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Offline bytemaster

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Offline voldemort628

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Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #1 on: May 02, 2014, 02:22:07 PM »
havnt we already had that? ;)

pts (and until recently ags) backed by "shares" in (future) DACs

Offline bytemaster

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #2 on: May 02, 2014, 02:30:04 PM »
Obviously Rand is referring to Bitcoin the technology generically.   Based upon his usage of the terms we can call our 'shares' bitcoins just like we call all tissues Kleenex or copiers Xerox machines.


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Offline G1ng3rBr34dM4n

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #3 on: May 02, 2014, 03:03:51 PM »
Nice find!  Threw a tweet at him introducing bitshares.


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Offline G1ng3rBr34dM4n

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #4 on: May 02, 2014, 03:05:33 PM »
Might help if team viral swooped in to fav / RT ;) ;) (search #bitshares)


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Offline santaclause102

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Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #5 on: May 02, 2014, 03:10:22 PM »
That obviously can be applied to DACs as well s BTS X...
But if you take it literally and peg the value (= the market cap) of for example Bitcoin to the value (market cap) of for example the Top ten US stocks, that wouldnt work because Bitcoin has a value of its own and if demand for Bitcoin increases it market cap get higher. So the peg can't work.
That was just my initial reaction.... Any contradicting thoughts?

Offline Empirical1

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Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #6 on: May 02, 2014, 03:55:37 PM »
Yeah Rand really doesn't get it. He's saying he thinks crypto-currencies like Bitcoin need to be backed by 'something else' to have value.

He doesn't get Crypto-currencies are already shares of a company & that they derive most of their value from their perceived advantages as a form of money. (As well as their perceived future potential.)

« Last Edit: May 02, 2014, 03:58:14 PM by Empirical1 »

Offline G1ng3rBr34dM4n

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #7 on: May 02, 2014, 05:26:35 PM »
Yeah Rand really doesn't get it. He's saying he thinks crypto-currencies like Bitcoin need to be backed by 'something else' to have value.

Agreed.

He doesn't get Crypto-currencies are already shares of a company & that they derive most of their value from their perceived advantages as a form of money. (As well as their perceived future potential.)

YET! ;)

Hopefully he's able (and willing) to evolve his thinking beyond 'stocks' and pivot towards the concept of shares.  I don't think it'd be a far stretch for him to understand, his political background and understanding of Austrian theory should prime his mind.

Offline luckybit

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #8 on: May 02, 2014, 06:07:11 PM »
Obviously Rand is referring to Bitcoin the technology generically.   Based upon his usage of the terms we can call our 'shares' bitcoins just like we call all tissues Kleenex or copiers Xerox machines.

Rand Paul's reasoning is suspect here. If Bitcoins are superior to traditional stocks then who does it benefit to back something superior by something inferior? It's like saying e-zines should be backed by print magazines or email should be backed up by print copies.

He wants Bitcoins to be backed by stocks then shouldn't he be talking to his friends to get the SEC to allow equity crowd funding?

The law is already passed but the SEC is delaying putting it into effect. I don't think Bitcoin itself could be backed by stocks and I don't think people would want that.

In some ways Bitcoins are a stock but designed to be independent of governments. A Bitcoin using Colored Coin could in theory be redeemed for a stock, or using Mastercoin, but by backing it by stock it puts the entire Bitcoin ecosystem under the control of politicians rather than programmers.

If we just have Bitstocks or Bitshares which are backed by smart contract then in theory you can have a Bitshare asset backed by equity in the real world, but why call say it's backed by a stock? If you can do the whole thing digitally why would you need it on legal paper at all at that point?

I see the whole "backed by stock" thing as a trojan horse to get Bitcoin, Bitshares and everything like it to be backed by the law, and if it's backed by the law then it's backed by the signatures of politicians who write the laws, as well as the quantitative easing.

Maybe this is a bit of a stretch, and may be seen as a conspiracy theory, but it's also possible that Rand Paul had good intentions and just didn't understand how the technology works.


« Last Edit: May 02, 2014, 06:17:42 PM by luckybit »
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Offline Empirical1

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Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #9 on: May 02, 2014, 06:22:00 PM »
Yeah Rand really doesn't get it. He's saying he thinks crypto-currencies like Bitcoin need to be backed by 'something else' to have value.

Agreed.

He doesn't get Crypto-currencies are already shares of a company & that they derive most of their value from their perceived advantages as a form of money. (As well as their perceived future potential.)

YET! ;)

Hopefully he's able (and willing) to evolve his thinking beyond 'stocks' and pivot towards the concept of shares.  I don't think it'd be a far stretch for him to understand, his political background and understanding of Austrian theory should prime his mind.

Yes I think  people will have a much easier time understanding/valuing Bithshares/crypto-equities as shares in profitable blockchain based companies as opposed to pure 'Crypto-currencies.' (Crypto-equities designed to function just as money/currency.)

But the thing I struggled with wrapping my head around the most, is that it just doesn't seem possible/plausible that many of the services offered by Banks/Exchanges/Insurance & Youtube/Itunes type companies that currently require thousands of employees to run can be replaced by some computer code thanks to consensus/blockchain technology. I think the size of companies/industries that are about to be displaced/disrupted is what will take most people by surprise.

