any idea how it works?

bitcoin in off topic

Hayek Money, F.M. Ametrano

QuoteOriginally posted by: CuchulainnHayek Money, F.M. AmetranoThe Austrian School like von Mises and Hayek were fans of specie (gold and silver) and critics of fiat moneyHayek Money would be gold not bitcoin

QuoteOriginally posted by: ppauperQuoteOriginally posted by: CuchulainnHayek Money, F.M. AmetranoThe Austrian School like von Mises and Hayek were fans of specie (gold and silver) and critics of fiat moneyHayek Money would be gold not bitcoinMaybe someone could comments on the pros and cons of the approach.Just having blocks of gold lying around in dusty vaults is just wasting space, but there must be some rational behind it I suppose. If bitcoin improves the mortal lot, then let's go for it.

As I have understood, to autheticate a bitcoin, one keeps its complete history, since inception. With respect to heavily usage (if it was to be a currency), it would need a size-exploding memory.Having a non-centralized currency is a great idea (but not new), as it cuts many intermediate costs. But making sure that it is secure/not-fakeable is an issue still to be solved.

QuoteOriginally posted by: APlusAs I have understood, to autheticate a bitcoin, one keeps its complete history, since inception. With respect to heavily usage (if it was to be a currency), it would need a size-exploding memory.Having a non-centralized currency is a great idea (but not new), as it cuts many intermediate costs. But making sure that it is secure/not-fakeable is an issue still to be solved.So, it's a technology problem rather than one of ideology?

QuoteOriginally posted by: CuchulainnQuoteOriginally posted by: ppauperQuoteOriginally posted by: CuchulainnHayek Money, F.M. AmetranoThe Austrian School like von Mises and Hayek were fans of specie (gold and silver) and critics of fiat moneyHayek Money would be gold not bitcoinMaybe someone could comments on the pros and cons of the approach.Just having blocks of gold lying around in dusty vaults is just wasting space, but there must be some rational behind it I suppose. If bitcoin improves the mortal lot, then let's go for it.Indeed! The (faulty) rationale for dusty bricks in dusty vaults is that gold can never lose value because it's intrinsic to the metal.Unless Hayak simply had a fetish for shiny things, I suspect he'd be a fan of Bitcoin because it fulfills all the other requirements of a specie-based currency. In fact, it's better than a specie-based currency because Bitcoin has built-in limitations on the rate of mining. With gold and silver, there's always the potential that some clever soul will find a way to mine vast amounts of gold and silver at low marginal cost and cause these metals to plummet in value.At one time, aluminum was a precious metal but then people invented low-cost ways to produce it.

for the fiat currency there is an organization that takes care that its value does not swing 10% per day. With an indipendent currency, I can't see how you'd guarantee its value stable-ish.

Successful at disposing of any central monetary authority using the Bitcoin protocol, the bitcoin currency has accidentally thrown away the flexibility of a non-discretionary monetary policy allowing for elastic supply of money. I explain how to gain monetary policy back in my paper:"Hayek Money: The Cryptocurrency Price Stability Solution", http://ssrn.com/abstract=2425270

QuoteOriginally posted by: ppauperQuoteOriginally posted by: CuchulainnHayek Money, F.M. AmetranoThe Austrian School like von Mises and Hayek were fans of specie (gold and silver) and critics of fiat moneyI will not talk about von Mises as I have not studied his works, but I am knowledgeable about Hayek, and he was not a fan of gold, just looked to gold as a way to limit the arbitrary power of money monopoly: For a time the ascendancy of the gold standard and the consequent belief that to maintain it was an important matter of prestige, and to be driven off it a national disgrace, put an effective restraint on this powerread it from his own words at https://mises.org/daily/3204: The gold standard is the only method we have yet found to place a discipline on government, and government will behave reasonably only if it is forced to do so.I quote this only as illustration of what among the economists who understand their subject is now an undoubted fact, namely that the gold standard is a partly effective mechanism to make governments do what they ought to do in their control of money, and the only mechanism which has been tolerably effective in the case of a monopolist who can do with the money whatever he likes. Otherwise gold is not really necessary to secure a good currency. I think it is entirely possible for private enterprise to issue a token money which the public will learn to expect to preserve its value, provided both the issuer and the public understand that the demand for this money will depend on the issuer being forced to keep its value constant; because if he did not do so, the people would at once cease to use his money and shift to some other kind.QuoteHayek Money would be gold not bitcoinHayek Money is bitcoin (i.e. cryptocurrency) with elastic monetary policy. Not gold. Hopefully I made it clearer in the latest revision of my paper

