About Bitcoin as it might be discussed in economics class, e.g. supply, demand and price in theory.

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40 views

Correlation between business cycle and BTC price

I would like to know if there is a correlation between business cycle and Bitcoin price, whether it is negative or positive. I am wondering because Bitcoin is deemed as commodity in my country's law, ...
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2answers
60 views

An “Almost” decentralised currency

I've been interested in Bitcoin for a while. I've been thinking I'd like to give it a go and see if I can make my own cryptocurrency, just to see if I can. I run my own small web hosting company, the ...
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2answers
100 views

What are some of the proposed ideas to why the Bitcoin dropped to sub $400 in the end of summer 2014?

Having seen that BTC was around $600 early summer of 2014 (May-July). It is currently almost 50% of that value. I read many varying reports of the cause of such a big drop. Can someone give a list of ...
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0answers
58 views

How does the Bitcoin forex work?

Does it work differently in relation to a regular forex because of its underlying technology? How can the market calculate its value?
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1answer
155 views

How efficient are bitcoin markets?

There are several bitcoin exchanges which trade bitcoins to $US and also several other markets which trade bitcoin for other currencies. Each exchange however quotes a different price in effective ...
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1answer
30 views

Are there any instruments that I can use to trade bitcoin volatility?

In the stock market, there are several financial products that allow an individual investor to trade/hedge daily volatility? As an example, there is the VIIX. Are there any such financial products ...
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2answers
89 views

How are new bitcoins created without monetary inflation?

As bitcoins are mined are older bitcoins retired? If not, how is monetary inflation prevented? Wouldn't the additional bitcoins cause the overall value of bitcoins to be deflated?
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3answers
45 views

How could a large owner of Bitcoin give back to the Bitcoin community in an equal way?

If there was one large owner of Bitcoin, for example somebody who owned 3% of all mined Bitcoins, would there be a way for that person to give back their Bitcoins in an equal way? I'm thinking more ...
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1answer
54 views

What are the economics of confirming a block of transactions?

From what I understand, CREATING a block to confirm or verify transactions is hard work, and is rewarded with 25 bitcoins, or something like $12,325 (depending on the daily exchange rate). But how do ...
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1answer
55 views

How do goods & services sellers manage price instability?

How do retail outlets manage the massive price instability? Are they really repricing every second with 25-50% spikes and drops over 24 hours? How much does it cost to maintain accurate prices? ...
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2answers
43 views

How can other currencies be “issued” via Bitcoin?

I've heard a few prominent bitcoiners (Andreeseen, ppl from BitPay) say that currencies such as US Dollars can be "issued" over the bitcoin network. I'm not exactly sure how this is possible, and I ...
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1answer
170 views

How to calculate velocity of Bitcoin?

So determining the value of bitcoin is not the question at stake here. Suppose there's a new bitcoin with a production algorithm that's tied to the feedback rule proposed by McCallum and adjusts ...
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1answer
154 views

Is there a way to make a crypto-currency stable by design? How? [duplicate]

I'm just wondering if there's any way of creating a crypto-currency that is stable by-design. How would one do so? Can there be something like a "central bank" built in into the currency client? I ...
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1answer
20 views

BTC for political donations?

When I am asked to make donations, I assure the requester that I will donate if they accept BTC. Initially, that gets a blank look, but I wonder how it might change if more of us took that approach. ...
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2answers
79 views

Why is mining difficulty increasing?

I have heard in many places that mining difficulty is increasing, meaning that the hardware used to mine new coins will need to be more and more powerful as time goes on. What is pushing mining ...
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3answers
5k views

Is there a point where bitcoin mining will not be profitable?

A lot of news accounts are pointing out that bitcoin mining is getting more difficult over time, murch even said recently in chat its getting "exponentially harder". I am not sure if that is the case, ...
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2answers
43 views

Bitcoin from an economic standpoint?

Anybody have any good resources to learn about bitcoin from an economic standpoint? Specifically discussing the debate around its deflationary nature?
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1answer
117 views

How do people know that less than 1000 people own 50% of all bitcoins?

