The Instigator
Nd2400
Pro (for)
Tied
0 Points
The Contender
PointyDelta
Con (against)
Tied
0 Points

Is BITCOIN the new wave of the Future?

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Post Voting Period
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Voting Style: Open Point System: Select Winner
Started: 11/29/2017 Category: Economics
Updated: 1 month ago Status: Post Voting Period
Viewed: 741 times Debate No: 105238
Debate Rounds (4)
Comments (16)
Votes (0)

 

Nd2400

Pro

My position is Bitcoin is the future of transactions... And could one day be worth more than Gold.....

Tell me why you like to debate this subject in the comment section....
PointyDelta

Con

I accept this challenge. Best of luck.
Debate Round No. 1
Nd2400

Pro

I want to thank my opponent PointyDelta for accepting this debate.

Okay, i will keep this round kind of simple. I will give a brief rundown on what bitcoin is and what it can do.

"Bitcoin is a consensus network that enables a new payment system and a completely digital money. It is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. From a user perspective, Bitcoin is pretty much like cash for the Internet. Bitcoin can also be seen as the most prominent triple entry bookkeeping system in existence". (1.) https://bitcoin.org...

You can use bitcoin As payment for goods or services. You can Purchase bitcoins at a Bitcoin exchange. You can Exchange bitcoins with someone near you. You can Earn bitcoins through competitive mining.
"While it may be possible to find individuals who wish to sell bitcoins in exchange for a credit card or PayPal payment, most exchanges do not allow funding via these payment methods. This is due to cases where someone buys bitcoins with PayPal, and then reverses their half of the transaction. This is commonly referred to as a chargeback". (2.) https://bitcoin.org...

The difficult part of Bitcoin is being there own currency or at least trying to be a new currency. And that what bitcoin is trying to do. I know last month China actually when as far as to cancel bitcoin transactions and some other things. So you would think this would bring bitcoin down. And it did, but only the first few days then it got back to being stable and then even gone up. So, after a couple of weeks or so China decides to do business with bitcoin again. China was testing bitcoin to see if it can last. And it did.
This plan an important part because China has they own goals of trying to bring there own currency in the market system and challenge the US dollar. China has huge steaks in this. Trying to pull the middle east off the US dollar to go with cryptocurrency and digital payment.
So, the government in other countries including the US would want to regulate bitcoin and try to control it. So, what bitcoin is doing and what they already accomplish. Is pretty stunning all by itself.

If you think bitcoin is just a bubble, well you might be right about that too. But isn't everything a bubble? Look at the stock market, bonds, the housing market, the automobile market. All of these are a bubble as well. Bitcoin continues to increase in value, and more and more retailers and other business are now accepting bitcoin. Bitcoin has a somewhat questionable intrinsic value it will eventually be a common fiat currency. The current value is a reflection of its future worth- it Is akin to a credit card.

If you want to learn more about it here are some YouTube videos...
https://youtu.be......
https://youtu.be......
( keep in mind these youtube videos are not evidenced just something to watch if you want to learn more about it, so, you don't have to comment on them in this debate).

So, with that, i will turn it to you...
PointyDelta

Con

Thanks, Pro. Little low on characters here so I'll post rebuttal to these points next round.

My argument will be structured as follows.

R2: Bitcoin cannot be money given that it doesn't satisfy the three roles of money
R3: Bitcoin [henceforth BTC] is inherently deflationary and as such volatile and therefore not sustainable in the longer run (furthermore, growth is currently fuelled by a "bubble" of investment into the currency
R4: Summary, mopping up, rebuttal.



Righto. Let's start by examining the three roles of money (as any intro to economics class will teach you).

These are:

- Medium of exchange (in other words, it replaces barter as a mutually agreed upon means of exchange - instead of me swapping 400 cows for a Toyota I can agree that it costs $40,000)

- Store of value (it needs to hold its value over time) - here's where the problems really begin for BTC

- Unit of account (Prices are information - they carry meaning about the costs etc involved in the production of the good/service - for instance, if the price (information) of wood goes up, the price of pencils will go up. The pencil, in other words, carries the information (facilitated by money) that the price of wood has gone up)

Let's quickly examine why BTC doesn't fit two of these.

