Draft of a book that explains how Bitcoin works [pdf]

by clark800 • 13 years ago

7 2 13 years ago

How can you say with a straight face, "There is low inflation risk since the production of coins is algorithmically limited and has a cap at 21 million." Inflation is "A general increase in prices and fall in the purchasing value of money." Meaning, one bitcoin has less purchasing power than it used to. The purchasing power of Bitcoins plummeted recently, and everyone knows it.

"Payments are irreversible (there are no chargebacks), so there is a reduced risk of payment fraud." If I'm not mistaken, many people use intermediates like mtgox that don't actually keep your money in bitcoins. Meaning, they reserve the right to reverse payments, and have done so on several occasions. You can argue this is not an inherent problem in Bitcoins, but if many (most?) users are susceptible to the problem, I think you're remiss to gloss it over.

"Payments can be made without identification." But they're only pseudo-anonymous. It's possible to track a bitcoin from me, to you, to someone else.

"Satoshi Nakamoto," I think it's crazy to not mention that Nakamoto is not a real person.

You mention Scarcity, but not divisibility. There are 100 million satoshis per Bitcoin.

"Bitcoin's primary use so far has been to facilitate illegal activities such as drug dealing and money laundering." This is a strong assertion without evidence.

andyzweb• 13 years ago

just read the whitepaper

Draft of a book that explains how Bitcoin works [pdf]

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