back to article Stewardess first to book $250k Virgin Galactic 'space trip' with BITCOINS

Brit entrepreneur Richard Branson's space-faring venture Virgin Galactic will now accept Bitcoins. In a grainy Skype call from his idyllic Necker Island paradise, the multi-platform mogul told CNBC today that his high-altitude zoom-zoom firm would let people pay for their lifts in bitcoin. "Why not?" he said. "It's a new …

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Anonymous Coward

Good old Branson

The master of the publicity stunt. He will have ponied up for the Stewardess. Bitcoins won't be around by the time his 'Spaceship' gets off the ground commercially..

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Ryan Galactic

Virgin Galactic becomes Ryanair. You find out, just before take off, that you paid twice as much as the person sitting next to you. You both paid the same amount in bitcoins, but you paid on the wrong day.

As the article suggests, it’s not just a PR stunt. Branson is, first and foremost, a businessman. It’s about releaving these young, suddenly-rich people of some of their money before the next Bitcoin crash, and they stop feeling so rich.

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Re: Ryan Galactic

"You both paid the same amount in bit coins ..."

I would think most people getting into this sort of thing are well aware of the risks and quirks of esoteric currencies.

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Re: Ryan Galactic

Good to see that optimism about human rationality and common sense involving money is not dead! It's totally misplaced, but at least it's not dead...

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Anonymous Coward

People talk about owning bitcoins, but I keep wondering who holds the fractional bitcoins.

For example with a price of 327.7 BTC, what happens to that 0.3?

Of If I want to buy something with BTC that costs $100 when 1 BTC is worth $763.

At least with a tulip bulb, you have whole bulb ;)

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Boffin

Bitcoins can be divided into 1*10^8 pieces... in theory. But this isn't completely problem-free because just like no one wants to be paid with hundreds of pennies, nobody wants to be paid with thousands of "satoshi"s, as the smallest Bitcoin unit is known. Recent versions of the Bitcoin software automatically turn over such small change to the miners, which is somewhat controversial. I think the smallest unit it will keep by default is worth roughly a penny.

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Silver badge

The solution is easy, just use a unit like milli Bitcoin or micro Bitcoin.

It's surprising how many people (even among Bitcoin users) get hung up on the idea of "1 Bitcoin" as if it was something special (e.g., "if a Bitcoin costs that much, most people won't be able to afford it!")

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Tulips

Pity this isn't the 17th century, I still have a lot of Tulip bulbs lying around. Back then that was a valid and overpriced currency :-)

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Anonymous Coward

With all the FBI seizures to get BitCoin off the street, they're actually forcing the price up as it is a limited pool. Supply and demand.

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Just wait

until the US Gov declares Bitcoin an illegal currency and worse still, used by Terrorists (alledgely).

The bearded one and the stewardess could see themselves doing hard time for breaching their silly interstate commerce laws.

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Anonymous Coward

Re: Just wait

HI will seek sales tax as well as income tax and the IRS will be seeking income tax on that 250k from her.

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h3
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Re: Just wait

Those rules don't apply to such as him (and people who are associated with him no doubt).

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Tulip mania

I think going up from 10 to 763 in less than a year is a pretty good indication we're at the bubble's 'blow off top' phase.

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Heard of Western Union or Paypal? Do a bit of research on Bitcoin and you'll discover why it's such a disruptive technology (note: not 'currency'). Sure, one day it may become a viable currency (Credit Card fees are 3%, Bitcoin fees are close to zero), but until that day, it'll replace Western Union, possible Paypal and become a gold alternative for those who wish to shield assets (especially those in countries with high currency pressure; Argentina, Russia, China, etc). The whole 'tulip' analogy is overplayed. Tulips serve no disruptive function and like fiat currencies, they can create more. Despite the obvious publicity, I'm sure Branson has done some research.

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"Despite the obvious publicity, I'm sure Branson has done some research."

And that's probably why he immediately converted it to cold hard cash...?

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and like fiat currencies, they can create more.

I still want to see how the deflation that is going to happen, or rather is happening with BTC is any better than (moderate) inflation. Don't forget that debts rise in real terms as well as the value of the currency, in a deflationary situation.

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Bitcoin loans

Loans today have a built in estimate of inflation, plus a "real return" that the lender wants above inflation. If you make a loan in a deflating currency like bitcoin, the inflation adjustment is simply a negative rather than a positive number applied to the "real return". Mathematically there is no problem doing this, even if it seems odd to most people who are not used to finance math.

