The underlying value of bitcoins is nothing. Consider the U.S. dollar the underlying value is nothing. However, unlike the dollar there is fixed supply. What makes bitcoin used in trade, is the game of bitcoin. If you want to play in linden dollars, you have to get linden dollars. Why is there an exchange of bitcoin for $? Because someone is willing to accept $ for bitcoin. Consider Zynga coins. According to wikipedia, you can get 21 game credits for $5. But, bitcoin, which I consider far superior you can get those 21 game credits, you can do something on the net to generate more in essence you are whole new world. There are new games being developed where you use bitcoins. You have live game credits controlled by no one.

This is why there are so many naysayers, silver bugs hate it, zynga hates it, secondlife hates it, the government hates it, any one that benefits from controlled games hates it.

So in summary I tried betco.in and I really had problems with it. It s open source and you can start your own poker room like moonco.in. But, for me I won't try it again for a long time. However, I do hope poker rooms consider bitcoin as an option. If full tilt had a bitcoin deposit/withdrawal option we would be all be rich today.

to answer op's question, with the benefit of hindsight, NO!
(Bitcoins appear to have been a bit of a Ponzi Scheme. Wait, maybe that's not the right term):

Are you serious?

I've played online poker for bitcoins for stakes equal to or greater than 100nl....28 out of the past 30 days....that's just what I personally have done, I don't know what anyone else has done.

strippers dont take bitcoins tho

The instability argument against bitcoin is a bit of a strange one. Sure, if you treat bitcoin as a currency then no one wants to hold it - imagine one pound sterling being worth $30 one day and then $10 the next day... You wouldn't touch Sterling.

The thing is, bitcoin is not a currency, it is a commodity. In fact the price of gold has been incredibly volatile this year, but do you see everyone dumping gold?

Bitcoin can be a success, it just needs to be embraced as a 'proper' commodity.

A proper commodity has intrinsic value. Gold, regardless of price is considered valuable. The value does change but no one is ever going to just drop gold Krugerrand on the street. Bit coins are not tied to anything. IMO if they really wanted to get bit coins going as a proper currency the way to do it would be to back it with a valuable commodity such as gold. Getting bitcoins on a gold standard would be an incredible step forward for them IMO.

zero

You're right, I would suggest it's something inbetween.

To those asking why Bitcoins could ever have any sort of value, I would ask them how do our currencies have any sort of value? It's just printed paper.

Currencies have "value" in that it buys good and services of the economy it represents.

No kidding. My point was that currencies have no real value to them. Most of the money in the world is just a # on a computer somewhere. In the US for example it's really just debt. In reality, there should be something behind the currency to back it up (use to be silver dollars).

I fail to see how bitcoins are any different. Its "value" is also set by the economy it represents. In this case, it's the internet.

I'm still skeptical about bitcoins but if it did end up working out, it would be great imo. Anything to get away from banks and middle ppl screwing everyone.

Exactly the same principle as BTC is founded on witha different basis. You are used to giving and receiving bits of paper and putting a value on them. Gold is just a piece of rock that looks nice has a finite supply and so has a perceived value. If a solid gold nugget the size of the moon was dug up the arse would drop out of Gold. Everything is perception.

The idea is that it is a virtual currency that has no central Bank with the associated controls. So no one entity (G20 etc) can controls it's flow, supply manufacture (ie printing) etc. It's a great idea in it's concept and how it is generated and controlled and supervised by all it's users. It might just be a bit too far out the box for most right now.

It's backed by "trust" that the currency is widely accepted and will buy you good/services in the economy it represents.

so are bitcoins. its just the trust and economy are like a a billion times smaller.

but growing. i have been using bitcoins to bet on sports and buy drugs (jk but i could) for the last few months. the volatility seems to be much less these days but you guys are poker players. embrace volatility

I think the answer is somewhere in what's being said. If enough people accept it as a medium of exchange, even if it's just a particular subculture, then their acceptance essentially makes the bitcoin valid and ensures that it will have value. Of course, acceptance in this sense means actually using the bitcoin to purchase or sell goods and/or services. But as long as enough people are doing that, it's volatility in comparison to other currencies will eventually subside.

That's what I was saying. An asset doesn't necessarily have to be backed by something tangible for it to have value, e.g euros aren't backed by gold, bread or BMWs, they're backed by trust and acceptance that I can exchange euros for those things.