Medium of exchange
BTC actually does pretty well here. The clever design of it means that it can be used as a means of exchange between two parties with mutually agreeable terms. It's very moneylike. Further, it's anonymous which is a very money-like quality which facilitates transactions.

The issue here is the transactions are usually not those of a "good" nature - BTC is often used by criminals seeking a less-monitored (not implying that such currencies as the dollar are indeed monitored). The FBI states that it can at least to some extent follow up on this but the prevalence of this as an easy means of exchange for criminals (which is its primary function in this way) [1]. Therefore, its fulfilment of this means essentially that it's an easy target for those you probably don't want to be giving agency to.

Store of value
Here begin the problems with BTC as a currency. We can divide these into two easy problems for ease of access for those who haven't done economics.

First, it's volatile.

Fiat currency (which is the alternative) is broadly based (massive oversimplification here) off the stability of a government - in other words, the value of the dollar is predicated upon the understanding that the US government is highly unlikely to collapse.

Here's a quick story from today (11/29/17) that shows the volatility of the coin. [2] After making huge gains in the day, it then sharply dropped by two thousand dollars. Such crashing in value would be enough for any regular currency to be instantly discarded. I could quote more but I think the point is made - that BTC isn't a stable store of value.

(As a side note, it's interesting that BTC is usually measured in terms of the dollar. This is because the dollar is a stable store of value and therefore suitable for use as a currency)

Consider, therefore, that for as long as people around the world think in terms of pounds or dollars or euros then BTC will have serious troubles establishing itself as a reputable means of account.

Second, it's deflationary.

This means that it tends to "decrease in value". This seems idiotic - today (11/29/17) BTC had hit a high of $11k per coin. How can we understand this? Simple.

First, BTC has a "cap" on the number of coins that can be in existence - [3] 21 million coins. This sounds great - it avoids inflation, right? Perhaps, but there's a reason that central banks usually aim for an inflation target of roughly 2% pa and that's because wages are sticky. What this means is pretty simple - it's hard for companies to pay their workers less. This can be because of unions, or even simple personal attachment and the idea that the person whose wages are cut will hurt. Therefore, a small amount of inflation essentially "allows" the pay cheques of workers whose wages don't rise in line with the inflation to be cut, bypassing the stickiness of wages. However, if, as BTC always will (the number of BTCs that can be mined each year halves until the cap) the currency is inherently deflationary (in other words, given that the price will always increase assuming demand remains static), which means that the price of everything else, like books and houses and cars will decreases in BTC terms and therefore deflation occurs. This sounds good but it sucks - prices will generally fall which means that workers (who, remember, have sticky wages) will become more costly for companies to keep. Those who are employed tend to hoard money (either by investing it in stable things like gold or houses or by literally stuffing it under a mattress) and as such companies find it even harder to hire workers.

The end result of all this deflation, which is inevitable under BTC because of the fixed number that can exist is higher unemployment.

BTC is not a store of value.

Unit of account
BTC runs into a lot of the same problems as it did before here - prices of BTC are not determined in the way that a usual currency would be - they're mostly determined by those who are attempting to get into BTC as a means of making money. This is really, really bad. This essentially means that the price of something in BTC is determined by supply and demand, which is fine, but it also has the "investment factor" tacked on to it. In other words, BTC's nature as a secondary currency will inevitably lead it to mask or hide the information that is being sent and contained within the price and as such it is unsuitable as a unit of account.

Let's quickly go over what we've learnt.

1.) Bitcoin does fine as a medium of exchange - but not for the kind of people you really want it to
2.) Bitcoin is too volatile and too deflationary to act as a stable store of value
3.) Bitcoin is not suitable as a unit of account.

It's clear that BTC is not suitable as a currency. Bitcoin is therefore not the wave of the future - it's unusuable except as a means to make money. I'll tackle this in the next round because I don't have enough characters here to deal with it. Over to you, Pro.

1.)https://www.fbi.gov...
2.)https://www.coindesk.com...
3.)https://en.bitcoin.it...





(As an aside, the definition of bubble is very much misunderstood by my opponent and I'll go on and attempt to knock down his reasoning on the topic here in the next round)


Debate Round No. 2
Nd2400

Pro

You pointed out some good things in your argument, such as a store of value, and unit of account. But you have to go a little deeper on why bitcoin not the wave of the future. And I'm sure you will in the later rounds. So, let's have a closer look at why Bitcoin can hold their own weight in the 21 century and beyond.

