This was posted to the official AMT thread:


Without implying that there are any scammers anywhere in the world, I must point out that this is exactly what every scammer wants his victims to do: give up, forget him, and let him get away with their money.

A scammer may even bribe one of his victims to give this advice to the other victims.  Or pose as one of his victims to do so.

By "fake" and "unreliable" I do not mean intentionally falsified (although that is a definite possibility, since almost everyone in the "bitcoin industry" would have a strong motivation to do that).

Take for example the plot of total estimated daily USD transaction volume by blockchain.info.  (That plot is obtained from the total estimated daily BTC transaction volume times the market price.  The "estimated" in the name refers to the exclusion of any transaction outputs that are assumed to be return change; I do not know how they do that.)

Note that the USD volume during Jan/10--31 was ~75 M$/day; in Mar/25--Apr/20 and Jul/10--Aug/05 it was ~50 M$/day.  So the USD volume dropped 30% from January to now, and did not increase from April to now (although there were some peaks in between).

That does not fit with "increasing adoption".   The only way to avoid that conclusion is to assume that most of that blockchain  volume is not actual payments (bitcoins changing hands) but "fake volume" (bitcoin moving between addresses that belong to the same person); so that the presumed increase in actual paymets is masked by the "fake" volume.   Indeed, this hypothesis is consistent with the claim by Bitpay that they processed 100 M$ payments for the entire year of 2013, with is only a couple of days' worth of the USD volume shown by blockchain.info.   

But if most of the transactions in the blockchain are "fake", the other blockchain statistics are equally meaningless...

Would you have a link for this data?

As I wrote before, these "adoptions" are unlikely to attract many new users to bitcoin.  They are attractive only to people who already have some amount of bitcoins and have decided to spend some of them.  New users who try paying for something in bitcoin, out of curiosity or hoping to save money, may be disappointed rather than "converted". 

Thanks.  It may be a troll using his account, of course; although, to me, it does read like his style...

they claimed to have processed 100 million USD in payments last year.  Somewhere in their website they should say what their fee is.  It should amount to a couple million USD of revenue, at most.  Not much for a company that has to pay maybe 10 employees at 50'000 USD/year or more.

Does anyone know how much payment they (and/or Coinbase) have processed this year?

Recently? Could you post the link?

"Price" = what one paid or must pay to acquire something.  An objective concept (everyone who knows how much was paid or is being charged for some item will agree about its price), but is typically different for each transaction, even for successive transactions with the same item.  "Market price" = price of the last transaction of the item in some open market, or largest bid or lowest ask in said market.

"Value" = how much one would pay to acquire that item, or charge to sell it.  A subjective concept (typically the same item will have different values for different people, even at the same time and place), may not be clearly known by the person himself, and may change quickly and radically as the person's mood, ideas, and circumstances change.

In a free and conscious commercial transaction, typically the item has higher value to the buyer than to the seller, and the price is some amount between the two values.

There's  an old quip, "an Economist knows the price of everything, but the value of nothing." 

Check your math again... If paying in bitcoin through a bitcoin processor like Bitpay or Coinbase (which is the only option for most stores that "accept bitcoin"), there are two bank transfers: when you send money to buy bitcoin, and when the processor sends money to the merchant.

Bitcoin may be more economical than bank transfers for international payments.  Otherwise it is just a convenient option for people who have old cheap bitcoins and have decided to cash on the profit.  It may (or may not) save some money, compared to selling the bitcoins on an exchange and sending the money to the merchant.

Oops, would you accept my apologies for that?

To be precise, someone posted some photos taken at some date, that show someone who looks like him in a room next to a Chinese-looking person and many some black boxes inside cardboard boxes, with some "No Smoking" laser-printed signs in Chinese on the wall.  

And in Scotland there is at least one sheep that is black on one side.  

Well, for one thing, he made a film that alerted people about the risks of all-digital voting machines.  

At least he did not try to steal millions from other people by promoting bitcoin.  

EDIT: Oops, should I delete this non-question that I posted by mistake?

We do not know whether the number of "bitcoin users" is increasing.

The sources that I know (such as blockchan.info) do not give that information.  They give some quantities (such as wallet software downloads, transactions per day, total BTC volume per day) from which some people claim to be able to derive the number of users.  However, those quantities include an unknown amount of operations that do not imply real additional use.  Some of them (like total BTC volume) have been relatively constant for the last 6 months.  Moreover, there is no information at all about people who stopped "using" bitcoin, e.g. after buying a bit just for curiosity.

Why should they close?

You have all seen the CEO's curriculum vitae, I suppose:
Re: Butterfly Labs CEO 25 Million USD Mail Fraud — A Concise Summary of Evidence
So, I am puzzled, what are you still expecting? 

"They brought the cryptocoin, and he asked them, "whose image is this, and whose inscription?" "Uh... Shiba's?" they replied.

"For the price of a banana" as they say around here...

Thanks for the link. My reading is that they did think of that blockchain being maintained indefinitely in principle, but were not very sure that it would "catch".  Is that it?

Funny you say that, because one thing that struck me in that paper was its "completeness",  with every necessary piece of the protocol identified and provided with a sketch of workable solution.  Most often, papers that describe a new technological breaktrough describe only a "toy"  implemetnation that demonstrates that idea only.  In that sense, that paper reads more as an engineering sketch than a computer science paper.

Speaking of Satoshi Nakamoto, I have a "historical" question.  When he set up the first mining node and started the current blockchain, did he see it as "the" blockchain, that one day would be used to buy servers from Dell, support investment funds, send people to jail, etc.; or did he think of it as an alpha-test of the protocol, that would be used only by computer nerds, only long enough to show that the idea was sound?

(IIRC there is nothing about that in the published paper.  Did he comment on that in his "epistles"?)

Right.  Just think about it, if Satoshi Nakamoto had not skipped his math classes in high school to work in the industry, he might not have designed bitcoin. 

A trader who publicly humiliates a colleague for losing money with a bad trade is like a fisherman who shoos away any fish that tries to nibble at his bait.  He has not quite grasped the concept yet. 

Oh boy, those old-timers are getting rid of their coins for real.  What do they know that we don't know?