The problem with btc for poker has everything to do with the current operators. They could easily build hedging into their sites so that players would not be exposed to losing their rolls while they sleep but some of the operators don't even understand the concept and others don't think it is important. In your account profile you could simply choose to have your account pegged to US dollars for instance. The site would have to conduct hedging operations on the back end but that is something that could be automated.

There is an enormous opportunity while US poker is blacked out yet at most you find six to ten players on the btc sites with most having none at all. They aren't advertising or applying any of the knowledge gained over the last ten years of online poker.

Bitcoin in itself holds definite value in providing a near anonymous transaction currency with fast and very inexpensive transaction costs. It is costing real electricity and hardware to mine the coins which should keep a solid floor to the price but if you bought coins at $15, that is cold comfort.

I've got to say it's unreal to see how people bitched about FTP's mismanagement issues, and then see people hailing bitcoin poker as the second coming.

Yep, ain't nothing better than betting with an unstable currency that can lose 30% of its value overnight on sites with play money software that is uncertified, with no information at all on the site's management, no clear security measures or directives, and no identified recourse in case anything bad happens.

But hey, it's anonymous!

One thing weird I noticed about my BTConTilt balance is that after winning two of their freerolls I have an account balance of just under $4 but they equate this to 0.30 bitcoins. Unless I'm misunderstanding something, I would think I should be able to cashout for something just over a full bitcoin at current exchange rates.

I'm not sure I understand the argument that the cost of bitcoin mining protects its value. Isn't that sort of like saying the cost of printing bills protects their value? If there's no market value (either on a currency exchange or in terms of actual goods and services) then it doesn't seem like the cost of mining means anything. Along those lines, at least a few of the articles I've read so far seem to suggest that even GPU mining is being done at a loss given current exchange rates.

I frequent one of the bitcoin sites. Seals With Clubs (http://sealswithclubs.org) usally have 3 table going ranging from .001/.002 BTC to .1/.2 BTC No limit

There is a market value on various exchanges and for goods and services (especially goods/services that might not be available in traditional markets). Even if there wasn't, the point is that to the people who do believe in BTC, there is a value and that value appears to be somewhat tied to the costs to generate coins now (versus this summer when there was a crazy run-up on nothing but publicity).

One of the things the btc poker sites have failed at is delivering on the speed of transactions. There would be no necessity of hedging if the sites allowed instantaneous withdraws. Customers would then be able to pull money immediately after a session and keep the coins in their own wallets or on an exchange, similar to how it works in live games. This is the ideal but some of the dopes starting sites didn't realize people might try and scam them or their players and lost a bunch of coins. Hence, all the sites have delays in transaction processing. Since that is the case, hedging is necessary. Of course not all customers will hedge since the price can go up just as easily as it can go down.

I think you misunderstood my post. I'm fully aware of the exchanges as well as the fact that some people are currently exchanging bitcoins for goods and services. What I'm saying is that I don't see any link between the costs of generation and actual trading value. If they lose exchange value, the cost of generating them is meaningless.

I see what you are saying in your post but I haven't seen anything anywhere that would suggest such a link actually exists.

The link would be the last 60 days of trading or so. After the moonshot, there appears to be a relative floor. Might not stay there and you can argue it is just sentiment and not related to mining costs, but I would bet that at least some good percentage of traders feel that hard costs create a floor for the price. Doesn't mean that a panic couldn't send the price to under a buck, just making an observation of trading after the moonshot and other perturbations following.

In any case, the value is irrelevant (or at least that is my overall point). Sites should offer a hedging strategy so players don't need to worry about what the btc market looks like. btc poker benefits from near anonymity, faster transactions and FAR lower transaction costs.

Certainly if enough traders believe this then it has that effect but the reasoning is circular since the value is still based on market perception. Unless there's some real basis for seeing such a link, their perception is still erroneous.

I realize I'm maybe being a bit picky and I'm def not an expert on any of this. I just don't see how the cost of producing a currency has anything to do with its value.

Seals with clubs has not failed with this. It is pretty much possible to hedge, like you are saying, using instant withdrawals from them. Freemoney, the site owner who is very friendly and communicative, and also plays in all of the games, will cash you out always after a session, instantly. All you have to do is ask him to approve your cashout, and its done in 10 seconds. So you can feasibly transfer those coins to gox, sell them for USD, and have your hedge.