Bitcoin has some great advantages, so let's see what they are...

"Payment freedom - It is possible to send and receive bitcoins anywhere in the world at any time. No bank holidays. No borders. No bureaucracy. Bitcoin allows its users to be in full control of their money.

Choose your own fees - There is no fee to receive bitcoins, and many wallets let you control how large a fee to pay when spending. Higher fees can encourage faster confirmation of your transactions. Fees are unrelated to the amount transferred, so it's possible to send 100,000 bitcoins for the same fee it costs to send 1 bitcoin. Additionally, merchant processors exist to assist merchants in processing transactions, converting bitcoins to fiat currency and depositing funds directly into merchants' bank accounts daily. As these services are based on Bitcoin, they can be offered for much lower fees than with PayPal or credit card networks.

Fewer risks for merchants - Bitcoin transactions are secure, irreversible, and do not contain customers" sensitive or personal information. This protects merchants from losses caused by fraud or fraudulent chargebacks, and there is no need for PCI compliance. Merchants can easily expand to new markets where either credit cards are not available or fraud rates are unacceptably high. The net results are lower fees, larger markets, and fewer administrative costs.

Security and control - Bitcoin users are in full control of their transactions; it is impossible for merchants to force unwanted or unnoticed charges as can happen with other payment methods. Bitcoin payments can be made without personal information tied to the transaction. This offers strong protection against identity theft. Bitcoin users can also protect their money with backup and encryption.

Transparent and neutral - All information concerning the Bitcoin money supply itself is readily available on the block chain for anybody to verify and use in real-time. No individual or organization can control or manipulate the Bitcoin protocol because it is cryptographically secure. This allows the core of Bitcoin to be trusted for being completely neutral, transparent and predictable". (3.) https://bitcoin.org...

Bitcoin not yet to the level of major credit cards companies, but they will be in time. Work is underway to lift current limitations, and future requirements are well known. Since inception, every aspect of the Bitcoin network has been in a continuous process of maturation, optimization, and specialization, and it should be expected to remain that way for some years to come. As traffic grows, more Bitcoin users may use lightweight clients, and full network nodes may become a more specialized service. For more details, see the Scalability page on the Wiki.

Bitcoin is money, and money has always been used both for legal and illegal purposes. Cash, credit cards and current banking systems widely surpass Bitcoin in terms of their use to finance crime. Bitcoin can bring significant innovation in payment systems and the benefits of such innovation are often considered to be far beyond their potential drawbacks.

"Bitcoin is designed to be a huge step forward in making money more secure and could also act as a significant protection against many forms of financial crime. For instance, bitcoins are completely impossible to counterfeit. Users are in full control of their payments and cannot receive unapproved charges such as with credit card fraud. Bitcoin transactions are irreversible and immune to fraudulent chargebacks. Bitcoin allows money to be secured against theft and loss using very strong and useful mechanisms such as backups, encryption, and multiple signatures". (4.) https://bitcoin.org...

"Bitcoin has not been made illegal by legislation in most jurisdictions. However, some jurisdictions (such as Argentina and Russia) severely restrict or ban foreign currencies. Other jurisdictions (such as Thailand) may limit the licensing of certain entities such as Bitcoin exchanges. Regulators from various jurisdictions are taking steps to provide individuals and businesses with rules on how to integrate this new technology with the formal, regulated financial system. For example, the Financial Crimes Enforcement Network (FinCEN), a bureau in the United States Treasury Department, issued non-binding guidance on how it characterizes certain activities involving virtual currencies". (5.) https://bitcoin.org...

Just like the dollar, Bitcoin can be used for a wide variety of purposes, some of which can be considered legitimate or not as per each jurisdiction's laws. In this regard, Bitcoin is no different than any other tool or resource and can be subjected to different regulations in each country. Bitcoin can also be taxed.Bitcoin is not a fiat currency with legal tender status in any jurisdiction, but often tax liability accrues regardless of the medium used. There is a wide variety of legislation in many different jurisdictions which could cause income, sales, payroll, capital gains, or some other form of tax liability to arise with Bitcoin.

