Bitcoin Forum

between all the people?
I don't see the reason why a few people who were the first could gain a big share of the coins and people who want to buy coins now have to pay for them. and why would people will cooperate with such system.
I mean I only heard about this today, I would participate earlier if I knew about it.

They took a much bigger risk.  There are lots of currencies beside the gov-issued which fall through and subsequently become mostly worthless.  It's like investing.  Those people saw the potential and put their money where their respective mouths were.  To give that up because more people are jumping on the bandwagon now that Bitcoin has better proven itself wouldn't be very fair.

what risk did they take? they got it for free.

They either bought the coins for cheap, or spent the time and money to mine them.  And there was no guarantee bitcoin would ever become anything.  It could've flopped and then, nothing.  They're being rewarded for believing in it while others said it was silly and would never work.  There's no right or wrong to it.  It's just the luck of the draw.

That sounds like a great idea comrade!  ;)

They coded and built the early version of Bitcoin. When any of us can create a cryptocurrency from scratch and then bootstrap it into existence, we'd also have a right to the fruits of our labors.

Lose the envy and do what you can to get some bitcoins. It's still a wide open game.

You should write a manifesto with your comrades

Wouldn't it be more fair if [insert whatever you want] were shared equally?
between all the people?

Yes and No.

Yes, if everyone insert the same amount of risk, work, money, time, ...

Otherwise just no.

Is this Sovietcoin?  ;D ;D ;D

Probably wouldn't be worse than the other Russky scamcoins going on down. ;D

I mined BTC back in 2010 and laughed it off as a complete waste of computational power. I like the idea but figured it was not viable.

I was proven wrong, as I have been wrong on many things and will again real soon I am sure.

The difference between me an OP is that I don't expect to be compensated for being wrong or just plain ignorant.

This is pretty much the guns and gold crowd.  They won't share bitcoins.  It doesn't matter if sharing would make a better world or not.
I grew up in Dallas and have lots of experience with this mindset.  Trust me, I'm a doctor.

If you mean, by sharing, spending, that would be great!

But if you mean sharing as in, giving away, ehh probably not gonna happen.

More fair for whom?

There's not really a good reason for mining being so profitable in the beginning - I think that was an unintended consequence, as was the giant mining rigs, ASICs, etc.

It makes more sense when you consider that miners process peoples' transactions. Just like Western Union takes a bit of money to help you send money, those who process transactions get paid for their services. They also get paid for helping to secure the network. Those reasons make sense more than the early mining bit.

It's a good question - why should anyone who isn't a bitcoiner already be expected to give anything of value in exchange for Bitcoin. I could just as well have declared that my used underwear is a currency and try paying for groceries with them.

What makes Bitcoin have value now is that they actually can be used for buying stuff. There is a bitcoin economy. Without a bitcoin economy a BTC would be almost worthless.

Bitcoin was distributed equally and easy for everyone to get if they cared exactly for that reason.

So the former hippie-nerd currency that was given to friends for free in the thousands, is something else now!

In a funny way, you disclose you own interest in Bitcoin by your suggestion. You wan't to get rich, so what? If you cared about the solutions Bitcoin provide, you would had noticed it earlier.

I think very few, if any of the early adoptors imagined that Bitcoin would be worth a lot of money one day. They did it for fun and ideology.

Bitcoin is not a better idea now because a Bitcoin is worth more.

In theory it would be possible to start out with every individual a share of the total of bitcoins. Problem is, in that case the idea, both of the technology and the limited supply, must have been agreed upon in advance. I don't see how that possibly could be true.

Find precious orangey-yellow metal

Mine for four years

"Hey that's not fair, you should share it with everyone!"

"Why?"

"Because it's shiny and I want it."

If you're hoarding something that you want the rest of the world to accept as a medium exchange, it actually would make sense to distribute it around a bit. Maybe by lottery and other types of gifting, and perhaps paying people for services with it. If I declare that my used underwear is now the currency of the future, it would have a higher chance of success if I'd already distributed it around the world and even promised to provide certain services or goods in exhcange for them.
https://i.imgur.com/cI2JRH1.jpg

Well, when you create a system from scratch it should be created fairly. they could also get 99% of the wealth and leave the 1 percent for the rest, would you still agree with that?
And people here talking about communism are mistaken. I'm talking about an equal starting point.
I know it may not be practical, but maybe it could have been thought.
It's like when you play monopoly, you give each one same amount of money.

So from what I understand the system is based on the idea that the earlier you start mining the richer you are going to be? and it decays exponentially?

That is a half truth.  The new coins from mining drops.  However, the revenue from currency trading will increase.  Also, the revenue from the miner's fee will increase as the volume of transactions increases and the rate of block mining stays the same.

You funny! So very, very funny!

http://i1109.photobucket.com/albums/h428/keithh409/chappeleRickJamesDirtyUpCouch.gif

There have been premined cryptocurrencies that failed spectacularly for the reasons you are outlining. Bitcoin was not premined so this argument fails spectacularly.

We're not playing Monopoly, my friend.

Feel free to correct me if I'm wrong.


So what do I have to do? keep the bitcoin software running all the time?

You are wrong. So very, very wrong. You stand corrected.

http://i1109.photobucket.com/albums/h428/keithh409/facepalm.gif

Wouldnt it be more fair to have your wallet shared equally to the world? (lol communitst idea)

ronenfe, you are free to create your own currency however you want. Obviously bitcoin is a good enough idea for all these people to be interested. If it had been created differently it may not have been as popular. Or perhaps your equal currency will be more popular. The beauty of bitcoin is that we are not forced to use it like the fiat currency the government forces me to use. You are free not to use bitcoin, and you are free to create your own equalcoin. Let us know how your new currency goes. :)

Yes indeed comrade, this will be to the benefit of the proletariat !


This Pleases me.

http://upload.wikimedia.org/wikipedia/commons/thumb/b/b4/StalinPortrait.jpg/220px-StalinPortrait.jpg

if everyone had the same amount of bitcoins it couldn't be money. Imagine if 2 people made a trade, this would cause one person to have more coins than someone else, which would then have to be corrected by the network in order to make sure they each had the same amount, which would defeat the purpose of having made the trade to begin with.

Maybe you should stick with fiat. It seems to work to your expectations. Just make sure you are among those who get the new money, that is, the banksters.

OMG I want Bitcoins! It's unfair! Give me Bitcoins!

You’re living in a land of make believe, with elves and fairies and little frogs with funny green hats.

Unreal

If you start mining now, you too can get them for free.  Well that's after you buy the equipment, invest the time to configure and pay for the electricity.  Save them up so that when each BTC is worth $1,000 in ten years, you can give them to people who cannot afford to spend the money, time and effort into getting them for them self.

I think what you have to realize is that everything has an opportunity cost and reward to it.  There are many people who put money and effort into other similar currencies and not made a penny off of them.

I'm sure you meant well, but I think a little more understanding of the history, current state and likely future of Bitcoin and alternate currencies will help you understand all of this a little better.

---------------------------------------------------------------------------------------------------------------------
NOTICE: I have no idea what the price of a BTC will be in ten years, I'm using the number as an illustration.

How would you equally distribute the coins to everyone in such a way that no one could fake the system into giving them two shares?

Of course the distribution will change afterwards, if not the money is useless.

You give each person on earth say 1 coin, then each one can do with it whatever he wants, some people then become richer and some poorer, but they start the same.

it could have been done like each one that register the system gets one coin, they can use a biometric identification to prevent registering more than once. I am sure this system should not be harder to implement than the current one.

Not each person on this planet owns a computer, or access to the internet, how would you deal with those? Not that equal anymore if you just ignore them.

And biometric identification? Are you serious, or just trolling?  :D

That idea is a better one than this overblown mining arms race we have going now. Those who don't own a computer can still use it by borrowing a phone/computer (yes they have those in the third world too - even some villages without electricity have cell phones that they might have to walk for many kilometers to recharge).

Birthcoin.

The devil's in the details though. What cheap, affordable and reliable biometric is there to use? Would we have to rely on government population databases?
And that will be true until the heat death of the universe. Some of the people investing in bitcoin assume that there's some mythical future where it will the only medium of exchange. That is silly.

No, he's complaining that it didn't start out more or less evenly distributed, and that a bunch of cryptocurrency nerds mined most of it in the beginning. It's a valid complaint from somebody who's considering adopting Bitcoin as a replacement currency, and that's one of the reasons why the current incarnation of Bitcoin won't be the currency of the future. It's only good as a niche payment system online.

Please could you send me my equalcoin now?  I feel I have earned it.

Those nerds that started this cryptocurrency got rewarded.
Those that keep the system running, by creating blocks and processing transactions that way, get rewarded.
What's unfair about that?

Why should anyone get anything for doing nothing?
And why would it be fair to give those that don't do anything the same share as those that do all the work?

I can't think of any way to initially distribute bitcoins in a more fair way than the one Satoshi came up with.

If I own a few estates around the world, a million acres of land, a few oil companies, am I still entitled to my share of equalcoins?

There are currently about 7.1 billion equalcoins in existence. You already have an equalcoin. There's just no way to spend it yet, since the equalcoin system
- doesn't yet have a way to publicly track transactions (except maybe through forum thread)
- doesn't yet guard against one person having several accounts

I hereby gift 0.000000001 equalcoin to ronenfe for starting the currency. (Transaction pending. Waiting for confirmation system to be programmed and deployed.)
The level of reward is too high - if you assume that Bitcoin will be THE currency of the future. Sure they would deserve to be paid for their work and awarded for their investment, but the people getting in on the ground floor holding nearly all the coins would be just another case of a ponzi scheme.

This is just based on the assumption that Bitcoin will be what we use in the future. If you instead consider it a niche payment system that nobody should be using as a store of value, then it's no longer a ponzi.

That's essentially what ronenfe asked.

http://www.ecology.com/birth-death-rates/
We have about 360000 births per day globally
We also have about 151000 Deaths per day globally
How do you handle those?
 

And that's exactly the point, we need a way to publicly track transactions and that's what so called mining does.
Someone has to do the work of tracking transactions, if you don't reward it, noone will do it.

When I (or any other super-early adopter (super, because we're still in Bitcoins very early days)) started mining, bitcoins were worth close to nothing, so I did work for close to nothing, just the same as people that start today, they will get close to nothing, deal with it.

You're under the false assumption, that early-miners earned a lot by mining.
They didn't!
IF they earned a lot, it's because they kept their coins, so they actually earned a lot by speculating, not by mining.

And I don't see how it's similar in any way to a ponzi scheme.
In a ponzi scheme those that come in early win, those that come in late lose, which is not the case here, those that came in early might have lost everything and those that come in now, or even later, don't lose anything.


It doesn't matter what people use Bitcoin for in the future, I'm not assuming anything here, I take it as it comes.
You want to use it as a currency? Fine with me.
You want to use it as a store of value? I'm ok with that too.
Why would or should I care? It's yours, treat it like you wish.

No, he didn't.
He wants anyone to get an equal share, no matter if they did any work, or not.
He's assuming that those that did the early work did nothing, which is clearly untrue.
He's also assuming that they somehow got rich doing that work, which is also untrue.

