Bitcoin Forum

Bitcoin: The Digital Kill Switch

by Shelby H. Moore III

March 29, 2013

Bitcoin is the first peer-to-peer (P2P) digital currency and payment system to gain significant interest. This month its marketcap surpassed $1 billion.

P2P currencies promise some differences from credit cards, such as increased privacy, no control by authorities, instant signup, lower fees for the merchant, and no chargebacks (buyer at the mercy of the merchant to issue refund if dispute).

Unlike a credit card which allows the merchant to see your details, making unauthorized charges to your P2P account is impossible, unless you allow someone to get your private key. Note credit cards are adding for example Verified By Visa to provide a similar degree of security.

The government control increased on March 13, when FinCEN ruled that transactions for goods and services paying with P2P currency are not regulated, yet exchange to other currencies is regulated and can't be anonymous. Since most users need to exchange from legal tender to and from P2P currencies, some of the purported privacy has already been lost. Also instant signup has been effectively eliminated for many, as now many new users must "practically give a DNA sample" to become verified by exchange providers— however this tsuris may not exist in all jurisdictions.

The anonymity of payments for goods and services is given by the fact that each sender and receiver of a payment is just a number without any other identifying information attached. New numbers can be generated by users at-will. However, the authorities regularly collect information from the internet about usage activity using various means of tracking such as man-in-the-middle routers, spyware, and requests for information from sites that collect information via cookies such as Google's ads and Facebook's Like that appear on many pages of the internet.

So what are the compelling advantages of P2P currencies, since most of the differences from credit cards are being diluted?

For merchants it is the elimination of the 2 - 5% fees charged by credit card companies, the elimination of the ability of the buyer to issue a chargeback, and accessing a new market of highly motivated buyers. In some cases however, the buyer will not like this "no chargeback" provision and prefer to use a credit card.

For the buyer or payer, there appear to be no remaining significant advantages. Even most merchants don't accept P2P currencies yet. The non-merchant has one significant reason to buy digital coins— the expectation of appreciation.

Valuation

The supporters of Bitcoin are projecting very high valuations ranging from $1000 to $1 billion per coin in the future, based on a limit of 21 million coins to ever be created, and a projection of percentage share of global transaction processing.

Notably 50% of Bitcoin's future money supply was issued to the founders and early adopters in first 4 years ended 2012, and by 2016, 75% of the 21 million coins will have been created. By 2020, 87.5%. By 2024, 93.75%. By 2028, 97%.

This accelerated phaseout in the creation of new coins is creating a mad "gold rush" to get in before it is too late. Even though at least 59% (but most likely 75 - 95% since that is only a lower bound that can be measured reliably) are holding long-term and not spending, the skyhigh valuations are based on the hope for adoption by merchants and then increased spending on goods and services in the future.

The 21 million Bitcoins are replacement goods with low barriers to entry and thus can be debased by market share. If competing P2P currencies issue many more coins, then the total finite demand for P2P coins has to be spread between the coins in all P2P currency competitors. However, this spread of market share is not uniform. Today, Bitcoins traded at $75 - $95 with 10.8 million coins issued and Litecoins traded at $0.58 - $0.68 with 2.5 million coins issued. Given real-time exchange between P2P currencies, there is nearly no barrier-to-entry, since merchants will want to accept as many no chargeback currencies as they can if value is rising or stable. Also Gresham's Law dictates that coins will higher issuance will drive coins with less issuance out-of-circulation towards a higher store-of-value. Valuations are also crucially based on market share of transaction processing to be captured in the future, which requires circulation of the currency. So it is quite naive to think that the 21 million coins of Bitcoins are immune to debasement by competitors, unless all competitors suck and have no desirable differences.

Much of the fervor is further amplified with a false sense of altruism under the delusion of being part of a momentus and historic creation of what supporters expect to be the first meritocratic money system— one which can't be debased by the power elite who control the strings on banks in the fiat fractional reserve systems society uses now.

Scaling

For Bitcoin to meet the expectation of investors in its digital coins, the transactions for goods and services has to scale up.

And here is where the hidden diabolical quality of Bitcoin (and Litecoin too) becomes too obvious when the technical details of the design are closely scruntinized by an expert programmer such as myself.

The processing of transactions in P2P currencies is provided by "mining" peers, who provide some Proof-of-Work to insure that double-spends can not exist in the single correct copy of the distributed database. These peers are computers connected to the internet and interacting in a protocol with the other "mining" peers.

To incentivize the "mining" peers to offer their hardware and electricity to this task, they are given the new digital coins created with each new block of transactions. Also they may be offered an optional transaction fee by some payers.

However, the rate of creation of new coins is halving every 4 years, and will eventually stop. Given the fervor the supporters have over non-debasement for meritocratic money system, the end of the creation of new coins is "non-negotiable".

If an attacker can muster 51% of the Proof-of-Work capacity of a P2P system, the attacker can take over the system. There are differences of opinion as to the degree of malicious behavior an attacker could do. However, one unarguable mathematical conclusion is that an attacker that had for example 60 to 90% of the Proof-of-Work capacity could process 60 to 90% of the transactions. If this attacker did not do any thing noticably malicious and did not charge a transaction fee, then virtually all customers would not find it necessary to offer a transaction fee, because over just 3 blocks of waiting time the 60 to 90% becomes 94 to 99.9% of all transactions.* If this was sustained for sufficient months or years when the production of new coins had ended (or declined significantly), then all the other miners would go bankrupt because their costs are not subsidized. Such attacker would then control virtually 100% of all transactions processed. Note this 60 - 90% could be built up over time, because offering free transactions to a percent of the market (when no new coins are being minted), drives some percent of the other miners bankrupt thus increasing the percent the attacker has— it is a snowball effect.

This was explained to some of the developers of Bitcoin who hang out at bitcoin.stackexchange.com, but they claimed it is only an opinion and not a fact. How can math be an opinion?

*First block, 60 to 90% + second block 60 x (100 - 60) to 90 x (100 - 90)% + third block 60 x (100 - 84) to 90 x (100 - 99).

Digital Kill Switch

There is an expectation that large retailers such as WalMart, Amazon, etc., will want to provide the "mining" peers at no transaction fee cost to the buyers, so as to gain a competitive advantage over other retailers.

But we see from the prior section that the incentive is very great to create a cartel that has control over all transactions. Once you have that cartel, you can eliminate those outside the cartel by delaying their transactions or charging transaction fees only to your competitors (billing the competitor, not deducting from the payer in the system). So this is just the credit card fees we have now all over again, except then they will also have a public global record of all transactions in the world (total end of privacy).

Then the government could easily collude with these cartels to turn off the transactions of political dissidents, free speech advocates, gun rights advocates, Ron Paul supporters, and any other classification of terrorist. With control over the processing and the merchants who depend on it, they can easily force an upgrade to the protocol which requires a SSN or other government tax ID to be attached to each transaction.

This is not a stretch at all. The design of Bitcoin and Litecoin encourages it— I go so far as to say they were designed for it given there are alternative designs (I proposed one) that don't have this diabolical possibility.

Having numerous competing P2P currencies does not escape from this diabolical threat, if all of them have the same diabolical design. A non-diabolical design would either have debasement that never ends and/or a minimum transaction fee.

I doubt one can create a non-diabolical P2P currency at any time in future, because the first-mover advantage will apply inspite of low barriers to entry. Because if the users already have Bitcoin and Litecoin, they may not see any compelling reason to add another, in spite of the diabolical quality which does not affect them directly (as a member of the majorty and not a dissidant or other threatened class).

Not Gold

The P2P currency fervor was further stoked by the illusion that they are somewhat like gold. Gold is a private hedge against government malfeasance, it can be traded privately with no public record. P2P currency ownership and transactions are stored in one public database that is never erased forever!

Gold's money supply is always increasing forever (we can mine it in outer space if we run out on earth) and the rate of nominal increase every year is also increasing. Bitcoin and Litecoin are geometrically decreasing the rate of increase of the money supply and will terminate production of new coins at 21 and 84 million respectively. Some people think this makes them even better than gold and silver.

Many people have the illusion these days that inflation is bad and deflation is good. Sorry to bust their bubble, but both transfer wealth to the power elite. The power elite have more savings relative to their expenses, thus they can switch their savings between investments which increase during both inflation and deflation. Whereas, the middle-class are hurt by inflation since they must spend more their income, and they are hurt by deflation, because their wages decline.

If distributed to the middle-class, some minimal debasement is beneficial to offset the guaranteed (government backed stopped) usury interest income the wealthy earn during deflation. I am not a socialist and I love free markets, but the fact is that money is a social collective institution and this is the reality of the math. Either you redistribute algorithmically with debasement and mining of new coins, or you redistribute with taxes and politics. I would much prefer the former.

It is possible to make a P2P currency that more closely emulates gold's money supply. And has the advantage that no one controls its rate of debasement and thus can't manipulate it to create false business cycles.

One thing to bear in mind, now that Bitcoin has shown success, everybody and his half-uncle are going to be trying to create a new P2P currency.

Buy low, sell high. Arbitrage is your friend. But no one knows timing, unless they are manipulating and controlling a market.

As an investor, you need to discern which new P2P currencies have the unique features, quality, professionalism, etc... to be taken seriously.

Anyone thinking $10,000 or $100,000+, you are not living in reality. Please don't get angry at me, but markets respond to opportunity cost. There is no way that other smart developers won't respond when now they see $100 per coin created out-of-thin-air.

hehehe, quite full of ourselves aren't we? You seem to like that word diabolical too much, make  sure it doesn't boomerang on you there.

Will be waiting and watching for your best imitation of Satoshi's genius, for that's all it will ever be, an imitation. Might even buy a few if they are good enough,  ;).

I believe it to be impossible to force in any protocol that can be imagined.

If a corporation wants to provide free tx fees, even if the protocol attempts to enforce it, they can just refund the money back in another transaction.

So users will route their transactions to those corporations.

I believe the only possible way is forced debasement and NO tx fees.  ;)

You must remove the user's incentive for a Tragedy of the Commons.

P.S. this is why I suspect Satoshi had evil intentions. He made a big deal about lying and saying Bitcoin's money supply was modeled on gold.

I had written that I would put you on ignore (dearth of facts & rationality in your criticism), but I guess I am too sleepy and read your msg too fast. I see you are just issuing me a challenge. Thank you.

I believe I am sufficiently smart on the level of Satoshi and apparently more than the developers of Bitcoin on global design visualization. But of course I am not saying I am a better network engineer, or any specific skill set. There are always experts within various specialties. That is why we do it open source.

I am more than happy to have the necessary changes made to Bitcoin, but I think they are non-negotiable in both Bitcoin and Litecoin.

So we may have no choice but to create a new P2P currency. I have sufficient financial backing of course.

I really don't want to do it. I have many other projects that I am already working on. I really wish I could convince the developers here to change the non-negotiable item, but I think it would make the market angry.

I think any such change has to come in a new P2P currency.

I guess everyone knows that my design is based on hard-disk space. So any one with a PC would be able to mine effectively and get coins.

The "distributed hash table" round-robin portion of my design is actually very old. I designed it in 2006 before Satoshi did his. I didn't implement because I didn't think P2P currency created-out-of-thin-air would catch on.

You are expecting the less likely threat, because the power elite don't shutdown what is popular, they find a way to own it.

The bigger threat is the government will not shut it down, but rather embrace, help it grow, and control it so they can turn off your ability to eat individually if they don't like you:

Bitcoin: The Digital Kill Switch

https://bitcointalk.org/index.php?topic=160612.0

Bitcoin is diabolical, but only an expert can see it.

If you read my technical thesis in the OP (opening post), then realize that the alleged takeover by corporations will occur subtly over a decade or two.

You will be lulled to sleep. Then once it is too late, they can start turning off the ability for dissidants to transact. By that time, probably all payments will be digital, even in the local market using your mobile phone (which by that time may be wearable).

Thus you won't eat if the corporate-fascist government apparatus doesn't like your behavior (politics, open source projects, etc).

I had more coins back then. It's not like everyone who started using it in 2010/2011 knew that it would be successful. Those who mined had to pay for GPUs and electricity too…
The first people who started using gold or anything else to pay for something had the same advantage (btw.: they're all dead now - and I don't think we'll be here forever). Back then nobody ever imagined that we could ever go to outer space or create virtual currencies.


That's true, if we'd really get to a point where it's 100% hoarded and not being used to pay for products & services I think it would collapse. But we could change it e.g. to 1 BTC = 100,000,000,000 units in case it's not enough ;)

There's also the question if it's worth to start mining it in outer space…

Bitcoin is being developed as a supposed superior alternative to another form of money, which was developed as an alternative to another form of money, which was...

OP, why would this process end and why does Bitcoin has to be a perfect form of money right now?

@chmod755: AFAICS apparently you entirely missed the point of the OP as to the technical threat. Please try re-reading it.

@joris:

Excellent question. I want to hear arguments on both sides of this.

Here is my current thinking.

The first mover advantage is causing a lot of capital to be dedicated to Bitcoin, and also complex financial systems such as hedge funds and futures markets, meaning the institutional capital is coming in (http://www.financialsense.com/contributors/jon-matonis/is-institutional-money-coming-into-bitcoin).

Once the big capital is in, they won't like to lose their investment. Everyone will have an incentive not to switch to an alternative. And remember I assert the diabolical part will come slowly and so no one will care (until it is too late, it was like that in every diabolical outcome such as Nazi germany most people never thought the thing would affect them, only the other guy).

So yes, I believe the window for saving mankind from The Digital Kill Switch is fast closing and then will be locked shut by marketshare and inertia. Remember a currency is a social institution. Its value is derived from the collective usage. Thus small inertia is bad, and big inertia is good.

The simpleton masses don't give a fuck as long as they can buy their junk. Once they are on board, you can never gain inertia with a competing P2P currency.

This is why I had limited patience with the developers of bitcoin who were telling me that "yeah but first we can do some good by eliminating credit card fees, then later we can look into fixing transaction fees". That is nonsense, we have to fix it from the start and transaction fees can never be the fix, for the reason I stated in a prior post.

Is it a diabolical design or not - http://qubic.boards.net/index.cgi?board=theconcept&action=display&thread=1 ?

Once you have that cartel, you can eliminate those outside the cartel by delaying their transactions or charging transaction fees only to your competitors...

Bitcoin already accounts for this. Before the cartel can squeeze its competitors it must identify them. It is trivially easy for anyone to create new address pairs that are not obviously linked to any identified account. If your payment address changes with every transaction it will be impossible for a cartel to blacklist you.

If the cartel chooses to blacklist everyone except their friends, there will be a strong incentive for other miners to return, or abandon the currency altogether.

Satoshi

Satashi

Satash

Satan

He's right!  It is diabolical!

Is your argument that there is no first mover advantage, thus a competing P2P currency can be created at any time to fix any design flaw that handed control to corporate monopoly?

As I explained in my prior post, I would not agree. You would have to address my prior post and show me why I am wrong about the first mover advantage.

You've not addressed the technical argument.

The cartel knows who the merchants and retailers are, they are publicly visible.

Once you have the inertia with the simpleton masses able to buy their junk from Walmart, Amazon, etc, then no one is going to be able to induce those masses to switch to a different P2P currency/payment system. When the cartel wants the users to upgrade their clients, they will have them click a button on amazon.com for example before they checkout. They can then convert the client to auto-update.

Once the cartel has this inertia, they can change the protocol to require tax id on every transaction (to "comply with government regulations", but of course they own the government, so it is just a ruse).

Welcome to 1984.

I guess OP hasn't heard about merged-mining?

If a superior form of crypto-currency blockchain comes along, it can co-opt the bitcoin mining power and take-over ... it is a level playing field for any good ideas to compete upon.

Wait, don't tell me, that is diabolical?

You fail to understand the technical problem in the OP. Merged mining does not fix the threat. The threat is the corporations can make it uneconomic to mine because they can offer it for free and the other miners will get paid nothing for mining, thus they control all of the mining (merged or otherwise). Before you attack that, go re-read the OP more carefully.

merged mining has its own set of tradeoffs

Simpleton masses? Who are you, Dr. Evil?

The cartel decides to blacklist Wal-Mart because they won't play ball. John Q. Simpleton goes to walmart.com to buy a new NASCAR shirt and some Slim Jims. Wal-Mart generates a never-before-used public address for John to send in his payment. How is the cartel going to identify it as a Wal-Mart address?

Obviously you fail to understand the technical problem. The cartel will control all the processing. John won't be able to get his transaction to go through.

This is a lack of technical understanding on your part as to how the Bitcoin algorithm works.

Once the cartel has all the mining, then John can't route his transaction to his own miner (or any good miner), because the miner who wins the next block must have processing power that is in scale with the total. But if the cartel has made it uneconomic to mine, then these miners with sufficiently high processing power, will no longer exist, because they long since went bankrupt. For example, say the cartel has 10 quadrillion terahashes by 2030, and so to have a 1% chance of getting your transaction through on each block try, you need 100 terahashes of computing power in your good miner. Who is going to keep 100 terahashes of computing power laying around unused because it has been rendered uneconomic by the free processing being given away by the cartel?

Just for those few dissidants that are affected?

Economics doesn't work that way. Go think this out more deeply.

Why did you even mention other things if you didn't want to hear comments about them? Of course the risk of a 51% attack exists and building it up slowly is possible. I'd advise every miner who paid off the rig and is making some BTC now to invest them in something like photovoltaics (or anything else that produces electricity) to keep the risk of "going bankrupt" in mining at almost 0%.

I don't say you are wrong about the first mover advantage. In my concept there are no fees, no way to identify approved/non-approved users, 51% attack becomes 99.999% attack for paranoic users, transactions are handled outside the system, scalability is not an issue... Just interesting if my concept looks non-diabolical from your point of view.

No malice intended, but you don't realize that investing in PV is economically worse than renting electricity from the utility. You will go bankrupt faster.

You don't realize that nobody can manipulate electricity prices if you produce it and in the long term it's cheaper in some parts of the world.

Let's say you're correct that the cartel effectively controls all mining power. In order for them to use it effectively they must be able to distinguish between their friends and their enemies. But there's no way to do that.

If they choose to assume anyone they haven't identified is an enemy, the public will quickly abandon the whole system, causing the exchange value to plummet. That's bad economics.

Bitcoin is just the first head of a Hydra. If it gets compromised over overtaken it can be abandoned and replaced with incredible speed. The cartels get left holding all the worthless currency and useless mining hardware.

Even if that were true that it is cheaper in some parts of world, it doesn't make it free, which is what you will need to compete with a cartel giving away mining for free. You will earn 0 from mining. Plus you have your hardware costs (PV and ASICs) to amortize.

Technically it may be a logical outcome, but how will the alpha-males work harmoniously together to form and continue this cartel?

On world-scale there exists no such 51%-entity, AFAIK. Human nature breaks organisations down internally long before world domination and after a break they will compete which each other, since they both think they are on the right track.

The largest companies and countries are small at the global scale, only one's exposure to one of them can be particularly large. So Bitcoin can be sufficiently protected by size and dispersity.

Where is the technical description of your algorithm?

Readers please note he is not disagreeing with me whether Bitcoin has the problem I allege.

It doesn't make it completely free, but much cheaper and most importantly independent from price changes on electricity. Where's your cartel that is "giving away mining for free"? It doesn't exist. There's not a single bank that doesn't charge any fees. Make your cartel and see how "profitable" it is  ::)

I am alleging the cartel will come, because monopolies make profits by extracting rents, e.g. they can increase the prices of products the customers are buying everywhere, just like how credit card fees are opaquely passed on to the customer and the customer does not care (because they don't know and they get to buy their junk).

Even if you argue the monopoly won't come (which I strongly doubt, since they always do), it is better to make a P2P currency that does not have this design flaw that exists in Bitcoin, so then we can be SURE it won't come.

In my design for a P2P currency, you will forever make money on mining. In my design, it would be impossible for the cartel to make mining free.

It will be too late. Please read my prior reply to joris.

And why not make it cartel-proof now? Why risk it?

There is something unique in my OP. What I am saying is not a 51% attack that does malicious actions. I am saying a 30 then 40 then 50 then 60 then 70 then 80 then 90 then 99 then 99.9999% friendly takeover of mining by corporations that make mining free and never do malicious acts.

No one will have a reason to switch.

Then they can turn off your access, because you wrote something that threatens the power elite. No one will care that you die. You are just one lone "terrorist". The rest of us are enjoying our junk and "free" transaction processing (because we can't see the opaque cost that has been added to everything in the market).

You see the problem, so you blog about it. Next day, your digital tax id is turned off. You die. No one cares. We won't even know it. You won't be able to even upload your blog, because by that time you have to make a micropayment to the hosting.

I have studied the power elite. I know how they operate. They do things insidiously so the masses don't know they've been enslaved.

It's written in Java code. I'll publish it when complete the development of the prototype.

Do you own the domain name? quibic.org?

qubic.info

PS: Let's move back to the topic.  ;)

Their friends are those who report taxes. Those who don't are enemies. Very easy to identify. Once they have the "friendly" takeover of mining, they can slowly morph the system to what they want with tax id attached to every transaction (either explicitly in the database or implicitly in the AML controls and other ways they can know exactly what every transaction is).

The public won't abandon it, because the public won't even perceive they've been harmed. They will happily buy their junk and be unaffected. Only the dissidants will be purged (the ones who think too much).

This will be a slow process, most will say I was crazy, because they won't perceive it is happening over decades. Slowly the dissidants will be picked off, a few at a time. We lose our freedom, bit-by-bit, not all at once. The power elite are not stupid enough to risk it all at once.

There is a VERY obvious reason as to why bitcoin is DECENTRALISED.
TO STOP GOVERNMENT CONTROL
To create a centralized "cartel" would be Shunned by the entire bitcoin community, Because you would be Creating a 51% attack.
Gosh this is stupid, This "killswitch" that your talking about is nothing more than the 51% attack threat that we ALL know about

Cartels work together because they can earn more rents together than separate. They eliminate competition which drives their rents up (competition drives rents down). So the strongest get together.

Over time, the cartels consolidate more, eliminating the weakest within them. They end up as a single controller, which of course is failure, because no single person can run a free market.

Thus they are ultimately == death (for everyone). If it goes that far. Usually before that, mankind will cut off their heads (e.g. in France), but the problem this time is they are far away. Everything is digital. We can't even find them.

This horrifies me.

I think you should go study how Rockefeller monopolized all oil and railroads in USA, if you believe cartels don't form naturally when the economics allow it.

I am proposing to change the design so that the economics will no longer allow it. Bitcoin allows it. My design does not.

I won't be re-reading any drivel from an amateur loud-mouth like you ... anyway i thought i was on ignore? I wasted enough time already on the first skim through.

It is easy enough to blow hard and loud on forums, go and produce the code. A fully anonymous, merged-mine coin (anonymcoin) will out compete bitcoin, we 'just' need someone to build it, not talk about it.

As I said I'll be watching to see how much code you produce ... not just talk about it.

Sir in all due respect, you fail to understand the threat I am explaining.

The mining won't be decentralized anymore, because the cartels will give it away for free.

I wrote before that I did not put you on ignore. Please go re-read my first reply to you up thread.

The first step in creating a better design is to make sure people understand why it is important to do so.

I am doing the first step first. The next step comes to writing the code, once people say "yes please go make it".

As I said, I would prefer that Bitcoin would be fixed, but Bitcoin refuses to make the necessary fix. And I understand why they won't make the fix, because the fix requires an ongoing debasement. That is why I explained in my OP that ongoing debasement (if small and automatic and known to all) is actually better. Gold has an ongoing debasement.

Satoshi put the "no debasement" design in because he knew you guys were gullible enough to fall for it, and he was working for the power elite.

You can never be sure that there's no flaw in a system - if you are: it's already flawed. And there's no such thing as a "perfect monetary" system. If you don't want wealthy people to buy your currency you basically need to find them and kill them, but that costs too much…

We should not keep flaws that we know about, which clearly open the door and beg for monopolization.

The threat I identified is not from wealthy buying the coins. It has nothing to do with who buys the coins.

What a complete load of nonsense from someone who only believes in zero sum games.

The economy doesn't work like that in reality.

The core problem I see here is that it assumes that suddenly everyone is using bitcoins exclusively, and that gives 'the cartels' a control over how people spend their money.

However, the future isn't going to be like that.  Its all about a little bit of whatever is best for those circumstances.  This means that we will never be in a position where only one form of wealth transfer is available.

Bitcoin has got a number of faults in it, but all that means is that another crypto coin will be created and the early adopters start again.  Its not difficult - 3 years ago, hardly anyone had heard of bitcoin.  These days, only most people have hardly heard of bitcoin!

However, trying to guess the political control structure of something that currently doesn't have financial statues is just nonsense.  Its like trying to predict in 1993 that Linux was going to be the main software OS of mobile phones 20 years later when everyone was predicting it would take over on the desktop - which it never did!

Anyway, that's my 0.0005 BTC!

Could you retract the nonsense claim? That isn't the way to have a civil debate. I never said "instantly a zero-sum game". You are putting words in my mouth which I never wrote or argued for.

Please go re-read my prior posts. I explained that I do not expect the threat to come suddenly. I expect it to come so slowly that you will not resist, because you will not even perceive it as a threat. And by the time you do, it will be too late.

Your point essentially is that P2P currencies won't overtake all commerce, or that not all P2P currencies will have this flaw that Bitcoin has. Well I hope so too! That is why I am here to say we need to make sure that happens.

So what is our disagreement? You think it will just happen naturally that cartels won't push Bitcoin? Do you not see what is happening now? First mover advantage is going heavily to Bitcoin (and Litecoin), both of which have this same design flaw.

I happen to believe that in 20 years or less, all transactions will be settled by P2P currency payment systems.

I don't agree that it will be easy to launch another P2P currency after one becomes dominant and heavily used by the general population and institutional investors. It is easy now, because there is a great unfilled demand. Once the demand has been filled, you can't replace.

Do you know how difficult it has been for us to replace Microsoft Windows and Microsoft's monopoly cartel? It took us 2 decades.

We would have never gotten there if not for the disruptive technology of the internet, server, and mobile Android phone (Linux).

But in currencies, you don't get another chance. P2P is it. After that, there won't be another paradigm shift opportunity in currencies for a loooonnng time probably.

The masses won't switch after their wallets are set in Bitcoin. They hate technology hassles. They just want it to work and give them their junk.

OP, you seem upset that the bitcoin people didn't listen to you at the start.

These types of super geniuses who have their bruised ego dragging along behind them, are still relevant, though it is tedious to listen to it, because it's all about "Oh they should have listened to me!"  ...This reminds me of the shuttle accident with the O-rings, obviously they shouldn't have launched that shuttle, because it blew up.  HOWEVER, there is always one grumpy pants engineer, who will say afterwards "See!  I told you!"

OP seems to be trying to say "I am a techno prophet and can see 30 years into the future"  ...But you cannot.

Granted: Your idea is probably superior, just like the guy saying "No, o rings will fail when they get too cold!" yeah, he's right, but if we listen to him every time, there will be ZERO shuttles launched, because his job is to be a cranky ass.  His ego, in a way, has decided that by nitpicking something ad naseum, he can always say "told ya so!"...  And hey, like I said, he was right that fateful cold morning when the Challenger shuttle blew up.  And yes OP, you may be right here as well, bitcoin and litecoin may be chulthu'd over time, by cartels.  But please step outside your superior intellect to maybe see what I am saying.  Even if you are right, good luck getting anyone to agree with you based on your communication skills.