So, i think it pretty much covers it. Bitcoin does have it own Store Of Value. It does have Medium Of Exchanges And has the Unit of Account. And just because Bitcoin has dramatic up's and down's doesn't mean it doesn't hold there own value, What you left out of today with Bitcoin roller coaster day, is it still was up in value. It opens at $9,816.35 Us dollars and its close at $10,517.51 US dollars. So just with today, it when up over 700 US dollars.

I know you said you want to go talk about the bubble, so i will give you what a bubble is.
"A bubble is a type of investing phenomenon that demonstrates the most basic type of "emotional investing." A bubble occurs when investors put so much demand on a asset that they drive the price beyond any accurate or rational reflection of its actual worth. In the case of a stock, the actual worth would ideally be determined by the performance of the underlying company. Like the soap bubbles a child likes to blow, investing bubbles often appear as though they will rise forever, but since they are not formed from anything substantial, they eventually pop. And when they do, the money that was invested into them dissipates into the wind". (6.) https://www.investopedia.com...
The stock market can have many bubbles, same with just about anything you look at, anything you buy or sell will someday create a bubble. So will Bitcoin have a bubble yes it has a bubble. But when will it pop open, where that will depend on what happens in the future. This rally could go up for years, to a few more weeks, before it starts to stable lives. One thing it got going is all the good news bitcoin been having lately, so the price will always go up with good news. And nothing seems to slow bitcoin down. It's a fast moving train right now, so better move out the way or hoop on before it to late.

looking forward to what you have to say about your bubble.......
PointyDelta

Con

This round I"ll talk about how the valuation of BTC, given that it"s not based on any possible use as a currency is entirely based upon the "greater fool" theory, and why this makes it not only unsuitable as a currency but also decidedly not the wave of the future.

First " rebuttal, point by point (not line by line, given that Pro"s argument is filled with meaningless quotes from...erm...BTC wiki. Not exactly the strongest source for a pro-BTC argument, but I digress.)

Rebuttal

>BTC has a somewhat questionable intrinsic value it will eventually be a common fiat currency.

No, it won't. Fiat currency is backed by a central bank. The pound, the dollar or the euro are fiat currencies. BTC isn't and never can be.

You pretty much handwave away my arguments on the nature of currency. You can"t do that, you see, because that"s the function of all currencies in order for them to be a currency. If they don"t do these, they"re not a currency. Given that they therefore cannot be used as a currency they have no value outside of the market in them. Given that Pro didn"t set forth any definition to wave of the future " I"ll set it forth as the "currency" of the future.

Let"s tackle the first assertions you make based upon source 3. (Assertion is probably the wrong word " copy and paste is probably better)

>Payment freedom

Regular currencies already have this. We"ve already talked about how, for BTC to be adopted as an actual currency it would need to have significant advantages over regular currencies in addition to fulfilling the roles of money (two of which, remember, it doesn"t and cannot fulfil and one of which it barely fulfils)

>Choose your own fees

Fees for BTC transactions are based upon what merchants will take for a certain amount " as the value of BTC goes up their work becomes harder and more important " therefore, fees will go up. This is actually a disadvantage over, say, the dollar given that the value of the dollar is stable (remember, that"s why it can be used as a store of value)

>Fewer risks for merchants

Mainstream currencies have this feature already.

>Security and control

This sounds like it would be great, but it actually kicks up even more problems with BTC as a currency. One of the peripheral attributes of all currency is that it"s fungible. This means simply that one unit of the currency is exactly the same as one unit of a currency. One dollar is the same as one dollar. The thing is, according to this "security" protocol, each bitcoin is different. It"s not fungible. The problems with this become apparent with the following thought experiment " consider that having shells as currency would be stupid given that each shell is subtly different. No scarcity and therefore means of creating a store of value can be established given that establishing a universal value is impossible.

>Transparent

Mainstream currencies already have this.

From this we can surmise that BTC has no advantages over mainstream currencies and is handicapped by the fact that it does not fulfil two of the three roles of money.

>Bitcoin is money,

No, it isn"t. It can"t possibly be. I've proven this.

>For instance, bitcoin are completely impossible to counterfeit.

This is because they"re not fungible. They are not money and they cannot be money.

>bitcoin has not been made illegal by legislation in most jurisdictions. [...] (5.)