Lots of false assumptions flowing around here.

A lot of people put thousands of work hours into promoting Bitcoin and were reticuled by family, fired from their jobs and alienated by friends for constantly talking about Bitcoins and posting Youtube videos.

We owe them everything, the rest of us are just freeloaders.

How cute, a communist on a board of ultra-randians. That's like a vegan on a board dedicated to exchanging BBQ recipes.

How are you going to distribute the gold and other currencies equally too? We need CommCoin now....

In Soviet Union, Bitcoin mines you!

this times 1000. Those early adopters deserve every satoshi of their wealth. They laid the foundation for us all.

The people in the third world can login to the website from anywhere and get the coin, they don't have to own a computer.Newborn People over certain age will get a new coin, people that die will leave the coin, the total number of coins would not be limited and it will rise over time.
You all talking about people worked hard to earn those coins, I don't see how wasting electric energy for useless calculations that do not benefit the society called work.
We could also decide that each hundred jumps in the air will get a coin.
At least it could be something useful like starting global projects and each one will have to donate somehow there in order to get the coins.

I don't think you know what communism is. I'm not saying people can't be richer than others or have their own businesses to earn more money.
I'm saying the decided method on how the total sum of coins is distributed is not fair, and the only fair method is to distribute it equally.

how could you distribute the bitcoins equally, given that the Bitcoin system is quasi-anonymous? It's merely software and a protocol. There's no organization, bureaucracy or authority behind it that could verify real-world identities.

A hundred jumps in the air can't process a single transaction.

It seems you have no idea about how Bitcoin works.
Do some research, please.

The first people to use Bitcoin took a risk, and you didn't. That's why they have more coins than you do.

I did not dispute that those who process transactions deserve to be paid for their work and investment, but to say that they deserve nearly ALL the coins for being early adopters is like saying that banks are entitled to own all the money in the world because they invested in the infrastructure to handle and process money. They deserve something in return for services rendered, and the risk of investment, but when there's no fiat reason to use their Manhattan Chase Dollars, the market will reject that dragon's hoard and use a different currency, like the US Dollar.

The payment processors aren't doing useful work until actual economic activity takes place.
Actually, it's the ones who are left holding a stake when the ponzi collapses that lose. There are only winners until that point. Then it crashes down. If you sell your ponzi stake at a loss, you're not as big a loser as the ones holding the bag at the final crash.

He just wants a starting point, and that those who get more than one coin to actually have worked for them. In other words, somebody gave you coins for a service you created.
Distributed, not re-destributed.
They did not do any useful work until BTC were used for real transactions.
They either hold thin air valued at around 27 USD, or have sold their thin air for something more than 0 USD, so that's an infinite % profit on useless busywork.

So the inherent value of a bitcoin is tears and wasted electricity, you say?

More like a farmer on a board of breatharians.

Sharing all bitcoins initially is a very hard (impossible) thing to do. Think about it.

The current method, maybe not perfect, but it *works*. Better something imperfect that works, than some idealistic notion that can never actually be implemented in the real world.

Also consider the nature of bitcoin being peer to peer. You cannot simply "give" everybody a bitcoin. Who's to decide who gets a bitcoin and who doesn't? How is that decision made? The Pope decides? Then it's no longer peer to peer and is controlled or influenced by some person or authority.

I don't think you understand how technically difficult "sharing coins equally" would be. That's the key here: not that everyone would be against the idea, but that it's technically hard/impossible to implement what you suggest in a method that is actually "fair". ("fair" also being subject to opinion)

As it is, it works much like investing in a startup company. It's like we're investing in Apple or Google or something in the early days.

Also you have to understand that the possibility of the early adopters earning a return is a great part of why Bitcoin is now successful. It's successful *because* it allowed early speculators to earn money; they drove its adoption and popularised it. If that had not been so, maybe they wouldn't have bothered so much and bitcoin would have failed or just been a niche curiosity.

The most important thing to know though is that this method is technically simple, very transparent (read: even if it's not considered "fair" by you, at least it's *HONEST* and everyone knows precisely how it occurs, and can easily make the decision whether to use it or not), and also roughly parallel to investing and speculating in something which is widely accepted as a fairly honest method of wealth gaining or creation.

Any transaction in the Bitcoin-network is a real transaction.
Without that work, not a single transaction would be possible, so BTC could have never been used, ever.

That's the thing you guys don't get,
the process called mining is not about generating, or distributing coins, it's about making transactions possible and secure.


As stated a couple of times now, it's not useless work, it's work that keeps the system running.
It's work needed to be done by someone.
No work == No transactions == No payment system == No nothing.

Again, do some research to learn how Bitcoin works.

I'm not saying i know well how bitcoins work or convert it to my suggested system. I'm saying a different system should be used where there is an authority maybe, something like paypal,  with the proper monitoring to prevent cheating, this has to be thought and invented. each one can open an account and get the coin.
State currencies also not perfect but work. So we are replacing one flawed system with another flawed one?
The bitcoins system looks to me far more complicated to think about and invent than implementing my suggested system.
I think it a new method can be popular anyway even without the early speculators motivation because people should know how bad the current real money system is and will want a fair alternative, and it can be more popular than bitcoins because more people will join if they think they are not discriminated between them and the early joiners.

Rule it, regulate it, control it. What's next, tax the hell out of it? You seriously are lacking in the knowledge department.
Discrimination? LMAO

http://i1109.photobucket.com/albums/h428/keithh409/what-a-crock-of-shit.jpg

rofl i cant believe i didnt realize you were a troll till now

I thought it was not allowed to use the P-word here. Ban him!

Feel free to fork the code and attempt your view.  It's already been done, though, and it never made it out of the planning stages.  The design of Bitcoin is not arbitrary. There are many reasons that bitcoin is the way it is, and being different from central banking/fractional researve/national fiat currencies is definately one of those reasons.

The Bank of Canada is developing an electronic version of their currency, so it won't be very long before you get exactly what you want without the effort.  It remains to be seen if it will offer any real alternative to Bitcoin, though.  I have my own doubts.

No.  The ignore button is to your left.

I'm smarter than you if you waste resources on this system, this will never succeed this way. And what is a troll, somebody with different opinion than you?

It seems that you have now recognised that your 'fair' system is not Bitcoin.  Maybe now is the time to take this thread to the Alternate cryptocurrencies sub-forum.  Then I would suggest looking through there to see what others have come up with that could be more in line with your principles.  For instance Freicoin as I understand it only gives 20% of new currency to the miners with 80% available to go to charities/worthy causes.  If nothing there is to your satisfaction then see if you can, with help from others there maybe, come up with an alt that suits you.  


If you do manage to get over the technical challenges (courtesy of the generosity of Satoshi et al at least some of the problems you are likely to encounter have been addressed and are available for your use free of charge) then it is a matter of seeing if you really do have a candidate to do better than Bitcoin.

If you prefer instead to stick to the Bitcoin forums dissing it for some of the aspects many believe are central its current and future success then don't be surprised if the responses aren't exactly positive and encouraging.

All the best with it :)

Fairness is: Somebody has to pay for this!

So, let me rephrase that:
You don't know what Bitcoin is, how it works, or what it's good for, but came up with an idea that is somehow better?
How can you even decide that your idea is better, if you haven't understood the idea behind Bitcoin yet?

The whole point behind Bitcoin is, that it doesn't need a central authority.
You didn't even get that.

You have to do a lot of research.

No problem.  Fork the bitcoin code and start a new, fairer chain today.

I'm late to this party, but...
Someone may have invested - and risked - their $500 back in April 2011, you can invest - and risk much less - $500 today. It is perfectly fair. Furthermore, unlike dollars, euros, or dinars, anyone is welcome to start "printing" new coins under the same rules - doesn't get more fair than that. Finally, those who have coins can only enjoy the benefits by spending them into the hands of others - yours included.

So, think again. Bitcoin is much more fair than you thought.

How about you share some bitcoin with me, Prof?

For some reason, this unequal distribution is not stopping latecomers from buying up bitcoin like crazy.

Which has the interesting side effect of redistributing coins. ;)

Nope.  The system is based around the idea of an economy built on exchanges of bitcoin for goods and services.  Provide or good or service, and you can get some bitcoin.

(Mining is just a footnote.)

Oops, you just compromised anonymity.


Please, demonstrate.

If you want this, you will have to build it yourself, because the rest of us don't want it.

But, according to you, it's easy, so why don't you just implement it?

Please substantiate this.

You can get as many coins as you like, right now.  Like everyone else, you will have to economize and give up something to get them: time, energy, effort, resources, funds, ...

Also, the value of the currency will change over time.  So if each new registrant gets only 1 equalcoin, early adopters may get a coin that is worth 1/10000th of a pizza, while later adopters will get a coin that may be worth 10000 pizzas!  That's not fair, and not equally distributed.

I won't use that system, then.


I don't think "global projects" are useful.

The thing about useful is that it's a subjective opinion, not an objective fact.

(Hint: the calculations that block-generating bitcoin nodes perform are not there just to waste time, though you might have read otherwise.)


Distributed at what point in time?

Hypothetically, if there was some way to prove your identity, the system could be set up so that each person who joined the network would be given an initial 50 units (or whatever number you picked). Would that fix the OP's desire for an equal distribution? The problem is there is no way (that I know of) to keep people from claiming to be new people and collecting extra bunches of coins. Rememberhow there was a bitcoin fountain set up by Gavin, giving away 5 bitcoins free to anybody new to bitcoins? He quickly had to lower the amount given out and add various checks to keep people from abusing the system.

I won't use it, then.


You think it and invent it, then.  I don't want it, and don't want to put any effort into it.


Since it is so easy, you should get busy doing it.


Simply starting a new blockchain with the same rules as bitcoin, but now when more people are aware of it, might achieve some of what you want, and might even be a good idea.

By the way, I am not an "early joiner" of bitcoin.

I think the Freicoin (http://www.freicoin.org/) (crypto-currency with demurrage) and Ripple (https://ripple.com/) (peer-to-peer credit) projects were created by organizations that do intend some kind of more equal redistribution after a while. Maybe you'd want to check those out.

I was just about to suggest Ripple as something to look into. If I understand correctly, anybody can generate currency in ripple.

You are a troll because you did not bother to take the time to get even a basic understanding of the subject you are posting about.  You just posted an idiotic opinion specifically to get a repsonse from the community of this board

That's right I don't know much about bitcoins expect to what i read in a few pages, I know it doesn't need a central authority. But based of what I did read which is that one person has 250000 coins which is 1 percent of the total wealth, and others also have too much, I can still say that a fair system is one that nobody starts with more than the other. I don't see any moral justification in which the first comer get the most, and I'm sure other better ideas can be thought to fix that.
It's also true I don't understand the reason bitcoins production is decided to work this way.
This idea happens in all economies. I'm not talking about how the bitcoins exchanged later, I'm talking about the problem in creating bitcoins this way.


