Bit Coin. Please explain it to me like I am a 3 year old.

I just came up with a crazy scenario

What if a country used their dollar.. and secretly over time bought a TON of bitcoin.. then crashed their currency and used bitcoin as their new currency.

That would be nuts.. whomever bought the currency with bitcoin would be screwed..

And the scenario I'm posing.. it would be people and other countries buying the currency.

That would be genius

a reply to: WorShip

Dear heavens! Watched this twice, now my head hurts and I have to go to bed.


Thanks WorShip. I think.

a reply to: rexsblues

You sure about that? $2k in bitcoin in 2013 is $2 million ?!

a reply to: trollz

Thank you

a reply to: trollz

Thanks for the education....
Correct me if I'm wrong but does this mean that price of bitcoin cannot be manipulated like the price of gold has been by short sellers?

originally posted by: TheConstruKctionofLight
a reply to: trollz

Thanks for the education....
Correct me if I'm wrong but does this mean that price of bitcoin cannot be manipulated like the price of gold has been by short sellers?

Keeping in mind that I could be wrong:
From what I understand, the more people who use it, the harder it is to manipulate the price. Over time it -should- stabilize more and more. Short selling and margin trading with bitcoin has already been going on in huge numbers for a long time, and it's doing relatively fine. That sort of thing is more of a threat to smaller "sh*tcoins" that are newer and more unstable. Bitcoin does have its unique threats though, such as from what's known as a 51% attack. Basically if a bunch of bitcoin mining farms in China got together and collectively controlled more than 50% of the mining network, they could wreak all sorts of havoc.
There's probably someone else who can give you a much better answer on that, but that's my personal take on it.

originally posted by: nOraKat
a reply to: rexsblues

You sure about that? $2k in bitcoin in 2013 is $2 million ?!

$2 million? Psh. Small beans.

If you bought $100 of bitcoin 7 years ago, you'd be sitting on $72.9 million now

Source

a reply to: trollz

I read this but I don't understand the math used to come up with these numbers.

Don't mind me, I am still stuck on, "the ledger is the currency", and that "it is it's own independent thing".

I know my skepticism is making it hard for a lot of the information to sink in, but I honestly feel that a lot of the information is questionable and more hype then accurate.

Not giving up though. Still researching.

originally posted by: NightSkyeB4Dawn
a reply to: trollz
I read this but I don't understand the math used to come up with these numbers.

You mean the $100 into $72 million?
There was a time when bitcoin cost less than 1 cent per bitcoin. So let's say for example they're 1 cent each; for $100 you could buy 10,000 bitcoins. Now let's say you hold on to those for a few years, and the price has gone up to $2,393 per bitcoin, what it currently is today. You now have $23 million dollars that you can freely transfer right into your bank account.

originally posted by: NightSkyeB4Dawn
Don't mind me, I am still stuck on, "the ledger is the currency", and that "it is it's own independent thing".

I know my skepticism is making it hard for a lot of the information to sink in, but I honestly feel that a lot of the information is questionable and more hype then accurate.

Not giving up though. Still researching.

By ledger, they're referring to the blockchain technology, where data is permanently stored in such a way that it can't be altered. So, every time there is any bitcoin transaction, that information is recorded permanently. Nobody can forge it or alter it. It's a far more secure recording system than anything currently existing for any fiat currency, which is why banks are jumping all over it and implementing it themselves. HERE is an article from fortune.com:

In four years, IBM says that 66% percent of banks expect to have blockchain in commercial production and at scale.

What do you feel is questionable or hype? There's no hype, it's happening all over the world. Banks, governments, businesses, organizations, etc. It's not something that's just being talked about, it's literally being implemented and used. Remember, there was a time when people said nobody would ever use email.

a reply to: trollz

wow

a reply to: trollz

So I wonder, if your bitcoin appreciates do you have to pay taxes on it?

Can bitcoin be stolen?

So I wonder with all the competing crypto-currencies, is it possible for Bitcoin to crash due to banks going with another format/brand crypto-currency?

originally posted by: nOraKat
a reply to: trollz

So I wonder, if your bitcoin appreciates do you have to pay taxes on it?

Can bitcoin be stolen?

I think bitcoin is considered property but I have no idea how the tax thing works.
Yes it can be stolen if you're careless with storing it, but as long you take basic precautions you can make it all but impossible for someone to steal your bitcoin.
It's kindof like paper money... If you leave a pile of cash sitting on the passenger seat of an unlocked car with the windows down, sooner or later someone is going to walk by and grab it. If you however bury that pile of cash inside a safe 30 feet under the ground in a location only you know, the chances of someone stealing it are practically nonexistent.

originally posted by: nOraKat
So I wonder with all the competing crypto-currencies, is it possible for Bitcoin to crash due to banks going with another format/brand crypto-currency?

Kindof, yeah. There's a ton of cryptocurrencies out there right now, but bitcoin is by far the most widely recognized and used, as well as the oldest. I'd say the biggest competitor to bitcoin is probably litecoin, which is essentially an improved version of bitcoin. If bitcoin's issues get worked out though, it'll hold strong for a long time.

How liquid is Bitcoin?

originally posted by: PhotonEffect
How liquid is Bitcoin?

bitcoincharts.com...

a reply to: trollz

I thought Bitcoin's main competitor was Ethereum.

I suspect taxes are not paid on appreciation. For example the dollar goes up and down all the time, but we do not pay taxes when it appreciates nor do we write off a loss when it depreciates.

originally posted by: nOraKat
a reply to: trollz

I thought Bitcoin's main competitor was Ethereum.

I suspect taxes are not paid on appreciation. For example the dollar goes up and down all the time, but we do not pay taxes when it appreciates nor do we write off a loss when it depreciates.

In the UK digital currencies would be subject to capital gains tax if sold at a profit.

a reply to: trollz

Is there one wallet, over any of the others, that is known to be the best (from a security and functionality standpoint)?

Ethereum is intriguing.

originally posted by: PhotonEffect
a reply to: trollz

Is there one wallet, over any of the others, that is known to be the best (from a security and functionality standpoint)?

Ethereum is intriguing.

There's a couple types:
Online wallet, like on an exchange - risky because of threat of hackers
Mobile wallet - wallet for cell phones, could be risky
Desktop wallet, as in software you use on your personal computer - Risky because of hackers + hardware failure, although hardware failure can be mitigated by simply keeping your information backed up
Cold storage wallet - Like a desktop wallet but on a computer that's not connected to the internet
Paper wallet - Basically a piece of paper with a code on it that gives you access to your bitcoin, can be stored or hidden anywhere
Hardware wallet - Think of a flash drive made for storing bitcoin

All in all I'd recommend getting a hardware wallet like the Ledger Nano S or one of the other popular types. They're very secure, and you have the peace of mind in knowing that your bitcoins are on your physical person rather than a hard drive in some other country.

originally posted by: nOraKat
a reply to: trollz

I thought Bitcoin's main competitor was Ethereum.

Ether isn't intended as a currency though like bitcoin is; they have two completely different purposes and uses. Bitcoin is for buying and selling, whereas ether is for fueling applications built on the ethereum network. Ether is only a competitor of bitcoin so far as competing for investments, but aside from that, litecoin is bitcoin's biggest rival since it's an improved version of bitcoin.