This is completely irrelevant.

>And just because bitcoin has dramatic up's and down's doesn't mean it doesn't hold there own value

Theoretically, everything scarce has a value which is determined by supply and demand. I"ll get onto this later but the implications of this essentially mean that air, for instance - which is scarce - theoretically has a value determined by supply and demand (note that with air the supply is so large that the price is effectively below the point where any company could profit by selling it). It doesn't matter that the prices of BTC go up instead of down, it's not a stable value, which is the point.

>What you left out of today with bitcoin roller coaster day, is it still was up in value. [...]So just with today, it when up over 700 US dollars.

Something that is attempting to be a currency cannot possibly fluctuate to this level in one day and act as a stable store of value, which BTC doesn"t. It"s not money and it cannot be money either.

Let"s move on to my substantive.

==Greater Fool Theory==

Sounds complicated, but in reality it"s pretty simple.

Couple months back, when BTC was pretty low, I bought and sold a few fractions of a bitcoin, making a tidy profit of "200. In order to do that, I needed to do two things.

First, I needed to find someone to buy them off.

Second, I needed to find someone to sell them to " remember, BTC doesn"t just vanish when you sell it. You"re selling it to someone else.

In order to buy them, I needed to find someone who was willing to sell. Consider that I was getting into the marketplace to make money " that meant that I wanted to buy them off someone who was stupider than me. Why? I"m clever (by the reckoning of this theory), therefore I wanted to get into the market in the expectation of making a profit. Someone who was as clever or cleverer than me wouldn"t sell their BTC to me " because they would see that the value was going to go up and therefore hold onto them in the expectations of selling them on to someone else later (this is important). Therefore, I needed to find someone who didn"t think or didn"t know that the value was going to go up " I needed to find the greater fool.

When I sold them, I was getting out of the market. That"s because I thought it would crash soon (otherwise I would have stayed in). People cleverer than me wouldn"t have bought the soon-to-be-worth-less-than-what-they-paid BTC off me, therefore I needed to find the greater fool.

Consider, therefore, that all the buying and selling that goes on in the BTC market is based upon everyone thinking that there exist a stupider person than them who doesn"t realize that the market for BTC will go up (buying) or go down (selling). This works fine (not really), as long as BTC continues to go up. The problem is that the value of BTC is therefore predicated on everyone thinking that everyone else is a greater fool than them, or at least that there exist enough greater fools for the market to continue.

This isn"t an issue with things like currencies, because they function with universal acceptance " furthermore, they act as a stable store of value which minimises the greater fool effect given that they"re not seen as an investment.

Investment into bitcoin is therefore fuelled by the idea that you can one day get out of bitcoin by converting it into a real store of value, like dollars. The problem here is the value of BTC (ie the ability to get into and out of BTC in real terms, like dollars) is predicated upon the thought that there"s a bigger idiot than you out there. This is the definition of a bubble. Getting into something that is rapidly increasing in value with the idea that you can get out before it crashes. Once the crash begins, you can"t get out " there are no greater fools left to take your BTC " or, at least, there aren"t enough greater fools to take your BTC.

What have we learned today? There are reasons we have money " to be precise, three reasons. Bitcoin doesn"t fulfil two and barely fulfils the other because of its lack of fungibility. Bitcoin"s value is based upon not nothing, but something worse than that - the mistaken understanding or assumption that there will always be enough stupid people for you to get out of the market before it collapses.

Quick addendum: The value of the dollar is mostly based upon the fact that you can use them to both pay taxes to the US government and also the fact that the Federal Reserve has promised to buy dollars.
Debate Round No. 3
Nd2400

Pro

Okay, I will take about why Bitcoin is like money/Cash, credit cards, the current banking system, and better than a PayPal, or Western Union. Bitcoin has value as much as you want to disclaim this. I will go further in this later, another thing I will discuss is the meaningless quotes as you say. I will also talk how about bitcoin currency and how it related to the stock market or another market for that matter.

So, let me go right into this. You say my "argument is filled with meaningless quotes from...erm...BTC wiki. Not exactly the strongest source". OKay, let me ask you this why inst BTC inst a strong source? Is it because it has true facts, and wipe out your claim on why Bitcoin actual has real Store Value, and can actually be a real currency one day.Or is it because you don't have a source to better challenge my source. Either way, you try to discredit my quotes, because they are right, and yet you show zone proof on why my quotes are wrong. BTC website is actually a very good informative site. You can learn a lot on Bitcoin. And it makes it easy to understand how it works and how it can change, etc, etc.