Let's break down some of the terms you are using:

Tax:  ...Okay, many Americans see taxation as theft.  So we have to go back to the essence of what money is, in order to use these weasel words (as Ayn Rand would call them) like "tax" which even now is being applied to bank deposit theft.  They'll use terms like "tax", "haircut", "forced loan", etc.  ...But the progressive income tax is a Marxist plank, and the 16th Amendment may be abolished before 2030, so using this word and drawing your airtight solutions based on concepts like this, tht will be probably destroyed by 2030, is a symptom of the ego-genius as I described above.  The word "tax" will have to be clarified based on utterly new paradigms which you or I are powerless to know for sure, as to what forms those new paradigms will take.  Admit it:  These words are relics, and nobody likes the IRS of the Federal Reserve Bank (debt issuers and thieves) so the impetus of humanity, will be to abolish these concepts, if humans are given the power.

Work:  ...Again, this is a word which has been watered down and destroyed in the sense that it has a dozen definitions.  Is sitting around babysitting some miner-PCs, "work" the same as digging a ditch for the local utility company as a pensioned s worker, wrecking your back with labor?  What is the meaning of the word "labor" once pensions are stolen?  Oh sure, you can reply at length, but I am simply knocking your premises around, because again, as with the term "tax", the words "work" and "labor" are going to be modified according to the new paradigm, which neither you or I can predict, though you may be x factorially smarter than me (and I work in IT but have a lot of contempt for so called 'developers' who are usually quite stupid as to practicality), neither of us can know what the future paradigm will be as to work, labor, and taxation.

So those are just two words, which are diverse in their meaning, and you can't pinion your whole super-genius-ness on them.  Yeah you're smart, but to knock bitcoin on the idea that miners will give their power to a cartel, is to diminsih the power of humans in general.  No, I do not agree with your shoddy estimation of the general mining pool.  Let me clarify along the lines of your argument.  You are saying for example, that Wackenhut, can use 1 million prisoners with each of them watching 100 servers, to produce a massive amount of hashing power, at pennies-per-watt...  TRUE, prisoners are very cheap employees, and yes, the prison industry is the best cartel there is!  Yes, your logic is sound.  HOWEVER, you are assuming that mankind will allow cartels to exist!  I am suggesting (sorry if my tone is a bit rough), that cartels are horrible institutions, and price does not drive all humans, and many many millions of workers/potential-prisoners will spend every ounce of their power and electricity, to DESTROY CARTELISM AND MERCANTILISM AS SUCH.

I understand you fear cartels.  Not every man does.  In essence, you underestimate the sheer political destructive power of bitcoin and all the clones that will come.  For example, during the civil war (which preceded the cartels you mention above, and the 16th taxation amendment), there were many many types of 'scrip' or paper currency.  Some were debt notes (like our federal reserve notes of today), some were exchange notes which could be traded easily for gold/silver if you were near a branch, point is, there were MANY types of 'money' during the horrific war called "US Civil War"  ...Therefore, one can easily plan for total mayhem between 2013 and 2030, and also with that mayhem will come many types of digital hash-based currency, but this will be a time of not just war, and competing currency, but of destruction of CARTELS AS SUCH.

After the US Civil War, the Constitution (which is a debt document, see the legal definition of "Constitutor" in Bouvier's law dictionary as: "One who agrees to pay the debt of another") was modified as to the 13th and 14th amendments, and this totally remakes the character of debt, work, and taxation (with the 16th amendment), so in the future paradigm, which neither of us can predict, I can safely say that if I am right about human nature (that humans will fight to be free), then I am right about the death of cartels, but if you are right about human nature (your tone is very poor as to the less-smart humans) then sure, you could be right.

In the end, prisoners make the cheapest workers, and thats the war that needs to be fought.  Bitcoin and its brother and sisters hash-based currencies are just the first of this type of weapon, but the point is that these weapons will be used to fight the money mercantile investment bank powers, not to give them more power.  War is fought by attrition of the enemy, and bitcoin gives a definite power to deny the enemy (cartels) of their debt power.  Bitcoin is not debt, but its not capital either, but that makes it in a way, more powerful for the common man, than either debt or capital.

(And none taken)
What i expect to happen would simply be something simmilar to a chainfork, We Would Not Use the "cartel coins", EVER, Knowing the Obvious threat that it comes with
Even if they were free!, They would have no value if nobody used them, Therefore making them worthless.
We would Fork off the chain away from centralization and use the Forked chain, Letting the (once good, but now bad) Cartel Coins (Centralized bitcoins) blockchain die

You could then Rinse and Repeat this process untill you have "killed" bitcoin, But you would then have Thousands of bitcoin equivalencies floating around.

Source? (being paranoid is not a reliable source btw.)

I think they have failed in their responsibility to protect mankind.


It has nothing to do with my ego. I would be very happy if someone will fix the design (so no more threat) without me.

I don't care who fixes it, as long as mankind won't be facing the Digital Kill Switch.



Economic opportunities dictate what happens in the future. If you leave a door wide open for the power elite, they will walk through it. GUARANTEED. I am even telling them how to do it now with these writings. And I will make sure these writings are spread far and wide.

This is going to be published every where. You will start seeing copies of my article all over the place soon.

I have already contacted people who can make this happen.

Shutting me down here, won't help you obfuscate my message.

You have to win on the merits of your logic. If you can convince me with logic, then I will listen.


I have no qualms with that. I agree. Great that Bitcoin was launched and proved the market exists.

I am here to ask if there is any demand to fix the designed threat or do people want to sweep it under the rug?



Are you saying tax will disappear so we don't need to fix Bitcoin?

If that is your logic, I think you are not realistic.



Oh you are very correct. We are studying this now:

http://esr.ibiblio.org/?p=4867

I am JustSaying over there.

But none of this will change the fact that a huge chunk of the population for some decades won't be able to keep up with technology and will demand tht government tax and spend. So during this time, the cartels and government will become more powerful, not less.

We have history to guide us. I suggested you read:

http://armstrongeconomics.com/armstrong_economics_blog/

He has studied history probably more than any person in the world. He even spent $21 million to make an exact chart of the value of silver during the Roman empire and fall.

He says increased government and taxation is coming for at least until 2033. This is the 78 year cycle of technological disruption.



Whether or not humanity can erase cartels by magic is something I will leave to witches.

In the meantime, I am grounded in economics, i.e. opportunity cost, which has proven to far more reliable than witches.

It does not harm for us to fix Bitcoin. Why not do it?


Agreed if the clones come and they don't all have the same incorrect design.

And my writing here, is to make sure it is so.

So what is your objection to my writings?

There could be no proof of this. But we shouldn't naively believe that Satoshi launched Bitcoin coz he was a good guy.

Okay, all my gentle ribbing and prodding seems to have not worked. You make some good points, bitcoin has flaws, the fee structure is suspect, it is potentially vulnerable to cartel behaviour and govt. control (there exists no evidence of this as yet) and it has privacy vulnerabilities. An alternative solution choice is needed in the market place of free monetary system competition.

Yes, please go make it!

Hope that is clear enough.

NB: bitcoin is still light years better than the cartelised, endlessly debased, zero-privacy, paper ledger legacy database, crap fiat monetary system in existent today.

I identified a threat inherent in the design. If identifying threats is paranoia, then please tell all the anti-malware activity to stop. And lets us be filled up with viruses and trojans.

You are correct, I can not be sure what was Satoshi's intent, and it doesn't matter any way. Let's just fix the threat.

(we don't need to assume Satoshi was a good guy, he got rich, so he got his reward already)

We are in perfect agreement on all your points in this post (only). Thank you.

If you want continuous debasement of Bitcoin, how do you distribute new coins? (not to the cartel miner I assume)

If the debasement continues forever, then the miners always get paid. Thus they never go bankrupt.

Thus there will always be some good miners.

We still have the 51% attack to worry about, where malicious is done. But remember the power elite don't want to be obvious, because then we would switch to an alternative.

And if all the miners are making money (which is more true in my design, because in my design you don't use electricity!  :o), then we will have more inertia against the bastards any way.

*In my design, only a few peers are computing the next block at a time, but most of the time, they are idle. The proof-of-work is based on hard-disk space. It is very clever.

I am not talking about a large debasement. Very slow similar to gold. Set in the protocol, nobody can manipulate it.

All transactions will be free.  Micropayments work very well. Everything scales better than Bitcoin.

http://anonycoin.org (this is very rough, needs a lot of work to make it more clear)

If you all would prefer to change Bitcoin, I am happy with that! But can you?

1: Okay we will see your articles, and the discussion will continue.  Cool.

2: Probably bitcoin will not be fixed, but you have failed to explain how cartels will trump the human spirit which strives for less assholes in the world, controlling the workers. (see below)

3: Very cute how you frame it "Are you saying tax will disappear?"  In a way, yes, along the lines of the colonists who dressed up as Indians and threw biritsh tea into the sea to protest taxation and gun confiscation, as a prelude to full on warfare.  I am saying war will probably kill you and me and 50% of those reading this forum.  What our children build after that, cannot be predicted, not by you and certainly not by Martin Armstrong.


I am very familiar with Martin's work, I have printed all of it and studied it at length.  Is he still in jail?  Like I said, prisoners make the best employees, yet you think humans will still remain imprisoned in the future?  I am not so sure.  But Martin's ability to predict the future is not yet proven, his idea that gold may go to 30,000 USD per ounce is interesting, and his knowledge of Japanese money manipulation is deep, but he is not too different from Leo Wanta and his cronies, who crashed the Russian ruble, from a practical perspective.  Neither of these men, are now bitcoin billionaires and so I am saying if you are describing a curve which will meet some point in 2030, you are giving your vector-analysis too much credit.  But don't get all hurt about it, I look forward to your articles, and respect your desire to defeat evil, though you seem to see taxation as like food?  Something humans will never live without?  That's silly.

Martin Armstrong is a knowledgable guy, a Princeton U. genius, and the enemy of Goldman Sachs.  But his idea about cycles can be compared to any other prophet.  An example would be "The Bible Code" type modality where people take words from a page of the bible, and read "Hitler will take over Germany" from it.  They do their bible code ticks, in hindsight 20/20, and that's fine, but indeed many messages can be gathered from any book even Moby Dick has pages that spell out "Hitler will take over Germany" if you look close enough.  But analyzing the past is slipshod brainwork when applied to the future.  The very existence of bitcoin shows that to be true.  The street level geeks, mined the early coins and got rich or spent them, but all the experts like Martin, were nowhere to be found.  Similar to that idiot Bill Gates who said that the Internet wouldn't amount to much.  So I guess I am just knocking you around, and seeing if you bruise easily.  Genius often do.  I look forward to your articles and worldwide fame.  ;)

You don't need mains electricity anymore with the new ASICs. 4 solar panels will run it so as long as you can recoup the ~$3500 outlay in the medium term. (A lot less than the outlay on GPU rigs and no running costs). When/if bitcoins become unprofitable, you can then just sell juice back to the grid.

itsunderstood, the human spirit will prevail. How else would you characterize my attempt to make a fix or better bitcoin?

Let's keep progressing, that is the way to win.

Martin is out of jail (7 years held in jail without a trial) and he writes much more sensibly now. I couldn't understand him when he was writing from jail. Now that he gets daily email questions, he is able to explain his stuff better.

Now I realize he is not nonsense. Before I thought he was.

That is not entirely correct (partially yes). Difficulty will scale up accordingly. But I do agree the ASICs hardware cost now far exceeds the electricity cost. This may change as ASICs are converted to IC chips that are mass produced.

My design uses hard-disk space, which is much more reliable to predict. We won't have these phase-shift changes causing miners to waste capital in a direction that becomes obsolete. The Moore's Law for hard-disks is very predictable.

I want miners to be healthy. I want every user to be able to mine some. In the design of a P2P currency, you can't neglect a part of your ecosystem. Investment requires predictability.

OP I am pasting this portion from the link you provided above:


So to discuss your concept, most people would see debasing of coins, gold and silver specie type coins, as being a lessening of the metals content, meaning a 99% pure gold coin would be debased such that it becomes a 50% gold coin, i.e. debased by half.

As I understand the words above (correct me if I am wrong), you identify that bitcoin does not ever debase its coins, but indeed, aims to have the final block, even if it is worth a billion US dollars, be the same as to its nature, as the first bitcoin block.  Am I explaining this right?  So in essence, bitcoins can never be clipped or debased, and you're saying that's a problem because the people who mine those final blocks, won't get "paid"?  Is that right?

And so your explanation of debasement as good, is somewhat obverse as to what people associate that word with (myself included) because, I suppose, the debasing is done by assholes who want to enrich themselves.  But you are saying, I think, that debasing the coins as they move forward (the final blocks produce more coins than the first blocks) is a GOOD thing, because it makes for a consistent flow of coins?  Is that right?

Just trying to allow you to clarify your points.  But again, since we won't approach the final bitcoin blocks before total global warfare (means: death of half of all humans on Earth), I stick to my claims that long term predictions are essentially just so much guessing.  Bitcoin here in Q1 of 2013 has crossed the rubicon, and within a few more years, I believe it will cause massive changes politically before your cartels can grab miners as your theory describes.  Chaos will be increasing from here out.  Hmm but perhaps that chaos will cause the miners (be they prisoners or just weakling in their basement) to adhere to the cartels.  Hmm...

No one will be hurt by this. The bitcoiners are already being rewarded. This is all open. Everybody can see what is coming and plan accordingly (if it comes).

More markets are better for all of us.

If someone can implement my idea before I can, then great! Let them win.

Can someone donate a great domain name in exchange for something (permalink in the About?)?

Firstly, I don't retract my opinion - if you are offended, tough. ;)

Your whole approach seems top down, and while it makes it easy to create a strategy, reality is different.

You also are conveniently forgetting every technology which has failed even though it had 'cartel' support.

For instance, nobody replaced Windows. It was the market that changed, with lots of little innovations from individuals and small groups like those that got bitcoin off the ground and Microsoft couldn't keep up.  The same thing will happen to Google, and Apple, and bitcoin (eventually!)

As for this worry of not being able to get rid of currencies, you have obviously forgotten the Euro experiment in Europe where 17 currencies were deleted and a new one introduced in a weekend.  With full political support, anything is possible! That is also true in reverse!

Finally, you have a very off putting dismissive attitude to the public's ability to make a choice. The public change things all the time, in fact the whole concept of the free market depends on it!

If people feel that the advantages of using bitcoin is being compromised by some big forces, they might do something about it, or maybe they won't, however, without actually offering a solution, your post is a bit meaningless.  

On the other hand, if you had started the thread with 'there are some problems brewing for bitcoin, and here is my solution..' you might have got a fairer hearing

The fact is that good enough is actually all you need, and at the moment, bitcoin is almost good enough - it just needs to be more public friendly to hit the mainstream! That is something I am working on and when I'm ready, I will be posting my solution!

You are missing the point. Difficulty is irrelevant. It just takes longer to glean bitcoins as difficulty increases. As the electricity is free (and you have already sold some bitcoins to recoup the initial outlay), you can just leave it switched on without incurring electricity costs. The issue becomes is it more profitable to mine bitcoins or sell the juice to the grid.

But this is an aside to your main points (it was just a comment to the poster about electricity).

More in line with your OP...........

I find the 51% very troubling. As I pointed out in this thread (https://bitcointalk.org/index.php?topic=153753.0) a 51% hashing power takeover has already taken place and was been proven to be effective. In this case the "cartel" was the bitcoin community, but it might not have been.

FYI:
New gold is mined at about the rate of 2.5% per annum, based on existing mined stock. And this "debasement" has held steady over very long time scales.

Why not just create a hard fork of bitcoin (or with merged-mining) and a new rule to hold inflation at 2.5% once it drops to that level around block 600,000 in year 2020.

Then you hand the power of the cartel to monopolize your mining. There is no other alternative choice.

Do you hate gold because it is debased every year? Every year new supply of gold is added to total supply.

Debasement is not stealing from your value. It is adding to your value, by keeping the total ecosystem healthy.

Static wealth is the antithesis of innovation and the human spirit. Do you want to force all the new innovators to respect what you innovated 1000 years ago? Come on. Idle capital has to be deplete slowly over time, else you are trying to fight against nature. Put your capital to work in investments that produce innovation, if you don't want it to deplete.

Your response here makes me interested in reading some of his newer stuff.

Any comments on Leo Wanta or the destruction of the Russian ruble?  That's a key component of the chaos which is coming.

Let me flesh this part out a bit:  See, for example, Silk Road marketplace, allows humans to be free.  They are free to buy what they want.  HOWEVER, the political power-cartel, CANNOT allow SR to continue.  ...So who is right?

Where would bitcoin be, without black markets?  It would be nowhere.  So the essential battle which will be waged, is one of freedom.  The freedom which Americans think they have, but really do not, but which bitcoin and SR, allow to be realized.  There are many people who suggest that drugs should be legal.  Well, bitcoin and all hash-based money, essentially acts like Alexander cutting the gordian knot of this discussion, because the drug war as such, WILL NEVER END, until those who are the enemies of freedom, are diminished from opressing those who are on the side of freedom.  Yes, I am saying that if my neighbor wants to be a meth head, I must, as an American who loves freedom, allow him to be that meth head.  Here is where all your (and Martin's) talk, hits a wall of pain.

Talk to me about how your hash-based money will make drugs more or less accessible to people.  Thats where the real money is.  As you know full well, all the major HSBC type banks were kept afloat in 2008 crisis by the clearing houses and their massive piles of laundered drug money.  I am saying that bitcoin itself, and yes, all anon-enabled hash-money, serves to act as a magnet for black market money, and what this does is severely weaken the existing banks and all their cadre.

Bitcoin right now, stands to acquire literally hundreds of billions of dollars of true, flowing black money.  That is what will cause it to hasten the chaos, because gangsters have a lot of power.  BUT, here also, does bitcoin threaten the gangs of Earth, because on SR for example, it allows the averge joes to sell product.  And the gangs cannot allow that.

You speak of "cartels"  ...Tell me, what is rockefeller cartel, compared to the Sicilian and Columbian cartels?  In the answer to this question, lies the war which is looming.  Bitcoin is like a Promethean weapon given to those who love freedom.  But yes, it may be destroyed, but not by cartels.  It will be destroyed by the same sort of government monitoring that has always been done. 

QUESTION:  Have you read the essays "The End of Money" by J. Orlin Grabbe?  If not, I will post a link.  These are the two most important essays about money, and prostitutes and drugs, and freedom.  Anyone like Martin and his genius friends, who talk at such high levels, without addressing the base human products of hookers and drugs, fail to achieve a realness at the level of J. Orlin Grabbe.  Money as such, is a control matrix, but bitcoin strikes at the root of that concept.  Though I think you are trying to 'perfect' bitcoin, I think the higher conversation is about freedom as a notion, because if the Pope and the Religious and the Politically Obsessed, end up running the world after this next war, it will be a new dark age for humanity anyway.  So I am suggesting there is a bitcoin subject that is not politicall correct to discuss, but which is as obvious as a 1000lb nude digital gorilla in the room, doing lines of coke.

I read ur paper about Anonycoin. But it's still unclear to me how peers come to consensus. In Bitcoin it's done via proof-of-work (a blockchain with the highest cumulative difficulty is chosen). Could u post short summary of the approach that solves the consensus issue in Anonycoin, plz?

That is the easiest fork.

I also wanted to fix the electricity consumption and ASICs removing the masses from mining.

I want they can download and mine, nothing to buy.

How about I do that easy fork, then we test the hard-disk thing and decide whether to adopt it later?

I can do the easy fork in probably a day.

Should I fork Litecoin instead of Bitcoin, so the GPUs have a place to go to recover their capital, while I work on the hard-disk option?

Better still. Post a link to the source so we can inspect and build it.

@itsunderstood: on Leo Wanta:

http://solari.com/blog/solari-stories-the-black-budget/

I am not offended as long as you are not trying to win a political argument with the use of colorful words. Let's see what logic you have put forth.


That is a reasonable point in the abstract. You should know that I love abstract. I regularly inhabit there :)

But here we have to come back into reality and try to discern abstract hypothesis from practice.

As my plumber friend says, "there is a big difference between theory and practice".


Failed? Depends how you define fail. Decades of suffering from Windows, with Bill Gates now using the proceeds to sterilize Africans is failure for them?


True, but someone had to articulate it:

http://en.wikipedia.org/wiki/Eric_S._Raymond

I assume you are younger than me (48), so hope you won't be offended if I say, "Get Off My Lawn":

http://esr.ibiblio.org/?p=3335 (World Without Web)

The prior link explains that someone made the internet happen for you. Somebody was worried then, as I am now, or you would not have the internet now.

So please don't dismiss individual human action.

What have you contributed?

I for one created the first social network which inspired friendster, which inspired myspace, which inspired facebook.

Which is driving a lot of the effects that give rise to Bitcoin.

So I did my part once already.


Sorry but you fail to understand economics, because you over generalize.  Europe will not dis-unify. Watch and learn.

http://www.mpettis.com/2013/03/21/when-do-we-call-it-a-solvency-crisis/#comment-21988

You need to view this has different gears turning at different speeds.

The youth and skilled are migrating. The old and unskilled are staying put in the Euro.

So the Euro is decay itself, but the decay stay unified for as long as it has this political control, which appears to be more like 2033ish and by then the cartel will have another angle up their sleeve.

The cartel is moving their control up the ladder of leverage to the end of the nation-state.

This is precisely why I expected to find the vulnerability planted in Bitcoin, and I found it exactly where I expected to find it. The cartel is trying to find global controlling paradigms, and let us gain our efficiencies from the end of the nation-state structure.

I don't view the end of cartelized instances as failure on their part, rather they are always sacrificing an instance to gain another instance, when it is time to adjust to the movement of the masses.

The cartel (power elite) are like cattle herders. They watch where the cows want to go eat, and make sure they place their capture devices there. After all they are just businessmen trying to maximize profit by any unethical means. But they also claim it is ethical because they claim we are unable to organize ourselves against failure.

So if you leave a monopolization threat in the design of Bitcoin, you are doing exactly what they claim-- designing for failure.


You have to offer the choice to them. That is what I am talking about here, to motivate someone to offer the choice needed.

Choice doesn't create itself.

Nonsense.


Okay now you have a valid point:

http://esr.ibiblio.org/?p=3514 (Those who can’t build, talk)

I first want to test my logic, to make sure I am correct. That is why I am here discussing. And also getting feedback on what the market wants and does not want.

I am doing a market survey in this thread.


Fair enough. Point is very valid.

I came storming into the forum with "Bitcoin is a Ponzi scheme".


Without fixing the "no debasement", the mining ecosystem will not be healthy enough and you leave the threat wide open to cartelization of mining.

I see you have a vested interest for Bitcoin to remain the only or best or favorite P2P currency. Okay fine. You decide where to invest your time. That doesn't mean you are correct about the threat I see.

You are asserting that the threat is not sure enough to worry about. I STRONGLY DISAGREE.

I will make this more clear soon. I already answered some questions about the algorithm somewhere in my past posts in other thread. I can't find it at the moment. Suffice it for now, the proof-of-work is based on having a terabytye (or what ever we decide or maybe scale it by Moore's Law) of shared keys with the other peers, so you have to be ready when your random turn comes, to prove you had stored all those keys. Static storage does not cost electricity. Everybody owns a hard-disk. Hard-disks have numerous suppliers.

GATA.org published. That is the first one possibly instigated by me. I emailed James Turk who I assume contacted Bill Murphy (I also have contact with Bill but didn't email him yet). "Is Bitcoin better than Gold?"

May only be in the subscriber area so far. I haven't had time to read it yet.

There is also another effective constraint and it is related to bitcoin's first mover advantage and the length of time until the deficiencies that you've identified become apparent to the bitcoin users/miners.

It won't be until the block reward drops sufficiently low that the issues with fees structures becomes apparent. Until then competing with bitcoin's zero-debasement protocol rule in the open market will be nigh on impossible and meanwhile it will keep building on its first mover advantage.

So not only do you need to produce a monetary product that competes with bitcoin in the long term, when it will be easier due to better fee structure, debasement rules, etc ... you also need to compete with it in the short term to gain enough market share that your product can survive long enough to prove itself when the "abstract" problems of bitcoin become real. Also you run the risk that bitcoin could always just adopt any solutions you provide to their long term problems and incorporate them into the source, since by necessity your product will be open source also.

Edit: this is all not to say that it can\t be done, just it should not be underestimated the size of the task. Strong anonymity or inherently easy to use privacy of transactions is an area that bitcoin can be competed with in the short term.  ;) ... which is why I'm following this thread. Zerocoin has some good ideas it seems.

Exactly. That is why I didn't just implement first. I need to see what the market thinks.


That won't happen. Too many people don't understand and would view that as treachery.

Very clever the trojan horse that Satoshi planted. I may not be able to defeat it. (but I found a secret weapon, see below)

However, realize I don't need to beat Bitcoin. I only need it to be enough marketshare that it doesn't wither. So then we have the option in case Bitcoin never fixes in future.

Isn't that worth throwing a few coins my way? (even if you keep most in Bitcoin)

Due to "smaller things grow faster", you may earn more appreciation in my design.

And you mine in my design with only your PC (no need to buy ASICs or GPUs), and get free coins too. Media would love this, they can show themselves earning a coin during a broadcast with a regular PC.

The ability for common people to earn coins simply by downloading the client, is the killer feature that could overtake Bitcoin.

More users == more marketshare.

I've been known to be clever jerk ;)

Agreed. That and user-friendly strong privacy.

What language are you going to be writing it in? Send me the source if you need someone to look over it.

Very fascinating thread. Are you saying there is no way to change the mining reward system to prevent the 51% takeover scenario (eg by a cartel)? I assumed bitcoin developers were already working on this issue..

Would the community accept Java?

I would really love to code in Scala (but avoid the shit that makes it hard to read and understand), and (maybe later migrate to my Copute language which I am designing).

Perhaps the first step is to fork the C++ code with say 2.5% annual perpetual debasement (or maybe greater in the start and scale it down to give early adopter miners more incentive), without the hard-disk proof-of-work?

Then move forward on the hard-disk version with new code base.

Name?

Thanks.

No. Please don't confuse this thread with the overt 51% attack.

The 51% overtly malicious attack is a separate issue and that threat will continue to exist in both Bitcoin and my design, but I don't think it is much of a threat, as I explained in the following linked post:

https://bitcointalk.org/index.php?topic=160612.msg1702033#msg1702033

The threat I identified is a slow-moving insidious take over of mining, by giving it away free (and making more profits from the opaque control it gives) driving other miners bankrupt who can't collect those rents from the monopoly control of consolidation of merchants. Then using this power some decade(s) from now to turn off the ability of dissidents to buy and sell (thus starving them to death perhaps).

https://bitcointalk.org/index.php?topic=160612.msg1701600#msg1701600
https://bitcointalk.org/index.php?topic=160612.msg1701584#msg1701584
https://bitcointalk.org/index.php?topic=160612.msg1701724#msg1701724

Note you might still see many merchants, but they would all be paying a rent to the monopoly, maybe even INdirectly via a tax to make it even less obvious to the general public. The cartel can hide (obfuscate) their rents in the government taxation, because they own the politicians. By removing this design weakness, we starve them for capital. We strangle their necks without ever touching them.

Consider it a form of digital decapitation, i.e. "off with their heads". Much less bloody. Perhaps we can imagine they will go grumbling into the alley and get drunk in their sorrows (actually I am afraid they will push the nuclear buttons if we start winning, but let's hope it all crumbles like the Berlin wall).