It's fair enough because he could keep the bitcoins and get the 10000 pizzas, it's up to him if he decides to spend it earlier or not But I don't think the value will be higher, the value should be constant if each person that starts to participate in the trade gets his coin.

A billionaire could easily wreck havoc on the entire bitcoin market, because there are individual people worth way more than the entire bitcoin economy right now! Doesn't sound right does it???


<<<< scratches chin.

What do you care what's my understanding is, I asked my questions here and people can answer, that's the idea of a forum as far as I know. You can open your new forum and ask people to take an exam before they are allowed to post.

I also can say you are a troll because you are an idiot, so?

Fixed that for you. Looks like you thing only YOU are allowed to comment, good luck on that one comrade. Time to turn your ignore to piss yellow. Yellow for the trolling troll.

BTW, I found your life story in the intarwebs:

http://i1109.photobucket.com/albums/h428/keithh409/img8012.gif

From your replies it looks that you are the one that didn't want me to post, caliing me things. So you are the communist that can't deal with other opinions, only by posting childish comments.

You're very much correct, but it's still very difficult to not be jealous of those people who made that excellent decision.

How do you feel about those of us with the luck to discover Bitcoin early, and the education to understand it's implications, but not the balls to invest all I *cough* <<we had?

I made a small investment in late 2010, and since then my bitcoin holdings increased in value by about 41,500%  If I had the balls to withdraw from my 401K and buy bitcoins then, I'd be that guy with a fortune close to 1% of all bitcoins.  

BTW, that is probably Satoshi himself.  If he is still alive, he deserves it.

You are not a troll because you are an idiot. A troll is somebody who makes inflammatory statements with the intention of causing others to react. While you may be making these outrageous arguments because you do not understand bitcoin, we cannot tell. Therefore, you should learn more about how and why bitcoin works the way it does, then you will not accidentally make statements which are trolling.

A guy named Alexander did something like this 1000 years ago. They still talk about him.

Sigh, you still haven't understood:
It's not the production that was decided to work that way, it's the way the system works, the production, or rather initial distribution of coins is a side-effect of that way.
Satoshi could also have chosen to simply create all coins from the start and give them away to anyone he likes, but he didn't, he chose to fairly distribute the coins among those that keep the system running.

And here's the better idea you come up with:
a central authority in control of everything,
a central authority to check your biometric identity to decide if you get some coins or not,
a central authority that has the power to dissallow you to send transactions to certain individuals (terrorists, wikileaks, enemies of the state),
a central authority that also has the power freeze your account and assets at a whim (because you're a terrorist, wikileaks, enemy of the state),
a central authority that most likely will abuse its powers.

That's why we need a system that is independent of ANY authorities, if you don't like it, use PayPal (although they won't give you any coins for free either).


Anyway, I suggest you read a bit more about Bitcoin, what it is, why it was deeply needed and how exactly it works, maybe.....just maybe you'll understand someday why people value it.
Sorry to say, but as long as you don't understand what it is and how it works, it makes no sense to argue at all.

Over and out.

When no actual economic activity took place, no it did not need doing. It's like holding a webcam show in your living room with 0 viewers, holding on to half your paycheck, and then expecting to be paid at the same minute value as when the webcam show has a million viewers. The models who are asked to potentially join the service and actually bring in the views might balk at that prospect and choose a different provider.

That's not a currency. That is more like a share of a start-up business. Why anybody started buying into the business at all, injecting real money in it, is some weird quirk of human nature.
Yet somebody is willing to give money for nothing. (And 2D chicks for free.)

It's the newbie forum, and it's a pretty obvious flaw with the whole idea of holding Bitcoin or running a node - or at least seen as such by a large number of people. Most of them don't even register here - they just reject it and move on.

I see Bitcoin as a proof of concept and as an alternative payment processing system, like Ripple or Hawala, but the overblown focus of mining is something that should be solved - or at least it should be better explained in a way that's easily understandable. I'm quite well educated, and understand how asymmetric encryption work, but I still haven't "seen the light" after quite a bit of reading, and I am skeptical of any belief system that requires "convincing yourself" of anything.

Sure, forks are well and good, but I wanted to understand the original. Plus ASICs are cool as a concept in themselves.

At the moment, bitcoin are futures in electricity wasting, ridicule and job loss (as brought up in this thread). Sure, they're being used for some transactions too, but it seems in the mentality of some that the actual economic activity is a sideshow to the mining.
I hope you don't work in marketing, because limited freebies are a great marketing tool. Note I said limited. You might be gifted your first Birthcoin at birth, or age of maturity, but that's the only one you'll be given by the system - you have to work for, or convince others to give you, any more than that.

You should have read my part about the central authority above.

It needs to be done, no matter what.
If I want to transfer some coins from my account to yours, our transaction has to be stored somewhere,
either this storing is done in a central database, run by a central authority.
or it's done in a distributed database run by everyone.

We chose the latter, the distributed database and we call that database "the blockchain".
To create that database, THAT is what mining does, it creates the blocks that build the blockchain and which store all transactions.
Mining is not about creating coins, it's about creating storage-space.
If we don't create that database, we have no space to store any transactions at all and all coins (no matter how they are created or distributed in the first place) would be worth- and useless.

Without the work done by miners (rather call them block-creators), we have not only no coins, we also have no payment system, we wouldn't be able to transfer anything to anyone.

Or the occcu. 


New Epic Fail Currency? 'Occcu'
 - http://bitcointalk.org/index.php?topic=62983.0

So, you admit you don't understand how bitcoin works, and you don't think it's a good system, and you don't want to use it.

So.....why are you here, exactly? GTFO, socialist.

I think you need to think about the points raised in response to you much more carefully, I don't think you understand the reasoning behind most. I have some questions to you, which may help us communicate better.

Imagine that you will now start this new currency you've been imagining. And let's assume you have the power to overcome the immediate obstacles like having to spend billions to implement some identification scheme that has never been done before. Now imagine how you would start.

How will you deal with cheating? How will you deal with the problems that centralization brings? How will you deal with the fact that the conformity of all individuals to this system will ultimately be used against them?

I'm not saying you can't. I'm just asking how you imagine to deal with these. What would be your strategy? Which technologies would you use?

People have been thinking about these problems for a long time. You need to look up and try to understand the reasons behind the continuing effort that led to the invention of Bitcoin, and why it can't solve what it doesn't. I recommend reading about why's and how's of DigiCash, and why radically different efforts like Ripple are too hard to implement (it was eventually implemented to a satisfactory degree, so I recommend you have a look at its internals too, if you have time).

Besides the technical difficulties mentioned above, and most importantly, what will you do about the fact that all the money you distributed fairly will very rapidly consolidate in few strong hands? (Consider free voucher privatization during Catastroika.)

You have no shoes, I give you a "token" which is worth exactly 0, since you can't exchange anything for it. Someone comes to you and offers you shoes. You are glad that you got rid of that useless token. After "the emerging elite" collect enough wealth to have the incentive to develop an ecosystem around this coin, its value increases rapidly and you begin calling "unfair".

That is, if that someone ever came to exchange shoes for it. If it never happened, you still would have no shoes, and everything would be "fair".

So, yes, even if you could implement it, your system would not be fairer than Bitcoin, and has massive disadvantages.

Of course, you could, instead of waiting for someone to come give you something for the useless coin, help people with their chores in exchange for their useless tokens. Then you would be the emerging elite.

But where is the incentive? Why would you even waste a second to get any of those tokens that are exactly worth nil? What is stopping another party coming in and issuing same sort of tokens? Anyone can do that? Hence, the tokens are infinitely worthless.

So either you take the risk and put your effort into this instead of something else, or you don't. In this case, putting effort into this might not be worthwhile anyway IMHO. Maybe I'm wrong and then deserve to miss on it. In Bitcoin's case it was. There are many things you can do in your life and most would not be worth it.

Think for a moment that there are millions of different ideas all over the place, all of which are made readily available to you. Some are the next big ideas that will change the world. Some are not so much but might make you wealthy. Huge majority are worthless. The way society deals with this problem is, reward people who pick the right ones. Why are you so against this?


S/he might be here to criticize and discuss. Why not? Besides, why is being a socialist a bad thing? Though I agree that criticizing without understanding here might have resulted in wasting everyone's time.

remove the words "might have" from your last sentence, and i think it would be far more accurate. :-)

Discussion and reasoned argument are fine, but the OP is just blathering on and on, with no real basis for their stance other than "bitcoin isn't fair".  Regardless of how they rephrase it, expand it, or try to wrap it in philosophical twat-waffle-ry, their argument just boils down to "bitcoin isn't fair, because I say so." 

Well, some aspects of socialism aren't "bad" in and of themselves, but too often socialism is equated with communism, which sparks the democracy fire in us western-culture children. :-)

If Joe and I go to work in the fields picking peppers at $5 a bushel, and I bust my ass and pick 40 bushels of peppers, while Joe fucks the dog all day and only picks 10 bushels of peppers, yet at the end of the day, the bossman averages it out and pays us each for 25 bushels of peppers, how is that fair? I did $200 worth of work, while Joe only did $50 worth of work, yet we end up each being paid $125?

Likewise, I don't think the early adopters of bitcoin should feel guilty about having the foresight and the courage to invest in its potential.  They saw something and said "this could be fucking HUGE", and they are now being rewarded for it.  Good on em.

Anyway, tis a silly discussion from post 1, and it's gone circle several times in 5 pages, and is no further towards making the OP any smarter, so I'm out. :-)

Decentralize what can be decentralized. Only centralize what must be centralized, such as internet address space, and maybe approval of new versions of the software. If one were to make an elaborate protocol, it might even include several government- and privately owned identity providers, with strict checks and balances, and ultimately a market based approach to who is trusted and not. (Think ratings agencies and auditors checking the inner workings of the companies, publishing their reports about them, and the market deciding who they consider most trustworthy.)
Well, unfortunately, the reliance on biometry or other unique property means that there must be some tie to the individual. Sure, it could be a one-way hashing function just to check that you're not the same person as somebody else, so you couldn't easily go back from hash to individual, but even so that ability to tie one person to a coin makes it only half-anonymous, like other *coin forks. (Say, somebody forcing you to use the biometry and hash to check if you did a particular transaction that somebody didn't like. Even an unbreakable hash doesn't protect you from that. You could only try to claim that it was a hash collission.)

Coins will indeed accumulate to those who provide a useful service/product over time. Isn't that what we want? The slight inflation caused by population growth, an the fact that those who provide services also have expenses, will help prevent excessive hoarding. Saving is fine, but if one guy ends up with 99 percent of the currency, it might as well be his used underwear. Or he could be the king and declare it to be the fiat currency of the land.  ;)

No, they actually provided somebody with things of value for those coins. That's fair - to the guy you gave a free token to. Only communists or greedy entitled people* don't agree with that. What would be unfair is if it turns out that these tokens are actually worthless. Then those "rich" people who accumulated them by providing value to other people have gotten a raw deal. They've been paid in Ponzi scheme stakes.

So it's the ones who provide services and sell real currency for your worthless token that are getting scammed. And because they don't want that kind of unfair treatment, they don't won't buy into your ecosystem. Sure they'll accept free tokens, but drop them like a hot potato.

