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I was just reading about how the "ether" cryptocurrency (CC) just got hacked for $200M - and I don't even know what that means, was it taken from someone, or it was created  - and I remember BitCoin getting hacked a while back.
Now I am not sure about how "ether" is generated, but my understanding is that BitCoin is generated by running some fancy algorithm that is very computationally intensive, and that a few year ago at least, there were reports of folks setting up server farms to "mine" this - basically investing in the hardware and more importantly the electricity for the systems and the air-conditioning to create the BitCoins. I would presume that ether is similar.
I also understand that there are few firms that act as banks in which a buyer transfers real government-approved cash (REAL CASH) to the firm, and the firm gives out the code which represents the CC, and similarly would accept a code as a "deposit" and transfer REAL CASH to the seller. OK, so far so good, this sounds like trading stocks. And there are few businesses here & there that take CC as payment for REAL STUFF.
Now, it seems that the only folks who are actually buying the CC (i.e., forking over REAL CASH) are [1] victims of ransomware, [2] criminal gangs making payments to each other, [3] CC speculators, [4] folks with an anarcho-techno-syndicalist bent, and [5] assorted "the international economy will collapse" whackos.
Folks in [1] obviously are forced to so this. Folks in [2] are simply doing this to get around moving around paper cash, which has various issues; that said, I can't see guys like Tony Soprano contentedly looking at their bits. Folks in [3] think that this will take off, and they want to get in the ground floor (the guy with the server farm would fit in this category). Folks in [4] are choosing the buy CC to pay for REGULAR STUFF as a way to help get the CC idea going. Folks in [5] consider CC to be like gold (Au) and think that the REAL CASH will be devalued with their CC remaining intact, like gold - just a lot easier to port around & defend.
Now the way I look at it, if I am forking over REAL CASH to get my hands on the CC, I had better be able to use it like any highly liquid store of value - but very few vendors really accept this, so store of value is as per those CC banks that will buy that CC in return for REAL CASH. If I invest in a stock, I am buying a piece of a publicly traded corporation that I can read up on the official statements about their business situation, and with the knowledge that there is always a liquid market for selling it; sure, some stocks can blow up like Enron, but if I buy an ETF or mutual fund, or have a broad portfolio, that wouldn't be a problem.
The point is that there is something really there; heck, with gold there is even something, it can be guarded, and the only way to create new gold is dig for & refine it, an expensive task. And as for REAL CASH, it is ubiquitous an everyone except for ransomware crooks takes it, most importantly the government for debts owed to the government, which gives it the ultimate value. And the financial institutions that deal with stocks & REAL CASH have a very strong level of safety with a code of law, the government as law enforcer, etc., to ensure that it won't disappear. Where the hell is that with CC? Where are the security guards? I see this as the 21st Century tulip mania!
modified 10-Jul-17 21:04pm.
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This is my favorite elucidation of crypto-currency: Conan BitCoin Skit – David's Odds'n'Ends 
It Is The Absolute Verifiable Truth & Proven Fact
That Your Belly-Button Signature Ties
To Viviparous Mama.
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Short answer is no. It's the future. The long answer is yes... it's a baby currency with problems and not something the real world takes seriously. But that's how it always starts. 50 years ago only kids in their basement cared about IRC. Now days, here we are with Facebook being popular. So things that change the world always start that way.
The reality is, BitCoin won't win, but the industry will. The bankers won't allow for something they can't control in order to control us. Even the government is controlled by the bankers. It's being used a test bed to weed out kinks before we go completely digital. The problems we have with greed BitCoin attempts to solve, which would surface in the digital world in our current system.
So it's coming. May take a couple hundred years, but when the banks and government get on board you can bet they'll create their own digital currency though.
Jeremy Falcon
modified 11-Jul-17 14:05pm.
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And when that happens, I will start buying up all the gold pressed latinum I can get my hands on.