QuoteOriginally posted by: APlusfor the fiat currency there is an organization that takes care that its value does not swing 10% per day. With an indipendent currency, I can't see how you'd guarantee its value stable-ish.Hayek Money solves exactly this issue

QuoteOriginally posted by: ametranoSuccessful at disposing of any central monetary authority using the Bitcoin protocol, the bitcoin currency has accidentally thrown away the flexibility of a non-discretionary monetary policy allowing for elastic supply of money. I explain how to gain monetary policy back in my paper:"Hayek Money: The Cryptocurrency Price Stability Solution", http://ssrn.com/abstract=2425270My 2 cents (on Ascension Thursday)I have read this article once over. First, I find it well-written and it is easy to read (maybe because most sentences are devoid of kommas (he said deadly serious), direct style and jargon-free.) I can imagine that you put a lot of effort into this. Congratulations.Since I know _nothing_ about Bitcoin some of my comments may be irrelevant. I put myself in the shoes of a potential customer/reqiurements analyst.Looking at the article as a requirements document you seem to focus on several stakeholders:1. The technical infrastructure2. Bitcoin itselfGroup 1. feels a bit like early days of internet (RFCs) and for group 2. the analogy might be the introduction of the Euro (for those old enough to remember/have not forgotten). Wll you get the same infrastructural challenges when introducing Bitcoin?Some other stakeholders and the roles that do not seem to be discussed:3. Banks4. Me (can I remove the middle man (tussenpersoon in NL) for loans, mortgages? On page 42 you mentioned peer-to-peer lending but how do I buy your villa on Lago Maggiore? Can I swap it for a cottage ? We probably need a clearing house?)5. Companies6. I think the big winners will be software companies who make Reporting Systems. (e.g. shovels and jeans during the Gold Rush).Any use cases? e.g. How would you set up a IR swap with Bitcoin? Do I need a iphone or other funny gadgets?? Is a bitcoin today the same as a bitcoin tomorrow?

"We probably need a clearing house?"Definitely. If you can remove all the other intermediaries you do need a clearing house. And not any bank, but a proper central counterparty, to guarantee you that you have the settlement. It is exactly what is missing now. The selling-sites were sort of central clearing houses but they did an awful job.

QuoteOriginally posted by: Cuchulainn.....4. Me (can I remove the middle man (tussenpersoon in NL) for loans, mortgages? On page 42 you mentioned peer-to-peer lending but how do I buy your villa on Lago Maggiore? Can I swap it for a cottage ? We probably need a clearing house?).....Intermediaries will appear in any monetary/financial system if either:A) The people who want to lend money don't have the knowledge/skills to: judge borrower risk, structure the legal documents related to defaults, service the loan(s), handle default(s) orB) The people who want to borrow money don't have the knowledge/skills to: select among loan types, prepare the right documentation for underwritingQuoteOriginally posted by: Cuchulainn....6. I think the big winners will be software companies who make Reporting Systems. (e.g. shovels and jeans during the Gold Rush).Indeed! A shovel is an intermediary (between miner and dirt). The right software systems can automate the intermediary process.QuoteOriginally posted by: CuchulainnAny use cases? e.g. How would you set up a IR swap with Bitcoin? Do I need a iphone or other funny gadgets?? Is a bitcoin today the same as a bitcoin tomorrow?It's the Wild West in bitcoin world! I don't think you can do anything like an IR swap with bit coin yet because I don't think bit coin (or Hayek Money) has any intrinsic mechanisms for lending the currency. If you want to use these currencies, you'll need funny little gadgets! A home PC would suffice but if you want to buy carrots at Broeker Veiling, you'll need a mobile phone!