber on the subject of money.

Richard Murphy says:
December 1 2017 at 8:44 am
But you can only buy turnips because someone is willing to give you sterling for Bitcoin

Fact

You can only buy turnips with sterling because someone is willing to sell swedes for sterling. Sigh.

sasha says:
December 1 2017 at 8:12 am
“On your c4iteria (sic) anything that can be exchanged is a currency and that is not true ”
Entirely true. As long as there is a shared confidence that it can be freely exchanged for items of value it fulfils all the requirements of a currency. This is decided not by banks & not by governments but by the users. The single criteria is confidence.

Reply
Richard Murphy says:
December 1 2017 at 8:41 am
And it is precisely because such confidence does not exist that only state backed currencies (secured by future taxation revenues) exist in the modern world

That people – however misguided – are willing to exchange 9,000 of the state backed currency for one of the non-state backed would seem to be an interesting example of which way the confidence is running, no?

20 comments on “Well, that puts bitcoin to bed then

  1. You could ask ten thousand ordinary Britons why they have confidence in the value of Sterling and not one would say it was because of future tax receipts.

  2. Tim

    On this one it is akin to shooting fish in a barrel – he is out of his depth even on normal financial instruments let alone Cryptocurrencies. Don’t get me wrong, you have done more probably than any single individual to confront a man who is, by any stretch of the imagination, a force for great evil in the world as we know it today, but here I wonder if there is any point to exposing his stupidity. It’s rather like taunting a caveman with a laptop – mildly diverting but ultimately too easy. Murphy has not got the intelligence to even grasp the concept of bitcoin – move on.

  3. A few years ago I visited a cafe in Silicon Valley which accepted payment in BitCoin. I immediately dismissed the entire concept, regarding it as a mere geek curiosity; as I did with the Internet some two decades prior.

  4. In Israel I was once given telephone tokens as change (the shop had no small coins).
    Inflation was 1500% at the time but the token was still good for a local call months later.
    Better than state cash then.

  5. I immediately dismissed the entire concept, regarding it as a mere geek curiosity;

    And if you don’t have a very high tolerance for risk, you were entirely correct in your assessment… It is a curiosity.

  6. And it is precisely because such confidence does not exist that only state backed currencies (secured by future taxation revenues) exist in the modern world

    Factually wrong. During the Irish Bank Strike of 1970 people used undated cheques as currency. And not just bank-issued cheques. Some were written on napkins, beer mats and even toilet paper. Clearly not state-backed, but trusted regardless.

  7. “That people – however misguided – are willing to exchange 9,000 of the state backed currency for one of the non-state backed would seem to be an interesting example of which way the confidence is running, no?”

    No, I would say that it was confidence that there is a greater fool. Right now, we need a Bitcoin futures market. There will be one starting in about 2 weeks time.

  8. Might be worth watching how far Bitcoin follows this pattern:
    https://people.hofstra.edu/geotrans/eng/ch7en/conc7en/stages_in_a_bubble.html

    My guess is that it’s currently at the “Enthusiasm” stage but after considerable swings in value it will survive in the long-term. Firstly, because it is actually used to buy and sell things in the real world. Secondly, because it is widely used to buy and sell other crypto-currencies which can’t be purchased with state fiat money. It’s the central node of the crypto-currency economy and is too useful to fail completely, unless governments suppress it.

  9. Anyone any idea what the volume traded has been? My market instincts tell me there’s been buyers bidding the stock up without shaking out too many sellers. All looks very impressive for the papers. As will the collapse, if it happens. But actually, in the market, few people will have caught a cold other than having seen some paper profits evaporate..

  10. “unless governments suppress it.” – govts likely will suppress alternative currencies if they become big – they are not going to allow anybody else to have any control of currency.

  11. I’d much rather store my wealth in bitcoin than the Venezuelan bolivar or the Zimbabwean dollar, despite the current speculative bubble.

  12. @Mr Bonk
    That’s my suspicion. There’ll be strenuous efforts by government funded agencies to hack the things & destroy confidence in them. The stakes are just too high.Will the algorithms be resilient to attack by multimillion dollar supercomputers?

  13. “I’d much rather store my wealth in bitcoin than the Venezuelan bolivar or the Zimbabwean dollar”

    You’re not setting the bar very high, there.

  14. “In Israel I was once given telephone tokens as change (the shop had no small coins).
    Inflation was 1500% at the time but the token was still good for a local call months later.
    Better than state cash then.”

    Even at its peak, inflation in Israel was never remotely anywhere near 1500%

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