That is unless the new net neutrality "laws" actually pass. The net is the wild west and if they can wrangle it into what they want then all bets are off.
if (Object.DividedByZero == true) { Universe.Implode(); }
Meus ratio ex fortis machina. Simplicitatis de formae ac munus. -Foothill, 2016
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Foothill wrote: I will start buying up all the gold pressed latinum I can get my hands on.
What exactly is your height to ear size index?
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Jeremy Falcon wrote: So it's coming.
Indeed it is.
Thirty big banks, tech giants, and other organizations—including J.P. Morgan Chase, Microsoft, and Intel—are uniting to build business-ready versions of the software behind Ethereum, a decentralized computing network based on digital currency.
Marc
Latest Article - Create a Dockerized Python Fiddle Web App
Learning to code with python is like learning to swim with those little arm floaties. It gives you undeserved confidence and will eventually drown you. - DangerBunny
Artificial intelligence is the only remedy for natural stupidity. - CDP1802
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Totally. Like self driving cars. Doesn't matter what we think of today... driving ourselves will be a thing of the past too... eventually. About the only constant in life is change.
Jeremy Falcon
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Jeremy Falcon wrote: . 50 years ago only kids in their basement cared about IRC.
I sure remember that from my childhood, in 1967 when we were doing IRC, fifteen years before the arrival of th Internet. For physical layer transfer, we used semaphore flags, using 6-bit symbols: Each arm could be set in one of 8 positions, so with two arms/flags we got 6 bits per transistion. There were competing technologies, like blinking with a flashlight, using a messy 3-value coding (off, dot, dash) for serializing variable length symbols - it was a really protocol, that never could reach the transfer speed of the clean 6-bit-per-symbol semaphore protocol - yet it almost completely took over visual data communication the last ten year before electronic transmission arrived.
I still feel sorry for my friend living on top of the hill, so his house could be seen from both sides. He was eager the first time we suggested that he could serve as a router for buddies living on the one and the other side, out of sight of each other, but he ended up spending all his time routing messages. When in transmission mode down one side of the hill, he had to use a mirror to look down the other side for new messages. He had a tremendous memory, able to hold several kilobytes of buffered messages - normally held in transient memory, but when he had to power cycle (i.e. be fed), he saved all uncomitted messages on stable storage (paper).
Those were the days! It is a pity that kids don't learn semaphore coding in school today, for communication when the internet connection breaks down.
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Jeremy Falcon wrote: The reality is, BitCoin won't win. The bankers won't allow for something they can't control
vaguely remember something similar being said about the music industry
Sin tack
the any key okay
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The crypto currency *industry* will win. BitCoin won't. Imagine you controlled the world since you control the money... would you give that up just because someone cooked up some new cool tech? Or would you watch that tech and see how you can make it your own and still have oversight of it? Guess which route the banks will choose.
Jeremy Falcon
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My guess is option B, but they'll likely take the MPAA/RIAA model of just lobbying to have competition suppressed, since innovating is hard and costs money... 
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What advantage would a CC like BitCoin or Ether have over current manifestation of digital currency for a major government? They can already increase the money supply via electronic means. The monetization of debt for quantitative easing is such an exercise when the Fed buys back bonds with new e-money. I am probably a bit naïve but it seems the biggest advantage now is the facilitation of criminal enterprise. Does it solve a problem that we can't otherwise solve?
Maybe this is some indication of the future but it seems quite far off. So far off, that the broad implementation will be as different from current CC as a typewriter is from Windows 10. And it will be decades or more. Control over monetary policy is critical for a highly sensitive economy such as ours. Mechanisms outside of control will be resisted and fought, once significant.
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Jeremy Falcon wrote: BitCoin won't win, but the industry wil
I am not going to be holding my breath on that one.
New ideas that work have an incredibly rapid adoption rate. Cell phones are a perfect example of that with the adoption not only in first world nations but third world as well.