*: I know, redundant.

In my mind, those are exactly the originators of all potential problems. I was already assuming the transactions were decentralized.

Even if you distribute the issuing rights to entities that are unlikely to be influenced, there is no way to guarantee that these rights won't in time consolidate in the States' hands.

This is exactly where the idea of using proof-of-work for both verification and issuing shines.


You could use blind signatures to make untraceable transactions. This, of course, introduces another centralized point, but it's almost instantaneous. OpenTransactions would work just as well for this.


Let's call this currency FairCoin. Are two pizzas an adequate service product for 10,000 FC? Should they cost 2 FC? 2 million?

If the accumulation is rapid, how would it differ from Bitcoin? Much worse actually, since you can't be re-born, but you always have the opportunity to mine.

You have to be able to centrally dictate the price if you want the accumulation be as organic as you wish. That's why I gave Catastroika as an example. Even though those vouchers had value, they rapidly accumulated in mafia's hands. Imagine if they had no initial value.

This is how all investments work. Get in early and assume greater risk, if your investment is sound then you benefit more. For example, it's too late to buy microsoft stock.

I read about it, but still didn't know how it works completely, because it's too complicated system. But I read enough to make my decision, after I saw that some people got a lot of coins , which discouraged me from using this system , so I asked and said that I think it should have been distributed equally.

And people who use uncivilized words like you and some others here should be the ones to GTFO.

Excellent post.  This needs to be repeated by people explaining the system to newcomers.

I love this paragraph.

Socialism and/or communism are bad insomuch as they are implemented with the initiation of force.  If you implement them without force, they are fine.  In other words, if you give people the right to opt out (analogous to the way Bitcoin doesn't force anybody to use Bitcoin), then there's nothing wrong.  Most families practice socialism internally to some extent, for example, but families typically don't force people to be members, at least after a certain age.


That's still fair because it's the bossman's peppers and he can do whatever he wants with them, and you can go work somewhere else. :P :)

The distribution method used in bitcoin is an attempt to address this problem. Basically miming profits are payment for the work of hashing. Anyone can participate, and in the beginning you could mine with a basic computer in any country. Even now anyone can get into the game. The bar is higher, but still achievable. For the price of a car you can buy mining equipment and start.

I started buying at $0.74. If that seems unfair then consider the risk I took. Back then there was no reason to be sure that bitcoin would be anything but electronic Monopoly money. Today they are $29.00 because they are much more established, used, and understood. That's a fair system.

LoL. Well, I suppose that's one way to look at it. In a real socialist paradise, Joe and the bossman would both end up on the bad side of an icepick in the ear some dark and stormy night.

Between all the people on Earth?

Who would administer such a bureaucratic nightmare? Who would pay for it? How would you prevent fraud and corruption (eg. people creating multiple identities in order to claim multiple shares)? How would you achieve this without a central authority? How would deliver the bitcoins to the 1.4 Billion people on Earth who don't have electricity, let alone an internet connection?

Even if this mammoth project was ever achieved, the "equal" distribution wouldn't last long.  

A similar idea has been attempted after the fall of the Soviet Union.  It terms of achieving a sustained equality, it failed miserably.  See:
http://en.wikipedia.org/wiki/Privatization_in_Russia

The aim of bitcoin isn't "fairness", the aim is a resilient decentralized payment system. Whoever contributes to security gets rewarded, simple as that.

 

Here is a much much simpler system.

Instead of trying to "be fair" by divvying up one cryptocurrency among all people regardless of the wishes of those who started that currency up in the first place, lets give anyone who wants one an entire cryptocurrency of their own!

Anyone and everyone can have their own personal cryptocoins!

Luckily for this grand plan RIpple.com migiht let me say "the IOUs you issue on Ripple are those personal cryptocoins!" otherwise I might have to face objections about four bytes of connection handshake magic bytes or four bytes of port number space isn't enough to sufficiently differentiation each and every person's blockchain-based personal currency to keep them from colliding when connecting...

So go ahead, start your own cryptocurrency! Issue them as fairly or unfairly as you wish!

It is unfair, however, to insist that others should distribute theirs according to your preference rather than their own...

-MarkM-

Do you avoid Apple products because some people got in early and made a mint in Apple shares?

Do you avoid gold, because its price fluctuates sometimes? Do you despise people who bought gold when the price was low, and do you vow never to buy or handle any objects made of gold because of that?

If some rival businessperson has the foresight to invest in some new technology and their business gains more custom than yours as a result, is that unfair? When you finally realise that the new tech has merit, should you be retroactively compensated?

If you don't agree with all those things: How is this any different?

Also:

Say your magical FairCoins were given one to every person on the earth. Maybe they start with zero value, maybe they start with a certain value, that doesn't matter. However the point at which you decide to sell a product or a service for FairCoin, and you receive another FairCoin from somebody else, you are giving more value to a FairCoin. (Previously you could buy X different things with FairCoin, now you can buy X+1! To everybody that desires your particular product, FairCoin's subjective value has increased). So the people that trade early in FairCoin will likely be able to command a higher amount of FairCoin for their products than those who come later. (Just like Bitcoin!)

Or maybe the FairCoin will go bust, and drop in value. Either way, the value *CHANGES* and doesn't stay the same; either the early adopters will win and the FairCoin will increase in value, or it will fail and everyone will lose. (The early adopters more so, since they sold actual products for it and are now left with worthless FairCoin).

So I think it's entirely possible that FairCoin would have the same "problem" that Bitcoin does. Maybe not quite to the same extent, but you would never know, because you can't control or predict these things. You would have a new hindsight and be trying to re-invent FairCoin. And again and again, each experiment giving a different result...

Ok, I want to ask a question, suppose you and 99 other men are living in a different planet, until now you trade things.
Suddenly you come with the idea it will be easier to use money instead of trading, everybody agree with you.
You all decide to create 1000 coins, now you want to share the coins between all of you. how many coins each one will get and why?

It's not the same, I don't mind people buy things that get higher value in the future. This is not the case here, Money doesn't have a value on it's on, it's the ability to get things from it, that give it a value. This is about a currency system that wants to replace the current one, now people can decide if they want to cooperate with it or keep using the current one, and if people feel that the system made in such a way that some people will be richer than the others only because they invented it or were the first to join, people won't want to join it, and if people won't join it this system can't live, and the people also know they can harm the system by not joining it.

It's not the same if the value of the coin changes in the future, because each one has the right to keep the coin or use it later, but they all started with the same point, and anyway it's not clear if the early users lose or win, it depends on how the coin value will stabilize, in any case the difference won't be that high as now.
Think about it, half of the coins in the world are already mined, they are held by how many people? 0.00000001 percent of the world population? Do you think people can accept that? If I use my example of the other planet, it means just for demonstration that 2 people of the 100 will get 450 coins each and the rest get 1 coin.

I believe the upside outweighs the head-start some users got.  Considering it's extremely difficult to spread the wealth of a decentralized currency, it's a lost cause to begin with.

People who wont use bitcoin because it's not fair that others have more, do not understand investing. With that logic I should never buy gold because I'll never get the deal my grandpa did in the 1940's. I also know people with way more money than I. Some of them received it in very unfair ways and even avoided taxes I had to pay. But the money I do have is still valuable to me, so I'm good.

Not only do you not understand Bitcoin, you don't even understand what money generally is.  What you want to do is literally impossible.  Yet, you are free to try it on your own.  We wouldn't try to stop you, although a great many of us are going to be quite amused at your attempts.  If you're right, you'd be a hero.

But you're not right.  Currencies are an amoral tool.  Nothing more, nothing less.  The fact that you disagree with how this one was designed makes no difference at all.  Are you going to claim that you do not use fiat currencies to live?  The nature of those currencies are far worse than anything that you imagine that Bitcoin may be.  That is what the alternative actually is.  What you would wish for is immaterial unless and until you, personally, make it happen.  Right now, what you want is not a choice, and no matter what you say on this forum, Bitcoin isn't going to change to suit your illusions.

From an agnostic standpoint, I would distribute it equally. What's the relevance to the subject? Have you read my post and at least pondered about the questions?

Now suppose that the coins you decided to use had to be manufactured in an expensive process to prevent counterfeiting. When this became known 95 of the 100 people involved decided to not bother. As time passed more and more of them joined in and worked hard to create more and more coins.
Now some guy in the 20 who never bothered working for it decides it would be more fair if he gets a cut out of the work everyone else did "just because".

Right.  He wouldn't want it if it had no value, as he assumed prior.  Asking someone to give you wealth because you didn't know it would be worth something in the future is not fair at all.  The argument that nobody will adopt the coin because people are wealthy (and presumably not spreading any wealth, which obviously means no one is adopting the coin) is just his misguided observation.

But people are joining.

If you think you have a better way than Bitcoin, by all means, start your own coin and see how many people are willing to adopt it.  I for one, would not. But don't let that stop you!

Not gonna lie, I'd rather have someone with enough insight to know Bitcoin could amount to something be on the top ladder in wealth, not someone who was born with a silver spoon in his mouth, shipped to an ivy league school, and guaranteed a spot in power for future generations.

This is a very good argument. Bitcoin is not backed up by any government or body. its a crypto currency which people just decided to use on their own and not the first one.
It would be easy enough to create your own crypto currency called sovietcoin (or sharingcoing) which you distribute equally amongst all people. Go ahead and do so

Also: Bitcoin (unlike the hypothetical sovietcoin) was specifically designed to protect against governments run by people with the opinion of the OP. It is designed such that there is no issuing body that can start redistributing it or printing money willy nilly. Its the only reason anyone uses it in the first place

First of all, I have never said people should give their coins after they had them, I said that originally it should be equal share.
This is not the case here, the work is invented in purpose and could be avoided. In any case lets say that only 5 people willing to participate.the 1000 coins should be distributed between the 5 people that wanted to participate, each gets 200 coins. How will they decide the value of each coin? I think they will have to experiment with it until it's stabilized. later comes another one that wants to join,  they can create him another 200 coins.

So how do you stop person #6 coming by and joining another time and another time and another time and a 50000th time in a pseudonymous environment?

This fundamentally cannot ever be bitcoin, bitcoin is not designed that way.

However I had myself imagined something similar as an improvement to the existing fiat system of many countries.
As long as it is tied up legally to be near impossible to change (tied up legally so the ratio cannot be changed without 95% of eligble voters voting yes on it... not 95% of people who make it to the polls... so you first have to convince everyone to go out and vote... the 2012 US election had slightly under 50% turnout amongst eligible voters according to my math from data taken from census).
That is, new currency is created OR destroyed by the government until total currency matches 1000$/citizen alive. If population expands government supplements taxes with printing. If population contracts government must spend some of tax money to destroy money. With a built in cap to only change 10% a year.
The difficulty of changing it will protect it from moronic temporary politicians who don't understand you can't muck about with currency with impunity.