I read this post on this site: Who are creating all the alternate cryptocurrencies? In it, there is a answer saying: An article about a month ago was written about the owners of Bitcoin and we ...
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2answers
115 views

Is price volatility necessarily a bad thing?

Discussions of BitCoin as the potential basis for a future global monetary system often point to the currency's price volatility as a shortcoming. Fiat currencies, by comparison, are (mostly) a lot ...
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0answers
93 views

How much Bitcoin volume is for purchasing stuff versus trading/speculation/investment?

What percentage of Bitcoin transaction volume is due to people actually buying stuff ("goods") versus between traders, investors and speculators? Of the "goods" volume, what percentage is for illicit ...
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1answer
182 views

Ripple network overhead

I like the way Ripple provides effectively instantaneous transaction verification. When building consensus how much traffic and their equivalent of orphan blocks are accumulated? Is communication ...
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1answer
101 views

Economics article on BitCoin [closed]

I was wondering if some economists started to create a research group around BitCoin, or published academic paper on it. In general, I was wondering how BitCoin was analyzed and studied in academic ...
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3answers
215 views

Is split possible in bitcoins (like in stocks)?

I see that bitcoin is reaching 1000USD. If bitcoin becomes widely accepted currency, then we'll have to deal with decimal numbers like 0.00023 for onions etc. This can be cumbersome and might become a ...
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4answers
844 views

Is Bitcoin deflationary and inflationary at the same time?

I was wondering as Bitcoin is represented in the public and media as a deflationary currency (for more adept media as payment protocol). Is it really deflationary? Deflation is described on Wikipedia ...
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0answers
172 views

How to calculate the historical ratio of daily active users (DAU) to monthly active users (MAU) using the bitcoin network?

Bitcoin has already great charts and stats but can anybody tell me if this DAU2MAU indicator is available? If not available, is it possible to figure this out especially since bitcoin is open source? ...
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2answers
233 views

How do we know that the algorithm of Bitcoin does not embed bugs since inception?

I'm new to Bitcoin. My understanding as a trained economist (and not a programmer or IT expert) is that the key selling point of Bitcoin is the assignment of monetary policy prerogatives to an ...
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3answers
641 views

What happens if Bitcoins are lost

Since there are a finite number of Bitcoins that can be created, I am wondering what happens if some of the coins are lost. My questions are three fold: How do you define a "lost" coin? For example ...
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399 views

Do exchange rates between countries' currencies have an influence on Bitcoin exchange rates?

Are the exchange rates of each country a factor in the worth of a Bitcoin ? Is the use of the Bitcoin similar to traveling to another country and having a exchange rate on paper monies. Basically are ...
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1answer
253 views

What pressure prevents alternate currencies from completely diluting bitcoin?

Looking into LiteCoin a bit makes me wonder: if LiteCoin were to gain transaction, what's stopping a 3rd, 4th, and 5th currency from gaining traction as well? Wouldn't this effectively eliminate ...
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3answers
649 views

How can Bitcoin change the world?

Let's think of a hypothetical scenario if Bitcoin becomes the world's major (most used + highest market cap) currency one day. How will it change the world? The obvious point is cheaper money ...
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1answer
160 views

Chinese Bitcoin background

What is the background of the whole Bitcoin ecosystem in China? Their market has been growing insanely in the last days... but I guess it can be very specific (different mentality of people, the Yuan, ...
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3answers
236 views

Is mining an antieconomical process?

I will (probably) oversimply things, but I see it like that: Gold linked currencies: someone stores in vaults the value of the circulating money (1) and that "real wealth" is safe to be eventually ...
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1answer
212 views

Why did Dan Kaminsky say that Bitcoin is dependent on the Federal Reserve?