To battle the cartel, you have to play in long timeframes. They are very patient and rely on the short-sightedness of humans to win.

How do you know I am not Satoshi? (Answer: only the source code matters correct?)

Can anyone comment on this comparison of physical gold & silver to P2P currencies. Is the following accurate?

1: cartelization or regulations, are what might cause digits to go poof?  But couldn't cartels hoard gold like how FDR stole gold and stuffed it into locked vaults?  Couldn't regulations cause gold to be illegal?  All it takes is a buttload of AK 47s in the hands of the right soldiers (backed up by 50 caliber technicals in the street and artillery on the hill or drones in the sky) and gold can be squeezed out of any people and taken away.  once said gold is taken off the market, then fractionalized debt note currency can be issued, like FDR and the FRB did.

2: A known rate of debasement for gold?  How long does it take to coat a tungsten bar in gold?  How quick is that debasement accomplished?

3: This one might be true, sure, but gold has to have a form, and lots of forms are serialized.  But yes, gold eagles for example, are not serialized.  However under point #1, it takes only the right authority to force all gold eagles to be stamped with a serial # and any without the number, become illegal.  So force becomes the key driver.

4: I agree with this part about not putting all your money in them, but if someone feels that the black markets (billions of dollars in secure flowing cash from heroin and Afghanistan wars) will go all into bitcoin to cut down on their laundering costs (making bitcoin go to insane levels), then he might take that risk thinking he could get out before the cops crank down on bitcoin.  But long term, war is the only sure thing when humanity is so rich in hypocrisy. Speculation is different than savings I guess.

5: Yeah, but like I said, flexing the established crime/black markets as bitcoin and its children-knockoffs will surely do, will surely cause war on a global scale, to either control the black markets or stop them, so its moot.  But probably you might be right.  I do not see humanity overcoming its hypocrisy with regard to sex and drugs, so war and chaos must be the result.  In such a case, logically, the guys with glasses are killed first because intellectuals are the first to be purged when true evil (Marxism), righteously decides to press everyone toward righteousness.  I mean that true hard core marxists will just gun down drug users in the street, they are essentially nihilists.  The nature of bitcoin and SR drug market means the drug war will ramp up to the maximum, and government will be threatened as will gangs (who traditionally live off drug distribution which is being taken from them via bitcoin and SR) and so society will probably not survive.  Crypto, however, will survive everything, as its mostly indestructible so long as two computers remain.  Computers doing math on prime numbers is pretty basic, and even if there are only 10 humans left after the shake out, one of them will be able to run a computer and do crypto, which will give them more power than the other nine.

But anyway, develop your hash-currency, and sure, some people will mine them and you'll get your fame.  There will have to be lots of crypto monies, to give people a chance to survive the coming chaos.

Let's be more fair and realistic.

1. The economy-of-scale for confiscating intangible digits is much greater than searching every cave and hole dug in the earth for my physical gold. And they still won't find it, because it "ain't in no" cave or earthen hole!

2. How long does it take me to know if a silver coin is fake? (10 seconds with a spoon to twang it with)

5. War is coming. There is a repeating 78 year cycle and war always comes (throughout history) in the last 26 years of it. The 26 year downturn started 2007. I will write more about this in the future, not in this thread. I can make this very convincing with facts and figures, but not in this thread. The prior 26 year down cycle was 1929 to 1955.

Problem with that as I argued in my prior replies to jorbis (review them please), is that there are market inertia you simply can't undo, e.g. simpleton users don't like to change their software, merchants can't upgrade easily, etc. And how do you communicate to all them? How do you do a unified upgrade? And maybe they refuse, because they don't feel harmed. The power elite are very crafty in obfuscating the damage in for example taxes or government theft. They then get their profit from the public backstop. Meaning they don't have to directly attack the users in order to gain transfer pricing rents on all merchants, they might even get it through a govt tax on all merchants (which exempts them), so the users may not have an incentive to switch.

It isn't as simple as you want to think it is. Better to eliminate the weakness from the technical design.

I'm just messin with you, your points are valid, no doubt if we survive long enough, bitcoin will be used as "the kill switch" by the cartels who will gain all the mining power.  Like I said, the prison cartel has the cheapest labor in town.  I heard Ratheon has prisoners making Patriot missiles for .50 cents an hour!  Those guys can easily run litecoin on their machines as well I bet.  So your theory is sound.

But #5 above is the sort of manic stuff that Martin Armstrong comes out with, and its all about sun cycles and so forth, and guess what?  Nature does not obey timetables like that.  Whatever is coming, Martin Armstrong will not be predicting it.  I am really put off by people who think they are mathematical prophets.  Chaos always flies in their faces, and that is as it should be.

There's a dude on the Internet who likes to call himself "Last Prophet" and he lurks on all the conspiracy forums yakking on about how he "told" us years ago, how things would go this way, and what's next.  Seriously bro, people get sick of prophets.  How many prophets called bitcoin as the raging billion dollar bull that it is right now??  ZERO, thats how many.  It's going gangbusters and looks likely to continue.  So prophecy can bite my ass, though I am sure Martin Armstrong and his Princeton crew will find ways to project more future talk, no different than Alvin Toffler and the Watchtower Publishing Society, everyone wants to be the ones who "called it" when shit hits the fan.

I'm not arguing really, because your thread here is legit, and seems to be a way for you to discuss your 'better' coinage based on disk space.  I think your idea has merit, and will probably be one of the bitcoin army of multiple crypto-currencies that will allow us to survive the epic shitstorm coming, but bitcoin is what ushered it in, and nobody called that.  Satoshi, whomever he was/is, was the first to make it real, and no, I do not feel your fear of cartels will come to pass, because there will be others (like yours) which people can dump their bitcoins and buy, when they feel yours is better.  Frankly, I want you to succeed, and I look forward to your articles and for you to be one of the 1000 alternate crypto-monies that free humans from the tyranny of debt and usury.  Go with God my friend.

At this moment in time, when banks are outright getting ready to raid their own depositors, and unleash hell on the people, I am quite bored by the prophets who are trying to appear smart about it all.  I look forward to the day when money, and voting, and taxation, are all lumped into some digital tool which allows us all to have more freedom and less tyranny.  I suspect you might be on the right track to make that happen, so we agree.  But good luck getting developers to make stuff that virus makers cannot destroy, because I have worked in IT for ten years + and developers, imo, are some of the dumbest people around, always wanting the latest version of Java though it's completely open to all kinds of exploits.

In the end, the hypocrisy of humanity in regards to sex and drugs, will allow evil to prevail, unless bitcoin can become the springboard for a larger discussion.  If somehow, the nature of bitcoin can accomplish a paradigm shift, it will be in the realization that the bitcoin chain is a collection of all kinds of black market activity.  And if the discussion happens on a large scale, it will basically have to admit, that the hedge fund which has 10,000 BTC in it, has its purchasing power enabled by thousands of heroin junkies and pirates, and consensually or non-consensually photographed nude persons of legal or non-legal age in it.  When a hedge fund buys into bitcoin, and grandma and grampa are thereby is profiting openly from black market transactions, humanity reaches a zero-point nexus, where they will either accept what they are (what WE are), or it will implode.  Based on the current pace/velcoity/vector at this time, it seems far more likely to implode than to become real (less hypocritical).  This means that bitcoin won't have time to get to the point you are describing because that point is way in the future, whereas the effects of bitcoin on the black market are happening this minute.

You ever read "Friday" by Robert Heinlein?  That's probably the best prophetic book I have read.  And so the description of uber-tech combined with complete reformation of all Earthly paradigms, is what I am getting at.  No prophet predicted bitcoin, and no prophet, can predict whats coming next, except that it will involve tears and orgasms, as humanity is based on those two things.  I am sure there is room for your idea for super-bitcoin based on disk space, intelligent transaction cost-schema, and debased hashed coins, in that future.  Keep this thread going until 2030 and you will have saved humans.  Thanks, in advance.  ;)

You force me to explain in this thread even though I said I wasn't :)

I don't want to appear irrational so let me prove to you that you can use cycles to predict the future. Yes there is chaos, but that chaos is occurring orthogonal to the forces of nature which have regularity of waves. The 78 year cycle has nothing to do with the sun or BS like that. It has to do with the 26 year generation of human reproduction. Since humans take years to become educated and contribute new technologies, then the technological change follows this cycle.

Every 78 years we have a huge wave of technological unemployment that causes a crisis. Go to following link and view the chart of history and the technological paradigm shifts every 78 years and corresponding downturns and wars:

http://www.mpettis.com/2013/02/21/a-brief-history-of-the-chinese-growth-model/#comment-21689 (see textual chart)

The last generation can't adapt, so you have 26 years downturn while they hold onto political power. Then 52 years of boom as the new technology is spread out. Then repeat.

So the downturn will bottom 2033. We will have a war interim.

Being a newbie noob that is only now getting interested in Bitcoin, I can't say anything about the technical merits of your argument but if half of it is true then you'd be better off getting your idea developed asap rather than making argument and drawing attention before you have a fait accompli.  I'll be an interested user if it's not too geeky.  As per another thread here, a lot more competition would be a good thing and you've made good points about why one should choose your system over Bitcoin.  Bitcoin may have first mover advantage but it now also has a sticker shock problem in that folks of modest means may feel it's already too late.  

Leaving the technicalities of mining aside, I'm not sure about your argument about debasement of gold.  Just because a little is added to the pile every year, there are a few more humans too so it's not like the debasement of Roman coins with base metals.  The only 'debasement' as you define it occurred when the Spaniards discovered 'free' gold in South America.  Their only cost was shipping and a few bullets but after awhile, all that free gold depressed gold prices in Europe.  

Certainly, it's been observed that the fixed number of Bitcoins could lead to hoarding which hurts everybody as money disappears from the banks into this black box, exacerbated by the banks' leverage in reverse.  Your idea of perpetual mining at say 2% annual increase is close to what central banks are trying to achieve so we are used to it but I do worry that when businesses relay on constant inflation (rising prices) to bail them out of bad decisions, then it makes them stupider.  

Standing back, while everybody, especially Libertarian types decry that gummerments print fiat money out of thin air, I think we ought to keep in mind that the provision of money to the economy is a sacred duty of governments.  Lincoln understood this.  Instead of trying to invent digital currencies because politicians are corrupted, the people should wake up and vote right, which is to say, a pox on all mainline parties.  Hopefully people are slowly waking up.  

As for marketing, being exposed to Bitcoin for the first time, I was rather shocked at the amount of storage required for the sync files and how quickly that has grown (1g to 6g since start of 2012).  How big will that get once millions start using it?  I still run Windows XP (and hope to continue) and also a small Linux distro (live CD) with limited storage, so I'm interested in a system that isn't too complex, can run on older smaller systems and yet is still secure.  Tall order but I hope you succeed.  You'll certainly appeal to the 'Occupy' crowd.  

Best of luck.  

See also my latter post that elaborates:

https://bitcointalk.org/index.php?topic=160612.msg1705610#msg1705610

Per my prior post about the differences between gold&silver versus P2P currencies, my view is that we need competition amongst units-of-exchange. Contrast this with the qualities of a good store-of-value and unit-of-account-- which gold is probably the best because of its intrinsic quality of being rare. A unit-of-exchange does not need to maintain a "perfect value" over a long-period of time, because frankly there is no such absolute in the universe (don't ask me to get abstract because then I will drop my unified theory of the universe on you). In layman's terms, no one can say what is a perfect value, because there are so many relativities, e.g. we say Bitcoin is eventually never further debased, but the fact is the value of Bitcoin is always changing and new competing P2P currencies may always be gaining/losing relative confidence.

In my view the most important attribute of a good unit-of-exchange is that it is level playing field, meaning that what ever the rules, they can't be gamed. And a good unit-of-exchange is as inclusive as possible, and is as free market as possible. Beyond that, I say let everybody compete.

If you want to speculate on rising use and confidence of a new P2P currency, that is fine. But that is not a store-of-value, that is speculation (which is fine too, we need speculators). What we don't need is naive people dumping their life savings into the next Tulip Mania, thinking that tulips are unique and have some value which they don't have.

Thus I would prefer to see competing P2P currencies. We will be much safer as a human race with more diversity, not less. So we lose a little stability of value by having a diverse, chaotic free market, but we gain the loss of catastrophic failure modes (similar to the comparison between a Cathedral and a Bazaar (http://en.wikipedia.org/wiki/The_Cathedral_and_the_Bazaar)):

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397396

If I created an alternative to Bitcoin, this actually removes the failure mode from Bitcoin, without them needing to modify the design. Because the power elite won't bother monopolizing Bitcoin, if they can't also monopolize the alternative P2P currency.

So actually what I am doing is helping make Bitcoin's future more stable at the same time providing an alternative to reduce failure modes.

This is very much like the bimetallic gold and silver standard, which reduced failure modes that could occur by attacking (manipulating the value of) just gold or silver alone.

So my response is let the free market flourish and build as many P2P currencies as we can. Then let the market pick the winners and the losers.

No person is smart and omniscient enough to manage the market and provide all its needs. We each throw out our contribution, and let the market decide how it plays out.

We backstop each other in times of individual hardship, if someone can't eat or otherwise failed big time. Individual charity makes you feel good. You know the person personally whom you are helping, who is down on his luck. That doesn't mean give them so much that they become discouraged to ever work or do their own. It means sharing some food, a place to sleep, and a way to rebuild. It doesn't mean triple-bypass surgery-- sorry they may just have to die if they did not save enough for that. Then again, if it is my mother, I will give her the money even if she didn't save. Family matters. When the govt pays for everything, family doesn't matter any more.

In my past, I had the experience to survive eating rice and salt. I did it to know what it was like. It wasn't pleasant, but it has made me realize that even though I like expensive things, I don't really need them that much. I live my life fairly simply, for the most part.

Greed is useless. Love, knowledge, and experience are irreplaceable.

Per my prior post about the 78 year cycle, we are headed into very bad times. But in the worst of times, is where the human spirit and innovation can shine the most.

We have generational differences. I'd really like you to read about the Long Wave Cycle:

http://goldwetrust.up-with.com/t9p570-inflation-or-deflation#4735

Yeah I used to own the domain name GoldWeTrust.com, but I let it go. I stopped working on ideas about currencies in 2010. I had some other things come up in my life. I dismissed the digital P2P currencies even though I had a rough design for one, because I felt no one would accept units created out-of-thin-air.  In hindsight, I did not factor strongly enough that unit-of-exchange is not store-of-value.

Any way, look at that link above. I am Gen X (age 47.9). Some here are Boomers, others are Gen Y, maybe even a few Gen Z here.

So the point is we will have different attitudes and perspectives given our different generational environment. My generation grew up somewhat neglected by our parents (but I don't regret this, I love my parents). Gen Z is growing up very spoiled (but facing massive technological unemployment). Etc.

So we need diversity. Because not all of us are the same. We are all competing to provide prosperity and fitness to the outcomes of future.

Degrees-of-freedom (diversity) is a game theory strategy of maximizing the breath of options, so that you can adjust to future without overcommitting to ONE FUTURE. There is not one future. The future is changing as we approach it. No one can predict the ONE FUTURE.

P.S. About gold as a store-of-value, although I am sure it will go up in value a lot from where it is priced now (maybe a further decline first though), I don't know if the future will include high interest rates again and thus gold declining in value relative to the currency that is being loaned at interest. There are no absolutes (of truth or value). Perhaps P2P currencies change the equation somehow such that we don't get a repeat of 1981 where gold declined when Volcker raised interest rates. This crazy period until 2033 is also about preserving value. For as long as the crisis is not resolved, physical gold&silver is the most reliable.

Thanks AnonyMint, this was very informative.  ;D

I am experimenting with how to teach computer science over the internet:

http://copute.com/edu/

Check out the "Why Learn To Program?" in the Intro to Computers. And also see my one page Intro to HTML, as you type in html, it tells you what you did wrong.

I am currently trying to design a new programming language to replace Java. It is named Copute. It is not ready yet.

http://armstrongeconomics.com/2013/03/29/cyprus-confiscation-of-assets-is-global-plan/


Not exactly correct. The P2P currency's distributed database keeps on running for as long as the peer-to-peer block miners exist and are incentivized and willing to process the transactions. It is impossible for any one to corrupt the database unless they control 51% of the Proof-of-Work capacity of those miners. The government can steal as many copies of the database as it wants, we always have another copy.

Without 51% attack, the most the government can do is to pass laws which compliant merchants will follow. But this doesn't stop the black-market of merchants from accepting the coins.

Even if the government gains 51% attack capability, as long as we have numerous P2P currencies, then we can continue transacting.

The main threat comes if we only have one P2P currency or if all P2P currencies have the same attack vector (e.g. merged-mining) and same kind of Proof-of-Work. Or the government amasses significant mining share and then gives it away free, thus bankrupting all the miners (in Bitcoin and Litecoin which stop paying mining rewards from debasement eventually).

When I said physical gold&silver are the safest store-of-value, there is one case that is an exception-- that is where you need to have the wealth accessible but not with you physically, e.g. crossing borders and other hostile environments.

BINGO! On this and everything else you've said in this thread. I just heard of BTC 2 days ago, so there's much for me to learn. From the limited understanding I have so far, it's already become fairly evident that one or a combination of several different things are in play here...

• 1) BTC is the creation of the power elite (using your title) and made to look homegrown.
• 2) BTC is a great product with an even greater marketing campaign but nothing more. Closer to "Cabbage Patch Dolls" in the '80s or "Beanie Babies" in the '90s, than a sustainable currency.
• 3) This is just one of the test currency models considered for the global, cashless economic system that will soon be implemented....more testing to come in the very near future!
• 4) BTC is genuine and was created in the high hopes of bringing something new, something free and something that works to the world
• 5) #4 is accurate and the only reason it hasn't been crushed by government(s), elite, the Fed, World Bank, etc., is because they're watching to see how they can use it themselves
• 6) #4 is accurate...at first, but it's been taken over by the powerful and is now (or soon will be) just another corrupt, evil and oppressive system that will soon be used to manipulate and control the masses

I've always been a pessimist, it keeps me from chasing after every wild fantastical new thing, I prefer it. While most of the things listed are quite negative in nature, there is nothing here that's so unlikely as the idea that BTC is going to replace the economies of the world with zero resistance, influence or intervention from the power elite (I do like that term...think I'll steal it ;)). There's also nothing here so unlikely as the fantastical belief that BTC will reach some of astronomical value some have predicted. The most prudent plan for people who have a sh*tload of them, is to watch for the perceived value to begin it's decline and then dump them quickly. Novelties like this tend to burn really hot and really fast once they catch, but they burn out every bit as quickly...sometimes quicker.

Yes, the BTC phenomena is pretty darned intriguing and interesting. As you stated though, someone will eventually come up with something better and BTC will fade into history like so many other novelties before it. My personal thought on the whole thing is, whether it began with the elite or whether it ends with them, this is just one of the stepping stones along the road they're building for the sheeple.

I appreciate your support, but I must do you the favor of explaining where you may have overstepped a bit. Because I don't want you to miss out on an important phenomena. Ostrich head in the sand is also not a level-headed reaction. Luckily you are still very early to the ballgame. Even if you missed being an early adopter and buying Bitcoins at 1 cent, there are arbitrage opportunities such as Litecoin, or maybe something like my idea to come soon. Bitcoins probably could also make another 10-fold gain from here but don't fault me if they do not (I am not giving speculation advice). But $10,000 or $100,000 per coin is pushing the realm where opportunity cost would be astronomical, at least in the near-term. It is very likely that Bitcoins push higher well over $100 near-term, because AFAIK there is only one viable alternative as of now, Litecoin.


1. I am not sure if the threat was intentionally planted by Satoshi (Occam's Razor seems to support yes IMO, although my next best guess is maybe he knew alternative P2P currencies would blossom if he made a bad design (http://www.coolpage.com/commentary/economic/shelby/mining%20-%20Any%20counter-proof%20that%20Satoshi%20Nakamoto%20did%20not%20design%20a%20ponzi%20scheme%20on%20purpose%20%20-%20Bitcoin%20Beta%20-%20Stack%20Exchange.htm)), but remember my point in prior post, that an alternative which fixes the specific threat identified in this thread, would then inherently removes that same threat from Bitcoin.

2. Without the transactions with real merchants that could end up being true. No one is sure yet. We see some legitimate use, but not sure how much is speculation and how much is real need.

3. I entertained that thought too.

4. Yes! There is the chance we are creating something important and lasting, and we need multiple competing P2P currencies so we have diverse options for the future. Bitcoin and Litecoin both have the threat I identified, so that is not exactly diversity in every important way.

5. I think that is very, very likely to be the case. We know the FBI is watching it due to a leaked report.

6. if true, then not soon. The power elite work in long time frames so we get complacent.

BTC will not necessarily fade into history if a better P2P currency comes along. It is likely that it will help stabilize Bitcoin instead-- a win-win outcome.

I suggest you don't depart us, you just arrived. Hope you remain intrigued.

I will reply to this after I get some sleep.

Thanks AnonyMint as I see you here have quoted Martin Armstrong and clarified his lack of knowledge about bitcoin.  Your thread here has accomplished a lot toward your goal of saving humanity I bet.  Nice work.

I have bolded your points as to the short term survivability of the hash based crypto currencies.  As mentioned, I think your point about "government amasses significant mining share" is the key waypoint ahead.   ...I think this point could be made further by theorizing as to a couple key questions:

1: How cheap are GPUs, for the US government and/or NATO and/or BRICs nations?

2: How many humans does it take, to babysit and/or administrate a bunch of mining units?  Assuming you have 1 million prisoners who can each babysit/administrate a cluster of 1000 GPUs (feasible, with hierarchical top-down oversight), that'd be 1 billion GPUs.   So how many terahashes is 1 billion GPUs?  Would it be enough to take 51% of the blockchain?

3: For the governments (NATO and/or BRICS), electricity costs nothing, because they can fob the cost onto taxpayers.  As your posted video from Catherine Fitts explains, black pools of funds controlled by invisible silent interlocked corporate cartels, mean that taxpayers will fund the electrical costs, and never even know.  +1 to the bad guys.  ...Further, in full on Marxist countries, they could just build another dam like three gorges, and provide tons of free electricity --for themselves and their GPUs, not for the people (common miners).

4: Having explained the above situation, which makes your point, the further question would be, what forces could defeat such tyranny?  We could maybe hope to get all the "gangs" on our side (the side of the bitcoiners and commoners) but on the issues of drugs and hookers, it is unlikely (as I explained) that the common people will be able to ditch their own religiousness and hypocrisy, and their root desire to adhere to the government as daddy.  It is more likely that the gangs and commoners and all pro-drug freethinkers, will be far outnumbered by the State powers of BRIC and NATO, who are essentially religious organizations at their core.  Jingoism among the plebes will be surprisingly powerful to the regular bitcoiners, as bitcoin itself is smeared and made to be synonymous with pedophilia and meth and heroin.  Words, can be altered and used as weapons.  Pedophilia, a greek term, means "to love children", for example, yet the term is used to describe the opposite; "to destroy children". So words can be used as weapons, and to imply the opposite.  "Bitcoin" is also a new term (may as well be greek) such that the sheer mention of it in the future above, will be enough to bring very large pogroms to the neighborhood.  Soon, just the mention of the word "bitcoin" will cause a pavlovian reaction in the Nationalists, such that it won't be hard to imagine large drugs-and-hooker-hating mobs hauling bitcoin miners out into the street, and burning them alive, in such scenarios. 

..Indeed, the root of my posts to you on your very fine thread here, is that a prison-based society, needs prisoners, to be cheap, very cheap workers, who are as cheap and obedient, as say Indians or Chinese people.  I think you are right, the alliances of BRIC and/or NATO, can use prisoners of war, or prisoners of municipal code, as a sufficiently cheap labor force to babysit/administrate thousands of GPUs, bought cheaply by taxpayers without their knowledge, and run cheaply on taxpayer funded electrical projects, like for example, a hydroelectric dam, which is easy to sell to the public who are jobless, whose sole goal is to work and get a wage, but who would be building an electrical source for the GPUs run by their own sons, who would be imprisoned once the dam is completed.

Hey, I hope it doesn't go this way, but you make some good points, and I do enjoy reading Martin Armstrong's work.  I am just waiting for all the intellectuals to drop the bullshit and get to the real nightmarish scenarios.  Perhaps Edward Bernays and Leo Strauss are right, and humans are just herd animals, who treasure their own hypocrisies.  However, I feel that you and I agree, that these two men are wrong to underestimate humanity.  Let's hope they are wrong, and that humans will be ready, as bitcoin is even at this very moment, shaking the Earth to its very core.

..

Why is this relevant to P2P currencies?

Please read the following linked post (JustSaying is me), it is very brief:

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397396

I am trying to create a computer language that would enable open source to delivered in mix-n-mash modules. Here is some info about that:

http://esr.ibiblio.org/?p=4824&cpage=1#comment-396626

That is great in of itself. But the further implication is that the modules become money. Knowledge becomes money. Bingo! You remove the ability for idiots to debase simply by "who they know", "how they can manipulate the ignorance of the masses", or any other form of action which lowers collective knowledge.

Why? Because everything in the future is software. We even can print new hip joints with your own body cells using a 3D printer. We can print a plastic car that is stronger than steel. Etc.. This is causing technological unemployment, until the youth adapt. The boomers mostly can't adapt. They will try to hold on to the political control and destroy the world into war with their selfishness and myopia. But we will just route around their failure mode of political control, by using technology which can't be controlled by politics. In my view, government is very good at making legislation to "fix" that which is unfixable, thus the motivation I have is to create projects which decrease failure modes so the government becomes more irrelevant and not needed. One day I hope the government becomes totally ignored, like babbling idiots talking to themselves and nobody cares.

What are P2P currencies backed with? Knowledge and need for diverse options against a dangerous future. So if you want to create an alternative P2P currency, you need to innovate. See my prior post for background on importance of diversity relative to no known ONE FUTURE:

https://bitcointalk.org/index.php?topic=160612.msg1703553#msg1703553

More on this in future, first we need to release someone similar to my design for an alternative Bitcoin. This would not be modified to make software modules money-- it is an orthogonal project. Also, this will not destroy Bitcoin.

"Also Gresham's Law dictates that coins will [sic] higher issuance will drive coins with less issuance out-of-circulation towards a higher store-of-value."

This is not quite correct. Gresham's law provides that "Bad money drives out good if their exchange rate is set by law"

Historical examples tended to involve bimetallic monetary systems in which one of gold or silver was officially over-valued in relation to the other.

It has no application to BTC or indeed to any free-floating currency because their relative values are set by markets, not by law.

"If an attacker can muster 51% of the Proof-of-Work capacity of a P2P system, the attacker can take over the system. There are differences of opinion as to the degree of malicious behavior an attacker could do. However, one unarguable mathematical conclusion is that an attacker that had for example 60 to 90% of the Proof-of-Work capacity could process 60 to 90% of the transactions. If this attacker did not do any thing noticably malicious and did not charge a transaction fee, then virtually all customers would not find it necessary to offer a transaction fee, because over just 3 blocks of waiting time the 60 to 90% becomes 94 to 99.9% of all transactions.* If this was sustained for sufficient months or years when the production of new coins had ended (or declined significantly), then all the other miners would go bankrupt because their costs are not subsidized. Such attacker would then control virtually 100% of all transactions processed. Note this 60 - 90% could be built up over time, because offering free transactions to a percent of the market (when no new coins are being minted), drives some percent of the other miners bankrupt thus increasing the percent the attacker has— it is a snowball effect."