And I don't think this can ever be an alternative currency. You need to know exactly how many people are involved and if the issuing body isn't the government then who gets the new coins? every wallet? if that was the case then many people will create a million wallets for the free money.

aaaaaand right here. This is the point where the Ignore button comes into play.  You want to just create currency whenever someone decides they want to be part of the economy? Do you have any idea what that does to the economy? Go read up on Zimbabwe. A prime example of a country trying to money-print its troubles away. The Soviet Union, same thing. They kept printing rubles after rubles after rubles, till people were wheeling carts full of bills to the store to buy a loaf of bread. The 'create as needed' method has been proven to NOT WORK. Currency has to be backed by SOMETHING. With fiat, it's backed by governments, by reserves of precious commodities in vaults somewhere, etc. With bitcoin, it's backed by the network, the blockchain, the work that the entire bitcoin using community contributes to the health and promotion of the bitcoin economy. Every time I send 0.10 bitcoins to bitmillions.com, i attach a miner's fee (generally 0.005 for small stuff, 0.01-0.05 for bigger more important transactions), contributing to the network and to the blockchain, keeping the wheels of cryptoindustry greased.

That's what backs bitcoin. The common effort of every bitcoin user to sustain and nourish the blockchain.

Well, those examples are not exactly the same because they created an infinite amount of fiat money.
the 200 in his example was an exact 1/existing pop. As long as they actually DESTROY currency to match citizen count as well as create then you end up with a system less stupid then pretty much every fiat currency in the world right now where they just print money whenever they feel like.

That being said 'less stupid then current fiat system" is not the same as "smart"

The biggest issue is with the idea this could be applied to bitcoins, ever. Bitcoins are not printed by a government who mandates their use; rather bitcoins are are a cryptocurrency based on cryptography that has to be manufactured. You can't just "create" more currency per wallet created in bitcoin. And even if you could it would be insane due to fraud (single user creates a million wallets)

Work in, work out :)  None of this welfare rubbish.

Money is not fair. Nor is it ever equally distributed. If it was, I'd quit my job and become a bong tester. Inequality is also the incentive to do more.

No, no and again no!

You still don't understand Bitcoin.

The work can NOT be avoided!
Even in the far future, when all <21million BTC are created the work still needs to be done!


Did you even read anything posted on the last 6pages? I guess not.

The work is invented on purpose... Key word is PURPOSE rather then "for the lulz".
The "invented" work is also known as cryptography and its purpose is to stop anyone from printing infinite coins as well as to ensure the system is unadulterated by fakes.

Its bad enough when the government is printing infiniate money, give that power to every citizen and you got a worthless "currency".
Can you come up with a way to ensure every living person only has 1 wallet? (answer: no... unless you are the government and institute some strict biometrics)

Your idea sounds interesting, I'm not against a centralize authority, and I came to realize that with bitcoins it can't be accomplished. I say I think it's the right and logical system, and such system is possible and simple.



I meant that the work is needed because that's the way they decided the coins can be achieved. They could also decide to create all the coins in less time, maybe using different algorithm, couldn't they? But again It's true I don't understand completely how this work this way and why.

You meant that, yes, but it's wrong.

No, they couldn't.

Yes, they could decide to create all the coins right from the start, with the first created block, or even within the genesis-block,
but the work needs to be done anyway.

First time that I agree with what you say, well, not totally.
You not only don't understand completely, you don't understand it at all.  ;)

The how is cryptography (see bitcoin wiki for detailed explanation)
The why is to prevent fraud

And even if it was equally distributed, it would immediately become unequally distributed. The hard question is how to create prosperity, not how to spread it around if you assume it magically appears in abundance.

+1

@ronenfe: What you are doing is unfair. Many people with in depth knowledge of such systems have spent a lot of effort to explain the situation to you, but you refuse to get informed and present your opinion in a more enlightened manner. Perhaps if you did the proper research, you would even change your mind. Instead you still only respond to bits and pieces you understand with your current degree of knowledge. There is nothing to be gained here. I don't think you are a troll, but mostly unkind and unfair. Over'n out.

Bitcoins ARE shared equally. Anyone and everyone is welcome to contribute, use, and mine - under equal conditions. You can't do that with dollars, euros, gold, uranium, diamonds, sea shells, or potatoes. You can with Bitcoin. Bitcoin is intrinsically fair. Also, this thread sucks ass.

IF Bitcoins was shared equally then everybody would have them.  Then what would be it's value? 

I don't get it. How are bitcoins and gold different in this regard? Anyone is free to mine gold too. And everyone doesn't have an equal opportunity to mine Bitcoin. For example, some live in areas where electricity is drastically overpriced.

No, not everyone is free to mine gold.  One must have physical access to the land, and the ability (legal and physical) to tear up the landscape.  This is not true for at least 80% of the population of the Earth.

Exactly. And to mine Bitcoins you need access to power, GPUs, Internet, and so on. But you are free to acquire these things and mine, just as you are with gold.

If you want it more spread about, I hear Freicoin (http://www.freicoin.org/) is lovely this time of year.

From reading the OP one would guess Freicoin would be a nice compromise between something that has a reasonable chance of working/succeeding and the impractical ideals expressed in the OP shared by others who hold a similar concept of 'fairness'.  However although I for one mentioned Freicoin a good while back in this thread it appears by now despite the efforts of many who understand and explain these things pretty admirably the OP is more interested in bitching about Bitcoin and coming up with the obviously-fairest-system-that-nobody-has-already-thought-of coin than in learning what's out there and how and why it works as it does.

 ::)

Smoke and mirrors also have their purpose. Actually I would value a financial instrument backed by lulz (comedy gold) higher than an instrument that essentially represents humiliation, jobloss and wasted electricty (actually to more mean spirited people that would represent lulz). The only rational actor I can think of who would actually invest in it long term, would be the power companies in markets with many miners, or hardware manufacturers, if they could use it as a instrument of electricity waste and hardware futures.

Note that I'm talking about bitcoin as an investment here - I'm not knocking it as a transfer system for quick payments. Only intraday stability matters for that.
Fraud is rampant though.

More importantly, once the security is high enough that the computational difficulty to break it would need much of the output of the sun, throwing more computation at it is useless. It might as well be backed by proof of jumping up and down in your living room.

It just becomes a game of chicken where those who can keep mining going for the longest can try to keep the value up, but then the last guys get stuck holding fantastically secure tokens that nobody else cares about, specialty hardware, and an electric grid connection that's ready for Vehicle-to-grid or starting their own mini power plant. Hopefully they didn't spend too much fiat in propping up the value of BTC to make their mining investment profitable.

Isn't that what Bitcoin initially tried to do? If every computer owner in the world could easily process transactions, without having to invest in specialty hardware, I'd imagine that the system would be more robust than one that encourages consolidation of "mining" power.
Even if governments get involved in some capacity, that doesn't mean that we give the control to ONE government or ONE corporation. The free market would still exist, and devalue the real value of a currency if they think there is a lack of transparency, or fraud.
You could make it illegal to control more than one issuing authority. Besides, the problem of over-consolidation also exists with the current Bitcoin protocol.

About 420 000 usd per btc, or 2.4 uBTC per usd.

(Taking a rough estimate by pulling numbers out of the air: currently 30 usd per btc with (wild guess) 500000 users, multiply that value per user ratio by world population of 7 billion)

Yes... that would be "fair".  ::)

 Thats were comunism failed. We are not all created equal, some people have ideas, some dont. Some have seen future in this project, rest didnt care. So the one who were early adopters should be rewarded because they made it available for others.

That, you can't do with a decentralized protocol.

Bitcoin can become anything of course, the system itself depends on some assumptions about society. However, at that point you need to give practical details about the proposed protocol so that we can compare the assumptions that we need to make for the systems to function. Bitcoin does not assume a lot of things most of the proposed systems that I've examined do, and that is its main strength.

There's all kinds of cool things you can do if people put you in charge and gave you a gun. But you have to take people's freedom away to do it, and that's an awfully high a price to pay. The challenge is to come up with ways to make people's lives better than don't require people to threaten each other into going along with the scheme. Ideally, this time no one would have to get nailed to anything.

Can we at least agree that whoever ends up with a gun and in charge take the Kardashians out back and shoot them?

No. Stupidity is not a crime.

True.  It's too great an asset to the nation's leaders to ever be illegal.

It's got nothing to do we them being stupid (clearly, they're not - they are very savvy and good businesswomen). They're just odious ;P

Why not? If you break that law, you can send those who break that law to prison or make them sell it, like anti-monopoly laws already do if one person gets too much control. Or the market rejects it. Even if the protocol doesn't know who owns each node, if it's transparent it is a matter of public knowledge and either governments or the free market can see that undesired centralization is going on, and react accordingly. It doesn't matter to the protocol if it's hosted in Soviet Russia or Ayn Rand Planet.

This is a social and political thing that an amoral protocol doesn't care about. The legal and political context will decide whether the protocol is successful though. A perfect technical solution to a non-existent problem will still fail to be accepted. Likewise a bad protocol, even if supported by all the guns in the world, will also fall apart and fail.

I'm sorry, I thought you meant subject to miner votes or something by the word "illegal". You are really talking about using State power to enforce legality? How is it not centralized? How are 10 entities threatened and dictated by one entity different from a single entity?

I'm talking about that even without government control, the market will vote with their feet and abandon the currency en masse, and choose an alternative that's more worthy of trust.

An untrustworthy* central entity holding all the identity power is just as bad as one untrustworthy central entity owning all the coins.

* If you can trust the central entity, then they can back the currency by fiat anyway.

I also have zero interest in any system that requires trust. If a centralization of BTC took place I would liquidate and look elsewhere, as bitcoin would be dead.

If someone wants a centralized currency...
Dollar, Euro, Won, Yen, etc etc...
The whole goal of bitcoin isn't crypto... crypto is the MEANS via which the goal is achieved.
The goal is to decentralize it.

Or you have to trust the system itself, so you can't use any system. Even if it's just the hardware and software involved, you can't inspect every CPU gate and line of source code. And you trust the infrastructure to be there for you.

I prefer to use a risk-based approach to trust: Only trust something as much as you have to, and if the disparity between risk and required trust becomes too great, use various strategies to mitigate or reduce the risk. (For example, escrow, audits, security guards, two separate keys, etc.)
Well now you know how the thread starter feels. He sees the current incarnation of BTC as centralized on the hands of a few people, and with no compulsion to reward them for being "reticuled by family, fired from their jobs and alienated by friends for constantly talking about Bitcoins and posting Youtube videos." as Luno put it (https://bitcointalk.org/index.php?topic=144956.msg1539204#msg1539204).

He may see it that way, but that doesn't mean it is that way...

As was pointed out nine pages ago, he can start a new cryptocoin with only a modest investment of effort, and make sure it gets more publicity earlier on, this time.

It's true I have to trust the system and the hardware. But I find my computer far more trustworthy than even my closest friends.

If it hasn't been mentioned before, OP, ripple is trying to spread 50 billion ripples evenly among as many people as they possibly can.  I think that's about as close as you'll ever get to what you want.

Consider the context, and how it would change if a cryptocurrency were to gain substantial traction. Hardware, or even the network itself, might no longer be something you can assume to be trustworthy, or even to be there.