Dan Kaminsky embed a custom message in a block, which reads "BitCoin's new dependency upon [...] BERNANKE". Why did he say that Bitcoin is dependent on the Federal Reserve?
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2answers
426 views

Inequality in a Bitcoin World

So let's assume at some point in the future bitcoin has replaced fiat currencies and we thus have a fixed money supply. Let's also assume we have increasing production and therefore deflation. It ...
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192 views

What's causing the drop today? [closed]

The BTC/USD is down 10.38% at the moment. Does anyone know what happend?
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80 views

Is there a Bitcoin casino that is willing to collaborate on some economics research? [closed]

Am looking to collaborate with the owners of some of the online Bitcoin casinos. I am in the process of designing some behavioural experiments to test for biases in Bitcoin gamblers. I will sign NDA ...
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3answers
173 views

What is the most reliable way to calculate the amount of fiat value that has been transferred into the bitcoin economy?

I would like to know what are the most sophisticated ways to estimate the amount of bitcoin that has been bought globally with various fiat currencies. Exchange data is only one source, and may well ...
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5answers
277 views

Do any Virtual Currencies use coins that have an expiration date?

Bitcoin has no way of knowing if a given Bitcoin is "expired" or has a Base58 address that no one has a key for One way of ensuring that coins are never lost is to expire coins and add them back to ...
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1answer
142 views

What are the specific problems that Virtual Currency is solving? (in the Banking system, economics, and finance )

What is Virtual Currency is trying to solve, and how is it trying to solve them? Many users of virtual currency (BTC, XRP, etc) talk about a corrupt banking system, and many other ideals, but I'd ...
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2answers
638 views

What happens if Bitcoin itself is obsoleted by another digital currency?

Unless Bitcoin is replaced with a Bitcoin-compatible currency, I believe that all holders of Bitcoin will be out of luck when the day comes that it is obsoleted by a superior system, as inevitably ...
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3answers
339 views

Why hasn't bitcoin mining been scaled / wouldn't that ruin the concept?

I'm just learning/getting started with bitcoin and one thing that's obvious straight away, is that the more computational power you can throw at it (with the cheapest energy possible), the more coins ...
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81 views

In what ways could Bitcoin prevent “deficit financing of wars”? [closed]

At a recent NYC Bitcoin meetup, a morally-pacifist, outspoken supporter of Bitcoin said that "Bitcoin would prevent the deficit financing of wars" ...alluding to his perceived notion that a ...
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517 views

Is Bitcoin antifragile?

A friend presented me the concept of antifragile and asked me if Bitcoin is antifragile. I couldn't answer properly, so I'm asking the experts: Can bitcoin be categorized as antifragile?
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6answers
1k views

Traditional VC investment vs. bitcoin IPO

There are few Bitcoin "stock exchanges" trading mainly BTC mining company pass-through shares, like https://btct.co/ https://bitfunder.com/ We are planning to get investment for our ...
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2answers
153 views

(Ripple + wire transfer) x Banking (loans) multiplicator = 2x debt crisis?

if Ripple users would use % loans uncontrolled way? For example: system (gateway) have 100 bitcoins, the quantity is limited, bitcoin holders have issued 100 loans for 1 bitcoin each with 10% rate ...
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2answers
1k views

Economics of Bitcoin Mining [duplicate]

I thought I understood the gist of what "bitcoins" are: electronic currency tokens representing $X USD that could be used to trade, buy or sell online items. But recently I heard the term "mining for ...
2
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1answer
262 views

How is Network Deficit Calculated?

I've seen this graph pop up around the interwebs, but never with an explicit explanation: http://blockchain.info/charts/network-deficit My question is how is this metric generated? Is it a ...
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6answers
4k views

How much energy will the Bitcoin network eventually consume? [duplicate]

A recent Bloomberg article stated that the Bitcoin network currently consumes about half as much energy as the Large Hadron Collider or enough to power 31,000 US homes. Even if the article is way off ...
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4answers
2k views

Where can I find well-written criticism about Bitcoin?

I couldn't find an article about criticism in the wiki. Is there some other place that contains well-constructed criticism for Bitcoin?
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8answers
605 views

What happens when bitcoin loans start to appear?

Disclaimer: Me and my friend barely understand how bitcoin works. With the limited knowledge, my friend is wondering what happens when bitcoins loans start to appear? Loans have intrest rates that ...