But what would it cost to offer free transaction processing to 60% to 90% of all transactions for months or years? And at the end of it, what would the attacker actually have achieved except to destroy BTC, which would seem like rather a pyrrhic victory !

Btw, I am writing about  Bytecoin here:

https://bitcointalk.org/index.php?topic=160186.msg1705547#msg1705547

Now...


Good point and I am aware of that. I think I had written that bad money would drive more store-of-value into Bitcoin and less relative circulation compared to the bad money that is debased more, i.e. there is a free market effect.

Please refer to my prior post on the prior page of this thread, wherein I pondered about the true value of unit-of-exchange. A unit-of-exchange doesn't really care about debasement, as long as it is not hyper-inflation and can't be gamed by one group. And obviously more debasement is going to chase away those who want a store-of-value.

But this is in degrees, because some people only need a store-of-value over a shorter period of time, and then a unit-of-exchange. Thus small debasement is good, because it keeps the mining ecosystem healthy and it discourages capital that is 1000 years old from thinking it has the same relative value as capital created yesterday. Because prosperity is more about innovation (we live better than kings of yore due to technological advance) and less about savings. Savings is important, but not 1000 years of savings, that is laziness and slavery. Lets debase those Old World Europe bankers who own half of the world, and innovate away from them leaving them behind.

I still don't understand about bitcoin

What do you not understand? You mean everything about bitcoin and P2P currencies and how they work, etc? This is not the thread for that discussion please. For that go to:

http://weusecoins.com

If you don't understand the threat I alleged that exists due to a design flaw in Bitcoin, then I can try to explain again if you first tell me your level of understanding up to now?

You have not read this thread. We already discussed this. I will not re-explain it again (not because I am angry but just because it becomes noisy if I say the same thing over and over), and I am tiring of going back to find the posts for readers (I have limited time). Please just read the entire thread, then you will get it.

In short, the monopolist can use transfer pricing to subsidize and win. Bitcoin would not be destroyed, it would be their main tool for control and taking all the profits from mankind.

I thought this article was interesting for a couple reasons, I have bolded the key comments.

[NOTE: It seems to be a clever way to deflect news freshness to remove the date of the interview.  This vice.com website should put the date up, I couldn't find it.]


Notice how "humans" are equated with "institutions" by this super-smart ignorant kid here?

Notice how he says "once we eliminate the bad institutions like banks, humans and the Federal Reserve, then things will run smoothly."  HEY YOU, HUMAN, do you see yourself as the same ilk as the bamks, and the Federal Reserve?  What sort of thinking is represented here, by this young "genius"?

The road to hell.  Paved with bodies and good intentions.  This guy sounds like most of the developers I have supported.  Total pie in the sky dumbasses, paving the way to tyranny.  Nice guy tho, no doubt.

Also notice how he has no real knowledge or answers about FINCEN?  He says there may be licensing fees.  Does he realize thats how the tyranny controls the common people?  How much does an FCC license cost, for example?  Also, what happened to UHF and VHF airwaves in America?  His answer to this last question displays a complete lack of any deep knowledge, people like this should be kept away from technology, but instead, this kid represents the next modern army, indeed if he is this smart+stupid at 25 years old (let's say, not sure his real age), then isn't it better to mine the schools for 13 year olds to replace him when he finally wakes up?

Notice his next comment:  "Ask for forgiveness not permission." becomes simply "Act, and [then] defend your position"   ...Do you think this will resonate nicely or poorly, with the control structures of Earth's nations?  Obviously acting without permission, is not what the authority will allow.  FURTHERMORE once young men like this are jailed, and put to work for the authority, what kind of menace shall they become, due to the threats upon their life?  How hard is it to send a honeypot jailbait spear into this dude's world, and then blackmail him?  He admits regulations (and code and statues) may continue to affect the world, but he doesn't see them applying to him.  Dissonate much?

It is hilarious to consider the inconsistencies of this young man.  What is there to say?  As I have said, this wave will envelop all of humanity.

One key aspect of my proposed hard-disk Proof-of-Work scheme (if it works as I expect it to), it that then every user of Bitcoin can also be a miner, simply by downloading the client. Nothing to buy. Batteries included (because the design uses very little electricity as I explained in a prior post).

Therefor, the attacker would be trying to match the resources of humanity. Good luck suckers!  :P

They may not need people to manage their hard-disk server farm, but humanity will also have robots too. What ever they have, we have more of it. Because there are 6 billion of us.

Maybe that is why the Georgia Guidestones (http://en.wikipedia.org/wiki/Georgia_Guidestones#Inscriptions) (from CNN founder Ted Turner apparently (http://www.youtube.com/results?search_query=Ted+turner+confronted)) say to reduce human population to 500 million. They are hoping they won't need us once we have robots.

The key is to make mining something that all users can do. This is actually the key design flaw in Bitcoin and Litecoin and Bytecoin and all of them, although Litecoin's scrypt Proof-of-Work claims to improve the balance (but I don't know to what extent, I think my design is orders-of-magnitude better in this balance).

Is that not a theoretical slamdunk for my design? (in theory not yet proven to work properly)



I just told you above.

You make a further good point, that indeed, "robots" will manage the GPUs.

But then you say that "humans" or "we", will have more robots, than "them"...  And yet I would counter with this point:  We humans do not control the prisons or the courts or the legal system.  Only anti-human types, becomes lawyers, and those who destroy their humanity even further, can then become judges or legislators or worse, politicians.

However, we are not arguing, because I am agreeing with you, and we differ only as to the "hope" quotient and/or what form that "hope" will take.

And yes, the points about your design are quite good, you are correct that having the users of bitcoins also be the miners, is great.  I am sure many people reading this are interested to hear more from you.

However, Java is a joke, it has been destroyed by Oracle, and has more virus vectors and 0-day exploits than ever.  So if you propose a client that becomes as ubiquitous as say Skype, well, that client will become the #1 virus vector.  Skype of course has sealed code, nobody knows who has backdoors into it.  So I see some pitfalls along the road as you will have to have the hardness of the client, as the cornerstone of your code.  And if the code shall be open, then I suppose these same users would have to learn how to compile code?

As mentioned, most developers are clueless as to virus vectors, and programming with security hardness in mind, is akin to the earlier analogy I used about the space shuttle.  If the security guy is listened to, in the IT/DEV meetings (I have sat through many of these), well, code will take 100x longer to write, and that's a fact.  It is always the case, the some dumbass DEV manager, who got promoted for his stupidity and not his sense, will tell the security guy to STFU so we "can get something produced!"  ...See?  So you are making noble steps on a very creaky bridge, but I like your goals.  Yes, when these issues converge, then something better will evolve.

Good start tho!  Just out of curiosity, if we assume you will have the "rights" to your idea, what kind of remuneration or profit, or pay, would be acceptable to you, if your idea was to be realized?  I mean, your suggestion is that Satoshi knew he was building a "Madoff" type scheme which would crash or become the end of the world tool.  So, assuming your ethos is superior to his, what would you want, for compensation?

He also thinks there is a limit to Moore's Law, I guess he hasn't heard of multi-core.

Please consider a differentiation between Java the libraries and Java the virtual machine. The virtual machine is solid. I need that virtual machine, because the higher-level languages such as Scala run on it.

http://www.scala-lang.org/node/104 (Tour of Scala)

I hate writing code that obfuscates what the code is doing. Scala if used carefully to avoid it's ability to make unreadible code, can produce code that 3 times more compact than Java, and perhaps 5 - 10 times more compact than C++. In many ways, it looks very similar to Java and C++. It is not so foreign if avoid a few gotchas.

The Java VM is open source, e.g. Android's Dalvik.

This decision can produce much more robust code that is easier to maintain and easier to understand and easier to find bugs and security flaws.

Python is I guess another possibility, but it really isn't the optimum performance, although Big O trumps:

http://esr.ibiblio.org/?p=4861

I wrote CoolPage and Art-O-Matric (coolpage.com) in C++. I know C++. I hate it.

Here is why:

http://copute.com/edu/Intro%20to%20Computers.html#Declarative (written by me)

Watch this video (very good if you are a programmer):

http://java.dzone.com/articles/lessons-jug-talk-eric-esr  (video is very humorous and entertaining even if you are not a programmer)

Figured this part here about Avalon (I quoted the kid above) is also relevant:


So batch 1 of 300 Avalon boxes, spits out roughly 18 terahash per second.

And the ENTIRE bitcoin network, spits out roughly 23 terahash per second.

So if we compare bitcoin to gold in terms of "rushes", it's like everyone has had pickaxes up until now, but some people have gotten sluice equipment and huge swaths of placer and lode claims equal to thousands of acres of Federal land.

How can one 49'er with a pickaxe, compare to a cartel that has acres of lode and placer claims, and tons of sluice and dredge equipment?

AnonyMint, I think I am contributing to your point, correct me if I am wrong, but your theorized enhancement involves lessening the effect of the ASIC devices, is that right?

Not just lessening, in theory eliminating.

Hard-disks is something all of us have and need.

And there is another angle to this... I am hoping we can store the cloud in our cloud!

I want to eliminate Google and facebook.

I am also working on a distributed social network and cloud storage.

No more data jails and government invasion of our privacy. We will own our data!

I have big ideas, but those can't build, talk. So I will need to stop talking soon.

What I am saying is that I want to create jobs for the world. I want to fix this mess we are in. Not just me of course, I mean just providing a few key innovations, and then world of all of you will do it.

Bitcoin adoption is accelerating. A competitor needs to come fast else the opportunity may slip away:

https://bitcointalk.org/index.php?topic=161785.msg1705988#msg1705988

It is time for me to STFU and code.

If there are no more very important questions, I will exit stage left for perhaps days or ...

Good idea to start the coding. The goals you have outlined are very important.   I wish you well and hope you will enable interested parties to contribute whatever possible.  To that end, perhaps you can check your pm every now and then. 
As Obi said, May the Force be with you. 

Force be also with you Obe Wan.

Be me not to fail that remind Obe Wan, individually held PHYSICAL gold & silver be still very important for STABILITY of the force:

https://bitcointalk.org/index.php?topic=160612.msg1702981#msg1702981

Teach you did the balance Yoda.

Thinking maybe it's time you head on to bed!

Although I love the ideas, I'm all for anti-establishment, anti-government, anti-corporate empire...Hell...anti-ANYTHING!  ;D

Thinking big is the only way to think!

However, I think you've reached the point of delusions of grandeur here....maybe it's time for sleep

Good stuff though!

@AgonyMint:

I've only read through the first two pages of this post, but I keep wanting to say this.

If you have half the chops you claim, (and I am by no means trying to disparage you), then do what you want.

Build it. If bitcoin really has this fatal flaw that you see, a couple of decades is nothing. While bitcoin has a good head start, P2P things I think are durable. If you build a client that is superior, it might take a while , but it will catch on. Especially if you do it now as opposed to ten years from now.

If your arguments are valid, they'll hold up, and people will use your invention, but only if you make it.

As far as virtual currencies go, there can certainly be more than one. Look at the history of fiat currencies. The world uses several main ones, and dozens of smaller ones.

Quit 'agonizing' over what you see as an inevitable future. There is no such thing. If you really have the ability to do what you say, you owe all of us the duty to do it.

As I mentioned up thread (yesterday), GATA did run an article and it is an interview with Jon Matonis. They did ask him about my allegation at the 18:30 min point and Jon denies it. I've been trying to contact Jon but don't know if I have the correct email address and no reply from him. Does anyone have a way of contacting him and making him aware of the diabolical Bitcoin flaw that I have alleged?

Jon thinks the open source community can fix any back door discovered. Well we are trying to prove that is true that we can fix it, but I think Jon does not understand that the fix can not be made in Bitcoin, because Bitcoin refuses to change their "debasement will terminate" design.

If someone could help me get this info to Jon and get a reaction from him, that would help a lot with my motivation.

I may still have Bill Murphy's @ GATA's email address and will try to contact him.

I will also try to contact Doug Casey, since they mention Doug Casey has objected to Bitcoin. I will try to bring Doug up-to-speed on the positives and my allegation if I can get through to him.

http://www.goldmoney.com/podcast/jon-matonis-on-bitcoin-and-crypto-currencies.html

It is all over the internet now, as promised.

https://www.google.com/search?q=Bitcoin%3A+The+Digital+Kill+Switch

Micropayments is an inherent weakness in Bitcoin, because there is no incentive in the protocol for miners to include transactions, in exchange for the new coins being minted per block.

Most of the overhead is in hash computation.

This should be something I address, that in itself will be a major win over Bitcoin.

Scary.

Interesting... Will this have an influence on Bitcoin price?..

First mover advantage isn't everything. Google was late to search. Facebook was late to social networking. If a system has problems a better system can take over. If bitcoin falls under the control of the elite anarchists will create something new.

Thanks for coming over here after I PM'ed you asking for your critique. You see I welcome it.

Unfortunately, I don't think you read the thread, because then you would understand that I am not describing a potential "51+% attack".

Please reply once you've properly absorbed the thread and understand the issue as well as the others do, who now understand and agree.

Btw, the main reason I PM'ed you is I what to be sure that the hard-core Bitcoiners are too cocky (and unwilling to read) to recognize and implement the fix. Because I want to make sure I won't waste my time coding a replacement for Bitcoin.

I had been studying your postings going back to 2011. So I expected you to do exactly what you do. Thanks.

Turns out "Proof of disk space" isn't so feasible with the current state of technology.

http://bitcoin.stackexchange.com/questions/8798/what-would-be-the-technical-and-wider-implications-of-a-cryptocurrency-that-us

;) I am glad to see that Colin Dean's one criticism shows that he doesn't understand that read/writes will be incredibly infrequent. And the rest of what he writes is positive.

I should stop teaching how my system is going to work, before I implement it.

I see they (bitcoin.stackexchange.com) block my account for 4 more days of "cool down", so I can't reply there (and I won't). Hey I am warming up and gaining momentum, not cooling down.

David Morgan has published:

http://www.silver-investor.com/blog/silver-market-update/bitcoin-the-digital-kill-switch/



The beauty of open source. Thank you.

Please don't tell me that bitcoiners are Illuminati tinfoil hat reptile alien nut jobs?? I was just starting to get my hopes up... is this rant about a global elite banning trade (which is basically the same idea as the Antichrist in the book fo Revelation) a parody?

I think OP spent a bit too much time on armageddonconspiracy.co.uk (http://www.armageddonconspiracy.co.uk/)  :)

Socialism.

Economics doesn't work that way.

No one gains prosperity by going bankrupt.

The masses will want their free transaction processing.

The cartel can continue to ramp up the processing power provided for free (from the profits they extract from the transfer price mechanism), those few altruistic miners will find their % of processing power reduces continually if they don't have funding to perpetually add hardware.


Who said anything about power elite banning all trade? That is not the allegation. Try reading the entire thread and learn the meaning of the phrase "transfer pricing".

I guess you failed to study history, and don't remember how John D. Rockefeller cartelized oil and railroads with Standard Oil.

The definition of insanity is doing the same thing over and over again, and wonder why you get the same result. Sigh.

So Standard Oil didn't exist and any one who says he did is a "tinfoil hat reptile alien nut job".

Does your propaganda accomplish anything but destroy the process of open source improvement which is supposed to be based in rational facts, not in nonsense posts like yours?


You have no logic to retort the numerous facts discussed in this thread, so you resort to propaganda. As expected. Sad.

If you don't respect open source, then continue with that strategy of polluting this thread without factual discussion. If you respect open source, and want to be respected as helping make a better world, please don't do that. Consider the benefit to yourself and the respect you will gain from readers, if elevate yourself from the level of caveman tactics (http://www.youtube.com/watch?v=WwqPOkcXrYQ#t=106s).

If you have a genuine factual and technical argument, I want to hear it. I want this to be peer reviewed. But peer review versus mudslinging represent two levels of evolution of homo sapiens. Elevate yourself. This isn't mud wrestling.

I am thinking about if it is possible to make faster transactions:

https://bitcointalk.org/index.php?topic=162781.msg1712280#msg1712280

I am thinking about if it is possible to improve anonymity.

One thought is that if it is not already done, then transactions should be flowed between peers encrypted if this doesn't ruin performance, so that traffic analysis can't be used to determine which IP (peer) transactions originate from. MUTE is an inspiration.

I am also contemplating whether it is possible to virtualize addresses.

No I am not. I am referring to a generalization of the concept of "transfer pricing", where the cartels that own the government are able to earn profits from monopolization via various means of extracting revenue from everyone but themselves.


Because it drives everyone else to bankruptcy and not them.


Here is something for your enlightenment about who owns the government:

http://armstrongeconomics.com/2013/03/31/so-what-part-of-ny-courts-r-corrupt-you-did-not-understand/
 

Who said I expected a free market? I am talking about a cartel, a monopoly, and fascism.

We have that now, you just haven't yet seen the full effects coming down the road:

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397431

(read the above linked comment and all the way to the end of the page to get all the detailed analysis)


Google for "Tragedy of the Commons". You don't understand economics.

The logic that was used in the past to not do the correct thing for Bitcoin was called "inflatacoin":

https://bitcointalk.org/index.php?topic=10666.40

Is gold "inflatacoin"? Gold's money supply increases forever (and there is probably more in outer space).

We have a possible name for this new coin.

DURACOIN

Any opinions?

The Russians won't support this coins. In Russian "DURA" sounds as "female fool".

Hey maybe you could start a new thread for your coin project?

You will need a name that is at least as effective and brandable as BITCOIN.

Duracoin Does not sound sufficiently brandable for the following reasons:

1.) The "Dura" part is not clear enough for its meaning. Does it mean durable? Whole words are definitely more hooking than concatenations or partial words.

2.) Coin is an imitation of bitcoin, which could be seen as plagiarism and hinder progress. Sufficiently intelligent people, who are going to be a major factor in facilitating adoption, do not advocate plagiarism (diverting from the bitcoin technical model is not seen as plagiarism, whereas copying the name "coin" for unit of currency probably would).

For a p2p currency to become successful you need to have a name that:

a.) includes reference to money. There are not many of these. Coin is obvious, note is another. Dollar could do, if it didn't have so negative connotations already and especially after it goes down the drain. Money is probably too flat and long. Mark could be viable, but I don't know if its meaning is known enough outside Europe.

b.) is easy pronounce and conceptualize.

c.) strikes home the essence of the currency. Bitcoin is very good, although it sounded naive at first. You'll have hard time topping that.

The powers to be already own it. Day one entity Satoshi owned more than 50% and never relinquished power since.

If anyone would try to establish a "one world currency" the traditional way he would face a revolt and people fighting toe to nail. Yet coming in in a a*se about way from behind it becomes "cool" and people trolling over each other to have a "one world currency".!

LOOL!
Feeding FUD to the newbies?

Who the hell is this by Shelby H. Moore III anyway?
He seems to be very prolific at selective reasoning.

That would be the perfect opportunity for John to switch currency...
I think you are highly underestimating the emergent properties of something like bitcoin.
If the cartel wants to process for free they will need to provide the computational power.
If they decide not to process some stuff then someone else will make this processing power available.
The end result will be that there will be an ecosystem of currencies and noone will have control over the whole.
The cartell will need to evaluate their desire to control a coin against the losses of customers rejecting it for that reason.
It is a form of democratisation of currency.

If a cartell gains this kind of power and abuses it even once it can be proven through the block chains and at that very moment the whole coin cannot be trusted anymore. Effectively the cartel would commit suicide.
Momentum or not, investors will pull back and the coin the cartell has control over will crash pretty hard.

Why would any cartel want to do that and how would they retain the value of a coin that includes proof of them tampering with it?

I'm wondering why you started this pretty technical bitcoin thread right in the newbie section in the first place.
You must have understood that most people reading this will have very little knowledge about how bitcoin actually functions and that most people reading this will not have enough information to understand the implications.
Seems to me you seek soft souls to deposit your fairytales.

I started it in Newbies section because at the time AFAIK, it was the only area I had permission to post. I think it should stay in the Newbies section because I am doing a market survey, as well as discussing the ideas. The experts are finding their way into this thread, it is good to have a mix of discussion with experts and newbies. If you are going to move this thread, then you must move the thread on Bytecoin launch and numerous others, such as those comparing Litecoin, etc.. Unless there is some highly technical topic, I think you should respect the desires of the person who started the thread and which audience they wish to target.

As for the name, I registered DURACASH too. This type of conjunction of partial words is called a portmanteau (http://en.wikipedia.org/wiki/Portmanteau).

http://64.19.142.11/upload.wikimedia.org/wikipedia/commons/thumb/6/65/Duracell_logo.svg/200px-Duracell_logo.svg.png

If the Russians are the only ones who get a bad connotation from the english fragments, I think we can sacrifice them. They can learn. Considering they just got their butts handed to them in Cyprus, they will need to become smarter. I read on Thaivisa, that they cause a lot of commotion and problems in Thailand with scams and travel businesses they set up (don't know if this is true or if all nationalities are causing equivalent problems). Or let them stay with Bitcoin, we need multiple P2P currencies.  Someone with a 150 - 170 IQ who I created the term "open source", wrote The Cathedral and the Bazaar (which launched all these open source movement), and who I respect very much, has written the following about the Russians yesterday:

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397459


DURACASH is sufficiently different than Bitcoin, and the units would be duracoins. I definitely have been searching for a name that is sufficiently different than Bitcoin. I thought of DOTCOIN, but everybody hated that. My daughter likes DIGICOIN, but that is not available. If anyone can donate a better name, I suppose we can offer then coins in exchange and they can have the excitement of the appreciation of value.

I thought of other names trying to say the coin lives in the internet such as cosmocoin and ethercoin (or cash versions). Does anyone prefer these or prefer a meaning of privacy instead of durable, e.g. stealthcoin (but that is negative)?

The intended meaning is durable, meaning that it can't go "poof" as the money did in Cyprus and MF Global and also AFAIR in Spain's Bankia bailout where they gave deposits receipts for some paper instrument that was subsequently devalued.  Durable not only because it can't go "poof", but also because the cartel can't monopolize it because everybody can mine on their regular PC, and because the anonymity will be much stronger than Bitcoin.

Btw, BITGOLD is not plagarism, it adds value to BITCOIN and causes more people to use BITCOIN. Anything "BIT" is going to end up sending traffic to BITCOIN.

The general public has no idea what "BIT" means. My daughter is very smart and she knew what a "BYTE" is but she didn't realize there are 8 bits in a byte. And most of the general public is even less aware. Bit has numerous meanings in english. In for example Finland, they invented a word in the 1980s Bitto or something like that, which has the specific meaning, so Bitcoin works for them.

The best name in the america would something like Cybercoin or Digicoin. Bitcoin is flying over their heads. But they learn fast. People can learn fast when they are motivated.

The most important factor is to choose a name that is brandable. Meaning it doesn't have a zillion permutations just like it. And which has a meaning that can make sense. Durable seems to be a very positive quality for money. I envision a logo that is a combination lock. And there is nothing else similar to that name that also means the same. STURDYCOIN or STRONGCOIN don't have the same short brandable quality.

Questions / comments?

Well... It's ur coin so u decide, but not only the Russians speak Russian (http://en.wikipedia.org/wiki/Russian_language). Seems u r going to sacrifice them as well. :)

It is a valid point and if anyone can give the project a better name, then I am willing.

But my point is also that BITCOIN means negative to most americans, but they figure it out. BIT means small piece. Why would I want a small piece of a coin?

I understand you are thinking of the promotional aspect.

Is that the meaning you want people to think of first when thinking about protecting their money from the confiscation wave that is going to go bezerk globally over the next few years?

ALL PAPER MONEY is going to be confiscated in ALL COUNTRIES, including CHINA.  All pensions, all life insurance plans, all stocks and bonds, all of it will go "poof".

Please read the following (read all of JustSaying's (my) comments following the linked one):

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397475

Electrum (http://en.wikipedia.org/wiki/Electrum).

History repeats itself. But now these coins will be truly electronic. And there is no annoying "coin".

I will be back to rebutt mobodick, I want to go write something else first and make a few phone calls before 5pm EST USA.

In fact, you started a whole series of negative FUD stories since you registered on the 24th.
You demanded access to a thread because you had evidence that bitcoin will break down in a month? LOL

Your trollcraft is pretty weak for bitcoin standards.

mobodick I will back shortly to reveal that you are wrong about your allegation that the threat from the cartel does not exist.

You also don't seem to understand how impossible it will be to migrate from Bitcoin in the future. You think the alleged attack will be noticeable, it won't be. It can be hidden behind invisible "transfer pricing" (a more general concept of transferring pricing to taxes, fees on your competitors, etc).

Let me ask you a question. Is the terrorism real the US govt has the citizen's fighting? Is that attack on our freedom invisible or noticeable? Can you get the citizens to know that it is a lie? How?

Duh! You don't realize how foolish your thinking is?

You seem to forget the weakness of a P2P database is the smallness of its peer proof-of-work. If you switch to a new p2p currency, but the masses don't switch, your new p2p currency can so easily be destroyed.

Duh! Are you just a total idiot?

Or are you profiting from making a cartel 666 currency?

You never think in terms of scale. You think the knowledgable ones are the majority. What fucking planet is that?

EVERYONE, I am doing a marketing survey before I will code. If you want me to code, I need to see others defending the need for my proposal. No one makes a currency alone.

And you better get it soon, because in a few more months, the opportunity is gone forever. You will be locked into the 666 currency direction with BitCON.

If there is a 51% attack then the chain is split in two parts and it will be pretty obvious who has the offending part.
This is a technical aspect of bitcoin and cannot be hidden.
This cartel would have to own all of the mining (which they can't cause people will be mining just to show them wrong) to be able to attack bitcoin and not get noticed.


Let me ask you a question back.
Are you even capable of organizing your conspiracy theories in your head before writing a scentence?

New coins can be pre-mined untill they are safe enough for the future.
I don't see the problem.

Ok, so we're playing the 'If you don't agree with me your either an idiot or profiting from 666 currency' game now, right?

I'm sorry i called you a troll previously, you are clearly just broken to the head.

Good points, but your economics are a bit off.

Let me take the time to remind everyone that the value of gold and Bitcoin (or whatever, really) isn't determined by the labor theory of value (you little Marxists, you).  These assets are valuable because they're scarce, not because labor or wages contributed to their genesis.  I mean come on...that's like Econ 101.

How many times have I written up thread that the cartelization threat has nothing to do with an overt 51% attack. Are you deaf, dumb, and blind?

Could you please learn to read the entire thread before making redundant arguments which have already been refuted up thread. Do you think I have time to come here and continually refute the same thing over and over again. You are trying to filibuster me so I won't have time to code.

It is not necessary for the cartel to fork the block chain, nor do anything noticeably malicious. You won't even know they are monopolizing the mining, except that you will notice that mining is becoming increasingly free or at below cost.

They can make their profits in an invisible way as I said in the prior post, "It can be hidden behind invisible 'transfer pricing' (a more general concept of transferring pricing to taxes, fees on your competitors, etc)."

I have written this same explanation 3 times up thread already. You lazily and ignorantly come here slinging mud without even reading the thread.

So you deserve to be embarrassed.



Spell checker is your friend.


This shows you are too ignorant to be a reliable source here.

Pre-minting does nothing to insure sufficient base of miners.



