Get that new video card before the crypto currency people buy them all

[Art Blade]

as far as I understand it, that currency can be used anonymously and by that to buy stuff on the black market such as the dark net. Like, you can buy drugs or side arms and other weird stuff I don't even want to mention.

[LowPolyOWG]

I'm NOT into that type of trading

But yes, that's indeed true that crypto currency can be used for illegal purpose

[Dweller_Benthos]

But it still has no "real" value? There isn't anything backing it up? I could see where your activity in processing these "units" are something substantial, like it resulted in some mathematical equation that's useful for something, but it's just wasting time processing numbers until it finishes, then you've magically created something that's worth money?

Basically, the only experience I have with these things is that cryptowall virus that they wanted you to pay a bitcoin ransom to get your files back.

The stock market crash of 1929 was caused by people buying stock on margin, in other words, on credit that didn't exist, and when that started to show up as non-existant money, the whole thing collapsed and the great depression dragged the world down for a decade and essentially caused world war two. Having a currency that's not valued on anything is a dangerous economic game to play.

[LowPolyOWG]

Should explain the basics behind it.




LinusTech explains about cryptocurrencies and how it w0#k compared to regular currencies

Had to fix the URL, looks like the forum messed up "w0#k" 

[Art Blade]

I can completely relate to D_B's post. Spot on

[Dweller_Benthos]

OK I read the page but haven't watched the video yet. Fundamentally, I see how it works, essentially the people using it have agreed that it's worth something and that's about it. It's pretty much the same with any money really, though the US dollar used to be based on gold (there was an actual piece of gold stored somewhere for each printed dollar) it's now just based on the credit value of the US economy or something like that. So even that is not based on something "real".

My issue with the whole crypto-currency thing is the waste of resources. All that computing power is essentially spinning it's wheels running useless numbers to complete a unit. We could be using all that computer power to something productive like cancer research or even the SETI project.

[Art Blade]

good point

[LowPolyOWG]

 

[fragger]

American currency is not backed by anything anymore. At the Bretton Woods Conference in New Hampshire in 1944, it was agreed upon by all Allied leaders that the greenback would become the world's standard international currency after the war was over. Later in 1971, Nixon abolished the gold standard for American currency so that he and his mate Kissenger could implement the Petrodollar system with the OPEC nations. The selling of oil by OPEC exclusively in greenbacks and the "petrodollar cycle" that keeps the greenbacks moving around the world is about the only thing keeping the American dollar afloat today.

If the Middle Eastern oil nations decide to start selling their oil in Euros or Rubles or some other currency, the value of all those over-printed greenbacks will revert to no more than the intrinsic worth of the paper and ink they're printed on. All the countries in the world which have stockpiles of greenbacks for the purchasing of Middle-Eastern oil will then want to cash in their greenbacks with America for gold or something, so they can start stocking up on Euros or whatever they will subsequently need to buy their oil with. But the US no longer has enough gold or anything else of monetary value to back up all the billions of dollars' worth of paper bills that they've cranked out over the years with such reckless abandon, paper bills which without their oil-purchasing power will suddenly have no intrinsic value to anybody. If it ever happens, a move away from the US dollar for the purchasing of ME oil will have a disastrous effect on the American economy and could plunge it into a debt-driven depression that it might never fully recover from.

The printing of paper money technically contravenes the US constitution itself. American money was originally all in coin form, and each coin had to contain a minimum percentage of gold, silver or other precious metal in its composition. This was done to keep the nation's wealth distributed among its people and prevent any kind of centralized accumulation of that wealth, hopefully avoiding the temptations of corruption that beset some people in close proximity to very large accumulations of money. Lincoln first introduced paper bills during the Civil War to help pay for that war, which was a move that (to greatly nutshell it) would ultimately pave the way for the Federal Reserve to come into being many years later. There is a Constitutional clause somewhere that allows the printing of bills in "times of insurrection" or some such, which was the excuse Lincoln used to print his bills, but the money was supposed to revert to coin form once the insurrection had been dealt with.

Of course, the Founding Fathers could not possibly have foreseen EFTPOS, the internet and cyber-currency over two centuries later, nor could they have visualized a situation where their nation's wealth would come to depend primarily upon the sales of Middle Eastern oil purchased with un-backed US currency, while the Saudis themselves hold America's debt (because the Saudis have used a lot of their American oil money to buy up billions of dollars' worth of American debt securities. This is why the US government treats Saudi big-shots like royalty and excludes them from travel bans).


US Constitution
Article I
Section 10

1: No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.


Building up an economy based on money backed by nothing is like building a house out of cardboard and hoping it never gets windy.

[Dweller_Benthos]

Nice read, Fragger, thanks for the clarification. I knew about the oil being traded in US dollars, but not the details and how it effects the worth of the dollar. Then there's the problem of when (not if) the Saudi oil runs out, which would probably happen sooner than them deciding to use something else to sell oil with. Oil is going to go away, there is no doubt about it, it's just a matter of when. What happens to the dollar based on oil when there is no oil to sell?

I can see keeping money in coin form where the actual coin is made of something worthwhile, but that's still based on everyone agreeing that those materials are worth a certain amount. Gold and silver are useful materials in many applications, but not, if you really think about it, worth the amount they are valued at just from what those applications are. Mostly it boils down to "oooohhhhhh shiny!" and that's about it. Diamonds too, for that matter, I once read an article that it's better to carry around diamonds than an equivalent amount of gold because, you know, gold is heavy. But even diamonds are only valued at the rate they are because people agree on that value. They have many uses in various applications as well, but again, it's mostly based on the shiny/pretty factor.

Plus, without paper money, you'd have to be carrying a ton of coins in your pocket, and who wants to jingle with every step?

[LowPolyOWG]

Well this happened... At least the RX 580s will be in stock now

Rumours suggested Ethereum would be much more harder to mine after block number 4.6 million and they hit that. Even BTC went down. The cryptocurrency market fell down towards 70 billion USD 

[Art Blade]

heavy. Imagine people bought crypto currency with real money and now lost a good part of that.

I'm glad that I can afford to say, "well, I don't care."

[LowPolyOWG]

It will probably stabilize itself some days later 

[Art Blade]

wanna bet on it?  that's called "speculation" and some people made a fortune speculating. Some lost everything, however..

[LowPolyOWG]

Some people even spent 1000s on computer hardware