You also try to disclaim Bitcoin has no real value. When in fact it does. i already when though thing process. Bitcoin is pretty much like cash for the Internet. Bitcoin can also be seen as the most prominent triple entry bookkeeping system in existence. Bitcoin enables a new payment system and a completely digital money. "Bitcoins have value because they are useful as a form of money. Bitcoin has the characteristics of money (durability, portability, fungibility, scarcity, divisibility, and recognizability) based on the properties of mathematics rather than relying on physical properties (like gold and silver) or trust in central authorities (like fiat currencies). In short, Bitcoin is backed by mathematics. With these attributes, all that is required for a form of money to hold value is trust and adoption. In the case of Bitcoin, this can be measured by its growing base of users, merchants, and startups. As with all currency, bitcoin's value comes only and directly from people willing to accept them as payment". (7.) https://bitcoin.org...
Again you can say no all you want, that doesn't make you right when you have no proof of why it doesn't have real value.

Now let talk about your personal experience with Bitcoin. You made some money on it, you say you made 200. So, the 200 you made doesn't have a real value for you? You didn't pay any bills with that money or didn't use it for entertainment purposes, or you didn't use it for food, gas, or anything else for that matter? You made some real money on it, and yet you still mad about that, sure you didn't get rich with it, but you made money. Now if you were wise you would have stayed in the market. Why because every trading sector like stocks, bonds, gold, or any other metals have periods of going down, and then they always go back up, in most cases even reaching higher levels. So, you trying to bash Bitcoin because you actually lost money just because you didn't stay long enough. Again you can hate the stock market or the bond market just as much because with every trading sector, you can lose money or make little gains, or even make a lot. There is a risk in everything, and even in the market case, you can win some and lose some. You have to actually do real research on the companies you are investing, but even with that you can get unlucky and lose money or break even. It's a game of chance and reward, it the same case with Bitcoin.

You also mention the rise and fall of the price of Bitcoin, yes it pretty extreme sometimes. "The price of a bitcoin is determined by supply and demand. When demand for bitcoins increases, the price increases, and when demand falls, the price falls. There is only a limited number of bitcoins in circulation and new bitcoins are created at a predictable and decreasing rate, which means that demand must follow this level of inflation to keep the price stable. Because Bitcoin is still a relatively small market compared to what it could be, it doesn't take significant amounts of money to move the market price up or down, and thus the price of a bitcoin is still very volatile". (8.) https://bitcoin.org... Did you know the US dollar wasn't as strong when it first started. "The dollar was chosen to become the monetary unit for the USA in 1785. The Coinage Act of 1792 helped put together an organised monetary system that introduced coinage in gold, silver, and copper. Paper notes or greenbacks were introduced into the system in 1861 to help finance the Civil War". (9.) https://www.google.com...
It takes a very long time before the US dollars became mainstream in the world marketplace. Bitcoin only stated in 2009, and now starting to gain more and more attention, not just for the trader, but business, and now the world markets are starting to take notice of Bitcoin. Remember when people like you, say the internet, Facebook, Google, or Apple wouldn't make it? People were saying the same thing about Bitcoin, and some still are, but all Bitcoin is doing is getting bigger and bigger.

Oh before i forget you mention "bitcoin has not been made illegal by legislation in most jurisdictions.
This is completely irrelevant". It only irrelevant to you, because you want to say Bitcoin inst a currency. But with what i have already said, it still holds water, it takes time for a new currency to form. It doesn't happen overnight. And we can see bitcoin is getting closer and closer toward that goal if they want it. The part of Legislation and most Jurisdiction are just. You can regulate bitcoin and tax it just like any other form of currency. But until a government or some other country make this leap, it just assets, you can make money on bitcoin, you can lose money or break even on it. But whatever the case you can still make purchases with it better than other a PayPal, a Western Union. a fact that more and more companies and business are starting to use Bitcoin is a testament to the trust it starting to gain. So, yes it pretty clear Bitcoin has a real store value. No matter what my opponent said. He is wrong on his claims and provided no real evidence on his reasons. I have provided proof, on this matter he has not.....