In reality, nobody in their right mind would make a loan denominated in bitcoins today, it is too new and unstable in value. Barrels of oil or gold bars are rock steady in value in comparison. Assuming the acceptance of bitcoins grows, and it is distributed in more hands, it should settle down, but bitcoin was not designed as a stable store of value. It was designed as an efficient way to transmit value across a network, which it does admirably.

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Anonymous Coward

Ah, yes. A viable currency. Such a shame that it is designed to only handle 7 transactions per second, or one every hundred days per person, were the population of the UK to all adopt it.

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Anonymous Coward

How do we trust any of the bitcoin exchanges as being kosher and not just attempts to inflate the "value" of bitcoins, anyway?

You deposit at Gox by sending them real money or bitcoins or both, and then you trade through their interface by putting in buy or sell orders and they get executed based on your balance with them. There is no way to know or identify with whom you just traded, because of course all that really happened is Gox added some numbers to one database field and subtracted some numbers from another database field. The only things that actually affect Gox's own balance of bitcoins and other currencies are deposits and withdrawals; the former being relatively easy and the latter being virtually impossible with any real currency, but relatively easy with bitcoins.

Gox could fake everything. There's no way to know what their total balances are of any currency and of bitcoins. We know that they've had significant assets in the US seized, but they're based in Japan so at least some and probably the majority of their assets are beyond the easy reach of US regulators.

Their claims that banks have prevented them from letting users withdraw cash are impossible to verify because they do not provide enough details to do so.

There's no way to know if the transactions being reported by Gox are real. There's no way to know if the price being reported by Gox is real.

Despite all of this, major news outlets consistently, including our own dear El Reg, report the "value of Bitcoins" based on Mount Gox's recent pricing, and buyers and sellers in non-Gox transactions continue to reference the Gox price for setting their own exchange rates. This is ludicrous, but there you go!

(At some point when Gox shuts down, which I think is inevitable, there's going to be a pricing crisis. Without a single (centralized) reference for exchange rates, how do you even know what your Bitcoins are worth? Answer: you don't, which tends to crash their pricing. Totally unregulated exchanges: just reason #893 why Bitcoin is utterly nonviable as a currency!)

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Silver badge

You are not comparing like with like. If I send $1000 by Western Union it will cost me £667.54, which works out at a charge of 8.2%.

Yes, sending bitcoin will be free, however I need to buy bitcoin with British Pounds, and the recipient needs to sell them for Dollars. At current rates, I would need to send 1.25 Bitcoins to enable the recipient to convert them into $1000, and that would cost me £659.03. A little cheaper, yes, but a lot more hassle. It works out at a total charge of 6.8%. Paypal charge a 3% currency conversion fee + 0.5% cross border fee + 3.4% debit card fee, so 6.9% in total. Sending money via a currency broker can cost as little as 1% in charges, much cheaper than Bitcoin.

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Re: Bitcoin loans

People will not lend at a negative interest rate, because they would be better off keeping the money under the mattress. Conversely they would be very happy to borrow at a negative interest rate, just pocket the negative interest as free money, and keep the rest under the mattress until repayment date.

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Anonymous Coward

That 7 per second is an artificial limit, which can be removed, its there to stop block chain bloating at the start.

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Gold badge
Meh

Intersting, like shares in Berkshire Hathaway.

Trying buying a share in them.

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Anonymous Coward

RE: People talk about owning bitcoins, but I keep wondering who holds the fractional bitcoins.

I asked about fractional Bitcoins because I thought that each Bitcoin represented something that was cryptographically unique and thus indivisible.

You have similar fraction/division problems if you use physical gold and silver instead of currency.

Not sure why down voted, was really just a question. :D :P

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Bitcoin is not just a currency

It's an experiment for a new form of "government". In Bitcoin every transaction will be logged and if it is considered legal by the miner managing to solve the crypto puzzle, it's legal. Laws are not created by some elite class, but everybody can implement their own laws into their client (if it mines at least).

Think about it in a grander scale. We could decide that certain transactions, e.g. trading for weapons, buying blue stuff or whatever could be illegal. We could implement this into our clients and the transactions would take longer and longer to be actually confirmed. Eventually, even without central organisation, the rules on this network would represent the moral rules of the population. (if mining power is distributed more or less equally)

It's an experiment. It has its flaws, but we can learn from it.

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