Now electronic payment options, such as those available via cell phones, will have legs.
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What just got hacked? Where's the link, the only recent thing I am aware of is the arbX exchange 'issues' as seen here.
The whole crypto arena a boiling pit of technology that is still trying to find it's ultimate use case to drive breakout. It is coming though, there is no stopping it I don't think.
Financial analysts predict continued growth of both BTC and ETH over the next few years. one has BTC hitting 50,000 USD in 5 years and ETH to hit 1,000 USD by end 2018. Never mind all the others that are also gaining momentum in their relative spheres of influence. XRP continues to grow in the financial sector and LTC is becoming an attractive alternative to BTC.
At the end of the day, these things will only have value if they are adopted....With an international banking transaction taking days to complete and costing a small fortune in fees, near real-time transfer and low fees in the crypto world does sound very appealing doesn't it.
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swampwiz wrote: "ether" cryptocurrency (CC) just got hacked for $200M ... BitCoin getting hacked a while back
Link? You probably mixed up exchange site with cryptocurrency itself.
swampwiz wrote: REAL CASH have a very strong level of safety with a code of law, the government as law enforcer, etc., to ensure that it won't disappear.
Haven't you heard about things like quantitative easing?
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Nothing has intrinsic value, it's just that more people realize this about bitcoin.
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swampwiz wrote: And the financial institutions that deal with stocks & REAL CASH have a very strong level of safety with a code of law, the government as law enforcer, etc., to ensure that it won't disappear. Where the hell is that with CC? Where are the security guards? I see this as the 21st Century tulip mania!
You do realize that despite all these laws, there is far more debt in the world than there is money?
So yes, by definition "value" will dissapear once those debts are called.
Bastard Programmer from Hell 
If you can't read my code, try converting it here[^]
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So let me feed into your fears: a cyber-attack in a BitCoin (&etc.) world would stop all commerce at all levels everywhere. Except, perhaps, in the primitive country that uses actual currency (and who coincidentally launched the cyber attack).
Having access to all of your assets, directly and at all times, is both exciting and frightening.
As for currency values, or even gold: neither is good if you're hungry. Only what you can exchange them for - if anyone wants to exchange for them. Stocks? The real value of most stocks is, well, nothing! Voting power in the companies management (not for your or me, with 1/10,000th of 1% of the shares) - so a few blocks of stock run things for their own benefit. The only value they hold is the same as currency, gold, or BitCoin: what will someone give you to get them from you. Look up hyperinflation[^] to realize your faith is anything but well-founded.
In a very real sense, they're all the same: dependent upon a market for 'them' when, in fact, it is not 'them' that is wanted but what 'them' can be exchange for!
| Ravings en masse^ |
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| "The difference between genius and stupidity is that genius has its limits." - Albert Einstein | | "If you are searching for perfection in others, then you seek disappointment. If you are seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010 |
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Bitcoin's problem is hyperdeflation 
Cheers,
विक्रम
"We have already been through this, I am not going to repeat myself." - fat_boy, in a global warming thread
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W∴ Balboos wrote: Having access to all of your assets, directly and at all times, is both exciting and frightening.
If you think about cloud computing, it's the same thing in a way. As a whole, we're moving towards a more connected whole, in more ways than one.
Jeremy Falcon
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I a pretty militant non-advocate of cloud computing. For now, I'm safe.
| Ravings en masse^ |
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| "The difference between genius and stupidity is that genius has its limits." - Albert Einstein | | "If you are searching for perfection in others, then you seek disappointment. If you are seek perfection in yourself, then you will find failure." - Balboos HaGadol Mar 2010 |
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Your grandchildren won't think it's a big deal. Welcome to change.
Jeremy Falcon
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LOL, if the stocks become worthless, that means that our civilization store has become worthless as well, and I guarantee that folks won't be bartering with CCs - it would be like Mad Max, with any kind of physically valuable material (e.g., liquid or solid fossil fuel); those ruffians would not be transferring bits on their iPhones.