No we are adhering to the principle that you should read the thread before making stupid posts, which are redundant arguments that have already been refuted up thread. ;)

I assume you are making the argument that the labor or wages component of the mining cost (or even the mining cost itself) is not what gives the value to the Bitcoin?

This has nothing to do with the thesis of my article and the diabolical threat I have shown exists.

Indeed you are correct that the value of Bitcoins derives from factors that have nothing to do with the cost of mining.

And the threat I am explaining has nothing to do with the value of the Bitcoins.

The threat I am explaining can coexist with a very high value for the Bitcoins.

I am explaining that the threat is that since there is no guaranteed income stream for the miners after the 21 million coins are minted, then cartels can offer the processing for free (or below actual cost), thus driving all other honest miners bankrupt. Thus the cartel will control the system. It doesn't mean they will do anything noticeably malicious. They can hide their malicious activities in a way that the broad public will never see, somewhat analogous to how they hide now their crackdown on freedom behind the lie of a "war on terror". The broad public believes it is a war on terror-- they don't understand it is a war on freedom.

Your post is an example of why I think it is important to let newbies post on this thread (you had 5 posts at the time of writing the above). You demonstrate that you don't understand the application of the economic concept you are putting forward as an argument.

Your cockiness about "Marxists" is so ironic, because your misapplication of economics makes you the Marxist and you don't even realize it. Wake up sheep! Your ignorance will lead you into your cocky slaughter by the cartel. They confuse you very easy.

The correct reaction is not to feel hurt, but to thank me for snapping you out of your delusion.

It could be premeditated or it could just happen naturally.

The large retailers will offer mining for free, because they want to make sure their transactions get processed quickly and as an advantage over their competitors.

Over time this becomes consolidated and cartelized, because the economic incentive to do so exists in Bitcoin's flawed design.


I would only differ to emphasize that this can happen very slowly and appear to be part of competition amongst retailers vying to offer lower transaction fees.

It is the long run where one day it is cartelized and by then it is much too late to change systems.

666

I am capable of coding what you all need to prevent this outcome. This will not destroy the value of Bitcoin, it will merely provide an alternative, maybe 10% market share is enough to insure we don't get locked into 666.

But I need to hear that you all understand, you want me to code it, and that you are willing to defend my thesis, so I don't have to come here always. I need time to code.

Bitcoiners should stop perceiving this as a threat. It will help to expand the awareness and bring more interest to P2P currencies. Competition is a good  thing. You bitcoiners like competition or a monopoly for bitcoin? Competition will put pressure on the bitcoin developers to improve their rate of innovation and improvements.

Tell me now please.

I was in the middle of coding a decentralized social network. I am willing to stop that work to do this, but I need to see serious support. I don't do half-assed projects. If I do something, I do it correctly and professionally.

mobodick if you said, "I understand, please go make yours, let the market decide", I would not be so discouraged by your posts.

One of the global moderators here told me (in a prior post in this forum) that was the conclusion from prior discussion as to what Satoshi meant by "some will be provided free" and the logical hope or conclusion of discussions the experts had in this forum long ago.


I deduce (as agreed/expected/hoped by the bitcoin experts in prior discussion) they would prioritize their own transactions, that is one of the points of giving it away free. One might deduce that they would probably process transactions for others that have a fee attached.


One can deduce numerous ways that the incentives play out, but all roads lead to cartelization in the long run, because the economic incentive is there in the Bitcoin design flaw of ending the new coins reward for miners in the future.


Might be a good business. Doesn't affect my thesis though.


Or cartelize. Which is what always happens in the quagmire you describe, because a winner must arise to lower the costs of fighting each other. This is Standard Oil all over again.

But if having a bigger HDD means you earn more, wouldn't that also lead to a spontaneous symmetry break where whoever gets enough of an advantage first becomes able to increase their own advantage exponentially faster than anyone else and eventually will hoard the equivalent of 51% of the storage space of the network?

Lol.

Bitcoin's value originated as essentially a composite ETF comprising different dark sectors of the black market.  Anonymity is the scarce commodity, not Bitcoin itself.

Thank you for another vote to proceed. As I said, I am taking a market survey, so I am counting these.

Realize that the disk-space Proof-of-Work is not critical for fixing the design flaw in Bitcoin that allows cartelization. The only required fix is to not stop making new coins. This was called "inflatacoin", but it is only a very small rate similar to gold which is debased roughly 2.5% per year (consider it a storage fee if you want). This is not inflation, it is funding your miners and keeping the ecosystem from degenerating to cartelization.

I hope you all know that Rockefelller got his opening, because of the bottleneck of the railroads and that creating railroads cost (on an opportunity cost yearly ROI basis) "more" than could be earned from the fees of transport. So it is analogous in that way and also where there could be two competing railroads, then better to form a cartel than drive each other bankrupt (remember this is very large capital so it is ripe for political capture too). Remember all utilities end up under the control/regulation of the government. The cellular wireless networks are similarly heading this way for the same reasons (http://www.mpettis.com/2013/02/21/a-brief-history-of-the-chinese-growth-model/#comment-21766).

My proposed disk-space Proof-of-Work improvement is a separate improvement, as are my proposals to increase anonymity, make transactions faster, fix micropayments, etc. Many improvements I am proposing over current Bitcoin.

And the Marxist thing was a playful jab - I'm a moderate but I do like the way Marx thought.  Capital was the only book I've ever read that was simultaneously interesting and boring lol

Okay we are good. Thank you.

1. I am not worried about an overt 51% attack, because Bitcoiners are correct when they say the world will fix any such damage. Overt attacks won't succeed. I am worried about the insidious cartelization threat that nobody can see even when it is in place, as I described very on the prior page of this thread.

2. So I don't have to worry if some large player controls 51%. I only need to worry that there isn't an economic death spiral that causes all miners to disappear except the evil ones. At least our transactions will still go through if our NUMBER has been turned off by the cartel.

With my proposed fix, they can never get any where close to 100% of the mining in any passive hidden scheme.

And realize that if there is a competing P2P currency with my proposed fix, then Bitcoin is also inherent fixed. Nice eh?

(fixed means cartel can never get near 100% control over all P2P currencies processing in any passive hidden scheme that fools the masses)

Litecoin AFAIK has same flaw as Bitcoin in stopping the coins at 84 million, so it is not a fix.

Okay we are good. Thank you.
[/quote]

You might be the only other person on the internet who can reconcile after a perceived conflict.  Cheers haha  :)

I will of course soon do that. The first step was to establish that we need to fix the cartelization flaw.

Then hard-disk-space proposed improvement for Proof-of-Work is a separate issue.

It is not socialism. More capital gets more coins, that is the way it should be.

The difference is that everyone already has a harddisk, so they have some capital already. More level playing field that doesn't throw existing capital in the garbage.

I hold no grudges (unless you gouge my remaining eye out), I love people that is why I am fighting for our freedom. Would be easier for myself if I joined the elite  (you know they are going to kill me for doing this, who else is brave enough?). And if I can make money, okay, but remember I said in the beginning that I would prefer bitcoin fix this or someone else create this.

But looks like I am the only one who can, so I will stop my other project to do this. I should be rewarded for that, but I won't cheat. I won't pre-mine.

I haven't figured out how to handle testing and launch yet. Will cross that bridge if I get there.

I have 5% cherokee blood. I take bullets. We do not descend from Chinese, the Cherokee genetically were from the first wave of migration from Europe.

Just do it. There's nothing to lose (hmm?), and everything to win. Unseen forces come to aid for the brave ones ;)

Okay we're good ;)

I will be old by then any way.

Hello AnonyMint.

I read your OP with great interest. I wrote down some of my own thoughts about the past and coming situations. I see you have discussed and answered some of these things later in the thread, but I guess the main thing (interspersed somewhere in this rambling wall of text) is me disagreeing with you that initial wealth and the market cornering % attack stuff isn't a problem.

First of all, there are hard problems with mining and hoarding. Look back at when the current economic system was overlaid the older feudalistic system. There were two types of initial wealth vectors at that time: the old aristocracy converting their means into foundations, and the new system tycoons who absorbed wealth both from failed aristocrats and the public (mostly from failed aristocrats, making the new guard tycoons aristocrats by proxy - the public of our civilization haven't really owned anything of note since Rome.) With this initial wealth vector they have been able to completely dominate the modern economic system, as they did the previous. Powerful people always form cartels, there's no "might do" about it. This is simply because it's always more profitable (in the long run) for small groups to work together against the public than to compete. Long term planning always wins over the burst benefits of the short term.

I see no way the wealth vector from the old system wouldn't be able to flood into a mining system (as in if one machine can do a thing, a million machines can do a thing a million times.) It would be good to be able to construct a cryptocurrency that does not rely on mining in this way. Something where value is generated corresponding to real physical value (like human work or a product.) But then you lose the ability to entice people into the currency by playing off greed (like bitcoin,) making it extremely hard to implement. In essence, how does proof of work help when some are able to get insane amounts of more work done through socio-religious means? I point your attention to how fast the establishment smacked up the google and facebook networks (ready to serve billions of users) when the time came to implement Web 2.0. Cost, relating to the publicly shared money pool is, as you can see, a very small deterrence. In top circles, obviously, the currency is not money but slaves.

When attacking by "trying to match the resources of humanity" the rational thing to do is, of course, to turn humanity against itself. Another thing, computer prices are at present heavily subsidized with slave labor in the east - this is because in the coming governmental system everyone needs to be on (soon in) the net. If need be, the subsidization could be removed, or the platforms modified (smart phone?) Granted there is inertia to this, but it still needs to be considered.

Regarding gold, let me tell you a story about my great grandmother, who was an aristocrat of sorts. As WW1 drew closer common people invested in gold and silver as they do now, sensing the impending upheavals. At that time she was selling gold while transferring a large part of her estate into physical barter goods like canned food, alcohol, tobacco and cosmetics. Late during the war, when scarcity hit, her agents then traded these as black market goods into gold and silver at thousands of percent profit post-war. This is one of the ancient scams. Deflation and inflation is of no consequence. Bank and government price charts don't show the true value deflation of everything but necessities in a crisis. War is always coming (only the dead have seen the end of it,) but 99% of commoners act as if it probably won't. I remember as a kid listening to the old bastards laughing about it. Why do you think the hillbillies are being flooded with cheap meth?

You say that the power elites don't want to be obvious, the rationale sounding like this will stay their hand in the matter. This is a truth with modifications. Granted, they will operate covertly when they can, but I think history has shown amply that if the gains are alluring enough, they can be quite obtuse in their implementations. You need look no further than WW2 (the restructuring of imperial bureaucracy to a socialistic-oriented base (was it to be international or national?)) killing off a couple of hundred millions in the process.

To truly tackle this beast with a currency you would need to get at all three pillars of empire. Coinage, for sure, but also the courts (international, national) and religion (media and education.) To attempt to topple the tower by attacking just one pillar would be possible, but it has increased difficulty because the other fundaments stand ready to compensate and flood in. It must be designed so that it can stand up to this. The solution whatever it is must be holistic, outlaw-friendly and jihad-proof.

As you, I don't mean to be negative. Nothing I say should be taken as a deterrence, just perhaps food for thought. I work at the problem from a completely different angle, so it would be strange if we agreed. I do agree, however, that diversity is key, support your project and will follow it with interest.

How about TRUECOIN or FAIRCOIN? Hehe.

Best of luck!

Have you looked at Freicoin (http://freico.in/)?


Have you looked at Ripple (http://en.wikipedia.org/wiki/Ripple_monetary_system)?

I think people here may be a bit madder and overexcited than I imagined.

I appreciate the rational discussion, that is what we need.

The 51% attack remains a problem for my idea more so than bitcoin, because assuming I am correct that bitcoin becomes a favorite vehicle of the cartel, then they have an incentive to overtly attack any system which competes with bitcoin (and can't be cartelized).

I am thinking of a new way to prevent the double-spend (I already mentioned it if you search all my posts, hehe).

I am thinking of solutions to this attack vector.

P.S. Maybe "mad" is not the correct way of viewing it. On the emotional or philosophical level (orthogonal to my non-emotional approach to design and engineering), we remember the Trail of Tears (http://en.wikipedia.org/wiki/Trail_of_Tears) and the Holocaust. We are loving, calm, stoic, and when the time comes where they (or YOU) won't stop slaughtering (or mind programming) our women and children then we rip their heart out and eat it in front of them before they die (http://www.heretical.com/cannibal/mamerica.html). This is only done on an individual self-defense basis to those who are evil beasts (not to the ignorant who don't know they are supporting the evil beasts), otherwise we are loving to all people. We shared our produce and meat with them when they couldn't eat during the hard winter. The Apache were not defeated (http://www.starfishandspider.com/).

Jubalong, I was jogging. Very astute and thought provoking post. I have been contemplating this also, and you explain well.

I may have another reply for you after I absorb what you've written.

Nah, the usual folks on this forum don't burn through tin foil hats like this guy does.

Yes I read the older discussion in the forum between the creator of Freicon and the person proposing Stablecoin. One uses demurrage which is basically a storage fee, and the other proposes a system-wide transaction fee. As I understand, both of these system varying the fees.

But I am not sure if they give those fees to the miners?

The system-wide transaction fee can be subverted, the cartel can send refund transactions.

If I remember correctly, the Freicon only charges demurrage on each transaction, so again it can be subverted.

So I am not sure if those systems address the cartelization attack vector.

Also Freicon's website is designed for PhD in economics, not for mass adoption.

Remember I created CoolPage drag+drop WYSIWYG web creation software for dummies in 1998 for Yahoo Geocities free hosting, Fortune City free hosting, etc. before friendster existed. I had a million users.

I create products for the mainstream. I know how to create user friendly products.

CoolPage.com has not been updated for 11 years. Sales just recently trickled to 0.


I am against money born as debt as the M0 base of the monetary system. What ever anyone wants to build on top with fractional reserve is fine, but it is not what I am working on.

Are you still embarrassed for accusing me of FUD and being ignorant of the facts? Play your slimeball troll politics (devoid of any technical facts) in a non-technical arena please. We are trying to get some serious work done here. Go throw sand in another sand box please. I won't go pesker you there.

Please don't tell me I am going to continually ward off of these posts that are devoid of facts attempting to obfuscate/filibuster the technical discussion? Are we doing open source here, or a spit ball contest?

PLEASE DON'T FORCE ME TO LOCK THE TOPIC.

Because I have work to do, and I can't be here constantly looking to see if you are being unethical again.

Jubalong,

You are spot on. I am impressed by your intellect, it would be my pleasure to know you more.

I am contemplating a solution to the 51% attack.

I am thinking we really don't need the miners to process transactions. We only need them to create new coins and to keep a copy of the transactions that occurred independently of the P2P database.

My idea which would also make transactions instantaneous, is that benefactor of a payment will stipulate how much reserve the payer has to attach to the payment. This reverse is returned to the payer after some time, when we are sure the payment has propagated into the P2P database. If the payer submits multiple spends within that time window, he forfeits everything including the reserve amount.

Perhaps that could be an optional mode perhaps, with the current single block chain as an alternative for those who don't want the option above.

Since only the payer's private key can create a duplicate spend, no malicious miner can do this.

Thus if 51% refuse to record the transaction, the other 49% do record the transaction. No harm done.

When the benefactor polls the database to see if a payer's balance is correct, any miner can respond.

The 51% is only need to determine who created the coins. From there, it is the private key that determines where the funds went to.

So as you said, keep the greed part for creating coins and get rid of the 51% attack on processing. We were thinking along the same lines, and I just hadn't written down (collected/assimilated) the thoughts I been having since yesterday.

The fact that Satoshi did not design the system this way (along with all the other weirdness (http://www.coolpage.com/commentary/economic/shelby/mining%20-%20Any%20counter-proof%20that%20Satoshi%20Nakamoto%20did%20not%20design%20a%20ponzi%20scheme%20on%20purpose%20%20-%20Bitcoin%20Beta%20-%20Stack%20Exchange.htm), even the developers said he disappeared when they pushed to know his identity), is another reason I am Occam's Razor that he was working for the cartels. But whether this is true or not, isn't really worth arguing over and my thesis does not depend on it.

I need to think more if this is a viable design. This was just off the top of my head.

I am liking my choice of a name more and more, seems perfect:

DURACASH

If the 51% goes berserk and creates coins faster than the prescribed rate, then (some of) the benefactors will stop honoring those later coins. So they defeat themselves.

LOL., at least you're entertaining.
I've seen the threads you have started recently.
Funny stuff.

Jubalong,

You are spot on. I am impressed by your intellect, it would be my pleasure to know you more.

I am contemplating a solution to the 51% attack.

I am thinking we really don't need the miners to process transactions. We only need them to create new coins and to keep a copy of the transactions that occurred independently of the P2P database.

My idea which would also make transactions instantaneous, is that benefactor of a payment will stipulate how much reserve the payer has to attach to the payment. This reverse is returned to the payer after some time, when we are sure the payment has propagated into the P2P database. If the payer submits multiple spends within that time window, he forfeits everything including the reserve amount.

Perhaps that could be an optional mode perhaps, with the current single block chain as an alternative for those who don't want the option above.

Since only the payer's private key can create a duplicate spend, no malicious miner can do this.

Thus if 51% refuse to record the transaction, the other 49% do record the transaction. No harm done.

When the benefactor polls the database to see if a payer's balance is correct, any miner can respond.

The 51% is only need to determine who created the coins. From there, it is the private key that determines where the funds went to.

So as you said, keep the greed part for creating coins and get rid of the 51% attack on processing. We were thinking along the same lines, and I just hadn't written down (collected/assimilated) the thoughts I been having since yesterday.

The fact that Satoshi did not design the system this way (along with all the other weirdness (http://www.coolpage.com/commentary/economic/shelby/mining%20-%20Any%20counter-proof%20that%20Satoshi%20Nakamoto%20did%20not%20design%20a%20ponzi%20scheme%20on%20purpose%20%20-%20Bitcoin%20Beta%20-%20Stack%20Exchange.htm), even the developers said he disappeared when they pushed to know his identity), is another reason I am Occam's Razor that he was working for the cartels. But whether this is true or not, isn't really worth arguing over and my thesis does not depend on it.

I need to think more if this is a viable design. This was just off the top of my head.

I am liking my choice of a name more and more, seems perfect:

DURACASH

If the 51% goes berserk and creates coins faster than the prescribed rate, then (some of) the benefactors will stop honoring those later coins. So they defeat themselves.

There are 2000+ reads on this thread, perhaps because for example maxkeiser has linked to this thread via David Morgan's copy of my article:

http://maxkeiser.com/2013/04/02/ag-fredericks-on-bitcoin/

(see bottom, right of page)

I am still working on getting this information out to more people who might be willing to publish it even more widely.

Ron Paul's strategy was to spread information, so at least I am doing that. Let's see if I can also spread a better implementation.

I've got 2000 reads on the marketoracle copy of the article already (2.5 days) and those readers are not finding this thread,  because it wasn't linked. My past articles have gotten up to 25,000 readers over time.

You simply can't stop me from getting the information out there, no matter how much you might filibuster (troll) this thread with your nonsense theories about "tinfoil hats and ufos". Rational people are not interested in such nonsense. We are more interested in facts, such as how corrupt the kangaroo courts are:

http://armstrongeconomics.com/2013/03/31/so-what-part-of-ny-courts-r-corrupt-you-did-not-understand/

And what part of "torture repeats throughout history" do you not understand:

http://armstrongeconomics.com/2013/04/01/euro-capital-flight-begins/

Yes of course. I am just thinking whether we can minimize what we need them for. I will need to think more deeply first, and then write it down more technically. I am not sure if what I wrote in the prior post will work. It was just off the top of my head.

My thought == we really only need the SINGLE block chain for the creation of coins.  After that, the BILLIONS of private key chains are sufficient independently. Tada!  I will explain more once I have thought it out more to make sure my initial intuition is correct.

Think of it like this, the creation of coins has to be agreed by everyone. The transfer of money only has to be agreed between payer and recipient. Just need a localized method of preventing double-spend instead of globalized, which I already offered.

The issue with this revolves around global time. I need to think about this more.

http://market-ticker.org/akcs-www?post=219284

1. Karl asserts Bitcoin's future money supply is asymptotically ZERO (0). I agree:


2. Karl asserts Seniorage is not a get-rich proposition (early adopters profiting), rather a responsibility to withdraw it when the economy is contracting, else the state can withdraw it, because society will demand it. I don't agree with this assertion that the government should increase the value of money during production contraction (so as to avoid rising prices) by removing currency. Let the market solve this, those what have capital can invest in production. I think seniorage should be distributed proportional to those who have the most capital, because they have demonstrated they know how to invest and increase production, but they shouldn't collect an interest for loaning and simultaneously receive the seniorage-- they have to choose (mining or loaning or investment in other production).


3. Karl asserts currency should appreciate relative to productivity increases, but be constant otherwise. I think it an impossible goal because it is impossible to measure the price level in an economy because goods & services change. Also I don't think old capital should be rewarded for being idle forever, thus a small debasement encourages capital to not become too stale. Gold's 2.5% may be a good balance.


4. Karl asserts digital currencies are not stateless, and users doing acts of evasion will suffer (including not reporting capital gains on all transactions). I agree this is coming later, if the government can trace your transactions.


5. Karl points out that Bitcoin's transactions are slow. I agree this needs to be fixed.

The beauty of this is that all the money stream constructions of multinationals that are now used to evade taxes can be traced down.
I hope you understand that multinationals are taking money out of the economy constantly and stack that in banks of countries where they pay no taxes to society. They have removed 9/10 of the world currency but are unable to use it because that would mean they have to pay taxes. Meanwhile, on paper, they have a bad time and need to be saved.
The reason the US issues more dollars to be printed is because dollars are disapearing from society. The only way to maintain some sort of fluidity is to throw in money on the other side from where they are taken out.
Our world economy is powered by money put in by society on one end and taken out by corporations on the other.

Having everything proven in the blockchain will reveal these money streams and alow us to act on them.
This mechanism of proof wil be an enourmous tool for society for keeping large institutions in check.

This can be fixed in society just as 'easily' as in bitcoin. The root of this problem is trust.
Bitcoin sidesteps trust by using a cryprographic rigor. But i can easily see that you can open an account with your gas provider that alows you to get a certain amount of gas without the immediate need to prove you will pay for it.
In fact, i have such a relation with my power company. I pay a steady amount per time unit for my power and once in a while the actual meter is checked and everything is recalculated on basis of that measurement. In the end it becomes a steady economic stream which is good as everyone knows what to expect of the (near) future.
Once bitcoin becomes so big that this realy starts to form a major problem you will find that there are many reasonable ways to fix these types of trust problems. Usually the transactions that require speed are the ones that transfer the least value.
I can even imagine a currency coming into existance to fill in this gap and act as the currency part for bitcoin. This coin would have a smaller blockchain and have a shorter acknowledge time from the network. And this would be justified because the value contents of individual transactions will be low.

For large transactions i would argue that speed is actually a bad thing.
Notice what happened when computers were alowed to fight over price at incredible speed with lots of capital. Speed is a destabilizing factor on those scales so it's actually better to have some energetic cost to transactions on these levels so they can change only slowly and only out of deliberation and not just in panic.

Debasement certainly is a usefull tool for preventing the hogging capital.
But i feel it should scale with the power the capital represents in society.
So it should be increasingly hard to hoard more capital and should be basically free of debasement for low ammounts.

But this is a pretty pointless discussion because multinationals (the corporations ruling the world and causing most of these problems) just evade the whole thing by parking their profits in countries where such laws do not apply.
Ever noticed how some movies don't make a profit despite breaking all box office records?
The truth is they did make a very good profit, they just dont want to pay back society for creating this opprtunity for them.
So they move their profits to some bank through a construction and -poof- it's gone.

At the moment debasement only serves to keep everyone else out of the supranational playgrounds of the multinationals. It doesn't touch them.
So your idea would actually hurt society in general while not addressing the point that the problem that caused you to think of debasement as a solution has gone way out of hand already.
We need something completely different to even get started on retreiving all this value from these entities.

I think your idea of distributing seigniorage proportionally to capital is flawed because capital can be gathered through corrosive means. A good way of gaining capital is not nessesarily a good or stable mechanism for society. So i dont think capital alone is a good indicatior for how usefull an entity is to society and should not be a base for any reward from society. The capital alone and the power it brings should be enough and is probably already too much.
You see, people have weaknesses that can be easily abused.
Imagine a pharmacorp that invents a medicine that hooks everyone. You don't have to buy it, but if you do you're prety much hooked for life. They can build up capital pretty effectvely from all the junkies they created. A whole industry can be created around the use of this substance. Even better, the junkies will do the hard part of the actuall robbing of society. Meanwhile the pharmacorp cashes in on the junkies. It's a booming business.
Do we want to give these organisations incentive to make more capital so they can get an even better position in society by eating it up? I don't think so.

I agree that a distribution of seigniorage could be beneficial to some point.
I just feel there must be a better way to assess usefullness to society than capital alone.
And i also feel that governments or government-like structures should always keep the better part of it under their control to assure the existance of certain institutions. No other party within society should be able to compete with the government on some terrains.

May be, but you'll have to be pretty ingenious to lose 2x10^15 satoshi.

No it will be used asymmetrically against the citizens because the government is already asserting its asymmetric power:

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397607

(read the 4 posts by JustSaying (me) forward from the above linked one)

Don't miss the conclusion of that discussion:

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397620

---

I have already presented a technical fix for DURACASH which enables instant insured transactions and avoids all the meta-trust overhead noise that you say Bitcoin needs. Tada! ;)

And Bitcoin's distribution of the world's future money supply to early adopters is superior? As if those early adopters who knew how to mine were more important to society than everything else going on in the world.  ::)

Rather we should reward early-adopters, but also debase them at a very slow 2.5% per annum over the long-term, so they can't hold the world enslaved just for one correct opportunity cost decision they made 100 to 1000 years before.


And precisely what would that metric be?

I am offering hard-disk space, so at least it is capital that most people already have to contribute, so we don't waste pre-existing and well distributed capital.

---

You missed the point. Over time coins are lost, that is unarguable. Thus at some point in the distant future, there will be 0 coins. That is unarguable. It might take a 50 years or a million years (we can't know because we can't differentiate hoarding from lost so we don't know the rate), but the statement "asymptotically ZERO" is mathematically unarguable.

Not knowing the rate of loss is very dangerous for adopting a currency. Bitcoin has no mechanism of debasement to counteract it.

That has already happened with alcohol and tobacco, and arguably with caffeine and processed sugar/high fructose corn syrup.

I agree with the above quoted portions. We must not give control of the capital to noobs in a way that they can be manipulated to corrupt the system.

The key to preventing the following quote, is to remove the ability of the collective to tax, confiscate, and abuse money so as to minimize their control over media and other means by which they can aggregate capital against humanity.

Also in my design for DURACASH, the debasement is only say 2.5% per year, so corrosive capital can't take more than 2.5% per year. Humanity's bursts of innovation and knowledge increases trump that 2.5%.

The cartel will be destoyed with DURACASH. I am perfecting the design which detaches the 51% attack from processing. The most they can steal is the 2.5% and even then it is a competitive race of capital, including the innovators who can aggregate capital at exponential rates, e.g. Google, Bitcoin creators, etc..

Exactly. But i can see much more serious applications of science.
Aint no debasement gonna help against that.
I mean, how long will it be before a croporation can grow their own genetically modified slave race?
How long before your job is replaced by an AI?

