Tag Archives: Bitcoin

Alt Coins – What are they good for?

Bitcoin and Litecoin are the two major cryptocoins traded today

Bitcoin and Litecoin are the two largest cryptocoins traded today. If Bitcoin ever was fatally attacked, Litecoin could easily replace it.

Now that Bitcoin has stabilized above $100 for a while, and the world’s press is sending out a steady stream of info (or disinfo) on the subject of cryptocoins, I’m getting bombarded with questions about the alt-coins, such as Litecoin, PPCoin, Novacoin, Namecoin & even Ripple. “Alt coins” is a term used to describe all of the cryptocurrencies that aren’t the dominant cryptocurrency at the time. (e.g. Not bitcoin.)

Alt coins have all branched out from bitcoin, started in it’s wake, and each and every one of them excepting only Ripple are based on the same decentralized, peer-to-peer architecture that requires a miner crunching cryptography and user wallets to function. Yes, they are all worth dollars in trade on some exchange somewhere right now as I write this, and all have their own developer community and hopeful users like bitcoin does. (Only much smaller, with extremely little, if any, merchant adoption.)

Why are people putting time and money into alt coins? It is assumed by the developers that one day a major government or at least the Mexican drug cartels will have a reason to try to “take out” bitcoin. Although its peer-to-peer behavior should be adequate at stopping these threats, nobody knows what the future holds, and the fate of our very economy is at stake here… So litecoin (LTC) was the first created to be a sort of “understudy” or backup for bitcoin. It has it’s own wallet, mining software and blockchain. Although it was the 2nd alt coin created, it has almost always been the most traded of the group, worth about 2.5% what a bitcoin is worth.

For an updated listing of all cryptocurrencies, with descriptions, see here. Continue reading

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Why Austrians are Wrong about Bitcoin

Austrian Economists unjust attack on Bitcoin.

Austrian Economists unjust attack on Bitcoin.

I have learned a lot from the Mises academy and Austrian Economics in general. There is in fact very little I’d disagree with that I’ve read from these sources, and I believe everything that came directly from Mises or Hayek themselves is the final word in economics. These great thinkers are rare gifts to humanity, and it’s a bitter injustice that ‘mainstream’ economists ignore them so often.

Sadly, the common opinion of Bitcoin expressed from the Mises Academy’s leaders today is a true exception to this otherwise pure fountain of wisdom. They have stated that Bitcoin can never be a commodity (since it isn’t useful for anything else) and therefore can never be actual money. Then some of them continue on to say that because it can’t actually be money, one should never invest in it, because they are sure the market won’t accept it. (My paraphrasing, but accurate sentiment.)

In short, the hardcore Austrians continue to say that the market won’t accept it, yet the market is valuing each bitcoin today at almost $50 USD, and growing.

Luckily, some others in the Mises crowd don’t go so far as saying that it cannot catch on; but still they don’t spend any time promoting it nor I’d imagine investing in Bitcoin. Here is the common response that most Austrians will point to on Youtube, and I believe it is the one such statement from Mises with the most reviews: Continue reading