Offline luckybit

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #10 on: May 02, 2014, 06:28:53 PM »
Yeah Rand really doesn't get it. He's saying he thinks crypto-currencies like Bitcoin need to be backed by 'something else' to have value.

Agreed.

He doesn't get Crypto-currencies are already shares of a company & that they derive most of their value from their perceived advantages as a form of money. (As well as their perceived future potential.)

YET! ;)

Hopefully he's able (and willing) to evolve his thinking beyond 'stocks' and pivot towards the concept of shares.  I don't think it'd be a far stretch for him to understand, his political background and understanding of Austrian theory should prime his mind.

Yes I think  people will have a much easier time understanding/valuing Bithshares/crypto-equities as shares in profitable blockchain based companies as opposed to pure 'Crypto-currencies.' (Crypto-equities designed to function just as money/currency.)

But the thing I struggled with wrapping my head around the most, is that it just doesn't seem possible/plausible that many of the services offered by Banks/Exchanges/Insurance & Youtube/Itunes type companies that currently require thousands of employees to run can be replaced by some computer code thanks to consensus/blockchain technology. I think the size of companies/industries that are about to be displaced/disrupted is what will take most people by surprise.

To be fair, Bitcoins and Bitshares do have to be backed by something else. But that something else doesn't have to be traditional stocks.

Stocks are backed by the same thing that cryptocurrencies are backed by which is the goods and services offered by the issuer.

So if you're dealing with Bitcoins, Bitshares, or stocks, as long as there are companies willing to accept it, work for it, people willing to accept it or work for it, then it has value.

Bitshares XT is a distributed virtual company so as long as you transact in it's tokens then it's tokens have value.  It does not need the permission of Rand Paul or to be backed by Invictus stock to have value. It already has value today and it's not backed by any stock, and to maintain value it has to remain profitable.
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Offline G1ng3rBr34dM4n

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #11 on: May 02, 2014, 06:40:36 PM »
Yeah Rand really doesn't get it. He's saying he thinks crypto-currencies like Bitcoin need to be backed by 'something else' to have value.

Agreed.

He doesn't get Crypto-currencies are already shares of a company & that they derive most of their value from their perceived advantages as a form of money. (As well as their perceived future potential.)

YET! ;)

Hopefully he's able (and willing) to evolve his thinking beyond 'stocks' and pivot towards the concept of shares.  I don't think it'd be a far stretch for him to understand, his political background and understanding of Austrian theory should prime his mind.

Yes I think  people will have a much easier time understanding/valuing Bithshares/crypto-equities as shares in profitable blockchain based companies as opposed to pure 'Crypto-currencies.' (Crypto-equities designed to function just as money/currency.)

But the thing I struggled with wrapping my head around the most, is that it just doesn't seem possible/plausible that many of the services offered by Banks/Exchanges/Insurance & Youtube/Itunes type companies that currently require thousands of employees to run can be replaced by some computer code thanks to consensus/blockchain technology. I think the size of companies/industries that are about to be displaced/disrupted is what will take most people by surprise.

To be fair, Bitcoins and Bitshares do have to be backed by something else. But that something else doesn't have to be traditional stocks.

Stocks are backed by the same thing that cryptocurrencies are backed by which is the goods and services offered by the issuer.

So if you're dealing with Bitcoins, Bitshares, or stocks, as long as there are companies willing to accept it, work for it, people willing to accept it or work for it, then it has value.

Bitshares XT is a distributed virtual company so as long as you transact in it's tokens then it's tokens have value.  It does not need the permission of Rand Paul or to be backed by Invictus stock to have value. It already has value today and it's not backed by any stock, and to maintain value it has to remain profitable.

I believe that "something else" can be distilled down to one word: math.

Bitcoin, bitshares, et. al - are backed by math.  A simple and powerful statement.

Offline donkeypong

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Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #12 on: May 02, 2014, 07:53:08 PM »
Rand Paul seems to take strong positions on issues he doesn't take the time to understand. I'm not eager to see his trigger finger in the White House.

Offline toast

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #13 on: May 02, 2014, 08:05:17 PM »
@empirical it works because when a dac creates value it can incentivize people to support it. Those thousands of employees are still there, working independently towards a well defined goal. Just look at bitcoin ecosystem.

@gingerbreadman Saying bitcoin is backed by math is like saying fiat is backed by paper. The word "backed" is abused so much and means different things to different people... the math is security and inplementation. The transaction rules are what make it into things that are valuable.

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Offline G1ng3rBr34dM4n

Re: Rand Paul says Bitcoin should be backed by stocks...
« Reply #14 on: May 02, 2014, 08:28:13 PM »
@gingerbreadman Saying bitcoin is backed by math is like saying fiat is backed by paper. The word "backed" is abused so much and means different things to different people... the math is security and implementation. The transaction rules are what make it into things that are valuable.

I think what your analogy describes is the form factor of the currency and that's not what I'm alluding to.  With crypto - you can't remove the security (math) from the transaction rules that allow it to function and expect it to function properly.  Without math, the crypto system would crumble.  Without government, the fiat system would crumble. 

I'll accept its an imperfect analogy, but to your 'average joe', clinging to the idea that currency "must be backed"... I think the analogy provides an initial straw to grasp hold of, and a catalyst to begin thinking about why currency has value and where it comes from.

 

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