Demurrage (Freigeld/Freicoin) and Inflation (debasement) have similar effect, but demurrage is better.

Workers would not have to renegotiate their salaries anew all the time.

The best would be if inflation rate could be tied to the GDP. But that's not so easily possible unless we can and want a totally computerized P2P economy.

But I believe since crypto-currencies are non-monopolistic, unregulated (free) currencies, the economic textbooks of yore don't apply anymore.

We'd have a rich eco-system of monetary and exchange systems.

In a truely freed market, that means also in a free currency market, there is no such thing as an inflationary currency or a deflationary currency.

Because there is no currency that will be regulated top-down. We're largely only familiar to planned monetary systems.

In actuality, the differences between currency, commodity, and asset would dissolve.

Once the demand for bitcoins has largely satisfied, they will have to compete with any other asset out there.

They will stop acting in a deflationary way when there are better stocks to invest in. People will put their money there then.

Okay I solved the key technical problem of consistent global time. This is simply a hash of each block in the chain. Each hash is a marker of relative global time. Really it doesn't need to be a hash, since the blocks will no longer contain transactions. It could just be any deterministic forward infinite series of numbers. Recursive hashes as a choice, adds a cost to targeting too far in the future.

(Side note, global hash time will be known before it happens, i.e. hash of prior hash is deterministically known a priori, so payers can send transactions that occur at known times in the future  :o)

So thus we don't need the mining peers to bundle the transactions into a block, in order to get collective agreement on when a transaction occurred. Instead, the payer need only include such a global hash in the payment sent, and then peers can independently save these, thus all peers agree on the "global hash time" the payment was sent.

If the payer sends a double-spend, the peers which have saved the prior conflicting spend will detect this, and we can choose our design whether to either ignore the double-spend or penalize it by confiscating the funds into the ether (lost forever). As I wrote earlier, we can have options for recipients to declare reserves so that payer has incentive not to attempt double-spend, as the reserve would be confiscated to the ether forever.

A double-spend can be achieved by getting peers to disagree about which transaction was sent first (due to network propagation order), if they are both marked with the same "global hash time". But I propose to penalize peers which refuse to mirror all transactions (exact mechanism described later), thus all peers will know there was double-spend. Again I propose the recipient can choose between waiting for sufficient time to be sure a double-spend is nearly impossible, or to attach a forfeitable reserve to insure the recipient will honor the transaction instantly.

The recipient will need to judge for himself (this will be a technology added on by third parties) what the risk factors are, e.g. if recipient can poll a significant proportion of the network for double-spend, then more probabilistic certainty sooner that the double-spend was not sent to any peer. The alternative is the forfeitable reserve optionally set by the recipient, which is unlocked from escrow back to the payer by the peers after the prescribed "global hash time" has been reached.

So therefor the block chain is no longer a block of transactions, but rather the collective agreement of the forward movement of time, and for doing this the mining peers are awarded new coins. Thus the 51% attack does not exist (or say it isn't a hard line in the sand between functioning and non-functioning system). And cartelization of the mining peers gains nothing except most of the new coins, which is only say 2.5% of per year of the money supply. Note the cartel could still make mining unprofitable by putting enough resources to bear that other miners did not get sufficient ROI for their contributed resources. Restoring debasement does not entirely eliminate the threat of monopolizing mining; rather only diminishes it (requires the cartel to need many more multiples of subsidy than otherwise).

Even if they have 99% the miners, they won't be able to block transactions entirely, and with the penalty for not mirroring transactions, the good peers will be evident to us. We can easily see who is doing mischief and route our transactions through peers we trust. In other words, the community has voting power over which peers to sort of ignore in real-time, without needing a fork. The most the bastards can do is get 2.5% per year.

Possibly we won't be keeping a history of transactions any more (although a peer could record this history), only the latest state of which public key owns which coins. I think we need the history to prevent rewriting history of who owns the money.

In theory, I've posit that I fixed the design of everything major that is wrong with Bitcoin (note my prior posts about improving anonymity).

P.S. The key flaw in my proposed hard-disk-space Proof-of-Work is how do we control the rate at which "block time" progresses? Even if all peers see that block time is going too fast, there is no mechanism to slow it down, since peers act selfishly to send their claim on the next block asap. So I may have to revert to CPU Proof-of-Work. Still thinking on this. Possibly we can require hard-disk work along with scrypt CPU work. Another solution is that if peers see block time is running too fast (outside the latency of network propagation), they can just refuse to accept new block time transmissions for a while. This would not stop transactions from processing. I think this might work.

Satoshi get off my lawn!

I worked out the key aspect for implementing the more decentralized design of my prior post.

Any peer can post proof of a missing transaction, then all peers must come into alignment else their new coins will not be honored by all, because on the owner of the private key can create a transaction, so these can never be created by a rogue peer.

This will be enforced by requiring the peer whose turn is to be awarded new coins to send a hash of all transactions from some # of blocks prior (give time for transactions to propagate and settle into system-wide agreement). So peers who do not mirror all transactions will not have their new coins honored by the consensus of peers. Knowing the hash announced for a prior block time from the prior peer, won't help to avoid mirroring all transactions.

Double-spend propagation will be handled by a challenge-vote to determine if a double-spend came too late and is to be ignored. This replaces the role  of a race to produce the dominant block chain in Bitcoin.

The advantage of this design is that the 51% attack can't degrade the transactions of others. As long as there is one peer disagreeing with the other peers about an excluded transaction, then that transaction will be still be processed by the system.

So the threat of cartelization is drastically reduced. The cartel would need to control 100% of the peers, or nearly 100% of the peers and have enough control over the network to disrupt communications to the remaining peers.

I need to spend more time formally analyzing this design.

I am on vacation for a week or so, before I dive into this with complete focus.

herzmeister, I haven't had time to reply to you yet.

So interested in where things will end up 1 year from now.

Loved the original article. Too much crap in the comments.

I hope someone creates a fork of Bitcoin that's not subject to gatekeepers or monopoly.  Then we can all flood there and leave Walmart, the abandoned leftovers.

The major flaw with Bitcoin is that it can *and in some cases* has to be translated to USD.  The currency should just stand on it's own and develop it's own separate economy.  The any privacy concerns would negligible.  The privacy is only effected if you try to convert your BTC.
*Which is the government panicking because they've lost control*

Remember, all governments need us to need them.  If we can function independently, then there's no need for government.  *The whole military/police argument is a sad excuse* Again, fear is just the government's way of manipulating us.

So, if Bitcoin functions independently, *Fuck the Dollar* then the government can't know who we are.  And in that regard, I think Bitcoin is far more valuable *function wise* and should be allowed to take it's natural role as defacto currency worldwide. 

I don't believe that privacy is violated converting other cryptocurrencies to bitcoin or vice versa.   This only applies to state sponsored money. *correct?*

BurtW, I will.

Arcavum, I agree the separate economy and a more anonymous design, would be outside the purview of the state's power (hopefully, will learn more on the details as I go forward).

To all, I am not gone. Just taking a break to organize some life details before diving into this.

I don't think you did.
You propose to internalize any inconsistencies and imagine that a 3rd party will solve all the trust problem for you in some magical way.
Tada!...

But there are more flaws i guess.
You propose that a receiver can make the sender put money in a special box so that when he double spends he loses the money in the box.
But how do you make sure the coin in the box is not a double spent one? Well, of course you can put some money in a new box and when the coin in the first box turns out to be double spent then the coin in the second box goes -poof-.
But then what happens if the coin in the second box is double spent?
Recursiveness never solved anything.

There also seems to be a lot of potential for poisoning the process.
If rougue peers start spewing out false transactions and there is some latency in the time protocol you propose then that can put a lot of computational stress on the network. If these transactions will become part of the chain then we will need to deal with them for the rest of bitcoins life.
And even worse, if this time signal propagates too slowly you could actually create multiple valid transactions of the same coins. Then every single peer that deals with the chain will need to go over these relations to figure out if a transaction is valid. But how can you decide in any way which of the multiple transactions is the valid one?
The only way to correct double spendings with identical timestamps would be to stop all transactions untill the inconsistency becomes clear and all peers are up to date. Only then can you create a new timestamp that can be used for future transactions.
The thing is if you have the same coins spent on different things on different parts of the network but with the same timestamp the network cannot know which of the two transactions it needs to use for the creation of a new timestamp (your timestamps depend on previous transactions).
So to be able to create a new timestamp a client needs to be sure they have absolutely every transaction uptill now and that no other transactions occured in the mean time.

I dunno, maybe you need to explain it in more detail but it seems to me to lead to a huge tangled mess of subchains inside the block chain.

You don't seem to understand the basics of economics.
There is no way of preventing interactions between bitcoin and the rest of the world. The rest of te world includes things like the dollar and the euro. So there is no way to prevent interactions between bitcoin and dollar.
You cannot create a money system that cannot somehow be translated to another money system.

If you want bitcoin to be completely its own economy then you would need to start at the beginning.
You can hope all you want, but bitcoin is completely useless outside of the fiat economies. Try manufacturing a computer with bitcoins and you understand how dependent bitcoin is on the dollar.

If you think i'm wrong they you should stop using the fiat computer and the fiat internet that you obviously use and just make your own devices and network and pay for it completely in bitcoin.
You'll find out pretty quickly that its impossible.

You haven't met a lot of humans, have you?

Overall humanity needs these institutions to function at the level we do.
If there was no military or police we would live in chaos.
Of course it would all be rosy if everyone agreed with your particular set of ideologies but in reality only a small group of people will.
Most people will have different sets of ideals and these ideals tend to change depending on the situation a person is in.
Most people will say that stealing is bad but if they have no food i think most people will consider stealing food.
So to protect society from ignorant egoism we need something that prevents your neighbour from robbing you without you needing to create a wall around your premise and arm yourself. And military/police do a good job at this.
Fear is part of the way governments are manipulating society and its pretty effective in stopping a lot of chaos.
Of course i also think that they go too far in some places but that doesn't negate the fact that humanity cannot operate this stable on this scale without these power structures.
I, for one, am pretty happy that in my country i don't have a real fear that someone will kill me in my house for a can of food.
To me the situation feels so stable that i don't even feel the need to posess a gun. I don't need that kind of protection.
This, in turn, gives me a lot of happy time where i don't have to think about the terrors of other people.
I can't imagine that things would be this stable if there was no overarching force that applied the law.

But maybe you have a solution to offer to humanity.
So let me propose a typical human situation like they have played out for hundreds of thousands of years.

Group A has a resource that group B needs to survive but they don't want to give it up.
Group B doesn't have anything economically valuable for group A.
Group B now wants to pillage group A to get at the resource.

How would you prevent this invasion without any military or police?

Imagine the USA dissed its army and all its weapons 30 years ago.
What do you think that would have done with the position of north korea?
I can tell you, the USA would be a suburb of Pyongyang.

So all i'm saying is that , despite the problems, we actually need the overarching force to enforce the rules of the game we happen to play.
There is no other way to get organized into such a complex society and have it not fall appart at the seams.
Without the global force we would naturally diverge into several parts that will all independantly compete for the earths reources.
I can tell you that with the current level of technology this competition would be far worse than anything humanity has ever seen.
I mean, sure you can start a little club of people that shunt violence. But that doesn't force other people to put down their guns and so if those other people want to abuse you in some way they will be able to do so. If you do not take a weapon in the hand you stand no chance against an average fellow human being.
So to even survive as a viable economical group of pacifists you will need an army to protect yourself from being raped by non-pacifists.
It is how humans operate and it is why stability is reached only under these circumstances.

I think it is possible to get to some sort of good compromise tho.
If a government assures certain basic needs then most of the unguided demand from the population will be luxury in nature.
Not many people are willing to fight over a better version of something they already had so that dampens a lot of the real aggression in populations.
(nothing promotes a revolution as effectively as empty shops).
What is left is a game for acquiring luxury goods.
And that's fine but needs to be capped.
The amount of resources any individual can take out of society needs to be capped.
The ammount of resources any non-human entity takes out of society needs to be monitored and democratized.
Then i think a lot of problems would be solved.
There would be a lot less need for the power structures to act.
At the same time the power structures would be unable to accumulate unnessesary power.

mobodick, I will soon be getting back on the technical exposition, but not today.

In the meantime, coincidentally I had been writing else where over the past days about statism and technology solutions:

http://esr.ibiblio.org/?p=4927&cpage=1#comment-399859

(follow also the 2 links in the post, and the subsequent posts on both pages)

Finally had some time to think more deeply on the technical issues.

1. Independently of the hard disk space Proof-of-Work concept, I am unsure about the idea that I previously floated up thread to allow any mining peer to record a transaction, i.e. an attempt to avoid having the winning block peer decide which transactions are in a block. A spender can create a transaction that is backdated to a prior block time, unless there is a forward moving master record of transactions. I was thinking that if a spender tried to send such a backdated transaction, the peers would reject it because it is backdated, but even with a vote, a majority of rogue peers could introduce backdated transactions, so the idea trades the attack of rogue peers refusing to include transactions for the attack of rogue peers introducing backdated double-spends. The advantage of the idea is that non-rogue peers might be able to identify rogue peers, but what is the resolution mechanism? And how to distinguish between rogue peers and failure to communicate a transaction that did occur at that historical block time?

2. I have an unresolved problem with the hard disk space Proof-of-Work concept. The selection of the next peer to perform work is the one whose key is closest to the "next key". The problem is the "next key" can't be known a priori, else peers can game it when they select their key. So where does the entropy of the "next key" come from? It seems it must come from a hash of transactions, since that is the only non-centralized source of entropy we have. So if the current block peer is selecting the transactions, the "next key" can be gamed to point to a chosen peer. Whereas, if the peers compete to include the most transactions that has a hash that is closest to their key, this can still be gamed by introducing transactions. This also appears to be related to the problem that #1 was trying to address-- requiring that mining peers don't exclude transactions. I had mentioned this issue in my original draft of the specification at anonymint.com

3. I have another unresolved problem with the hard disk space Proof-of-Work concept. The concept is based on the current block peer having to provide a mutual digital signature with the "next peer" (or prior peer), so the current block peer has to maintain a hard disk storage of all these signatures. But how can a peer which is closest (and thus should be next) prove that it communicated with the current block peer if the current block peer doesn't have the record? I had handwaved at a solution in the original specification, where the peers keep track record of peers that persistently lie. I am doubting if such self-policing schemes are robust enough. Will think more on this.

These issues have to be resolved. I don't have a decision yet whether it is impossible to resolve them, yet I am leaning to that it is impossible.

I first read this in the marketoracle a few days ago and im glad to see it somewhere being discussed because it is very important. Many people do not realize that unless explicitly and actively prevented, the natural inevitible progression of anything is a monopoly, and bitcoin's mining network does not do enough to prevent at least a 51% cartel from forming after the mandatory incentive is gone. This is guaranteed to progress deeper into monopoly. For this specific mining incentive problem, where does Freicoin fall short? I need to read more of the details on their system, but it supposedly was invented to address this very problem.

The full ambition or potential exercised by a would be mining/transaction processing cartel (or any other type of "attacker") probably cannot be contained solely with the architecture of a new internet cryptocurrency system in and of itself anyway, no matter how well designed and implemented. Other facets of the monetary system in the physical, real world need to be properly implemented to complement the cryptocurrency in the electronic realm. That being said, a crytocurrency system better than bitcoin in the 51% cartel attack vector regard (and maybe some others) must be designed and implemented to address the very real problem you bring to light in the kill switch and will go a long way in making a network transaction processing cartel less feasible, but relying on this alone to solve potential oppression by a power elite through a monetary system is putting all your eggs into a basket they already have their hands all over.

There exists of course a permanent, unperishable public record of all transactions ever made in the form of a giant perusable blockchain. This blockchain combined with the current siphoning and storage and sifting of the entire internet of all webpages, emails, texts, bank statements, DNS records, tax records, etc and the use of subpoenas, traffic analysis, secret warrants, criminal botnets, and everything else means there is absolutely no lasting anonymity using bitcoin. Bitcoin is going to be positively anti-anonymous as soon as it goes mainstream, guaranteed. The fact that people still think bitcoin is or will continue to be anonymous is ridiculous. Assuredly there are already teams of monkeys everywhere creating and using tools to mine for and plainly connect the dots of an always ever growing number of unmasked cryptocurrency addresses. Anybody or any institution, corporation, etc will be able to learn how much money their boss, neighbors, competitors, enemies, friends make and what they spend their money on and vice versa.

The solution to the anonymity problem is off the network. Inert, physical notes, coins, and accounting entries need to be issued on bitcoin reserves, guaranteed to be redeemed by the issuer for actual network blockchain cryptocurrency units. This adds total anonymity and furthermore will kickstart the use of cryptocurrency as an actual currency in the real world instead of the store of wealth/speculation gizmo that it currently is right now.

This sounds like a plug for fractional reserve banking, but there is no other way. Fractional reserve lending does not need to occur simply to issue and redeem inert notes one to one, although the temptation and ability will always be there. Fractional reserve banking becomes oppressive when banks become irresponsible, run out of reserves, and then get bailed out. One could also argue here that fractional reserve lending will be much more difficult to get away with using cryptocurrency reserves instead of precious metal reserves, because demand for the actual specie will be so much higher as it actually has a real use in transacting goods and services over the internet.

Furthermore, the issuance of notes on cryptocurrency reserves need not and should not be done by private entities for profit. It can be done by a p2p network issuing, counterfeit-proofing, validating, and redeeming physical notes based on open physical standards such as openpgp cards or the like. The method of issuing inert cryptocurrency notes is crucial because the current financial bloc performs this very function (based on pretty much nothing as reserves), and they will be tempted and have the means to FR lend. It needs to be cryptographically bailout proof and furthermore totally preclude the need for any bailout.

Centralization, lack of competition, or globalization is dangerous, not only for users of a currency on the internet but in the real world. Different cryptocurrencies need to proliferate not just on the internet, but geographically, each with its own blockchain, note issuance, etc, based in separate geographic areas that make sense. To illustrate the importance of this, who can argue that the ECB is less oppressive to Europeans than each country's own previous currency issuers? Who can argue that the FED is less oppressive to Americans than the Bank of North Dakota is to citizens of North Dakota? Who can say that Wall Street in 1912 was less oppressive to the US economy than the proliferation of smaller, regional, separately owned and controlled currency issuing banks across the country in the mid 1800's?

Tin foil hats, as the negligently naive masses call them, have been warning of a cashless global currency with no anonymity, controlled by a power elite for decades. Bitcoin in its current implementation is potentially poised to become just that.

I'm going to post this elsewhere in the forum as soon as I get out of noob jail. Please let me know what you guys think and feel free to publish these ideas anywhere.

townf, I need to study freicoin more thoroughly. Will do and report my analysis.

Anonymity can be much improved using a MUTE concept.

Any system that trades over internet whether fractional reserve or not, must address monopolization and anonymity. Physical trading is a different need and utility.


This #3 can be resolved since all peers have a list of all peers, then for any registration requests not honored (possibly network error), the request can be sent to all peers who are required to proxy the request and either return the registration from the target peer. If target peer doesnt reply to any peer then it is banned. Peers have an incentive to help else they could be banned when they are target peer. Given the delay to reregister, there is an incentive to participate.

Note this doesnt consider overhead practicality, which must be analyzed. This doesnt resolve item #2.

Anonymint, i think i was mistaken when i implied the purpose of freicoin is to specifically solve the mining monopoly problem. Its stated purpose is to improve the velocity of money and to be used more for a medium of exchange as opposed to a store of wealth. It hopes to accomplish this by charging demurrage, which is then given to miners. This demurrage fee paid to miners can possibly be the mandatory incentive necessary to keep smaller, honest miners in the game, however im not familiar with what hashing algo is used or what kind of mining hardware is required to be competitive.

Anonymint, I support your attempts to rectify the problem. I don't like the name duracash very much because from a marketing perspective it just sounds somewhat "scammy," at least when I first read it. I think its due to the use of "cash" and the overusage of the word by hucksters and bad infomercials (cash4gold for example). I like anonybit or just another "generic" coin name like digicoin.

To Arcavum and the argument about anonymity being lost converting from fiat to digital currency. Even converting to stereos purchased at Amazon is a leak on anonymity.  Anytime you give a physical address and a wallet address in communication for an order, anonymity is effectively blown. I know SR has a few workarounds but the average user connecting without the darknet loses digital coin anonymity in everyday usage pretty quickly.

On the other hand, Bitcash sounds quite OK to me. And I agree, good name is a big part in gaining acceptance.

While I agree the success of bitcoin will encourage the development of other digital currencies, I don't believe they will surpass bitcoin as there is a substantial amount of momentum behind bitcoin already.

After thinking about it, something with cash in the name might be necessary to convey that this maintains more of the cash functionality then other cryptos.

How about CashCowCoin?

All thoughts on names are useful. I also registered DuraCoin.

townf, your synopsis agrees with my prior analysis of freicoin.

The sort of anonymity I want to improve is the inability to track a transfer to/from a specific IP address, and built-in as standard. Certainly shipping physical merchandise disrupts anonymity, but such purchases are small in value compared to the need to transfer net worth anonymously.

In my view, the future value in economics will mostly come from computer software, since everything will be automated. Thus physical assets which be the minority of the portfolio.

We won't need to ship, when we download the software that 3D prints the item locally.

I hope everyone is aware that the death of the current statism is due to the 78 year technology disruption cycle:

http://esr.ibiblio.org/?p=4927&cpage=1#comment-400320
http://copute.com/edu/Intro%20to%20Computers.html#Why_Learn_Programming

The goal is not to surpass Bitcoin, rather to provide an alternative that is hopefully popular enough (say 5% of Bitcoin usage), so there is always an option for people to use that isn't monopolized by a cartel. And hopefully is more anonymous. And hopefully which anyone can realistically mine with their personal computer, so they don't have to necessarily buy via an exchange with fiat (and thus not be reported to the government by the exchange).

Realize the G20 just called for all countries to share information on movement of cash. The reason is because the Europeans are hiding their cash in the USA in real estate (etc.) and the corrupt Chinese taipans that steal most of the profits via shifting profitable portion of pricing to Singapore, are storing their money in London and Switzerland and the USA.

So when the global economy crash circa 2016 or so, the impoverished masses are going to call for a global taxation of wealth to go after all those people who escaped with their capital. Europeans think they they can leave their country and not be taxed by their home country. They are going to be very shocked when the global reporting cooperation comes in a few years.

Bitcoin is going to be a complete record of everything too and the governments will tax everyone after the fact.

Everyone is planting their own jail time by not reporting everything now. Because everything is tracked now. Just the governments have not yet set the plan in action to go after you.

THEY WILL.

I share your enthusiasm for anonymity but I wonder if in the future we'll even be able to use a computer without being monitored. Will an anonymous currency even be accessible in an anonymous way?

Easily ... the technology exists today so it is inevitable since that is the medium of exchange that the market will naturally select.

Ehhr, you see to be confused. It's the US Dollar that is created out of thin air, not Bitcoin.

I agree that the technology for anonymity exists. And thus the market should move that direction once the governments go bezerk with capital controls.

Tor is not completely anonymous, because the injection node or the destination node may be compromised.

The solution is to inject your transaction from your mining peer (so you know it isn't compromised), but the way the system would be designed, it wouldn't be resolvable where a transaction was injected:

http://en.wikipedia.org/wiki/MUTE

If enough of the peers are not compromised, it becomes very unlikely for traffic analysis to determine where transactions originated from. If transactions can't be tracked to an originating IP address, then there is no technical way to subvert the anonymity.

I still have the prior listed unresolved problem with my proposed design. I will report if I have resolved it.

I have briefly looked at a Proof-of-Share proposal:

https://bitcointalk.org/index.php?topic=189239.msg2119596#msg2119596

I don't want to get into that "diabolical cartel" talk. However, I totally agree in the very long term, coin generation should continue to provide incentive for miners to secure the system. Unlimited coin creation is a good thing as long as the trend is easily predictable.

I'd support something like, 0.1-1% annual increase in coin quantity in the very long term future. A small percentage of total "money supply" should be enough to pay for the computing power necessary for sustaining the network in the long term.

Seems this problem may be solved when the entropy is grabbed ever day or so, instead for every transaction block:

https://bitcointalk.org/index.php?topic=189239.msg2120749#msg2120749

But the details are still unclear to me on how to have a global consensus on this randomized hash.

Very interesting thread.

I seems clear to me that Bitcoin as it currently is seems to have a fundamental flaw. When all, or even nearly all, coins are mined, difficulty has risen to a ridiculous point and the power of electricity is constantly rising what incentive do miners have to keep mining. Without miners the system is dead.

I also agree with you AnonyMint that if mining could be equally available to all, the system would be much more sustainable in the long run. Professional miners could set up large mining rigs but also the average person with an average pc could also mine. I have put some thought into this before and was thinking about an algorithm that uses large amounts of memory per processor that would make it impossible to mine on GPUs or ASICs. How that algorithm would actually work I have no idea yet. I like your idea of a hard drive mining algorithm though. One advantage of your low power usage idea is that is makes the whole digital currency concept much more environmentally feasible which I think is a powerful selling point, in terms of the general public, going forward.

I think you make a mistake.
Difficulty will not become ridiculous. Difficulty follows from hashrate.
If less people mine then difficulty adjusts downwards making it more profitble for the ones still mining.

Ah, ok I see. Please excuse my ignorance.

But the point stands, whats in it for the miner once all the coins have been mined?

transaction fees

I have disputed that as a viable model upthread. I don't want to repeat that debate (please), readers can read the entire thread if they want the full discussion on that.

Separately even before minting terminates, it is not clear that difficulty will not become ridiculous. The state has more resources to fund supercomputers due to the fact that the masses want to hand over power to the state. The state (or a banking cartel which has captured the state as is the case now) could in theory use the statism to drive hardware costs so high (lookup who were the top pre-IPO investors for example in Google and Facebook where the world's server farms are), that no one is profitable at mining. Statism will be going into hyperdrive with the global economic collapse. Perhaps it is not coincidental that minting is designed to stop 2030ish, which is exactly when the 78 year repeating model for economic implosion expects the statism to peak.

Remember statism socializes unprofitability.

First of all about your last sentence. I think the most beautifull and worth living for things are not profitable. So by itself i think it is a non argument against governments. Socializing unprofitability can have great benefits to society. On the other hand, profit doesn't give shit about society. If a banker could sell his mother for more profit he would. In fact, most of our current problems stem from the fact that there are people who put profit before the human race and get away with it.


Anyway, if the state can take a large enough stake in minig so it becomes inviable for private miners then they can completely control the network by 51% attack. So there is no reason to even speculate about private miner profitability. It would just become state controled.
But that still requires some government to actually do it and when they do the system is broken so fundamentaly that there would be no reason for people to use bitcoins at all.

So the only outcome of such a takeover would be that the system would become unusable.
But that would be a very strange thing to do because states have the power to break a sytem like bitcoin with much fewer resources. They could simply create a law that would force ISPs to frustrate the use and people will run away.

So i don't think that the government would attempt such a thing.
If they wanted bitcoin gone they can use any number of techniques to break it beyond usability.

Unfortunately, statism always ends up in economic implosion and often megadeath, because it is gamed by everyone to maximize state debt. Unprofitably means war at the end game.


Well exactly. That is the weakness. The state (or cartel) can take over Bitcoin.


The masses would happily continuing using it. It would in theory work fine for all of them who are compliant with the state (or cartel) edicts.


Statism doesn't care about resource cost. Debt is paid for by the dumb masses, not the cartel owners of the state.