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What Jeremy said, plus, there is a much broader movement toward decentralization with particular emphasis on decentralizing social media.
Also, keep in mind that blockchain underlying technology can be used for creating any kind of contract/transaction, not necessarily one involving "coin" or even having a direct translation to hard currency.
Marc
Latest Article - Create a Dockerized Python Fiddle Web App
Learning to code with python is like learning to swim with those little arm floaties. It gives you undeserved confidence and will eventually drown you. - DangerBunny
Artificial intelligence is the only remedy for natural stupidity. - CDP1802
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Swampwiz.
Am gonna take the time to answer back with two hopes in mind
1) you can read my comments amongst the full barrage of responses, both bad and good you'll get with such an opinionated post.
2) you can have a real change of heart not because of my actual words, but by the intellectual process that occurs with the interchange of ideas which, in the end, form the basis of any modern society and form the inherent concept of value.
With that in mind, I will be brief.
First... I will refer to you, and older article which was written in 2011 which did precisely what you now do: overestimate a paradigm shift and catalogue all of them involve as fringe and subject to your contemptuous judgement.
The Rise and Fall of Bitcoin
Second... I will show you another article, which clearly shows what happened next and how Ethereum learned from bitcoin's mistakes and move further along the lines.
The Rise and Fall of Bitcoin and the New Kid on the Block
With those two things in mind, let us elaborate on your superficial post.
You put REAL MONEY in all caps, but fail to mention what your currency of choice is. Venezuelans, today, don't have that luxury and British thought that they had it two and after the Brexit vote, lots of products have inflated due to the inherent vision that things are gonna get bad before they get better in the U.K. after Brexit.
So, your idea of REAL MONEY is essentially an illusion but regardless, is a useful illusion.
Then you mention, the physical quality as something important and forget that the U.S. dollar overtook it's namesake, the Spanish Dollar or Piece of Eight or 8 real silver coin not with a coin, but with a banknote which ironically was worth in those silver coins it replaced. So physicality is neither something set in stone nor really important when speaking about currency.
Which takes to the central point of your rant, FORKING REAL CASH in favor of an illusion. Ironically, you'd been doing that since your birth. The actual REAL CASH is products and services. Money is the first instance of virtuality, that is, Bank Notes and coins are our first technological tool and it predates the pencil, paper and even monoliths. The only physical and real is what you produce in an economy, but ironically, you have to give it value in order for it to be desirable. Don't think a BMW Series 3 costs anything more than a VM Jetta. In Germany, Mercedes Benzs are Taxis and Ubers. The moment you export Corona Beer, Swaroski crystals, iPhones and Big Screen TVs, that's the moment that their value increases.
So, value is not a matter of physicality, tangibility or even usefulness. It's a matter of perception and conviction. A Xiaomi phone might be physically more adept than an iPhone 7, but brand awareness makes it better.
So that we can leave past doom predictions and dogmas, let's focus on the the essence of your post. Are we in a bubble (of bits)? Is Ethereum (or Bitcoin for that matter) just vaporware and it will vanish because it's a fad by fringe groups? Only time will tell.
But in the meantime you could be on the side of success or you can be on the side of failure. You only can decide. Any great rewards demands a great risk. If you are not a risk taker and you let your dogmas move your business decisions, go ahead, you have nothing to lose.
But the again, in REAL ECONOMICS there's something called the Opportunity Cost, that is, as per the Wikipedia:
"In microeconomic theory, the opportunity cost...is the value (not a benefit) of the choice of a best alternative cost while making a decision. A choice needs to be made between several mutually exclusive alternatives; assuming the best choice is made, it is the "cost" incurred by not enjoying the benefit that would have been had by taking the second best available choice."
Are you willing to have that Opportunity Cost? Are you 100% your choice is not the second best?
Only time will tell...
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