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Could Amazon's New Virtual Currency Rival Bitcoin?

J.P. Hicks | Blog Tips

Last week Amazon announced a new way for customers to buy and sell goods on its massive online retail platform: a virtual currency called Amazon Coins.
Coming in May, Amazon Coins is a new virtual currency for purchasing apps, games, and in-app items on Kindle Fire.

Amazon Coins is an easy way for Kindle Fire customers to spend money on developers’ apps in the Amazon Appstore, offering app and game developers another substantial opportunity to drive traffic, downloads and increase monetization even further.

Amazon will give customers tens of millions of dollars’ worth of Amazon Coins to use on developers’ apps in the Amazon Appstore—apps and games must be submitted and approved by April 25 to be ready when Amazon Coins arrive in customers’ accounts.

Amazon calls the Coins an important step to create the "most complete end-to-end ecosystem for building, monetizing and marketing their apps and games."

http://www.blogtips.com/2013/02/amazon-coins-virtual-currenc...

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Bitcoin is more FRN than it is Silver.

What is important here, is that Bitcoin is not redeemable, and it is not money by virtue of its own value; Bitcoin is just nebulous computer data.

Silver is something of value.

This is the most important difference, and something that Bitcoin supporters don't understand. Bitcoins and FRN's are trading vehicles; a means to an end. Gold and Silver are beautiful precious metals, and an end in their own right.

When you receive a Bitcoin, or a dollar, what matters is what you can get for it -- material enrichment. When you receive Gold, or Silver, you've been materially enriched.

Bitcoin is actually WORSE than FRN, because it is not good for tax payment.

Who Runs The Mining Software?

And what are the rules for who can do the mining? A bitcoin can not be immune to price fluctuations or inflation because the products purchased can be purchased outside of the internet (real world)and the suppy of the virtual currency will change. Therefore, bitcoin would/does have an exchange rate. To say that a government can not pass laws affecting bit coins doesn't seem reasonable.

answers

Anyone can mine Bitcoins.

The exchange rate will fluctuate just as it does for gold or other currencies. Competing currencies are good.

Bitcoins have a fixed inflation curve until all the coins are mined. Once that occurs, no new coins can be created, period.

Government can pass laws about bitcoin, but since they cannot sieze your account or stop you from transacting with whomever you choose, the law is meaningless.

I love how people think bitcoin is not centralized

LOL go back to econ school idiots...The only reason it can hold value is because of its current popularity, it will fail when people stop using it.

It is just another FIAT currency. If you think otherwise, than you have no idea what a FIAT currency is.

Typing the word FIAT in all caps

Typing the word FIAT in all caps doesn't magically make it true.

I lul'ed when you challenged people's understanding in the definition of fiat, when clearly you don't know yourself.

From http://en.wikipedia.org/wiki/Fiat_money

"Fiat money is money that derives its value from government regulation or law."

Bitcoin is niether fiat, nor FIAT.

The primary difference between gold and Bitcoin...

Gold is susceptible to violence. Bitcoin is not.

When you rap your head around that, you will get that Bitcoin is the WMD of the liberty movement.

In order for precious metals to be used in the modern world as a serious currency, you have to have vaults to store it. Then we all have "accounts" with say goldmoney.com and I can send you gold instantly, and goldmoney deducts my account and credits your account.

The problem is it exists in a physical location, and men with guns can march in there and ruin it. In fact it already happened. Goldmoney was threatened by governments to stop that practice, thus thwarting gold being used as money.

Governments will use force to destroy the markets ability to make precious metals money.

Bitcoin is immune to violence... well at least more so than Gold. Just like government can't kill the peer to peer bittorrent, they cannot kill the peer to peer bitcoin. Napster is like gold. Bitorrent is like Bitcoin. One pair are susceptible to men with guns. One pair are not.

When you get that. You get that Bitcoin is not only the investment of the century.... It is the WMD to the fiat/war/debt paradigm.

www.SuccessCouncil.com
Protect your assets and profit from the greatest wealth transfer in history.

I guess you have never heard of Identity theft

What you fail to realize is the proper roll of "currency" should not be 1 of anything.

When you stop your central planning and learn how the market really works, you will understand bitcoin is useless.

The idea is to constantly switch to something that will retain or increase in value. Bitcoin is weak and it will fail.

"Central planning"

LOL. He said "Central planning". About Bitcoin. It's decentralized.

Anyway. To your point about investing money in something that will store or grow value, that is not the objective of Bitcoin. The objective of Bitcoin is to take control of the money FROM the central bankers and governments and give it to the people. It is money that cannot be siezed, intercepted, created or destroyed.

That will give YOU the freedom to put your assets to work in meaningful ways instead of playing around on commodity/currency exchanges.