My opening article speculates that a supranational $trillionaire cartel (which owns the state already, Bilderberg meetings do actually happen), would love to have a functioning digital currency. Why would they destroy it, when they've been trying to find a way to eliminate cash (and physical bullion) so they can track everything (so they can destroy competition from millionaires).

Can you say 666?

And i still don't see your point. Almost all transactions are already digital. If you think that the bilderbergs own some state then they already have enough power to control just about anything in that state. If they wanted they could have controlled bitocoin already. Or maybe bitcoin is their idea and satoshi works for them, right?  ::)

Anyway, if they somehow indeed control bitcoin then any control they excert would be noticed by everyone. It would be documented in the forked blockchains. It would be clear to everyone that bitcoin is not free anymore and that it is time to move on to the next best alternative. So even if they control the network they cannot use it without being exposed.

If you have $trillions then millionaires are the least of your worry.
The bilderbergs control a lot of the companies that feed a lot of people.
Try dealing with angry workers, that will teach you about power.

Not sure what to make of the 666.

I guess you haven't transacted daily in any of the third world countries that contained roughly 5 billion of the world's population. Yet many of them now carry a smartphone and thus are ready for a Bitcoin.

It can be seen as another strategy to for example subvert bank secrecy laws in for example the Philippines, that protect depositors from state monitoring. They may not end up needing Bitcoin, but they can float it as a trial balloon to have multiple competing options to get their ability to spread statism and taxation (and thus socialization of debt unprofitability and slavery) to every human on the planet.  Eliminating physical cash is very important and they would like to achieve it before 2032 (as evident by their pronouncements for regional blocs such as North American Union and Asian Union), when this current round of statism debt implosion bottoms. Also include the Trilateral Commission.

This can be viewed as fascism (big business + government) maximizing "cooperation and organization", i.e. vested capture of statism and slavery.


Precisely what I speculate to be true based on bizarre coincidental features of Bitcoin. Although I can't know it for sure. And I don't need to. I can see the where trend over history is headed.

And even if there isn't a concerted cartel control, statism and technology are still trending this direction. We should make sure we use technology that doesn't hand over this power to the state, because for sure the statism will grab it.

Note we may be getting closer to eliminating the Bitcoin threat (pending further technical review and discussion at the following link):

https://bitcointalk.org/index.php?topic=189239.msg2124304#msg2124304


Is debatable whether someone might be able to make it appear that the peers are coming from diverse sources and thus not detected.

Regardless, I don't see there is any need for them to fork the blockchains, if they want to use this power to both refuse to include transactions from people who don't follow their edicts (thus the masses remain happy and continue using the system) and to track the IP address that every transaction originates from since they will control most (if not nearly all) of the mining peers. One of the edicts can be to not use Tor or obsure the source of the transaction. Controlling the mining in theory gives them more control, because laws might be subverted otherwise.

Just because a few hackers recognize that a system has been overtaken by the state, doesn't mean they can do anything about it, if by that time the masses use that system and will not switch.


That shows you don't understand economics. In nature, small things grow fast, and large things stagnate and decay. The reason is that because new opportunities are exponential in potential, but mature captured markets do not expand forever. Saplings grow fast to oak trees, but oak trees don't grow to the moon. What the $trillionaires have to fear is some disruptive new ideas that some millionaires turns into multiple instances of $billions, which also craters the control that provides their $trillions of value. Often disruptive innovations destroy old capital, e.g. the tractor destroyed the investments in animal pulled plows. The $trillionaires gain and hold their wealth in control over debt, insurance, and governance. If they lose that control, their wealth can implode as the freedom of man catapults into a new paradigm.

It also not necessarily fear, rather that they want to expand their wealth, and most of the wealth they don't have already is in the upper-middle class.


Indeed. The reason we have a global crisis coming now is because of billions of people who can't program a computer, yet the future is all about eliminating human non-programmer workers with programmed automation. Driverless cars, humanless customer support agents, humanless factories, integrated POS and accounting without humans, etc..

There is an infinite amount of programming to be done. Programmers (and related hitech innovators) will be employed. The rest will depend on the state to steal for them.

The cartel will manage the wars and megadeath necessary to cull those who can't adjust. The statism delays adjustment by increasing debt, thus making sure more people don't initiate education and adjustment.


Tracking every transaction and tying to a human identity, so the state can extract taxes to pay for all those who don't want to work-- which is eventually nearly everybody, so this is basically a eugenics trajectory. Luckily we have technology to save us during every one of the 78 year technology disruption cycles.

The bigger threat is the government will not shut it down, but rather embrace, help it grow, and control it so they can turn off your ability to eat individually if they don't like you:

I think we may have a fundamentally unresolvable problem in attempting to fix Bitcoin's 51% attack with any alternative scheme:

https://bitcointalk.org/index.php?topic=189239.msg2128451#msg2128451

It has to do with peers being first instead of last, i.e. the inability to inject non-determinism in the selection of who processes the transactions.

I am almost ready to abandon any work on cryptocurrencies. They appear to not be a solution to anything:

https://bitcointalk.org/index.php?topic=189239.msg2129228#msg2129228

Sorry to say. I am awaiting any refutation.

http://esr.ibiblio.org/?p=4944&cpage=1#comment-401419

The bigger threat is the government will not shut it down, but rather embrace, help it grow, and control it so they can turn off your ability to eat individually if they don't like you

LOL,.,
People in 3rd world countries do not usually have cell phones and when they do i don't think they have internet, never mind the money to pay for upkeeping the blockchain.
And what are they going to use their bitcoins for? Buying from silk road?
For these people bitcoin is the most useless thing in the world.
The idea that 3rd world people will become enslaved by bitcoin isrealy stupidly crazy. There is just not even the slightest posibility bitcoin will be meaningfull to these people.

If it would happen then it would be fascism, but it's just not very likely to go that way.
These people would first need to have food, housing and work before bitcoin would start taking on a meaning.


About the bilderbergs designing bitcoin/technology.
If you can't trust bitcoin then you can't trust any device in the world. Bitlderbergs would already own your ass.
If such groups could organize stuff on this level then society would already be completely controlled by them. Nothing you say or do will make a difference and you will be their slave all your life.

You call it statist but actually its called the information age.
We live in transformative times. Technology has opened far more doors than we can possibly look through at once. We need to find a new balance within these new posibilities.

I mean, ok, lets assume the bilderbergs know how much bitcoin i have in my account. Then what? They will just take it? And i wouldn't notice and post it on a blog or forum for everyone to know?
The point is that if they want to control bitcoin they need to control all the computers and networks already.
But if they already control the computers and networks then there is no point for them to control bitcoins. They would already be able to do arbitrary things with the exisiting substrate of technology.
In reality there are much more effective tools to unilaterally control society, if one wanted.

So i find it ammusing that you ignore the older possibilities for complete and total control in favour of new and unproven techologies of complete and total control.
You have to ask yourself, why would they want to control bitcoin if they already control everything that is needed to run bitcoin?

You also seem to have a lot of misconception about how bitcoin works.
First of all, they can have hidden nodes all they want but as soon as they start doing funky stuff the blockchain will fork and everyone will know they are manipulating transactions. At that moment everyone will have a choice to either work with the new chain or revert back to the old chain. I think most people will hear from their neighbours that its best to use the old chain and get out of that system asap.
I mean, if you hear that your bank is being robbed at random then you will want to take your money somewhere else.
So there is no realistical way to control the network like this.
But then you backpeddal and define control as the ability to see the transactions.
Well, have i got news for you!
You can already do that. This information is already widely available as there are sites that keep a record of the IP addresses that made the transactions. It is public information.
Sure, you can use things like Tor, but that is just a general layer of obfuscation. It has nothing to do with bitcoin and so controling the bitcoin network won't give you any extra information.
The only thing that having more than 50% of the network is good for is to forge transactions, but that is detectable and so unusable for the long run.

So again, there are no good reasons for any group to hijack bitcoin except to destroy it or make a quick buck (while destroying it).
Excerting real control will be difficult without a lot of extra facilitating control and if that is in place then the actual matter of bitcoin or another currency is immaterial.
What i'm saying is that there are much better places to furbish with mechanisms of control.

You tell me that i don't know about economics but then you go on to tell fables about biology/evolution..  ??? ::)

First of all, the most prolific life form on earth is the humble bacteria.
Small things grow fast because they are simple and their genes can adapt faster.
It's not about the opportunities, it is about being capable of adapting fast enough to be able to capitalize on the many opportunities nature provides.
That is why we get niches. Big complex organisms have a completely different set of opportunities than small simple ones and so they act according to different rules.

Anyway, if the bilderbergs need to control bitcoin to fight off millionairs then they have no real control at the moment. All this paranoia is nonsense if they can't already control most of the world.

And your techocratic underdog fantasy is also nothing more than a fantasy.
You claim that the recent crisis is because machines are more efficient than humans and and so humans become obsolete.
But the actual problem is human greed. It has nothing to do with workers but everything to do with a finacial system that thrives on profit and self-enrichment. So basically human nature.
The problems we have come from the fact that the financial world acted completely irresponsibly on the freedoms society allowed them. They were pushing credit without being properly secured against defaults.
If we can learn anything from this is that people cannot be left free with the kind of power one can ammass in society. People are assholes and start acting like it once they gain power.
Nothing will change this because we are all humans.
It's not the bilderbergs screwing us, it's our fellow citizens. We all grew up with the fantasy that the sky is the limit. It just turns out to be not true. There is no room for everyone to be at the top but that sure doesn't stop people from trying.

And still your arguments are twisted.
You say that these big groups are slow and irresponsive to changes.
But that is a GOOD thing as well and you never mentioned it.
Do you realy think they could get away with too much change? How many people would get fired? What kinds of consequences would it have on society if milions of people would be replaced by robots? How would you be able to maintain stability and peace?

You completely disregard the fact that these bilderberg people get their power from the workers in the factories. That is why they are so central. They actually represent a large portion of society. It is much more an ecosystem than a strict hierarchy. All involved parties need each other to create this reasonably stable and prosperous world we live in.
If you go back less than 200 years then our society has changed tremendously.
Just think of what we have developed in the last century and a half and specifically the later half of the last century.
Trains, planes, automobiles, cinema, electricity, television, hygiene, water, housing, shops, food supplies, luxury goods, communication, electronics, transistors, integrated circuits, computers, computer networks, genetics, medicine, lifespan doubling, information technology, satelites, space travel, human rights, global trade agreements, voting rights for women, etc, etc, etc.

Humanity never had it this good on the average.
So of course it is in our own interest to not want to change it too radically.
These millionairs you speak of would need to provide food and job for them to be able to gain any momentum.
But even then a sappling has no chance of surviving withour properly adapting to the environment (the big old trees).
If the sappling grows too close to the old tree the shadow from the big tree will naturally prevent the sappling from growing. Balance is the key word here.
Sure you can make a factory that runs on only robots, but that also means that 200 people won't get money that they can spend on buying your product.
The first question you need to ask is if it is economically viable to have only facories that work with robots.
Programmers won't be needed in the future as computers will be able to program themselfs.
So in the future these people won't need anyone to make a factory run. But who will have money to buy their product?
It turns out that there is only so much that you can automate without losing buying power. And without buying power your economy will stagnate and everything will collapse. It is not a strategy that will allow you to survive.

I whish things worked as superficially as you want them to but in reality there are many many societal dependencies and the only way to look at it is from an emergent ecosystem pov. Then you can see that control is not as clear as it might seem on first glance. There are a lot of niches.
I think that instead of obsesing with these bilderbergs you should realy take a wider view and see that the bilderbergs have their own set of dependencies and that they are more like shapers than like controllers. They are not concerned with how much money you have in your bank account. They are worried about whether they will have enough schooled workers for their airplane factories so they need schools and engineers to be planned beforehand. They do not have absolute power but they are a big cohesive force keeping shit together.
It takes a lot of responsibilities and i can imagine it's not easy to structure society into a system that is this stable. Never before in history did humanity manage to organize itself into such a complex and productive entity.
At the moment it's not only about organizing the next cool thing. It is much more a question of keeping the current level of prosperity going because we never gotten this far in history of mankind.
To have this level of society we need to plan ahead. There is just no other way of having the cake and eating it.
On the societal scale you are confronted with completely different sets of problems.
The bilderbergs are in a sense the emergent manifestation of the solution to these problems.
They grew naturally out of the dynamics of our development and have a function in giving society shape.
That is why there are these meetings.
It allows for the tuning of resources. Industry can communicate their needs i terms of resources (workers, energy, etc) so that they can provide the jobs for people. Then the politics can act on this by providing the resources. And then the politics can state demands from the industry to provide a good to society. It's an interaction.

It turns out that to you need this interaction for society to profit.
Both parties are worse off when they try to control the whole too much.
The only way this is going to work is if a balance is found and both parties know it. Otherwise such a system is doomed to destabilize.
Just take a look at the glorious societal development of north korea and you can clearly see how far total control will take you. And the only way they can keep it together is by total information control. They can't have anyone talking about the wrong things. It's not something that is stable in the long run and getting this level of information control going in our modern world would be impossible.

So this won't happen in the western society without the world economy collapsig. And if that happens all bets are off. Everyone will have to struggle for food and society (including any power extracted from it) will collapse.


About the 666, i hope you realize it was originally written as a critiqe against the roman empire that was recording identity for the purpose of collecting taxes.
It is the inevitable consequence of organizing beyond the structure of a village and it has been around for millenia. There realy is nothing special about our current situation as every large civilization has to deal with these things.
In fact, taxes are much older than the romans and even the pharaos collected taxes in the form of grain (that was then stored) so that when that civilization was faced with bad crop years the pharao could still feed his people. This was so successfull that they could supply whole cities with a steady supply of food and water despite productio rate. This in turn reduced famine and unrest. If your crop failed this year you do not have to steal it from your neighbour who only had a partially failed crop. You will get some of your tax back. And it would never have happened if the pharaos didn't take a bit of everyones produce as tax.
If you want to describe people as sheep then this is it. People in general are too egocentric and short sighted to be able to organize themselfs beyond their direct surroundings. They need a kind of hyrarchy that gives them the security that they are not the only ones that pay into society and that secures the benefits they will get from the tax they pay. If this structure is missing then people get into micro wars (man against man, group against group) and society has no chance of flourishing. It would be a mess if you think about the kinds of physical harm one person can do with modern tools.

So taxes are not bad in and of themselfs. They are the fee for living in a stable society with so many usefull mechanisms.
What we do need are mechanisms of democracy.
We need a way to inject demands from the people into the whole so the structure of society keeps benefiting the people and does not become self serving.
And i think this is where it often goes wrong and statism can thrive.
But a thriving statist regiment does not equal a productive society.
Any government that is too statist will be outcompeted by states with more freedoms. Even war is not an option anymore because the states that are more free actually are the only ones capable of producing these toys of mass destrucion. It is just not economically viable to sustain a deeply statist construction. Even russia and china realized that.

On the other hand, states without any statism structures are bound to eat themselfs up as everyone will fight over food with their neighbors.

So the only way, from a government perspective, to have a stable state for the future is by not demanding too much tax and to use tax in an open and discussable way. That way you will have the people behind you and will be stronger as a state.
Complete statism is not something that can survive for long and so it is not in the benefit of any one party in our society to push it too far.

So i don't think you can take this statist thing as an absolute thing that is separate from society.
It is because of statism that we have such a successfull society in the first place.
Without it we would still be tribes fighting over the best berry field.
Statism is fully embedded in our society and it has its benefits.

The thing to worry about is keeping statism just for the purpose of statism.
But that's nothing new and humanity has been working on the problem for thousands of years.
The problem is that the optimum is a balance of freedom and structure so we are doomed forever to re-evaluate this balance.
You should not address statism itself. You should try to see how it should fit in society so we can achieve an optimum in a given situation.

So you quote yourself answering yourself with a link to a post from yourself describing a problem you perceive yourself..

You must think very highly of yourself.....

Aah, so their solution is to have the people they don't like beg and steal for their food? Great way to have a nice stable society..  ::)

No it is to have them die (or jailed when they steal), because they fight against slavery and thus threaten the statist apparatus.

Statism tries to maintain a stable society but results in horror and megadeath every time in human history.

You have no clue what statism means and the economics of the collective. Read the comments at the links at the bottom of this page.


I live in a 3rd world country, you are making a fool of yourself.


Well bitcoin is pretty useless now, and if it becomes useful, then it will be useful to these people because they are dying to be able to sell over the internet, but paypal won't let them be sellers.

They are innovating and stealing your jobs with BPO, call centers, freelancer, etc.. This will accelerate with a Bitcoin.


We already have fascism in the world. What do you call the global banking takeover of regulators and governance?

Or have you been spending all your time under a rock since 2007?


Are you feeling a bit insecure and wanting to imagine what you see on Children's International. Take a trip and discover reality.


They do own your ass. Or at least I can say for sure that the statism owns your ass, and this will become very clear to you before 2032, something along the lines of Nazi Germany is heading our way again.

You do know that Prescott Bush, the grandfather of baby Bush was a financier (Union Bank) of Hilter's work camps?

You do know that Bush's have purchased ranches in Paraguay, with US Military mini-base nearby for protection?


The statism can't usually kill everyone, it isn't that efficient yet. For WW2 period, the USA had a gun under everything blade of grass. The 3rd world countries had a bolo knife behind every banana tree. Things are changing, technology for killing has improved. Gun control is more widespread, where the dept of Homelove has permission to buy 1.6 billion hollowpoint bullets (over 10 years, and these are illegal in war, because they are so gruesome). There are more roads now, etc..


You are confusing technological innovation with statist outcomes. I will stop here, because what you just said is so uninformed that I can't possibly clear this up in the time I have to alot to this. I don't want to repeat the discussion here that I just had over at following blog:

http://esr.ibiblio.org/?p=4912&cpage=1#comment-399082
http://esr.ibiblio.org/?p=4927&cpage=1#comment-399859
http://esr.ibiblio.org/?p=4934&cpage=1#comment-401360
http://esr.ibiblio.org/?p=4912&cpage=1#comment-399642


We already had the debate on the vulnerability of Bitcoin upthread, so I am not going to repeat that as I already refuted everything you just wrote.

I see you haven't studied the repeating 78 year technology disruption cycle. You have all the wrong reasoning about what is happening now. Sigh. I provided links up thread to all the research and evidence. It is up to you if you want to educate yourself or remain an ignorant one.

P.S. If you read more carefully, I never said humans are obsolete. I said the statism helps many of them delay adjustment and education. The Singularity is hogwash, the humans will always do the creative work.

The statism exhausts its resources eventually and there is a reset and renewal, e.g. after WW2. For example, 90% taxes can only be sustained for so long...then society is trashed and we start over again from the ashes.

I don't agree with this in the sense that you only look at half the story (It makes me think you have no clue as to the function statism has in any society).
I think you are only talking about when statism goes out of control.
I fully agree that statism out of control is a bad thing. But no statism at all is also a bad thing.
The only solution is to make sure there is a healthy balance.
Megadeath will happen on both extremes.
Too much statism is megadeath.
Too little statism is also megadeath (because people cannot voluntarily peacefully co-exist when resources are scarse).


Wait, you're an accomplished programmer (that's what you said in anoteher thread) and you live in a 3rd world country and you hang around on bitcointalk talking about the bilderbergs?
LOL at how much fail is in that proposition.
You have no chance of not being part of the 1st world system, wherever you happen to live. Your whole thought pattern is prove of that. You concern yourself with luxury problems of our society with no regard to the actual problems (and solutions to those problems) of third world countries. You show absolutely no insight in the actual dynamics that drive world economy. You put all blame in one thing (and that happens to be the subject of rich westerners conspiracy fantasies) and then see everything from that point of view.
How could anyone in a 3rd world country be so thoroughly indoctrinated with western paranoia about the bilderbergs?


LOL at your twisted brain.

Bitcoin can only be usefull if it has a benefit for the users.
So by saying that bitcoin will become usefull you already agree that these people have a benefit in using it. To use bitcoin they need computers and fast internet to be ubiquitous.
But in a 3rd world country these are exactly the kinds of things that are missing.
Bitcoin is so terribly expensive in use that it is pretty much meaningless for people in the 3rd world.
I think those people are much more worried about their food and water supplies than about the possibility to sell their luxury products to some overseas fat white guy.
Usually these countries have very low industrialisation so WTF are they going to sell on the internet and in enough quantities to maintain their bitcoin ecosystem?
If you don't have food then you can't invest in the kind of technology that is needed for bitcoin.
Bitcoin cannot ever help severely underdeveloped countries to get on top of their problems.
In some cases bitcoin could help but it can't change basic things like infrastructure or climate or political regime. You put too much faith in bitcoin and fail to see it is not some magical fix-everything currency.
It has some benefits, sure, but it's mostly a rich kids toy.

Yes, and fascism will be there with or without bitcoin. Welcome to the world, it has not been different since known history.
The solution is not in bitcoin, the sollution is in reducing the power of these bankers. Trusting in some technology to solve your problems for you is tremendously stupid.
And so trusting in bitcoin to solve all your problems is also tremendously stupid.
In the end all change starts with people, not with technology.
That is because the actual problem is people, not technology.

I don't know this Children's International. It seems it's a US organisation. Funny that you know about them when you live in a 3rd world country when i don't know about them and i live in a 1st world country.
I think you're bullshitting and have never in your life visited a 3rd world coutry.

Ok, so i'm going to assume you're from the US and not some 3rd world country.

If they own your ass then bitcoin never had a chance anyway. Your whole paranoia about a weakness in bitcoin is fantasy because they can control the societal dynamics despite it.
You realy need to let go of bitcoin as a magical technology that will free you from the tyrany of society.
What would actually help is to stop consuming all the products pushed on to you by the tyranny. Stop using bitcoins, stop using the internet, stop using computers, stop using cars, stop using supermarkets, grow your own food, don't visit doctors or hospitals, dig your own water pit, and have enough land to do it all without taking away from others.
But clearly you have it too good in the current situation to do all these things that are required to live a 'free' life.
It's funny to see people pretend to be revolutionaries that then use the tools provided to them by the system they oppose to prove the system is wrong. Their support of the system is contradictionary to their statements.
If you want real change then the first thing to do is switch off the computer.
The next thing to do is figure out how you can get all these nice things without any statism.
Once you get there we can talk again. But you won't because these nice things are the result of a certain ammount of statism.

Statism is just a tool and like any tool it can be abused. You don't want statism to go away, you want it to be a tool for society and you want to prevent it from becoming too dominant.
But again, that is not what bitcoin can achieve. The kinds of changes that are needed for this have nothing to do with technology.

LOL.,
Again with the brain twisting.
We have had technology to wipe out the whole world population for over a hundred years now.
There are chemicals that, once injected into the atmosphere, would kill almost all people.
So this could have been done even before the first world war, if that was the goal.

The thought that statism doesnt kill everyone because of inefficiency is truely bizar.
If they kill everyone (and as i say above, the tools have been there for a while now) then who will still make up the system?
What i can make of it is that you trust that some un-subvertable technologies will save your ass.
If you would indeed be an experienced programmer like you claim you are you would know by heart that there is no such thing as a system that cannot be subverted.
It is a stupid proposition to hope that technology will save your ass.


I did not mention bitcoins in this paragraph...

There is no 78 year technological disruption cycle.
If there are any cycles than they must be accelerating.
We used to have horses for milennia. Now in a short time we got both trains and cars.
Then only a slow evolution of these ideas without anything specific technological disruption.

The first and second world war had nothing to do with technological disruption.
If anything the wars themselfs were a big factor for advancing technology.

Please explain why we had 2 big wars separated by 20 years instead of 78.
What kind of cycle is that?
And why do you conveniently fail to count the many many wars between the world wars and now as significant? Why the arbitrary 78 years? In the last 78 years the world never stopped changing, so what is so special about these 78 year periods?

Please provide evidence that such a cycle indeed exists and then provide evidence why it must happen.

There is no chance in the world that 90% tax would make a system survive longer than a day in the current situation. No statist power in the westen world can extract 90% of what people make and use it for its own selfish goals.
To do it you would need complete and total control over all information. This is simply not doable anymore. Countries like north korea get it done because they strictly control the posibilities for communication. That would be unthinkable in our world and so this form of control becomes a lot more useless unless everyone decides to not use their internet or mobile phones.

I'll say it again, things are not a simple or clear cut as you make them out to be.

Treaty of Versailles. You could say it was one big war.  :)

Sure, but if you want to take that viewpoint then war never realy ended. And lots of other wars that were not directly related to this treaty. War never stopped because humans never stopped fighting over stuff. And the fact that there was this time of lots of disorder in our particular corner of the world doesn't point to a cycle, nevermind assuming some time period for it to be valid.

Just to be sure i want to stress that i make a distinction between cycles, which are cyclical and have a given period, and economic booms, which can overlap with other booms and have cycles with stochastic time periods.
To me a cycle is the result of a similar system acting over a long time and starting to resonate while booms are formed by singular changes to the system (like the availability of a new technology) that opens new opportunities.


In case you are a proponent of the 78 year cycles, look here and tell me if you can identify it:
http://en.wikipedia.org/wiki/List_of_wars_1945%E2%80%9389 (http://en.wikipedia.org/wiki/List_of_wars_1945%E2%80%9389)

Maybe you can say that there is this cycle in the US economy, but to be honest, the world is stopping with giving a shit about the US of A. USA is not the future of the world. The future is much more likely to come from asia. USA is becoming a dinosaur on the world stage. Who are they going to attack? China? Russia?
If the USA starts a war for real they know it can't end well for them.

THE LINK TO THE EVIDENCE OF 78 YEAR CYCLE IS AT THE END OF THIS POST. STUDY IT. YOU WILL BE SHOCKED AT YOUR IGNORANCE.


Please read this rebuttal (including the comments below the linked one):

http://esr.ibiblio.org/?p=4934&cpage=1#comment-401360


For perhaps 10 days of my entire life, and just stated that I am leaving because I am stopping all work on cryptocurrencies.


Except for the fact that I created coolpage.com back in 1998 from a Nipa Hut and was essentially the world's first social network with 1 million confirmed users at that time when the internet was tiny (had 1% of the internet building their websites with my product), and was earning a significant amount of money given I was the only employee.

And not to mention that precursor to friendster came around to buy me out, but only got a non-exclusive license because I didn't want stock options right before what I knew was a coming dot.com crash.

Should I mention I created one of world's first WYSIWYG commercial word processors back in 1986.

Or that I worked on what is now Corel Painter.


Diarrhea.


To use bitcoin (not mine it), requires rudimentary smartphone with a client and rudimentary internet connection.

Both are ubiquitous in the Philippines where I am, which has higher penetration of cell phones than in the USA (most people own more than one), and there is an internet cafe on every street corner (if not 2 or 3).


Yes it is useless for transactions now. It is only a gambling casino right now (or speculation).

BTW, I can buy Bitcoin in the Philippines, do a damn Google search before you foam at the mouth.


Nearly all income comes from exporting their products and people to service developed countries.

And they are fanatical about getting an education and about finding opportunities to generate income from abroad.


Native products, including bamboo furniture, artwork, carvings, but more importantly now they sell their time to do business process outsourcing, for example compiling corporate records, or medical records and zillion other things at 1/20th the cost of a westerner doing the same job.

There are even freelancers doing marketing surveys, writing blog posts to get share of advertising revenue, teaching english to other nationalities over Skype, and a zillion other things.

