Talk:Myths

Terrorism

From the linked Wikipedia page:

The USA PATRIOT Act defines terrorism activities as "activities that (A) involve acts dangerous to human life that are a violation of the criminal laws of the U.S. or of any state, that (B) appear to be intended (i) to intimidate or coerce a civilian population, (ii) to influence the policy of a government by intimidation or coercion, or (iii) to affect the conduct of a government by mass destruction, assassination, or kidnapping, and (C) occur primarily within the territorial jurisdiction of the U.S."

This definition is broad enough that it could probably be applied to the Bitcoin system. IANAL but I imagine lawyers could pretty easily demonstrate that Bitcoin is 'dangerous to human life' because the Four Horsemen can use it for evil [drug-dealers, money-launderers, terrorists, and pedophiles.] It can 'influence the policy of a government by coercion' by removing options such as Federal Reserve dollars. (C) might be tricky to prove. PLATO 22:34, 23 March 2011 (GMT)

besides the one attorney general that made a snide remark about terrorism in the LibertyDollar case, i don't think that this is in any way a 'common misconception', so i'd question whether we need to have the 'terrorism' section at all.--Nanotube 04:02, 24 March 2011 (GMT)

I agree. All yes for removing terrorist stuff? EvanR 00:10, 30 March 2011 (GMT)

Fractional Reserve Banking

I'd like to suggest a change here (translation: I fundamentally disagree with the tenor of the article). Credit Unions/Building Societies could quite easily be created, and this would increase the apparent amount of BTCs in existance, but it probably wouldn't exceed twice the original number.

However, a bank functions differently: it creates a distinction between "hard money" (bank notes+coins) and "credit money" (money in bank accounts). So, in a bank I may deposit some real money (notes) but the bank effectively may lend some of that money to others AND I may also spend that money "in" my account by transferring it via a cheque or e-transfer to another person's account. (Building socities don't allow you to do that.)

Now if I were to make a _BTC_ deposit into a "bank", then I wouldn't be able to spend the money in my "account" using conventional BTC trading (confirmations etc). No, what the bank would have to do is to set up a "virtual BTC" (vBTC) trading system, whereby they would manage accounts and transactions, and banks would owe each other v-BTCs depending on how their clients were deciding to spend/borrow their money. Banks could issue huge (virtually infinitie) amounts of v-BTCs depending on how risky they felt that morning.

But then we'd be back to the present situation with fiat currencies, banks, treasury bills, etc etc. I guess it could be a new kind of "gold standard" - a "BTC standard". But the banks would still rule the world, and I thought we sought a way out of that....

...maybe the ability of the user to transact BTC independently of any "fractional reserve banks" would keep a check on their potentially enormous power. But then if the number of v-BTCs was much more than real BTCs (as seems very likely if FRB took off - currently then ratio of v-GBPs to real GBPs is 20:1) then BTCs might end up so scarce in comparison that user trading in BTCs would no longer take place: it would all be in v-BTCs. All this make me think actually v-BTCs wouldn't work in the conventional way, and therefore that fraction reserve banking might not generate any more than 21m v-BTCs. I'd welcome help here.

So my simple answer to the "Myth" question would be "FRB is possible, but "virtual BTCs" would be created, not real BTCs. Lawrence18uk 19:47, 8 September 2011 (GMT)

Fractional reserve banking with Bitcoin is fundamentally different

My edit was removed only because someone disagrees with it, although they did not provide counterarguments. I did not claim that FRB is impossible, I claimed it is unlikely, due to lack of demand for Bitcoin substitutes. Without substitutes, FRB is impossible. Supply of Bitcoins cannot be increased beyond 21 million. The only thing that can be increased is the amount of Bitcoin substitutes, which are incompatible with Bitcoins. Demand for lending does not increase demand for Bitcoin substitutes. The argument presented by the author of the current text on the wiki is erroneous. It is impossible for a bank to accept a Bitcoin demand deposit and lend it simultaneously. It requires a creation of a Bitcoin-subsitute, for which there is no demand, because Bitcoins can exist in forms that other money, such as gold or fiat, require substitutes. PeterSurda 09:28, 7 November 2011 (GMT)

Bitcoin mining is a waste of energy and harmful for ecology

IMHO this chapter is superficial. Compare Bitcoin to electronic fiat currencies. --Shrewdwatson 17:57, 23 April 2011 (GMT)

How about this:

The electricity spent in hashing is not wasted. It creates a product of value to the Bitcoin economy. The product is a supersignature on the complete list of transactions to date (the Block chain). This supersignature attesting to the chain's completeness is Bitcoin's defense against double spending.

Many sources of energy vary in their availability in ways that do not match the variations in demand. The law of supply and demand will require Bitcoin to soak up a lot of energy that is currently "wasted" without making a big dent in the otherwise usable energy supply. [Perhaps cite estimates of the break-even point for mining profitability that imply near zero-cost electricity.]

More --JohnTobey253 04:49, 29 April 2011 (GMT)

Categories and subcategories

Now we have everything in one place, but it should be divided into smaller subcategories to make it easier to find interesting topic

--Zwierzak 22:03, 13 August 2011 (GMT)