2. Myths about Bitcoin

rollsman (51)in #bitcoin • 8 years ago (edited)

☜❶☞

12. Lost coins cannot be replaced, and that is bad

Today we know about a large amount of lost coins which most likely will never be used. But why do you think that's bad.

Coins are lost if the user lost access to your wallet file wallet.dat, which stores private keys. In most cases it is the fault of the user.

Remember that the safety of your coins in your wallets, and your responsibility.

Why is there no mechanism to replace the lost coins?

Because to distinguish between lost coins and coins that are not used now (temporarily, or are on cold storage) - it is impossible. Loss of coins - an unpleasant situation for the user, but it's not a minus for cryptoeconomy. In this case, lost coins are deflationary additional advantage of the model - the less coins, the more expensive it will cost one Bitcoin.

"The lost coin, make everyone else a little more expensive. Think of them as a gift to all". Satoshi Nakamoto

13. Bitcoin is a giant Ponzi scheme

The pyramids are created in any currency. Don't confuse technology with various projects on the Internet that can accept Bitcoin as a Deposit and be financial pyramids. And greedy to fast money people, believing in unrealistic promises, and somehow blame the technology, not those who cheated them.

Also don't need to see bitcoin as only source of income. Bitcoin, first and foremost a means of payment, it is technology, a method of generating new coins, and every transaction, each purse are part of one huge system.

All of this is irrelevant to the concept of “financial pyramid”. There is no regulatory, interested in receiving the income of the center, there are just people who are building a new economy.

14. The idea of bitcoins will not work, because there is no way to control inflation

Inflation is simply planned or natural growth of prices over a period of time, which usually is a result of the currency depreciation. This is one of the foundations of the modern credit economy, the constant increase in the quantity of money.

Why and who to control inflation, if ways to issue bitcoins and Fiat currency are completely opposite? Credit economy is not the only possible model.

The key here is that bitcoins cannot be devalued by the sharp increase in inflation by any person, organization or government, so it is not possible to arbitrarily increase the supply.

In fact, because of growing popularity, the more likely scenario of increasing demand for Bitcoin which will lead to constant growth rate and deflation. Deflation in cryptoamnesia is a decrease in the cost of goods, when the least number of coins it will be possible to purchase more goods and services.

15. The community Bitcoin it geeks, anarchists, conspiracy theorists and the gold standard

In the early days of Bitcoin it was true. Satoshi did everything possible to preserve political neutrality, but his comments technological solutions showed in this libertarian sense and hacker mindset.

The Creator of the first mining systems Yifu (Yifu Guo), has long worked with Bitcoin and knows it from the inside, reflected these sentiments in an interview, saying that their original slogan was, "better go too far than do too little."

“Bitcoin if we are able correctly to explain, in tune with the libertarian point of view. Although I'd rather write code than talk” - Satoshi Nakamoto.

However, sensing the opportunity to earn in cryptocurrency business came the real "sharks of capitalism" - a retail network, it corporations, venture capital funds and even some banks. Therefore, in recent years the number and influence of real cryptoanarchists steadily decreases. And who knows whether it is good. Because new ideas are best developed by enthusiasts and not by administrators.

16. Anyone with enough processing power can intercept management of the network

With the increasing number of generating nodes is becoming more difficult to do so.

Even if we assume that someone will be able to get the network under control, the opportunities that he will get will be so tiny and incompatible with the enormous expenditure that the reasons for such attacks can be only ideological.

Under any circumstances he will not be able to use other people's bitcoins. Attacking is available only to repeal its own recent transactions, as well as the freezing of foreign transactions. This is a very expensive attack is not worth the small benefits, so there are no sound economic reasons to pursue it.

Already, the purchase and provision of equipment capable of carrying out such an attack, will cost at least 150-200 million dollars and its work will continuously spend up to 50 megawatts of electrical power is the consumption of large industrial enterprises.

17. Point of sale merchants accepting bitcoin, impossible since it takes 10 minutes to confirm the transfer

If sending a payment for goods made through the electronic or banking system, it may take a few minutes and several days. In addition, the Bank may cancel the transaction and the transaction generally will not happen. But even these circumstances did not prevent the formation of Internet Commerce.

In fact, Bitcoin wallets normally expect from 3 to 6 confirmations before the coins become available for operations, that is, will have to wait about an hour. If payment is made on the spot, when using bitcoins, the seller already knows the irreversibility of the transaction and it is not necessary to wait the required number of confirmations.

Many online merchants use the prepaid system. The customer can replenish the account, and then spend bitcoins from it.

In addition, there are payment gateways that help you to instantly obtain a confirmation of receipt of payment from another country for fast shipping. Payment gateways act as an intermediary, confirming the transaction and accelerate the whole process. The use of such gateways, the seller receives your account is not Bitcoin, and the currency of their country.

Additionally, the payment gateway Coinbase offers Bitcoin users to make purchases at many online stores accepting MasterCard.

18. After the extraction of 21 million coins, no one will generate units, confirming the translations

When the cost of generation will not be able to be covered by a reward for creating a block, miners will be able to profit at the expense of the transfer fees. It is expected that for more than 100 years, which will be held to almost complete zero emissions, the momentum of Bitcoin will be more than sufficient to provide for the remuneration of miners among commissions.