I personally know people doing all the things I mentioned above. I have been to their houses and see them doing it. Dumb ass!



Come over here and see all the fat people. And girls with big breasts. Dumb ass!

Maybe you are thinking more of Africa, but I know someone in Ethiopia and they highly censor the internet, but the floodgate will open there, and the people are eating a lot more these days than you think. She recently added me to a social network I'd never heard of. People are much more aware and connected than you think. The change is happening so fast, that talking about last year's conditions is silly.


Who ever asserted that Bitcoin would solve every problem in the third world?

I was more interested in Bitcoin as a way other than gold for rich people to hide their capital from the statism failure that is going to confiscate everything in the next few years.


The entire world is going to be enslaved by the economic failure of statism and the confiscations are going to worsen the failure. The developing nations are short the dollar via massive dollar loans as the Fed has been flooding the world with dollars. Thus the more severe the confiscations (the less can be hidden), the worse the developing world is going to be hit with implosion and chaos.

Read an expert who called the decline in gold before it happened:

http://armstrongeconomics.com/armstrong_economics_blog/



The hope was another place to store capital to prevent the fascists from confiscating it (via their control over government).

 

The failure is guaranteed by the economics of statism. You still haven't read the links I sent you. Google this "Some Iron Laws of Political Economics".

There is no solution to avoid the failure. The only hope is to save yourself.

And yes to help as many people as possible to learn how to do hitech, so they won't be unemployed. ANd this is all about technology.

But that won't stop the coming failure and confiscations.



They can't have that unless they know how to do hitech, because other skills are going into the dustbin of robotic and automation pre-history.

Everything hinges on technology. For example, online education, which I am creating:

http://copute.com/edu/


I was born in the USA. I emigrated in my mid-30s (48 now), but not permanently except perhaps since 2006.


Indeed, except if there was a technological alternative that can't be dominated by societal dynamics. And it turns out that there apparently isn't such a possibility, for the reason that non-centralized entropy can't be injected into an alternative that does not otherwise have a 51% attack. As I detailed in a link up thread.


Indeed I have.


Nonsense. None of that would stop the guaranteed failure of statism over and over in history.


That all comes from technology, which the statism fights against, by propping up the old paradigms with debt. Thus leading the repeating 78 year failure as technology advances and people don't

The two world wars were due to cottage industry disrupted by mass production and thus massive unemployment.

The current one is about the personal computer disrupting western employment. First the jobs went the China to compete against automation, now the jobs are leaving china as the automation has gotten more efficient as wages have risen in China.

The prior ones on the 1700 and 1800s were soil technology revolutions that increased yields and displaced agricultural workers. There was also the first industrial revolution and the railroad bubble.


You are twisted. I never argued against using technology. I am one of the biggest proponents of technology you will find.


As if the computer depends on statism  ::) What an idiot. You conflate orthogonal things.


No dimwit. There are real people with real hearts (majors, corporals, etc) between those buttons and the world annihilation.

Also the statism can't overtly kill everyone and have any support. It must pretend to have good versus bad, so the people fall into their trap of wanting everything they want irrespective of cost.

Also nuclear winter won't kill everyone. The likely survivors would include many hard-core anti-government folk.


Learn to spell, bizarre.

The efficiency has to operate within conventional war, where the excuse (illusion) of good vs. bad can be maintained.

The megadeaths occur where the population is disarmed and the government has been given the arms.



That was the proposition. Research revealed it isn't possible.


There are varying degrees of subversion. If all technology was fully subvertable, nothing would function. This is stupid generalization. We look at the specifics and come to a conclusion based on the facts, as I did.


It is the only thing that has saved mankind's ass, starting since at least the invention of tools and fire.


WRONG!

Read all comments above and below the linked chart:

http://www.mpettis.com/2013/02/21/a-brief-history-of-the-chinese-growth-model/#comment-21690

(wait for the page to load the specific comment down the page, which has an unformatted textual table of dates and technology disruptions and the wars caused by the unemployment due to technology disruptions)

If the comment doesn't scroll into view after clicking the above link, then search down the page for "armstrong" then look for the comment with the table.

Note that linked site is sometimes down due to overloaded server. Keep trying it. I will also try to find another copy of the information and provide a link in future post.

The link in the prior post to the table of the 78 year cycle is superior because it has links to much background information, but that server is not loading right now (it will load at other times, keep trying).

Here is a synopsis version:

http://esr.ibiblio.org/?p=4824&cpage=1#comment-395999 (scroll to the end of the linked comment)

Some other links on this point:

http://www.coolpage.com/commentary/economic/shelby/Housing%20Recovery%20Illusion.html
http://esr.ibiblio.org/?p=4867&cpage=1#comment-397370
http://esr.ibiblio.org/?p=4927&cpage=1#comment-400320

You might be interested in this:

http://www.marketoracle.co.uk/UserInfo-Shelby_H_Moore.html

Check out the accurate predictions on silver Oct 2010 and gold on March 4. Yeah that is me.

Someone asking me if I was bailing out on investing in Bitcoin. Here was my reply.

I can't give advice because each person's situation is unique and because I can be wrong. I don't want to be responsible for the outcomes of others.

I don't think the flaws that I revealed in Bitcoin are going to affect the near-term outlook for speculators who are buying Bitcoin. Thus no impact on the near-term investment returns.

I will share with you what I am thinking for myself. First, I trust the following blog as having a good (not perfect) track record of understanding:

http://armstrongeconomics.com/armstrong_economics_blog/

Second, although Bitcoin will probably be a positive returning investment, no one can say for sure when it is overvalued short-term, and there is much risk from not only volatility but also from unexpected government rulings which could be positive or negative.

Also much capital is shifting into Bitcoin because there is so much capital floating around looking for a positive return. When the next liquidity squeeze comes (anytime between 2014 and 2017), then risk assets may be the first to selloff. I would be selling into the Bitcoin rallies and using proceeds to buy the gold dips.

Core savings that can not afford to be lost should be in gold. Period. And probably waiting for a further dip in the gold price to bottom either in 2013 or to extend the decline out to 2015. Armstrong is watching for a close below $1310 for 2013 as a sign of potential decline through 2015. If not, we may have seen the bottom in 2013, probably another 10 - 25% (perhaps even 30% as a small risk) lower from current price.

Given gold is going to double, triple or more by the end game, buying it at any time for long-term hold is fine.

Short-term speculation rarely works out. You buy Bitcoin for a long-term hold if you really believe in it, then maybe sell a portion on every 50% - 100% increase in the price. But realize it is no where near as sure to not destroy your savings as gold is. Allocate accordingly.

Having said that, I am not allocating anything to Bitcoin, because it is too much of a hassle and stress and I don't expect my big gains in life to come from speculations, rather I expect them to come from my programming projects. I don't want to cause a risk to my savings that prevents me from being able to work on the projects that I want to work on, that have the best chance of generating outsized returns.

I've read it and it's selective mumbo jumbo.

lol
a lot of fancy words
if the "cartel" wants to delay your tx ,   others will not and accept the tx    hardly a digital kill switch

If you deny that the economic problems of Europe at turn of last century were caused by the unemployment due to loss of cottage industry to mass production, then go on in your fantasy world. The Case-Schiller housing price chart (for the USA) clearly shows that housing was abnormally cratered for a few decades due to this.

And this is repeating, this time it is due to the computer causing massive unemployment.

Note the more fundamental cause of Europe's problems have always been statism, as it funds (by stealing from production with taxes and sovereign debt) people to delay their adjustment to technological shift. The mathematical model here:

http://esr.ibiblio.org/?p=4934&cpage=1#comment-401368

Nonsense from someone who doesn't have a grasp of the technical issues.

Without the concensus block being respected, there is no guarantee against double-spends.

Dude I have thought about these issues deeply. My IQ is well into the near genius range. Please stop wasting my time.

http://armstrongeconomics.com/2013/05/13/gold-2015-75/ (http://armstrongeconomics.com/2013/05/13/gold-2015-75/)
http://armstrongeconomics.com/2013/05/13/welcome-to-the-new-international-currency-the-dollar/ (http://armstrongeconomics.com/2013/05/13/welcome-to-the-new-international-currency-the-dollar/)

What he is saying is that gold bulls are fighting the idea that the dollar is going to rise (dollar rise because Europe and Japan will crater first over next 2 years or so), thus the low in gold is protacted until the bulls finally capitulate.

He doesn't see the low pushing out past 2015.

To me, looks like we might get a low this summer, then a rally, then another capitulation later perhaps 2014, for a final low. Then start moving back up.

He reasons in the second link above, that gold won't blast off like a crazy rocket to all time highs until the dollar rally has ceased, which is after 2015.

There simply isn't any reason to be in a rush to buy now. The dollar must go up first or gold bugs have to anticipate it early and capitulate.

The break of support at $25 for silver, can't be over yet. There is always at least a deadcat bounce and a move lower.

Any way, I am not really trying to make money on my savings in PMs now. Just trying to manage my savings sanely, so I have cash when I need it, and I minimize chances of needing to sell at the bottom.

The goal is not to make money, but preserve capital.

Let's hope capital gain taxes are only 28% on gold by the time we well (for those in USA without retirement plan deferral protection). By the way, get everything out the retirement plan-- it is all going to be nationalized and confiscated.

Stop thinking about not reporting unless you are dealing entirely in cash with a broker who doesn't record your identity. Too risky. See if there are cameras. I don't advocate breaking the law.

I am thinking it is best to pay taxes. The best is to work and generate income.

Money is a hassle. Keeping life simple is best, use what you really need. Work on what is really interesting and doesn't consume your entire life. If it generates enough to sustain your simple life and all is contented. Well that is the hope, but not always easy to implement.

Disclaimer: I am not giving advice, consult your own professional. I am sharing some thoughts about my thinking only! Don't hold me responsible for anything you do!

https://bitcointalk.org/index.php?topic=189239.msg2140631#msg2140631

https://bitcointalk.org/index.php?topic=189239.msg2140843#msg2140843

In my experience computers have generated more work than any industry ever.
Workers that use computers don't work less hours, they simply do more in a given time period.
Moreover, computers created completely new industries. People designing websites, people working as engineers, etc, etc, etc.
The jobs of CGI artist, programmer, website designer, system administrator, computer guru, security specialist, network engineer/administrator, electronics manufacturer, dance music producer, industrial designer, video editor, etc etc etc etc.

I think you forget about the fact that computers created lots and lots of jobs.
So to me it is much more a shift of employment.
Sure, a lot of jobs became useless. But at the same time lots of new possibilities for employment came into existance.

In fact, please provide figures that make it clear that the computer revolution (lets take the first intel cpu as a starting point, around 1970) reduced jobs and caused unemployment. Please make it so that it is clear that unemployment was caused by computers and not by other factors.
Maybe you can start by comparing unemployment rate with PC penetration, see what you get.

 ::)

People that need to tell others that they are smart usually try to hide the fact that they are not smart enough in their eyes...
Seing what you have writen on these forums makes me think that maybe you are smart, but not even close to being genius.
So stop sniffing your own farts. Your brain will be more healthy that way.

I belive 500$ Is going to be the max over this 10 year period.

Nice bender

I AM NOT BEING PAID TO CONVINCE YOU, AND I REALLY DON'T CARE. I WILL NOT PUT MORE EFFORT INTO CONVINCING YOU. TAKE IT OR LEAVE IT.


And I already stated that upthread:

---

Are you denying that mass production destroyed cottage industry and caused massive unemployment during the first 1/3 of the 1900s?

If not, then please realize that didn't happen until the network effects kicked in from the 1st and 2nd industrial revolutions.

The network effects from the computer revolution are accelerating now.

Examples, 3D printing, completely automated distribution warehouses, voice recognition customer support bots, open source, the internet, Etc..

The unemployed in the USA were in manufacturing, paperwork, customer support, real estate related, etc.. The real estate bubble was the statist delay of adjustment (and expanding government with Fannie and Ginnie Mae, etc), by lowering interest rates to keep the economy growing while the other listed jobs were being lost.

Some links on the technology disruption going on now:

http://www.theatlantic.com/business/archive/2013/02/the-mystery-of-the-incredible-shrinking-american-worker/273033/
http://www.cbsnews.com/video/watch/?id=50138922n
http://www.financialsense.com/contributors/michael-shedlock/fed-cannot-win-fight-against-robots
http://esr.ibiblio.org/?p=4817&cpage=1#comment-395423
http://www.wired.com/autopia/2013/02/3d-printed-car/
http://endoftheamericandream.com/archives/we-are-witnessing-the-slow-tortuous-death-of-the-american-worker
http://www.extremetech.com/extreme/148220-ibm-makes-watson-the-size-of-a-pizza-box-starts-offering-cloud-access-to-doctors
http://armstrongeconomics.com/2013/03/07/the-jobless-recovery/
http://www.marketoracle.co.uk/Article39495.html

OMG so many scary stories.
You must be a GENIUS!

You link to whiners that whine about workers disappearing in the US.
Well guess what! The Chinese have your work now! Cheap chinese labor is the real disruptive force. China as an economic power is a disruptive force (as has been predicted for decenia).
Funny how you didn't notice this but instead blame computers for it. Thu tukkin mu jub!
Whine some more and maybe the chinese will employ you... if you are willing to work as hard as they do for the same wage.

Most of the US labour that disappeared in recent years is now in chinese hands.
China owns the US. It has nothing to do with computers taking over.
US sold its ass and now it has nothing to sit with.
If anything then technology and computers are the only thing preventing the complete downfall of the US.
Remove hollywood, silicon valley and some other key technology players and the US becomes a husk hollowed out by years of canibalism.

Ok, explain the technical issue then.  I'm very interested, especially the concensus block.
I don't question your intellectual capabilities.  Your IQ can be up there, your ego clearly is.

No, but mass production created incredible amounts of opportunities for people.
The automobile was not produced by cottage industry.
Note how much the world advanced due to automobiles.

Still no figures? Thought so.

Very interesting, thanks a lot.

Interesting, but no.

It is instructive that you missed the part about the manufacturing is leaving China back to USA where it is now highly automated.

I wish you wouldn't spam the thread with so many multiple instances of low comprehension.

Your new questions are valid, but not where you want to force me repeat arguments already made.


I already pointed out to you on the prior page of this thread, that it is the shift from old employment skills to new ones and statism delaying that adjustment by feeding people debt, that is the cause of the decades of unemployment, war and destruction.

Then the statism is destroyed (debt is erased) and the youth rebuild with their skills in the new technology. This will happen now until the reset in 2033.

Happens every 78 years. I am not going to explain it further. It is up to you to go do some research. I provided the pointers.

A supporting sliver of data is that very high youth unemployment (especially in Europe) because the boomers have the statism captured and award themselves government jobs and aid.

The youth will win after 2033, when the boomers will be put down into debt implosion.

Note I am not asserting that there is only one cycle, or one phenomenon. There surely exists a plurality of overlapping cycles and phenomena. And I am not asserting that the CLEARLY REPEATING THROUGHOUT HISTORY 78 year real estate boom+bust cycle (which I have associated with technological shift) is proven unequivocally-- almost everything in life is a theory backed by reasonable evidence, until disproven. Macro economics is particularly complex, because most likely is a multivariate solution space.

Note it is 52 years boom, followed by 26 years bust. In the USA, that was bust 1929 to 1955 (reset after WW2), then boom to 2007, now bust to 2033. (we have a 3-5 year bounce now due to global capital confidence cycle model where capital is rushing into the dollar as Europe and Japan near implosion first). The cycle repeats going back to 1700s at least. I didn't check it before that, but Martin Armstrong claims he has.

Here again is the link to the Case-Schiller housing price chart for past century, to illustrate this:

http://www.coolpage.com/commentary/economic/shelby/Housing%20Recovery%20Illusion.html

Note the dates don't exactly agree with the 1929 to 1955, because the USA was not in isolation. Europe had its cycle start earlier and capital was fleeing Europe into the USA after WW1 which caused the bounce before the crash again after 1929.

Also I am not sure if we can trust the price action in dollars in 1910 as comparative to the price action after the Fed was created in 1913. Before that the money was gold and after that the money was fiat. When gold is money, we must usually adjust prices for deflation and vice versa when fiat is money. So this can be another reason the housing crash appears to start in 1915 instead of 1929, when the economy truly crashed. We know the 1920s were booms times, and it was because gold was flooding into the USA.

Similarly we know the USA was bleeding jobs much earlier than 2007, and it was debt that was holding the economy up and prices may have peaked sooner if we used a non-liar inflation stats such as http://shadowstats.com

And this was due to global flows of capital and jobs to China for example.

Capital tries to flow where it can earn the highest short term return.

In any case, anyone who argues that we don't have massive low skills unemployment in the world today, due to the requirement for skills being raised by the computer, is in denial.

The unemployment is not just because of too much debt and failed policies, because today I could offer them a job if they knew how to program a computer. But they don't. The debt just enabled these people to stay longer in the jobs with no future. Without the debt, they would have been forced much sooner to reeducate.

Just read this about India's low education and labor laws, means most modern manufacturing there is done by robots not human labor:

http://www.economist.com/news/leaders/21577372-how-india-throwing-away-worlds-biggest-economic-opportunity-what-waste

The computer has enabled routing around these failed statist policies.

The point of scolding the dolt, was to admonish him to ask a question instead of asserting his technical ignorance as fact. Go through the entire thread, I was very careful to be humble and not assert my ego, but mobodick is testing my patience with his spamming of the thread. Mobodick is encouraging the other dolts to come out of the woodwork and make idiotic proclamations with no technical justification nor correctness, because dolts tend to think other dolts are winning the debate, because none of them comprehend.

The technical explanation is that only the winning peer for each block can add transactions, and every peer must respect this, otherwise there is no consensus and thus there could be multiple versions of the record of spends. Multiple records of spends, means spenders can spend more than once. If the cartel has made mining unprofitable by driving difficulty to insane levels, then they will win all the blocks (or at least so often that your transactions are delayed for say days or weeks by those miners who offer resources at a loss as a charity to society).

That is so elemental that anyone who doesn't understand that, doesn't even understand the basic theory of the Bitcoin algorithm. Thus they shouldn't dare try to make any proclamation about it. Novices should ask questions instead.

I base my IQ measurements on tests such as the following one:

http://www.sigmasociety.com/sigma_teste/sigma_teste_eng.asp

For example, I rapidly solved question #22.

I have perhaps revived my interest in my harddisk space Proof-of-Work, in marriage to a simplified Decrit's proposal:

https://bitcointalk.org/index.php?topic=189239.msg2151850#msg2151850
https://bitcointalk.org/index.php?topic=189239.msg2140631#msg2140631

(read two consecutive posts of mine at each of above links)

The point is we don't eliminate every chance for the socialization (cartels/govt) of money (don't require Utopia). We improve Bitcoin in every facet instead, including marking cartelization more difficult (99% versus 51% attack).

In addition to anonymizing the IP of the injection point using MUTE concepts in every peer that transmits transactions, there is an idea to anonymize the blockchain:

http://blog.cryptographyengineering.com/2013/04/zerocoin-making-bitcoin-anonymous.html

See, this is exactly why it is impossible to have a normal discussion with you.
You claim a fact, then link information that does not support that fact and then you point out "See, it's right there!".

Nowhere in the article are robots or computers mentioned and according to this article it is indias failure to educate their new workers to normal standards (skilled worker) so they at least can prosper in simple factory work.
They didn't so the conditions in those factories are bad.
But not a hint about robots or computers taking over.

Moreover, you do not present clear proof for your obsessions, you create your own personal 'proof' from fragments of media (mostly opinion blogs, it seems). Only your brain makes the connections and as i said before it is acting very selectively about what information it cosiders. It seems like you haven't trained your internet-bullshit detector well enough and have fallen into the informational schemes of internet weirdos. In my view this makes you miss the actual complexities and you obsess over (sometimes minor) influences of parts of the whole.

You see only statist control without seing the benefits it brought to society.
You see computers and robots as a threat without seing the benefits it brought to society.
You see mass production as a threat without seing the benefits to society.
You say that there is this 78 year cycle that ends in war without seing that war was conducted throughout the perceived 78 year cycle.

One thing you COMPLETELY miss is that disruptive technologies are a normal thing that happen every few years.
The actual technological cycles at the moment are severely compressed due to the exponential nature of scietific development. Technological development doesn't follow these 78 year cycles. It used to take centuries for anything significant to come through. Now you can read about scientific breakthroughs on a weekly basis.

So of course we will need to adjust. We are in a constant state of change and have been for decenia. Every generation has a different world presented to them. And the changes are accelerating. This is completely unknown territory. Never before in history did humanity have it so well, for instance. Go back only a few hundred years and you are at the end of centuries of shit life for almost all people. Work hard for your lord untill you die and be glad that you got some food underway. Wife is pregnant from the land lord and your life expectany about 30 years. Normal life for a commoner in the past.
Things have gotten a lot better since we started with the technological revolutions and despite the challenges and (various) social disruptions we managed to make society better with every step.

For someone claiming to have near genius IQ you sure as hell fail to see important movements while obsessing on others.

I believe it to be impossible to force in any protocol that can be imagined.

Okay I am are good. Thank you.

I'm liking this thread more and more, as we get away from the elephant of cartelization, which I believe less relevant, and move toward the things like allowing for drastically more peers (your HDD ideas) and best of all, better blockchain anonymity.

Green folks, read before talking in here... (probably still just watch for a long while): https://en.bitcoin.it/wiki/Weaknesses ... If at least 95% of that isn't pretty crystal clear, read more.

AnonyMint, I still haven't quite decided your ratio of crazy to smart yet, but in any case, don't worry about Sigma tests and stuff. If it helps, I'm an ISPE Fellow... No need for people to prove things. Colorblind folks cannot have the color red PROVEN to them, no matter the credentials of the individual telling them. Anyhow, there is an awesome little IGNORE link in the forum avatar section of posters. Click it. I clicked it for mobodick a week ago, because he was shitting up the thread and making it unreadable -- feels good, man.

Carry on good sir...

Did the ignore.

Perhaps the end of the following linked comment qualifies to demonstrate the capacity to abstract a problem to grasp the generative essence:

https://bitcointalk.org/index.php?topic=189239.msg2165884#msg2165884

Essentially we can't violate Coase's Theorem.

That is an interesting application. By the way, having considered it a bit further, I am moderately concerned with the "cartelization" attack. I am not sure how it might play out in the real world, and some of your descriptions rely on certain conspiracy theories, which make it harder for some in the thread to consider your perspective, but the technical flaw is real enough.

Detractors may do well to note that this is a variant on a known potential flaw:


(From https://en.bitcoin.it/wiki/Weaknesses)

Cancer nodes

It's trivial for an attacker to fill the network with clients controlled by him. This might be helpful in the execution of other attacks.

For example, an attacker might connect 100,000 IP addresses to the IRC bootstrap channel. You would then be very likely to connect only to attacker nodes. This state can be exploited in (at least) the following ways:

• The attacker can refuse to relay blocks and transactions from everyone, disconnecting you from the network.
• The attacker can relay only blocks that he creates, putting you on a separate network. You're then open to double-spending attacks.
• If you rely on transactions with 0 confirmations, the attacker can just filter out certain transactions to execute a double-spending attack.
• Low-latency encryption/anonymization of Bitcoin's transmissions (With Tor, JAP, etc.) can be defeated relatively easy with a timing attack if you're connected to several of the attacker's nodes and the
  attacker is watching your transmissions at your ISP.

Bitcoin makes these attacks more difficult by only making an outbound connection to one IP address per /16 (x.y.0.0). Incoming connections are unlimited and unregulated, but this is generally only a problem in the anonymity case, where you're probably already unable to accept incoming connections.

Looking for suspiciously low network hash-rates may help prevent the second one.

This thread has a scary sounding to it.

Right?

I think that most of the retailers will think twice before widely using such an uncontrollable coin.

Btw: Your topic made me think about that movie with the kill-for-money button.. can't remember it's name.

Well, ignoring whether you'll buy the OP premise that Satoshi baked-in this flaw, which really doesn't matter, it's still only a problem to be solved. Right now Bitcoin is fine, and may be for quite a while. Meantime, people work on developing a potential successor (Litecoin is just that, Lite bitcoin, and actually pretty dumb beyond its goodness as a Silver to Bitcoin's Gold; almost everything is the same, with just different scales). In fact, this is the only alt-coin development thread I've been intrigued by.

Still not even sure that constant debasement is the right answer to this cartelized-cancer node question.

Bitcoin is still infinitely free-er than existing fiat (US dollars, etc.) OP is solving a problem that MAY happen and only present itself many years from now, if ever. Which still makes it very worthy of solving, unless it can be proven impossible.

This really was a good article.

End of factories (and human-labor for them):

http://www.youtube.com/watch?feature=player_embedded&v=q9t68cMAPgA

Sorry to say, but i was a bit disappointed by this guy.
He royally underestimates the disruptive power of the technology he describes.
The 'razor and holder' model will be useless for 3D printers. It is already eating itself up as 3D printers are becoming more capable of replicating teir own parts. Even better, these desigs are open open source.
This guy just doesn't see the real potential of 3D printers and the way the world will be changed by them. He clearly does not get the concept that these devices are being designed for the specific purpose of replicating themselfs. Once that is done there will only be a thin layer of opportunity to make money from it and you will be competeing with the biggest open source community ever.

The real money from the 3D printing revolution will be made selling the materials used in the printers.

Will be waiting and watching for your best imitation of Satoshi's genius, for that's all it will ever be, an imitation. Might even buy a few if they are good enough

Bitcoin is an ongoing experiment, like democracy.  Time will tell whether either will succeed.

Satoshia imitated and innovated on hashcash.

I have already solved the final problem (#2) of the Proof-of-harddisk. I found the random entropy I needed!

https://bitcointalk.org/index.php?topic=189239.msg2196083#msg2196083

Great article

Off-topic a bit, this is excellent article about gold and the impossibility for hyperinflation of the entire global economy:

http://finance.yahoo.com/news/gold-rallied-years-misunderstanding-021935344.html

Hyperinflation only occurs where it is so bad in one currency regime and there is another stable one to run to. There is no other stable currency to run to, neither the Yuan nor gold have enough market size to accommodate liquidity for the $40 trillion in global capital.

QE transfers ownership from the middle-class to the bankers, and the dollar loans are going to the developing world, whom are thus now implicitly short the dollar (developing countries will have a liquidity crisis when the cash flow from labor and product exports to Europe and Japan collapse circa 2016).

As Martin Armstrong explains on his blog, gold will skyrocket only after 2015, when the global economy goes into cardiac arrest and the confiscations go into hyperdrive.

Gold is taking a breather as the economic implosion of Europe and Japan has been delayed a bit by various measures, such as Spain stealing the entire social security fund to buy its sovereign bonds. Dollar is rallying until 2015, as every where else in the developed world (including China!) the (sovereign) debt crisis is much worse. Canada and Australia are dependent on China.

Not quoting it - mobile - but nice find, AM. "Implicitly [holding a] short [position] on the dollar" ... An analysis I wholeheartedly agree with, and that should be passed around in financial circles. People need to understand this and what it means (whether it comes to a head in 2015 or gets delayed a few years, it is coming).

Some relevant commentary from me about the coming massive theft of everything physical that can't be easily hidden and transported:

http://www.mpettis.com/2013/05/21/excess-german-savings-not-thrift-caused-the-european-crisis/#comment-23390

Please excuse my sloppy writing style and typos. I am rushing.

Note France is moving aggressively against physical gold.

There's also the question if it's worth to start mining it in outer space…