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Bitcoin – I think I was wrong

I have been thinking more about Bitcoin and what it could be used for and why the exchange rate of Bitcoin may actually mean very little in the real world. Here is what I think.

Given there is relatively few places that are actually accepting Bitcoin to purchase their goods the only thing I can think of that Bitcoin is good for is to store value; anonymously!

Lets pretend I’m a crook and I want to launder money that I have gotten through less than honest means, I could purchase Bitcoins through a place like MtGox and hold it there for a period of time and then either exchange it back to USD – or what ever the currency you purchased it for in the beginning.

In the above situation it doesn’t really matter what the exchange rate is when you buy Bitcoins, it could be USD1000 for each Bitcoin, as long as the exchange rate doesn’t move against you when it comes time to change it back to a common currency you are OK; in fact the higher the exchange rate the better because the percentage change would reduce if the rate was fluctuating by a few dollars up and down. To explain, at USD10/BTC a $2 change is a movement of ±20%, the the exchange rate was USD1000/BTC a movement of $2 is only ±0.20%. Now, sure the $ value may also be moving by large $$ values but up and down $200 would appear to the market as fairly extreme.

Further, I would even think that given the funds being laundered were ill gotten perhaps the launderer (if there is such a word) is prepared to take a hit of a certain % because, lets face it, they probably stole it to begin with.

The other explanation is that there are a bunch of guys (and girls) ripping each other off for fun, kind of like a game of musical chairs, and who ever holds the Bitcoin at the end of the game actually looses (because you have been the one most ripped off).

These are just my thoughts that help explain the exchange rate crazy-ness going on. No doubt there is some dodgy-ness going on by someone in the back ground driving the rate up anyway.

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Bitcoin – the slippery slope down

I’m going to call it, the exchange rate between USD and Bitcoin has started its downwards path and will not get to the heady heights it has recently been again (however, I can guarantee some collusion here with some nutty seller agreeing with a nutty buyer to exchange at USD20 or something stupid, I’m talking about long term averaged daily prices here).

I’m not sure how it logically could have gone up to the high experienced on 18 May of high of USD8.40. Actually, my understanding is that logic has a limited impact on markets like this because people tend to get swept up in the whole hype of it all. Perhaps it was the greater fool principle showing here, one person ripping the other off until the market takes a breath and asks its self, what the hell can I buy with bitcoin and why should it be worth so much now when late last year it was worth USD0.095?

Oh well, its been interesting seeing a bubble play out in front of my eyes. But perhaps I’m just grumpy I didn’t buy when I first heard about it when it was USD1, could have made a bit of $$$ but who was to know.

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I think I’m going to the cloud

Well, I calculated the cost of hosting the lump of hardware that you can thanks for allowing you to view this page today, its about AUD580 per year an dthat is a crap load.

Amazon now has some super cheap micro instances which will drop this cost to around $200 per year and with that I think I am off to the cloud.

Its been a great ride but power prices are going up and my mate will soon run out of ptience with me and the licensing server issue sI get on my ESX box that hosts the machine that hosts this blog.

I’ll let you all know when I move and how it went., Im sure perhaps 2 people will read it!

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Bitcoin – WTF!

So a couple of months ago I listened to a podcast on security now about bit coins, at the time the Bitcoin (BTC) to USD exchange rate was at around parity, now I look at the exchange rate and its about 3.5 USD = 1 BTC. Is this a bubble or what?

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Where have you been Martin?

Its been a while but so much has happened since my last post.

If you have been reading my Milan – Taranto blog (and why have you not been?) you will now I had a 2 week trip to Italy in early July and ran in the Milan – Taranto rally on my MV 350B motorbike.

I returned to Australia mid July and started work straight away which came as a bit of a shock and its taken me a couple of weeks to stop wishing for Italy any longer.

I have doing little, just bits and pieces around the house, messing about with my computers (building a new mythtv box) and thinking about building a new webserver virtual machine to take over from my old one that has been running now for perhaps 3 years. I’m worried its a bit exposed.

What do people recommend as far as a flick the switch web server goes? Just down load a LAMP server from VMware and fire it up?

Meh, I don’t know. I’m thinking of going lightweight web-blog as well, wordpress seems to me to be the most bloated of all weblogs, I’m thinking nanoblogger.

So, suggestions on webserver VM and blogging app please.

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New blog – new blog!!

I have created a new blog just for the Milan – Taranto that I and the old man are in this July (actually, in a week!).

Check it out at…..
www.milan-taranto.com

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University……tick

After 6.5 years I sat my final exam, assuming I pass the unit (Law – Torts) I will have my BA Commerce – Woot!.

That didn’t take long.

Big thank you to my wife for putting up with me.

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MV arrived in Italy

I have today been advised the MV arrived in Italy and is due to be inspected sometime this week which will be great. Hopefully nothing wrong and it will clear Italian customs without a hitch.

My old man will be in Italy tomorrow week so it has worked out to be very good timing.

Today is the last day of study for me with my final exam ever (I hope) at uni tomorrow at 9am. Its on Torts law and I am so sick and tired of studying. Wish me luck!

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MV350B on its way to Italy

The bike left in its crate today bound for Italy.

Its one of the final steps of a project that has turned out to be a little larger than I thought it was going to be – however, its al a learning experience.

Anyway – here are some pics of the bike in the crate.

I expect it to actually leave on the ship next Saturday with a transit time to Italy of about 40 days which should give us a few weeks of the bike in italy with out me there which is very decent indeed.

One of the things I did to get the bike into Italy is to get a Carnet de Passage. My only concern is that when they get it in Italy no one will know what the heck to do with a bike arriving on a carnet de Passage and procede to make life uncomfortable for me in getting the bloody thing out of customs – fingures crossed.

Pics as always.

In the crate - on ts way
In the crate - on its way
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MV made the trip home

Well the long weekend showed that the MV is reliable enough to take part in the MI-TA.

The 250km trip from the Southwest back to Perth went without a hitch (save for loosing a foot peg rubber somewhere around Bunbury). All up now I have put arpound 700km on it over the last month and all if

The bike went well, no oil usgage, no funny noises (save for tapets that are now in need or re-adjustment) and not a single hickup.

So, in a couple of weeks, assuming all goes well the bike will be packed into a crate and shipped off to Italy. The trip is comming together!