Bitcoin is the wave of the future, just because you are scared of what it can do online doesn't mean you shouldn't ignore this new technology embrace this new way of doing business such as transactions. Just like the internet, people were afraid of it the first few years of its existence. And I notice you totally forgot to mention that bubble you were trying claim. Since i show you what a bubble is and how it can be on anything in the market system you going to just leave that part out now. That's fine another point by me. Anyways Bitcoin is the wave of the future rather you like it or not.

I want to thank you for this debate.
This was actually a good one. Gladly you were a worthy opponent. And now it's your turn......
PointyDelta

Con

As promised, rebuttal and summary this round. Let’s begin.

It should be apparent to anyone reading that citing the source that invented BTC as a reason to justify BTC as a stable store of value and a currency is not the best of sources. Taking something as read with assertions not based upon proofs is the quickest way to make yourself ignorant very quickly. Pro’s sources are entirely BTC wiki. Now, they might be good at talking about BTC, but simply asserting that something is so does not make it so. Stating something which is economic fact is the case.

“BTC has value as much as you want to disclaim this.”

I’m not disclaiming [sic] it. On the contrary, I’m stating that it very much has a value. Pro seems to be confusing value with price. The value of something is “the regard that something is held to deserve; the importance, worth, or usefulness of something.”. Prices are information, not values. The value of BTC is based upon the understanding that one can sell it on to someone else. I showed in previous round why this depends upon the greater fool theory and as such the price, not value of BTC is based upon something which is essentially a pyramid scheme.

“BTC [has] value because they are useful as a form of money.”

No, they aren’t. My entire R2 argument centred around why BTC cannot be money. I notice Pro has failed to address the issues I raise aside from handwaving them away.

“based on the properties of mathematics”

Congratulations, you’ve proven BTC is scarce in supply and there’s a demand for it. This thing now has a price. Price is not value, value is not price.

Before I continue I’d like to quickly mention that I resent the implication that I’m attacking BTC because “I’m mad that I didn’t stay in the market”. Nonsense, and this absolutely reeks of ad hominem and an attempt to discredit my arguments from economics because of my personal experience.

“It's a game of chance and reward, it the same case with BTC.”

Correct again. A “currency” which fluctuates to the level that BTC does is not suitable for use as money. It doesn’t matter that it trends up instead of down, the fact that it is inherently deflationary due to the fact that there is a limited supply and based upon the greater fool theory. It is not a stable store of value. Theoretically, were there to exist a market for polished rocks, they would be a store of value. The point is, without any central guarantor other than limited supply they do not and cannot be a stable store of value. BTC are unsuitable for use as money.

“You also mention the rise and fall of the price of BTC, yes it pretty extreme sometimes.”

Pro pretty much concedes here and accepts that BTC is volatile and therefore unsuitable as a stable store of value. It doesn’t matter that it is indeed a store of value, the issue at stake is that it doesn’t inflate at a stable rate. I’ve discussed earlier why a modicum of inflation is a good thing.

The discussion of the dollar is irrelevant, given that the dollar fulfils the three attributes of money – the dollar acts as a stable means of exchange given that it’s fungible, it acts as a stable store of value given that it’s essentially “guaranteed” by the Federal Reserve and it acts as a unit of account given that its value, not its price remains relatively constant and non-volatile, inflating at a stable rate of roughly 2% per year according to the target set by the Fed.

Bitcoin does not.

“It only irrelevant to you, because you want to say BTC inst a currency.”

I’d love BTC to be a currency. It’s a cool idea. The thing is, it’s economically unsound. It does not fulfil the attributes of money. It cannot be a currency. No matter how much people wish BTC to be a currency on the level of the dollar, it will not replace it, because the dollar does the things that money needs to do. BTC does not, and cannot.

“But with what i have already said, it still holds water, it takes time for a new currency to form. It doesn't happen overnight.”

Actually, it can and does. [1] In Brazil, economists in the government created what was essentially a new currency, which backed the failing real. It did, indeed happen overnight. You know why that happened? Because that currency fulfilled the three roles of money and was backed by a government therefore it was a stable store of value.

“tax it just like any other form of currency.”