Criminals, corrupt officials, or government groups, might have incentive to attack the system if it gains traction.

Some components are only made in one or two factories in the world. There might only be one actual network provider in one area (even if by resale you pay your infrastructure bills through another company). Transparency is good - such as release of source code and perhaps circuit diagrams - but as complexity increases it becomes hard for the individual to inspect it and put 100% trust in them.

By the way, it's sad that you'll trust the weakest link of thousands of people across the world who built your computer hardware and software, having millions of logic gates and lines of codes where intentional or unintentional security risks might be lurking, yet centralized in a few companies, over your friends.

Of course, all of these problems would have to be solved just as much by an equalcoin/lifecoin/birthcoin system, so it's not an argument for them being better than Bitcoin v 1.0, but it is an argument for that you can't eliminate all trust in somebody, so you have to veigh paranoia with utility. You have to land somewhere between supersafe but useless, and total unsafety.

To modify the Einstein quote, eliminate as much need for trust as much as possible for it to work, but no more.

i could use some extra

They are shared equally, equally based on percentage of effort putting into mining it. If every single person got exactly the same what would be the point in buying anything other than a single GPU to mine with, meaning also no coins would be found?

Sadly it would not work.

Since I have 0 btc, please share with me equally exactly half of whatever coins you have. Be the change you desire!

1FauWGhoQ5Vo72kKu8m4psZmrf6c8joKx6

Thanks!

He doesn't have any, which is why he's advocating for change!

All I can say at this point is:  THANK YOU RIPPLE IN ADVANCE FOR SHARING 50k XRP WITH ME.

Then he can send me his dollars.
Anyone who is advocating equality, please put your money where your mouth is and redistribute your own funds.

Again, he's not arguing for re-distribution of wealth or the re-destribution of coins. He thinks the system should have started out with a base already in place. In a way it did, except that base was 0.

The Ripple giveaways are interesting to watch in this regard. If the giveaways after Bitcointalk progress to places like the streets of Mumbai, rock festivals, knitting forums, newspapers, etc. that might help get that intermediate "currency" into the hands of diverse enough people that it might help it gain momentum. I hope they emphasize its use to convert between currencies and send money to people, rather than as a "get rich" scheme.

Yeah that's the disconnect.  Doesn't help that ripples are disguised with a three-letter abbreviation similar to the other currencies, either.

If I were to hazard a guess, I'd say that he doesn't have many of those either.

Yes, it's arguing for what Bitcoin should have been that makes his whole premise ridiculous.  Bitcoin is what it is.  You want something that works differently then be part of creating/promoting that.  Bitcoin obviously isn't for you.

Oh sure, it could be used to process payments for various business, so it could be for me in that way, but not something that I'd sit around accumulating.

If there's no worm / incentive for the early bird, then things never happen.

I think it's as fair as it could be that people get compensated for inventing things that deliver UNIMAGINABLE VALUE.

Also, there's no such thing as "fairness."

Full Ack!
If BTCs are going to lift off (public acknowledgement) then everybody will get its share(by banks or whatever) if OP believed in it, he would buy them, if not , he should just go away.

He could start an "Occupy Bitcoin" movement.

All good points man.  :)

There certainly is fairness.
Its just that fairness doesn't mean everyone enjoys the fruits of other's labors.
Bitcoin is fair. This is why people use it and this is why people want to make it unfair via redistribution

No.

Fairness is a subjective valuation.

Justice is not, which why justice is often harsh.  Bitcoin is just, and it can't work any other way.

fair·ness [fair-nis]
noun

the state, condition, or quality of being free from bias or injustice;

nice try.  they are synonyms.  get over yourself.

Nothing gained: Neither bias nor justice or its opposite injustice can be determined without a subjective valuation.
Just because lots of people share an opinion doesn't make it insubjective.

If you want to make things "fair", you have to invent some sort of mechanism for creating and verifying identity, or else you'll be vulnerable to a Sybil attack (http://en.wikipedia.org/wiki/Sybil_attack). Since some of the main selling points of bitcoin are its pseudo-anonymity and proof of work system, which require no trust, sharing BTC "fairly" isn't really possible without fundamentally altering the protocol itself.

Sorry to bump this awful thread, but it's interesting to observe the exact scenario I explained here happening with Ripple's XRP. People who think it will be useful in the future are buying them in bulk while ones who want to make a quick buck sell everything they've got (minus the 200 residue left in accounts).

In the end, even if you distribute FairCoin to everyone on Earth equally, they will, within a blink of time, consolidate in the hands of people who believe in it. They will be the early adopters. I think all in all, assuming it became as successful as Bitcoin, early adopters of Faircoin would have a higher percentage of total coins than Bitcoin early miners.

This is not a bad thing at all. Only that the ultimate consequence of this idea must be blatantly clear. Faircoin would be a misnomer, or a reference to an irony.

No, most of them would sit unused by people who don't know what they are. The real losers in this case will be people who signed up just to sell off their coins, while the winners would be those who wait to join until they've actually become useful for something.

Of course, this is all depending on if the coins ever will become useful. If they never will, the masses are none the wiser, and the true losers would be the ones who bought coins in the beginning.

Not early adopters, but those who sold too low or bought too high - as in any market.

Sure, within Bitcoin the early adopters are king of the hill, but when Bitcoin itself is mostly rejected by the market for this exact reason - among others - that's not so great anymore. Mining Bitcoin could be compared to working to buy one of those certificates that says you own a particular star, when in fact possession is 90% of the law and there's an international treaty against making claims in space.

It IS fair. My concept of a fair competition is that it presents equal opportunity, not equal consequence.

Bitcoin!

Why do you think that? Strong hands have an incentive to reach those who are uninformed, and they would be the biggest losers in the game.


By early adopters, I meant those who bought too low.


But the competing idea isn't any better, you still have the great minority owning great majority of coins. Also, I didn't get the analogy.


Exactly.

Wouldn't it be more fair if the bitcoins were shared equally?

let me think.. No.

Wouldn't that just mean that there's more incentive for people to market the new currency, leading to more public awareness of it? Sure, a couple of mooks might be tricked into selling their windfall far under going rate, like those people taken in by various gold buyers today and tricked into selling valuable gold jewelry for below scrap value, but it would definitely lead to word of mouth and mass media attention about why this is valuable.

Whether it's high or low, they don't know yet. When I talk about early adopters, I mean people who actually adopt it early. As in people who start actually using it for useful things before most people, not just people who staked a claim in fantasy property.

Not unless the original owners willingly sold or gave away their original stake. But you are on to something here: The rest of the world could just sell their coins to the early speculators, and then go start their own fork. The fork that would win would be the one that is actually used for useful transactions.

Ripple has IOUs in the mix, which changes the game. Now there's actually something persistent and tangible that gives the system inertia.
There can be any number of companies selling "deeds" to deep space real estate. If I name a star in one registry, the same star could be "owned" by somebody else in the other registry. If I buy a tract of "property" on Mars from one company, another company could sell me the same tract of land, and both "deeds" would be equally unenforceable.

The fact that the number of stars in the Milky Way galaxy is limited in our lifetime, and the size of Mars is known and finite, doesn't mean that people that bought a whole sector of the galaxy are actually richer than the rest of us, unless they're able to convince us that we should respect their chosen star registry as an actual ownership.

Even if you could have a market for Martian "property" online, and people would buy second hand "deeds" from each other, the rest of the world wouldn't have any incentive to reward these people for being early birds to the fictitious Mars deed market when Mars actually gets colonized and terraformed. And what about the competing registries (forks) where the same Martian property is shown as being owned by a different person?

On the other hand, an online P2P property registry that actually dealt with Earth real property, and reflected the true owner of land here on Earth, might actually have a chance of taking off, if it started out containing information about those who actually owned the property today.

It would not work if this property registry showed that 99% of the Earth land was owned by guys who bought lots of GPUs and participated in a "mining" lottery where the surface of the Earth was doled out between them. Bitcoin has the same type of problem being accepted by the world economy as a currency.

I'm puzzled with most of your argument mainly because you are explaining why Bitcoin won't be accepted at the same time as evidence is pouring in that it is increasingly being accepted.  It is nice to fantasise that the vast majority of potential new currency users would philosophise about the principles underlying it and decide whether or not to endorse it by using it.  And even if they did I suspect if they thought about it long enough, reasoned it out or debated it here, most would conclude the way it is being done for Bitcoin is actually pretty good. 

But we're talking about 'the unwashed masses' here.  Just imagine those who have just heard on facebook that their mate just bought some gadget at wholesale prices from BitcoinStore (1 month offer announced today) but only if you use this weird new internet money stuff which you get from Wallmart, how many of them do you think would even think of let alone be stopped by ideological ethical considerations?

On your point comparing Bitcoin with land I am even more emphatic.  True, Bitcoin and land have  in common the fact that there are finite amounts of both and I can see your parallel with distribution starting off with a small number of players.  However if Bitcoin does succeed the the long-term purposes for which it will be used will be as a store of wealth, a medium of exchange, a means of transferring money anywhere worldwide etc.  How is this affected detrimentally by early-adopter hoarding?

There is an essential difference between bitcoin and land.  Land speculation and hoarding is causing all kinds of problems to most economies for the simple reason that less available land means the amount that can be bought with your money is less.  With Bitcoin not so.

Let's say we have the whole of the world's land split equally between 1000 initial owners and 999 of them decide simply to keep their own.  This leaves .1% of the world's land available to the rest of the world population.  It is a problem because you can't grow the same amount of crops on a plot 1000th the size of another.  You can't sleep in a bedroom made 1000th the size of another.

But if it were the same case with Bitcoin - that the initial Bitcoin total was split equally between 1000 owners.  Assuming Bitcoin even took off if 99.9% of early adopters just sat on them in this case too we only have .1% of all existing bitcoin for everybody else's use.  BUT people can still do exactly the same with the amount available to them as they could if the it were 1000 x as much. 

Of course there are potential problems if some people have many many many times the wealth of others but that is what we have today.  One of the differences is that today a significant number of the extremely wealthy are also large historic land owners and have been for generations reaping the benefit of labour and public spending reflected in the increased value of their land.  Another difference is that today governmental control over how businesses run and governmental crippling of economies via taxation on the productive keep many many in poverty.  There are problems of jealousy and there will always be problems of jealousy.  But if the advantages of being wealthy do not impact negatively on the not-wealthy jealousy is an attitude problem of the jealous and not something that can be fixed by redistributing wealth.

And although I am a fan of Land Value Tax (I don't believe Bitcoin will solve everything) I am pleased it looks like a significant proportion of those with Bitcoin holdings that would be worth an absolute fortune if it takes off are volunteerists and libertarians and are therefore unlikely to be wanting to use force to manipulate others but are likely instead to be out there offering services and creating jobs with their money.  The likelihood of that being anywhere near in the league of as bad as things are now are I believe remote to zero!

I'm puzzled by your perception of reality.

How do you give someone something and not have to tell them what it is?

How is Faircoin even valuable? It has zero value, like Bitcoin had. Am I missing a fundamental aspect of your design?