Also, in the generation of new blocks will be interest holders of bitcoins, as in the case of termination of generation, their coins will become useless.

19. No built-in cancellation mechanism of payment, and that's bad

Inability to cancel the payment is a built - in mechanism of protection against fraud. Responsibility for care when sending, the credibility of the recipients and be responsible for the security of your bitcoins is only for you.

Organizations like PayPal are responsible for preventing fraud. If you buy something on eBay, and the seller does not send you the product, PayPal withdraws money from the seller's account and returns them to you. This strengthens the eBay economy, as buyers are aware of the limitations of their risk and make even riskier purchases.

Suppose you agreed to sell your goods or purchase of bitcoins, transferred cash (sent the item) to the scammer that sent You the coins, but then canceled the transaction.

If you have bitcoins, they are only yours. If you allow the cancellation mechanism of payment, that it will give the chance to another person to collect your funds. Either you have complete control over their funds or fraud protection, but not both.

20. Quantum computers violate the security of the Bitcoin network

Yes, theoretically it's possible. Quantum computers, capable of it, at the moment do not exist. In the case of their creation, if the security of the Bitcoin network would be compromised, the developers will be able to translate network postkantoor cryptography. This will lead to some disruptions in the network, but after a while it will work in a former mode.

Note that the cryptography is used not only cryptocurrencies but also the entire Internet – shops, payment systems, stock exchanges, and most importantly - banks. That is, it would threaten the entire modern financial system. Cryptocurrency due to its flexibility to overcome the crisis faster than the others.

21. The generation of bitcoins is energetically costly and harmful to the environment

A large amount of electrical energy required to maintain the necessary computing power for Bitcoin mining. But no need to exaggerate. The power consumption of the whole Bitcoin network does not exceed the needs of a small city with a population of 100 thousand people.

If you compare the Bitcoin mining, for example, the development of any mineral, as with any effects of human activity, this process can be called one of the most economical and environmentally friendly on the planet.

Do not forget that all modern financial system, for example, many server rooms and branch network of major banks, consume no less amount of energy. However, no one accuses them of violating environmental regulations.

22. Store owners can't set prices in bitcoins for goods due to the unstable exchange rate

The owners of shops and outlets, great Internet resources mostly use to accept bitcoin payment gateways that conduct the transparent conversion of payments from Bitcoin into national currencies and Vice versa. Sellers set the price of the goods in the currency of their country.

Buyers of goods pay in bitcoin which is converted into this currency, which does not affect the value of the goods the sellers always get the desired result, regardless of the exchange rate for bitcoin and its volatility. Some sellers, for example, Overstock, cryptocurrency leave a portion of the revenue itself, thus taking the risk of volatility.

23. Bitcoins can be abolished by governments because they are illegal (like the Liberty Dollar) and because they are used by criminals.

To liquidate the Bitcoin, as it has no centralized control mechanism: there is no single information repository and centralized management, and there is no point, the refusal (prohibition) which could lead to failure of the entire network; no government can order you to liquidate the cryptocurrency.

Maximum power state intervention might look like ban the use of cryptocurrencies for payments in a particular country; it is unpopular in every way is unlikely to be widespread.

Attempt to produce an alternative currency in the United States (Liberty Dollar) was considered as fraud and counterfeiting. Bitcoins are not used as physical coins, there are no assurances about the availability of their support.

Criminals can use Bitcoin and any electronic payment system, although, according to statistics, the greatest number of crimes carried out by cash, in 99 percent of cases, US dollars.

24. Bitcoin - a scheme for quick money on the Internet or high-yield investment?

Great fame Bitcoin received due to the rapid growth of value in 2013, and many "success stories" in the media. The more enticing it will look the story of the next bitcoin millionaire, the more people will hope that Bitcoin will quickly bring them profit, the more will appear once the con artists using bitcoin as bait for their criminal goals.

It is possible that investing in bitcoin is a good investment, as the cost may grow significantly. Just as there is a likelihood that Bitcoin will be worthless. Investing in cryptocurrency is unlikely to strike you with the results in the near future; likely in the next few years, the rate of bitcoin will be unpredictable. Good investment implies a quick profit, and you should not consider bitcoin as a way to quickly and without risks to get rich.

For a simple layman, not a investor, I can recommend the following: with a convenient date and available a number of free money to buy a few coins and put them in cold storage in your wallet. Most importantly - do not expect that this investment in the near future will bring fabulous wealth. A time of rapid growth in the tens and hundreds of times as it was a few years ago, has already passed – then worked the so-called "low base effect" when the rise of prices of Bitcoin in the global economy were ridiculous. But now its market capitalization is measured in billions of dollars, so the astronomical growth will not be.

25. You can earn money simply by installing the Bitcoin client on your computer

Installing Bitcoin client, you do not start earning.

Once, at the beginning of the development of Bitcoin, people put on your computer or laptop wallet included the mining function and mining the cryptocurrency on the processor. Currently have enough computing power to mining bitcoins profitable can only specialized farms, which occupy large areas and consume huge amounts of electricity.

This way of earning - generate coins on your home computer - the ordinary people is no longer available. However, the processor and even hard disk drives can produce some ppl were. But the profitability of this activity rarely cover even the costs of electricity.

Source of information: https://bits.media/