Monday, December 30, 2013

The Overstock CEO on Bitcoin

Like I said in my post, Does Anyone Really Use Bitcoin as Money?, Bitcoin is more like a gyrating American Express travelers check than money.

Overstock CEO Patrick Byrne told Fortune:
I'm not investing in bitcoin. I'm just saying we'll accept it. I don't have any opinions on its value, and I don't even know how one would go about finding that out beyond just looking it up everyday and what it's trading at. Overstock accepting bitcoin shouldn't be read as an endorsement or a view that the value of it is going to go up. We're not going to be holding any bitcoin -- it's just a medium of exchange.
Byre is not an economist but he has a pretty could take on Bitcoin, though I would argue that Bitcoin is not a medium of exchange, at this point, but a receipt for a fluctuating quantity of dollars, dollars being the medium of exchange.


  1. Stop posting so much about bitcoin. Be more libertarian, and try to live and let live. We get it, you don't like bitcoins. We get it. We get it. Understand. Comprende.

    1. @ Anonymous:
      So you are saying a true libertarian would be completely silent about bitcoin and never post about it?? It seems like libertarians make the most posts about bitcoin.

      And how is it non-libertarian to think that bitcoin is not a medium of exchange and/or not a good investment?? The only non-libertarian position would be to advocate government restrictions on bitcoin, which RW has never done. RW posts lots of investment advice and speculations, including his thoughts on whether one stands to gain or lose by buying bitcoin. What is non-libertarian about that?

  2. The tie-in to libertarianism, and Austrian school economics, is that we Austrian school people want a monetary system based on something that mandarins cannot "manage" (i.e., screw up). Hence, our affinity for gold (mankind's stock of which has been growing at a 2-3% rate for about 5,000 years) and aversion to fractional reserve banking. Being so disposed, Bitcoin strikes a chord with us: It is mathematically constrained (as opposed to physically constrained, like gold) but constrained is constrained.

    Yours in limited government,

  3. @Dr Byrne

    I am surprised that you would fall for this false equivalence of mathematical constraint with physical constraint, without a second thought.It is a meme, a mantra.

    Gold has been a monetary metal, not only because of limitation of supply and difficulty of mining, but from a history of use that has both cultural and religious significance. The religious significance is of utmost relevance here and involves a recognition of the physical properties of metal and its effects on man, biologically, emotionally, and spiritually.

    This will seem far-fetched only to people who do not know their own histories. It is the reason why gold was the object of the alchemist's pursuit.

    The physical constraint justification is thus secondary to the justification from history and tradition.

    BTC's "mathematical constraint" is nowhere near equivalent as a justification.
    While BTC cannot be produced ad infinitum, it can be duplicated. Gold cannot.

    Third point. Physical constraint is IRRELEVANT if the entire operation is digital and publicly available.

    That means that effective control of BTC is with those who use it (CONSUMERS). This is a libertarian wet dream, only if your libertarianism is of the kind that doesn't recognize collusive manipulation of consumers, which, Dr. Byrne, obviously you do, unlike the an-caps promoting BTC.

    So here is the paradox: Rothbardians who do NOT recognize such a thing as market manipulation are AGAINST BTC, even though market manipulation is the most cogent argument against it.

    Meanwhile, libertarians who DO recognize manipulation (or are closer to the LIBERAL position) are FOR BTC.. I am putting Dr. Byrne in this category.

    I seem to be the only one with a consistent position since I have always recognized markets are not just jungles and can be manipulated. And I am about 98% sure that BTC is an elite operation, coming out of defense-related cryptographic research.

    Just trace back the promotion of this story and decode SATOSHI NAKAMOTO.

    1. I should add that I own no gold and thus am not talking my wallet.

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