Why would it get any media attention? Why would it be pro-Faircoin?

Since it has zero use, almost everyone would exchange them for very little (I have given two real-world examples to this). And this is rational. If you want me to understand your reasoning, tell me why this would be irrational somehow. You exchange something that has zero value with something that has value.

The difference between strong hands and weak hands for a specific instrument is not that one of them is more rational than the other. What if Faircoin fails miserably? The ones who accumulated it would lose a lot of money. That's why they have incentive to do something about it. The fact that they have the means to do it makes them stronger hands, not the fact that they are more rational. The means could be know-how, capital and/or social connections.

Actually, this is not very hard to demonstrate. Give all the forum accounts one Faircoin. Don't even say that you did to each and every one, just assign it somehow. The accounting would be very straightforward, but you could create a blockchain for that too. See how almost instantly everyone will get rid of these coins in exchange for goods or BTC.


There is a heap paradox here. How will you decide when is early? Say, a couple of months in, people forked the chain to get rid of the early adopters (erm, "early speculators" with your terms). Then a year in... Then a couple of years in... This would only prove that the currency is not useful as it is.

Besides, the real world example to this is the almighty Bitcoin. Who even forked Bitcoin to get rid of early adopters, let alone succeeded? How is it any different. With your logic, Bitcoin is even worse, so such forks should happen all the time. Right?

No, but even if it was how would it work logistically as a currency, each time a new person joins does everyone lose a fraction of their Bitcoins to that person to ensure it is equal?

I'm seeing it being used for a few transactions that wouldn't really care if 1 BTC = 0.00001 USD or 1 BTC = 1,000,000 USD - and the rest being pure speculation.
I talked about how it would go against their self interest to adopt it as a replacement currency.

Some might be stopped by ethical considerations like opposition to illegal drugs for example, and I know some people who limit their use of cash on purpose, but that's not what I talked about.

Never in this thread did I tear down Bitcoin as a payment processor, where Bitcoins are a temporary intermediate that you don't have to hold for longer than the transaction takes.

But it would be a fundamental problem with getting people to adopt it as a currency. As in, pricing their goods in Bitcoin, keeping substantial savings in Bitcoin, etc.
My precise point is that early-adopter hoarding is a hindrance to its success for those uses, since it'll cause rejection by the "unwashed masses".

Since it's trivial to replace it with yet another fork, there's no incentive for users to reward early miners just for being early miners. Unlike real property, unreal property is potentially infinite. If 99.9% of BitEarth v.1 is owned by 999 early adopters, just make yourself BitEarth v.2 where you own a couple of continents for yourself.

There are already government and legal approaches to the land issue, as you've mentioned. For example, there's laws about adverse possession where squatters who actually use the land can take it over from an inactive property holder, land taxes that make it expensive to keep land unproductive, etc.

It would first have to be be used by somebody for transactions. Then if people started actually paying USD for it, people who wanted to cash out on this would be joining, and this would create attention: Somebody created a cryptocurrency that has been handed out in a finite amount, and some people will actually pay you for them, or offer goods or services for them. That would cause word of mouth and media attention.

The Faircoin has two things going for it:
- It can be used to process transactions
- It has a known supply that's proportional to the world population, and everyone starts out with a certain amount.

If you want to throw that away that's fine. But if you believe that you'll need Faircoins in the future, you'd be better served to keep them and use them. Both are rational acts depending on whether you believe in the utility of the currency.

This sounds like throwing good money and time after a bad investment.

Every new person who comes in the door and wonders if this is something for them, would consider the people who came in as earlier than them. If you get handed a free "inheritance" and told "here's your Faircoins - you won't be given any more - spend them wisely" I would be more interested in that than a bunch of guys running around screaming about how their randomly generated bit strings are the currency of the future and please will you give me 35 USD for it.

It does.* And unfortunately the Faircoin would also suffer from the forking problem. While new adopters might be attracted to Faircoin, the people who sold off their Faircoin v.1 holdings in a fit of greed might be pushing for their Faircoin v.2 fork to be the new thing. That would be an interesting dynamic to study.

One interesting side effect, since Faircoins would be tied to a specific person, and transparent, could be that if people see that you've spent away your Faircoin v.1, they're not likely to trust you in Faircoin v.2 either. "Hey, you've already spent all your Faircoins - why are we to use your fork so you can double-spend?"

Maybe - just maybe - this might actually work? It would all rest on somebody starting actually using them for something useful.. Edit: Read: Something that you can pay for only with Faircoin, or more easily with Faircoin than anything else.

* While new forks happen all the time, the main competitor to the main Bitcoin fork is the "no thank you, keep your play money" fork.

I stopped bothering to read past this point.  How often have said "unwashed masses" ever rejected any value proposition on the basis that others before them had an "unfair" advantage? 

Exactly zero.

just leave.

being an early bitcoin adopter required you to read and understand the bitcoin software. Later adopters were able to rely on the expertise of others. Reading all of the code of a program AND understanding it has a substantial cost.

You could always start an alt-chain with the properties you want.

From what I can see, there are dozens of different methods for obtaining "free" BTC right Now.
I DID just jump down to the bottom of this thread from the first page, so I am at risk of speaking from incomplete knowledge of the conversation,
or just being redundant, but it seems to me that the opportunities are there to GET some bitcoins, people Are Sharing,
or at least making available opportunities to earn some small amount, for things like watching videos, reviewing things,
or just "visit my site, help me generate some Traffic- Help me out, I'll help you out"
just to give people a leg up into the game.
Once again, at the risk of sounding ignorant, I ask the original poster if they have attempted to make use of these various avenues of getting some BTC,
or if they feel that these things are not enough for them?
Is this a "don't just throw me a Bone, I want a Steak!" kind of thing,
or a case of not scrolling through the posts to see what's out there before asking that question?
How is gimme gimme gimme "fair" anyway?

The OP didn't want to work for wealth, he wanted it handed (redistributed) to him simply for existing.  
Work for money you got some crazy ideas son.

LOL Da, Comrade!

Those are good points. I got my first bit-cents from Gavin's old bit faucet. I think it was like .05. it seemed like such a tiny amount. What is that, $2 this morning? Well worth the click in retrospect.

Yes indeedy. Can't wait for this wallet o' mine to complete its initial sync so I can play too!

People who believe in initial distribution to all newcomers can start a charity that accepts donations from likeminded people and makes disbursements to new people entering the bitcoin community.  The charity can perform whatever checking (or no checking) it wants to avoid second trips, etc.  In fact, there could be multiple such charities, competing amongst each other for donors and recipients based on their identification policies.

In fact, such charities have already existed.

So this can be implemented on top of the existing bitcoin protocol.  The existing protocol is therefore "fair."

One could for example collect a small amount of BTC from each sale at a special "fair" exchange. This bitcoin could be used to fund a program that hand delivers bitcoins to disadvantaged women between the ages of 18 and 20ish. I would even volunteer to fly to Scandinavia and look for these women.

This is such a joke. "Why don't you give me some of what you have? That would be fair because you have some and I have none!"

Heh. Reminds me of the homeless guy scene in the movie 'Falling Down'.

It's more of a "no I won't pay you 40 dollars for the right to play air guitar" thing. I'd really recommend reading the thread before replying to it.
Maybe because it's also a good marketing move by big holders of Bitcoin.
The fact that you can subvert the protocol through social or political action, doesn't make fairness an inherent quality of the protocol. If communists took over, they could likewise force everyone to give all their Bitcoins to the State; the protocol supports it, but that doesn't make the existing Bitcoin protocol "communist". Would you like to try again?

It's more of a "no I won't pay you 40 dollars for the right to play air guitar" thing. I'd really recommend reading the thread before replying to it.

Well, I'm not going to Give you forty dollars to play air guitar, either. I might flip you four cents to watch, though, for my own entertainment, but I don't think you're worth much more, and since it's MY $40, I get to decide.

Comrade.

A crypto-currency where currency could only be created by a fixed amount being issued to each unique individual upon attaining the age of legal majority is an interesting sci-fi concept. It might even be interesting from a practical standpoint if there was any secure way to implement it. One key question -- could you get such a thing adopted other than by forcing people to adopt it? And would it remain "fair" over time?

What exactly would you propose people do? If competition for Bitcoins wasn't a motivating factor then the BTC economy would be a lot less robust. The people who found BTCs first were the ones who helped Bitcoin grow in the first place. It's also not like they "stole" anything or ripped anyone off by being the first to mine Bitcoin.

Of for... I can't believe this is still being argued.

look, bitcoin is for free market capitalists. if you are a communist there IS a crypto currency for you called: http://freico.in/
Its exactly like bitcoin except:
1. Built in penalty on being rich (its like a tax except its not collected by anyone, the richer you are the more of your money just evaporates every month).
2. Built it tax for redistribution.

If you can find a good unique identifier per individual (e.g. DNA) and a practical way to pass the money to them (e.g. giving an address in exchange for a blood sample given in person), they can claim it whenever they want to use it. Since it's scarce, there is an incentive for adoption, like Bitcoin. It would be very similar to Bitcoin actually, replace mining with buying others' fair money. Why wouldn't you adopt if someone is willing to give you something for it?

In summary, you still need early adopters to take the risk if you are not going to force adoption.


As I said earlier, the distribution would become heterogeneous very rapidly. I think this sort of heterogeneity is a requirement for adoption anyway, otherwise no one would have enough incentive to develop services for it. You could try making it legal tender instead, but since it doesn't have any value, stronger hands will still accumulate them until they have enough to work on making it useful. It will be completely "unfair", as these people will make a huge profit out of it by selling these back to the people they bought from.

The OP might be absurd, but if you think about it this is something that somebody is going to probably try at some point.  We don't have to detach all virtual cryptocurrencies from governments.  We can attach a cryptocurrency to any structure we can dream up.  It might not be successful, but we can try it.

If I were a mad scientist I could create a currency with a central bank that sells bonds every time it rains in Lake Titikaka on a Tuesday and I could sell bonds every time the Steelers win a football game by more than 6 points.

By the same reasoning, if I were into monarchy I can create a currency that runs based on my whim, because I declared myself the emperor of the local sushi bar.

If I were into Athenian style direct democracy I could make monetary decisions based on the votes of the currency holders, with each unit of currency being worth one vote (this doesn't seem like a completely horrible idea to me, in theory).

By the same reasoning, it would make sense for Marxists to try to create a cryptocurrency based on their political beliefs.

In all the above situations, on a certain level, we are starting to create the basis for governments that people can join and leave voluntarily, regardless of geography.  Easy entry and exit to a marketplace could make government more efficient by introducing competition to government.  Right now if I don't like the US government that's too bad, I'm stuck with it unless I want to move.  If I don't like how bitcoin is going, though, I can just drop my BTCs and buy BTC Lite or Liberty Reserve or in the future I might be able to buy MarxCoins from the OP or Democracy Coins from somebody else or Mad Scientist coins from somebody else. 

