Better than Bitcoin Interview with Bit N Mortar

[sschechter]

One thing I don't understand is why is it necessary to tell people Bitcoin is a company (an unprofitable one) not a currency. Firstly, I don't really understand the logic of why it cannot be considered a currency. But secondly if people want to think of Bitcoin as a currency, that's fine, because its not in direct competition with Bitshares. As I am a bit confused, maybe others are, so is it really a key marketing point?

From a BTS/DAC perspective, Bitcoin definitely resembles shares more so than a currency. The shares happen to be in an unprofitable company.

It's a great marketing pitch. When it clicks, there's an "ah-ha!" moment of understanding. Followed by a smug grin.

Yeah, one of the Larimers' early metaphors was that Bitcoin is a company that pays 100% of revenue and a huge dilution subsidy to security guards (aka miners). That really clicked with me, and is one of the reasons I'm with BitShares today.

 

I'm just joining you guys now, and to be honest this was one of the KEY points of turning me to Bitshares also!

I have sooo many questions, I wish the live chat group was working

May I suggest you grab your popcorn, click on bytemaster's name on any forum post, then click on the 'show posts' link.  The rest of your day may be ruined, but there's a lot to learn.  As an investor since December, the case for owning BitShares becomes greater every day.  Welcome to the club

[happybit]

Company metaphor is...
BitsharesX vs Bitcoin and the winner... BitsharesX

Currency metaphor is...
BitUSD vs Bitcoin and the winner... BitUSD

We win either way!

 

I'm new, very new, and this is also how I see it!!!

[happybit]

One thing I don't understand is why is it necessary to tell people Bitcoin is a company (an unprofitable one) not a currency. Firstly, I don't really understand the logic of why it cannot be considered a currency. But secondly if people want to think of Bitcoin as a currency, that's fine, because its not in direct competition with Bitshares. As I am a bit confused, maybe others are, so is it really a key marketing point?

From a BTS/DAC perspective, Bitcoin definitely resembles shares more so than a currency. The shares happen to be in an unprofitable company.

It's a great marketing pitch. When it clicks, there's an "ah-ha!" moment of understanding. Followed by a smug grin.

Yeah, one of the Larimers' early metaphors was that Bitcoin is a company that pays 100% of revenue and a huge dilution subsidy to security guards (aka miners). That really clicked with me, and is one of the reasons I'm with BitShares today.

 

I'm just joining you guys now, and to be honest this was one of the KEY points of turning me to Bitshares also!

I have sooo many questions, I wish the live chat group was working

[MktDirector]

GREAT point Mysto. 

We are building both a "company" and and "currency" in that sense.  The only reason we keep preaching the "Bitcoin is an unprofitable company" is to show the absolute lunacy and waste that's built into the mining paradigm.  One day I predict we'll all look back and laugh at the silly idea of mining and all the wasted wealth used to support it over the last 5 years.  It will seem archaic and like most hindsight perspectives, unnecessary with the adoption of newer technologies.   

A great example to compare Bitcoin to is gold.  Gold is valuable because it represents an ENORMOUS amount of effort to excavate, move, and process hundreds of tons of rock, just to get a very small ounce of gold out of the ground.  It's rare, it lasts for ever and its finite.  It has tremendous value over say, sand, because sand is not rare and requires nearly zero effort to acquire. (Is gold money or a commodity, I wont go into here - this is more a comment on waste vs value).

Bitcoin too requires an ENORMOUS amount of resources, money, equipment, manpower, etc to get to the good stuff.  Yes, technically it's finite but the difference is that none of this "work" is required any longer, and thus is wasteful and ultimately costly to the users.   But Bitcoin is and will always be extremely volatile, something a currency by definition can NOT be, if it to function as a medium of exchange for the long term. While currencies are always inflating and trade against each other, they are stable enough that they can be used for long term planning and budgeting, saving, etc.  This is something Bitcoin can never do, but bitUSD and other bitAsset "currencies" can.   Long live bitAssets and BitShares.

Just my 2 cents,
b

[Mysto]

Company metaphor is...
BitsharesX vs Bitcoin and the winner... BitsharesX

Currency metaphor is...
BitUSD vs Bitcoin and the winner... BitUSD

We win either way!

[starspirit]

I'm not the marketing expert, so happy for whatever approach the marketers think is best. The messages in the interview, as they stood, were very clear and tight, even the metaphor.

I do wonder what would happen though if an interviewer, or worse, debater, questions why a currency needs to earn a profit like a company. Minimising waste - agreed - but earning a profit would not be a conventional view for an asset designed to become a currency, even though its clearly not accepted as one today. It feels like an avoidable can of worms, but maybe not too dangerous.

To me a DAC is not an alternative to bitcoin (or any other wannabe currency), but a chance to earn profits from a real business in the crypto space. I see the true competitor to bitcoin and its ilk as BitUSD (stability, cost advantages, greater speed etc.)