Amazon... pointless

one of the reasons bitcoins are so attractive is that they are not a centralized monetary system. enough said.

"We’ve moved beyond the Mises textbook. We’re running in the open market." - Erik Voorhees

If you're worried about Amazon's stance on guns...

If you're worried about Amazon's stance on guns, you can always take your business elsewhere. You know there's a little site call Silk Road, where you can purchase whatever you need.

Except vendors on the site only accept Bitcoins for their peer-to-peer and pseudo-anonymous properties. :)

Will Amazon sell you weapons and drugs for Amazoin Coins?

The angle is

setting up something to covert from one to the other

I love bottom feeders

If silver did not work out, may be bitcoins can turn into gold?

Fake

Just a big fat phony.

-quiet engineer

pffft!

Amazon's tokens are centrally controlled and have, as their basis, the whim of the creator=Amazon.

Bitcoin is like gold, in that it's source is objective nature: gold is mined from earth, and Bitcoin is mined from numbers.

What distinguishes gold from other earth material is the rule for gold, ie. the chemical composition for gold. What distinguishes Bitcoin is the mathematical rule for Bitcoin.

wait what? I thought there was a fixed amount?

I heard a dude explain bit coins on wenzel's show. He said they were expanding the supply of bit coins and then at a certain point in the near future they were done...fixed amount. (what scares me is who decided that and what if they change their mind)

Sure there is a fixed amount of gold but call me when they quit digging for it cause at some point they will end up going to space for it.

You're mostly correct.

But 'they' are not expanding the bitcoin supply and 'they' aren't going to change their mind. There is no one making these decisions now. The network expands the money supply at a steady rate based on the number of people running the mining software. The hard limit of 21 million bitcoins will eventually be reached because that is built into the programming. The original programmer made that decision, but now it can't be changed because the network is on a set path. The last bitcoin won't be mined for another hundred years or so though, if I'm not mistaken.

I like the way

you put it, "gold is mined from the earth, and Bitcoin is mined from numbers." This is how I'm going to describe it to others from now on. I've been speaking about the technicalities of it and people tend to hit dissonance and therefore don't yet fully trust it. I saw the light only 8 months ago. This is a currency of the future. When it finally grows to wide acceptance by the majorities there won't be any fiat currencies that can compete with it, the general public will be too smart by then. It's an opportunity, an evolutionary upgrade from my perspective. If not Bitcoin, it will be only something that can compete with it, which gives me much excitement about the future. I've been getting out of USD and into BTC and feeling great about it. My value has already doubled and Bitcoin's true value has yet to be realized. It's as good as gold to me.

I tried bitcoin and I just

I tried bitcoin and I just don't get it. Will everyone have to set up and run these wallet programs in the future? I couldn't get it to synch, I didn't see how it was portable, it just seems a pain! I think I'm doing it wrong.

End The Fed!
BTC: 1A3JAJwLVG2pz8GLfdgWhcePMtc3ozgWtz

No

everyone won't have to use the original wallet you're setting up.

One thing to understand is the technology for Bitcoin is still being developed while Bitcoin runs. Think of it like the Internet. New and improved websites are constantly being built, all while people have used the Internet since the mid 90's.

Bitcoin technology operates much the same. Right now the developers are working on version 0.8.0 of the original wallet to take care of the lag in synchronization. It's not ready yet, but it's sorely needed.

To use Bitcoin most people recommend using an eWallet like Blockchain.info to get started. It's easiest for newbies. See here for more info.

I am getting into bitcoin little at a time

I take issue with your post though.

"the general public will be too smart by then"

You got a lot of educating to do,

http://www.youtube.com/watch?v=qf_ENBaAna0&feature=player_em...

You make your point. I can appreciate that.

Who really knows when anything will happen? It may or may not be in our lifetime but the trajectory I described has a decent probability of playing out according to the way I organize reality. I hope you can realize that not every individual needs to meet the educational requirements necessary to overcome the controlling systems of others. It only takes a certain percentage of the population in order to breach the tipping point that would change the "current" and allow a new direction to be pursued. When that takes place, then, the uniformed followers will follow and perhaps at this point they might discover some of the beneficial advantages to be found in new ways of doing things. I'm hoping that at some point in the future it will become common knowledge that some things, such as the control and manipulation of a money supply, will be recognized as harmful.

The only thing we really need to do is to lead by our examples. If others deem our actions to be beneficial then they might choose to imitate. Now let's all go and enjoy life. This attracts.

No. Amazon's Currency is Fiat. Bitcoin is not.