One cannot tax a currency. One can, however, tax the value which is represented by a currency. If the currency doesn’t stably represent that value then it is unsuitable for use as a currency. BTC does not stably represent value.

“But whatever the case you can still make purchases with it better than other a PayPal, a Western Union. a fact that more and more companies and business are starting to use BTC is a testament to the trust it starting hto gain.”

Untrue. In fact, fewer companies and places of purchase are accepting BTC that were last year[2]. Major online retailers that accept BTC are down to three, from five last year. You know why they’re doing this? It’s because BTC isn’t a suitable unit of account. You know why? Because it’s volatile. You know why? Because it’s backed by no value other than that which can be sold on. BTC is not suitable as a currency.

I’ll ignore the ad hominem implying that I’m scared of BTC. I’m not.

“ And I notice you totally forgot to mention that bubble you were trying claim.”

Where those investing in anything are doing so because of an understanding that there exists value within it which is derived from the expectation that one can later sell the thing onto others to extract that value in terms of a stable store of value. Like dollars. Say I’ve got a house, and I want to sell it on to someone else. They give me 400,000 dollars for it. I have now taken the volatile value of the house, and converted it to a stable value by means of a price. Where the entirety of the value is based upon this, as you claim, and further that it increases rapidly it knocks out the greater fool effect that leads to investor confidence. This is a bubble.

My source for all of my claims is my trusty copy of “Principles of Economics” by N. Gregory Mankiw plus two years of formal Economics education.

In summary, I’ve repeatedly proven, with statistics and economics that there’s a reason we have money, not cows or funny-shaped rocks or seashells. To be more precise – there’s three reasons. First of all, money needs to be a way for two people to swap things. Money lubricates the gears of all transactions. In order for this to happen, all of the money needs to be the same, it needs to be fungible. BTC isn’t. My opponent fails to address this charge beyond baseless assertions from the BTC wiki. Second, money needs to be a way that people can count up how much things are worth in terms of their value, and then convert them into a price. My opponent, in answer to this, confuses value with price and price with value. There has been no reply. Finally, money needs to be a way for businesses to tot up how much they’re worth. There has been no reply.

My opponent categorically fails to address the economic concerns on the fact that BTC is not money and it can never be money. It could be used as a means of transaction, but so could cows or houses or shiny rocks or sharp sticks.

Furthermore, in order to replace currencies such as the dollar it would need to have advantages. Not only does it not have these, it has significant disadvantages. It is volatile, unstable, difficult to base value upon. It is not currency, and it is not, cannot and will never be the wave of the future. Vote Con.

1.)https://www.npr.org...
2.)http://uk.businessinsider.com...
Debate Round No. 4
16 comments have been posted on this debate. Showing 1 through 10 records.
Posted by whiteflame 1 month ago
whiteflame
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>Reported vote: BryanMullinsNOCHRISTMAS2// Mod action: Removed<

7 points to Con. Reasons for voting decision: Con won because he had a better debate strategy than Pro's. So, con by default!

[*Reason for removal*] The voter is required to explain their decision by referring to specific arguments made in the debate. Generalizing is not sufficient.
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Posted by PointyDelta 1 month ago
PointyDelta
There's a reason I have an extension on chrome which changes all mentions of "bitcoin" to "magic beans".
Posted by Nd2400 1 month ago
Nd2400
And yet it was still positive for the day. Any ways it not rare for bitcoin to have huge gains or loses in matter of minutes...
Posted by PointyDelta 1 month ago
PointyDelta
Sounds fair to me.
Posted by Nd2400 1 month ago
Nd2400
PointyDelta: you seem like a worthy opponent. So, how about the first round is accept only.
I will be arguing why bitcoin Is the new form of transactions and why it could be a new currency on it own.
You would be arguing on why it cant be they own currency and why bitcoin will fail.
Does this seem fair?
Posted by PointyDelta 1 month ago
PointyDelta
I'll take it. Set forth some rules and I'll give this one a whack.
Posted by Nd2400 1 month ago
Nd2400
Hmm. I'm open to the idea of debating you. Tell me why i should accept you? I do not like Forfeited....
Posted by SupaDudz 1 month ago
SupaDudz
ND, i would love to debate you but i do not meet any criteria
No votes have been placed for this debate.