[bytemaster]

The metaphor of BTC as an unprofitable company naturally infers it will end in failure. The metaphor of BTC as a currency does not. When gold was the money standard, there was also a cost in its mining claimed by the miners. Did that make gold an "unprofitable company" for its owners? Or a "charity"? No of course not, it was money! All money has a cost of production claimed by its producers. But all of this is like all philosophy - subject to the definitions of the debaters, and quite pointless.

My main point was, because it is an arguable proposition and not self-evident, I think it distracts from message as I think this thread is beginning to also do! I'm not sure why its necessary to compare DACs to cryptos. They share some similar technology, but they have different purposes, and a different audience. Comparing BitUSD to cryptos makes perfect sense on the other hand.

I think the difference is that gold has value for reasons other than its use as money... it would certainly have greater value if no new gold was being mined, but that is beside the point.     

I prefer to take the stance that there is no such thing as "money" or "currency" and that everything is barter.   Using the money/currency analogy is what is confusing and leads people to make poor investment choices.   Perhaps it doesn't matter that the holders of Bitcoin are being debased and the supply is "irrelevant" for its use as money.    But you cannot ignore the costs...  existing gold coins don't depend upon mining of new gold coins to secure their value.   You could stop mining new gold at any time.   

A metaphor provides a perspective and shows that if Bitcoin were a company it would be losing money.   If Bitcoin were a commodity (gold analogy) then it would be getting less and less rare as new production enters the market... those speculating on Bitcoin price as a commodity do so against a head wind of new incoming supply.  Ie: Bitcoin must grow by 10% per year or you will lose money.    Most people expect more than 10% growth so this isn't a major deterrent... today.   

Given two commodities one with a growing supply and one with a decreasing supply  (gold / silver)... a speculator would stand to gain more by holding the one with a decreasing supply than one with an increasing supply when market demand for the industry grows.   

When it comes to a "currency" then people will use what everyone else uses, but right now we don't have a currency we have speculation on an asset that *might* be adopted as a currency in the future.   The speculators are currently betting on network effect, but smart traders get in prior to the network effect by looking at fundamentals.   

The public will never tolerate a currency with so much waist and centralization as Bitcoin.... not to mention poor performance.    Fundamentals matter.   

[carpet ride]

The metaphor of BTC as an unprofitable company naturally infers it will end in failure. The metaphor of BTC as a currency does not. When gold was the money standard, there was also a cost in its mining claimed by the miners. Did that make gold an "unprofitable company" for its owners? Or a "charity"? No of course not, it was money! All money has a cost of production claimed by its producers. But all of this is like all philosophy - subject to the definitions of the debaters, and quite pointless.

My main point was, because it is an arguable proposition and not self-evident, I think it distracts from message as I think this thread is beginning to also do! I'm not sure why its necessary to compare DACs to cryptos. They share some similar technology, but they have different purposes, and a different audience. Comparing BitUSD to cryptos makes perfect sense on the other hand.

Using the term "cryptos" is avoiding the issue, no?

[sschechter]

Its a polymorphic digital asset! 

[starspirit]

I'm happy to cede to the majority opinion on this, it was a minor point to begin with. Based on this interview, the marketing looks good to me.

[Pheonike]

I think metaphor provides focus and clarity.

[starspirit]

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/03/10/taxpayers-lost-105-million-on-pennies-and-nickels-last-year/

If it cost more to make a penny that it's worth, should we keep making them the same way?

How much electricity and computer power does it cost to make those 25 BTC in that 10mins period? Not just person who gets the coins, but all the people who are trying at that moment.

Clearly PoS is superior to PoW on this front. I'm not an apologist for bitcoin at all. Just demonstrating how the metaphor can be challenged and create unnecessary distraction.

[Pheonike]

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/03/10/taxpayers-lost-105-million-on-pennies-and-nickels-last-year/

If it cost more to make a penny than it's worth, should we keep making them the same way?

How much electricity and computer power does it cost to make those 25 BTC in that 10mins period? Not just the person who gets the coins, but all the people who are trying at that moment.

[Pheonike]

I can't think of any now when it comes to pure POW cryptos.

[starspirit]

The metaphor of BTC as an unprofitable company naturally infers it will end in failure. The metaphor of BTC as a currency does not. When gold was the money standard, there was also a cost in its mining claimed by the miners. Did that make gold an "unprofitable company" for its owners? Or a "charity"? No of course not, it was money! All money has a cost of production claimed by its producers. But all of this is like all philosophy - subject to the definitions of the debaters, and quite pointless.

My main point was, because it is an arguable proposition and not self-evident, I think it distracts from message as I think this thread is beginning to also do! I'm not sure why its necessary to compare DACs to cryptos. They share some similar technology, but they have different purposes, and a different audience. Comparing BitUSD to cryptos makes perfect sense on the other hand.