No. Amazon's currency is fiat so that they can inflate their currency as much as they want without anyone to stop them other than market forces. Bitcoin is not fiat. It's true that it's not backed by gold, but it cannot be inflated the way teh dollar or Amazon's currency can. It has a ceiling of units which it cannot go above.

how is this a currency.. 1

how is this a currency.. 1 amz coin = $0.01 USD. if it were a currency there would be a market in which the value of each coin would adjust according to demand. it's just a marketing gimmick. many retailers have already used this in other forms. ie, rewards points, ebay bucks, etc. besides, all their products are pegged to the dollar anyway.

Yeah! I've got a Colgate coupon worth 1/100th of a cent

Yeah! I've got a Colgate coupon for 25 cents off four (4) products with a cash value of 1/100th of a cent. A wheelbarrow of those'll buy you a loaf of bread.

Man, coupons suck these days! I wouldn't pay $2 for a newspaper to get "money saving coupons" if I get only 6.25 cents off one bloody tube of toothpaste!

"Cowards & idiots can come along for the ride but they gotta sit in the back seat!"

I don't want a currency I

I don't want a currency I can't hold....period. I now see the dangers in it all. And anyway, I don't trust Amazon anymore. Didn't they just show support of gun control? Makes you wonder about them.

Bitcoins

were under $1 per coin in Jan 2010. Today they are worth over $25 per coin. That's a 2500% increase in 3 years.

Comparably gold was $1,120 in Jan 2010. Today it's about $1,640. That's a 46% increase. While impressive it's not even close to Bitcoin's gains.

If someone sends you a bitcoin PLEASE send it to me since you can't hold it ;)

Which just goes to show that

Which just goes to show that BITCOIN is valued the same way as the dollar. If people use them they're worth something. If they don't, it's not worth anything. Gold and other commodities however, whether used as currency or not, still have value.

The market chose gold and silver because they had value outside of money, they were easily divisible, and they were durable.

I don't condemn anyone using bitcoin, but I would never use it. It's much to subject to people's opinion of it. One bad story comes out about it and it could send it's value plummeting. I prefer something that has demand outside of money, that I can physically protect and verify it's existence.

Commerce with all nations, alliance with none, should be our motto. - T. Jefferson rЭVO˩ution

"Everyone wants to live at the expense of the state. They forget that the state wants to live at the expense of everyone.” - BASTIAT

money has influence, not value.

money is a token of purely psychological influence. It only has influence if it is perceived to have influence (as opposed to, say, violence, which doesn't require psychological acceptance.)

So, money is used to influence the transfer of value. (Much like force is used to influence the movement of mass, or voltage is used to influence the movement of charge). The price of something reflects the influence needed to transfer that something. Price is not value. Eg. air is free - ie. it's price is zero - ie. no influence is needed to acquire it. However, it's value, regardless of zero price, depends upon how short of breath you are.

So, lets say the mass of people create pie. And, as a convenient means to distribute pie, tokens of influence are created. Whoever has more tokens has more influence, and, therefore greater pie access and control. In our system, (fiat) tokens are created at will by, and gravitate to, and are managed by, those who don't create pie. Therefore fiat token creators can transfer influence and power to themselves at will merely by creating more tokens of influence for themselves. Influence-tokens which are sourced and constrained by nature (eg. gold, Bitcoin) would make theft of influence much more difficult. Hence the resistance to gold and Bitcoin.

I understand your point, but

I understand your point, but mine is clearly that money best derives from something that already has it's only value. Which is why gold and silver worked so well. There was no need for the "trust" that the dollar needs. All that was needed was for the people to know that gold and silver actually had value outside of being money. Which made them mediums of exchange. It was not influence of a trade, it was merely understood that these monies had a value that could be exchanged for other items. They did not influence the trade, just mediated it.

Commerce with all nations, alliance with none, should be our motto. - T. Jefferson rЭVO˩ution

"Everyone wants to live at the expense of the state. They forget that the state wants to live at the expense of everyone.” - BASTIAT

Too easy

to counter your points.

Bitcoins DO have value outside of dollars. See here for the exchange rates it has in other currencies like euros, yen, pounds, etc. I only quoted dollars because that's what many are familiar with.

If people don't use them?!? People ARE using them. There are now 162 players using bitcoins to play poker at SealsWithClubs. (Incidentally, when I last posted here about that site there were 93 players on average playing.) There are hundreds or thousands playing the new provably fair lotto site BitMillions.com. There are many others buying/selling things in the marketplace section of the popular Bitcoin forum, and who knows how many other countless places on the Web and in real life.

One bad story coming out? You have no idea. There have been stories of Senator Charles Schumer condemning Bitcoin because it makes the drug site Silk Road possible. Stories on hacks of bitcoin exchanges, stories of scams people fell victim to, stories about how it's not "really money" from "people who know" lol. Still Bitcoin marches on...