Changing currencies would change who I can conduct business with.  I can't buy a loaf of bread from the BTC only supermarket, but I might be able to buy a loaf of bread from the Marx Coin bakery on the next block if I change to Marx Coins.  Hell, if the bread is good enough I might change over just to get some of that delicious Marx Coin bakery bread.  This creates a network effect.  The currency I exit has less people working in their currency and whatever currency I move to has more people working in their currency, which increases the attractiveness of the currency I move to for other people.  In this way, all currencies are strengthened because they are all competing for my business.

Of course, the best way to handle a complex situation like that would be to diversify, but even then I would probably hold less of a currency I don't like and more of a currency I do like, which would have kind of the same network effect.

Not only it depends on the meaning of fairness, but it also raises a bunch of questions/challenges on its own:

* How would you implement such a distribution?
* How to claim, through Internet that you are a different person?
* How to do this universally?
* How to avoid identity thief or coercing people to claim their share for you?

People verifying the authenticity of other people therefor get a form of control/power on them. This is against one of the core principle behind Bitcoin, namely decentralization.

Why would you need a distributed crypto-currency if you have central authority? Everything the network does is redundant; you inherit all of the downsides of a distributed network with no gain at all. If the concern is resilience, you could achieve it much better using redundant storage, forward error correction, encryption, distributed authorities and whatnot. (Also, if you are open to competition, you can allow free exchanges between your centralized currency and decentralized currencies.)

Bitcoins are not supposed to redistribute wealth evenly nor are they designed for a communist regime.

I guess the OP is quickly learning about the political divides of the world!

It might feel that it would be good to share the coins out equally, but as a late arrival, you do get more than the first miners got.

They started with nothing, and had to build their wealth from some useless files with no financial wealth associated to them. 

A few years later, you don't start with nothing, you have a free infrastructure where you can spend coins, people know what you are talking about, and the coins have a real value.

For $60, you get access to this world, and you won't even lose your money, because you can change from a bitcoin back to fiat any time you want.

Seems to me that is better than equal for you.

Maybe you should quit while you are ahead?

I agree with you that there are very strong advantages to having no central authority, which is why I like bitcoin.  The problem is, there are perceived advantages to amassing more power, especially for the kinds of people who probably aren't on forums like this.

Let me illustrate with a more concrete example:

Lets say you are a religious nut with a big following.  Maybe you are a wealthy muslim imam from the middle east, or maybe you are a member of Christian Exodus (http://christianexodus.org/) or something like that.  You want to set up a theocracy.  You buy a couple thousand acres of land in some remote part of Montana and build a small town and bring your followers to live in it.  You set up your theocracy with contract law.  This would probably use precedents from neighborhood associations (http://en.wikipedia.org/wiki/Neighborhood_association) and sharia marriage contract laws (http://shariainamerica.com/) that are currently in effect in the US.  Whatever scripture you happen to follow, you claim that it says that you, as the grand pumbah of Theocracy Land, have the sole authority to make monetary policy decisions, along with decisions regarding how everybody should live (going to church, the sex lives of your people, how many times a day they are to pray, what kinds of businesses they can work in, what technologies they are allowed to use and how, etc).

You set it up so that people must use your currency while in Theocracy Land.  You can't actually execute people without having the feds called in, but you can cut people out of the local economy by denying them the ability to use your currency, effectively exiling them.  You have just created a theocratic company town, like the mining towns we had in the 1800s.

I'm not saying that this is desirable for me, but there probably are a lot of crazy people who would want a system like that.  People are idiots.

Also, I could imagine a warlord taking over a small region of, say, Afghanistan, and requiring everybody to use their cryptocurrency.

Lets say I live in a town with Muslim theocracy land to the east and Christian theocracy land to the west.  Muslims have a comparative advantage on butter and Christians have a comparative advantage on guns, so I keep enough of each currency to meet my needs for butter and guns and then use bitcoin for things that are cheaper in bitcoin and USD for things that are cheaper in USD and things like that.  I might keep some Marx coins around if there is a Marx coin town somewhere that has a comparative advantage in bread.

There is nothing stopping people from using bitcoin technology to secure their own private currencies like this.  Maybe multiple systems like this would be a good thing, if it opened up competition in the market for currency.  As it is, we already have a certain amount of competition with all of the different flavors of bitcoin floating around (https://bitcointalk.org/index.php?topic=134179.0).

His point was blockchain technology is expensive (in terms of never ending storage requirements, massive computing power, and eternal risk of 51% attack).  This isn't to say Bitcoin is "bad" but there is a cost.  The price for decentralization is the cost of the blockchain.  Remember the cost isn't just in the miners (proof of work).  All full nodes must not only store the blockchain, they must validate each transaction, each block.  No node accepts the "work" of another node ("trust me this block is legit") all the work is replicated all over again by every node.  All that cost is the price of decentralization.  Without a trusted central authority each node must operate on a trustless model (which is EXPENSIVE). 

Having a decentralized, centralized currency makes absolutely no sense.  You combine all the costs and limitations of a decentralized currency with all the costs and limitations of centralized one.  Don't feel bad it is a common noob mistake/assumption.

The blockchain isn't good because it is the end-all perfect method of processing transactions.  Hardly.  The blockchain is good because it is the best (only one proven so far) to process transactions without a trusted third party.

The ONLY advantage that Bitcoin has over a central authority is that it doesn't have a central authority.  Everything else could be done with a central authority (irreversible transactions, finite supply, psuedo anonymous transactions, contracts/multi-sig, etc).  Of course you have to trust the central authority ... implicitly.    The purpose of the blockchain is to eliminate the need for trusting a central authority implicitly.  If you don't trust the central authority the blockchain doesn't help you, and if you do trust the central authority then the cost of the blockchain is just wasted energy. Liberty Reserve for example would gain nothing by moving transaction processing to a blockchain.

Precisely. Bitcoin's entire design is based around the requirement that no central authority be needed. Pretty much everything else in the design exists solely to make that core requirement have as little downside as possible. If you don't see not having a central authority as a huge advantage, all those sacrifices are for nothing.

It would be like pushing around a car instead of riding a bike. If being capable of powered movement is not an advantage in your application, you *don't* want to use a car to get around because its whole design is based around that. But if powered movement is a big plus, then a car is *way* better than a bike. For an unpowered means of transportation, don't take a car and rip out the engine. Build a bike.

That said, there are some ideas from Bitcoin you could take for a centralized currency if they fit the rest of your design. For example, the way Bitcoin addresses are formed. The way transactions are formed and signed. The structure of a wallet. The way outputs are pulled in instead of having an account balance. The use of hash chains to permit a large amount of data, with history going back indefinitely, to be secured by securing a small chunk of data. And so on. All of these ideas might make sense in a centralized currency.

To be honest, I don't understand block chains at all yet.  I haven't run across a serious explanation in any of the FAQs I've read or intro to bitcoin videos I've seen so far.  They all gloss over it like it's just magic or something, which is kind of frustrating.  I program (and I have dabbled in cryptography before) and I'm a semester away from having a bachelors in economics from Indiana University of PA, so I doubt it's beyond me, I just haven't found the right documentation yet.

Can you recommend a place to find some documentation that isn't frustratingly dumbed down?

That it intentional.  Most people will never be able to (or need to) understand the currency at the "nuts and bolts" level.  Just like someone can use facebook without needing to understand the OSI model or the Internet Protocol.  Even a good web developer doesn't really need more than a high level understanding of those concepts (mainly so they can understand the limits and capabilities of the world wide web).


The source that started it all ...
http://bitcoin.org/bitcoin.pdf

A tip.  Read it from start to finish.  Even if there are parts you don't quite get or have questions about read it from start to finish.  Then wait a few days and read it again.  Later as you are looking at code, asking informed questions, and piecing together the mechanics refer back to it.   Also if you read through it and believe you understand Bitcoin on the first try ... you don't.  :)

Then there is the source code ...
https://github.com/bitcoin/bitcoin

Without a good understanding of the paper above though it will just be technical magic.

When you can ask informed technical questions this site is a good resource:
http://bitcoin.stackexchange.com/

Thanks!  Now I'm getting somewhere with this!  Time to order some pizza and settle in for a day or two.

Ain't that the truth.  I read it four or five times over the course of two weeks before it clicked for me.  The first three times I read it, I would have sworn that it's some kind of complicated scam, but something about it nagged at me.

I like how this thread has so many posters who neither understood the OP or read the rest of the thread. It's not about redistribution. It's about initial distribution, and how Bitcoin looks like a premine to every potential new adopter.
It might have been more similar if mining didn't turn into a race to the bottom. As it is, it would be very different from Bitcoin.

Precisely. But to treat that sentence as not a rhetorical question: "Because it's too difficult and time consuming to do so." If you know that you can get 10 USD by claiming some cryptocurrency that was equally distributed to the Earth's population, but it takes several days of work to do so, some might not bother and just leave it in their "account" until it becomes easier to do and the value rises.
The higher the value rises, the more people would join the system. You'd stilll have people who are more interested in holding than selling, but as the system grows I actually think the heterogeneity would lower over time. As the value rises, there would be less incentive in the system for the new adopters to sell their coins cheaply to a handful of hoarders.
On the other hand if it becomes too heterogeneous - i.e. too few people hold the coins without using them for anything useful (hoarding) - it leads to failure.
Being legal tender is enough to give a currency value, since you are guaranteed to be able to use it for paying off debts and taxes. Of course, if you let that currency hyperinflate it would still be a low value, but since the "lifecoins/fair coins" are in limited supply you'd avoid that problem.
If you start out with one king making all the coins, requiring taxes paid in coins, and paying for public works and public servants in coins, you sort of have the extreme case of heterogenous holding. This still works since the king rules that the coins are the legal tender of the land, and there's not an infite number of rival kings issuing their own coins.
If the coins end up on the hands of just a few people who offer services to increase the value of their coins, they have effectively become a sort of voucher for their services. It wouldn't be unfair to the non-holders, since the non-holders would buy coins to pay for the services offered in the coin economy.
1. A ("strong hand") buys funnycoins from B ("weak hand") for USD.
2. A provides goods and services for funnycoins
3. A sells funnycouns to B for USD.
4. B buys goods and service from A for funnycoins.

Even if coin/USD rate has risen from step 1 to step 3, what has effectively happened is that B bought goods and services from A at market rates. So the "strong hand" here is the one that actually provides something that the market will exchange something of value for, at competitive rates. If, however, A fails to provide that, this happens instead:

1. A ("strong hand") buys funnycoins from B ("weak hand") for USD.
2. A provides goods and services for funnycoins.
3. B uses the USD from step 1 to buy goods and services from C

What has happened here, is that the "strong hand" is left holding the bag and effectively paid B to shop from C.

I personally find it pretty amazing that the bitcoin algorithm anticipates human behavior. Its a pretty smart move to ensure acceptance by early adopters in this way. The architecture rewards risk with profit. for early adopters it was a risk investing fiat money or computational power into btc in early times.

Pretty easy to come here nowadays when bitcoin is established and complain basically about not jumping on the wagon earlier.

It is not fair to share them equally, as the currency is not mandated by authorities and comes with high risk for early users.

Hypothetically, let's just suppose that the Bitcoins were shared equally amongst the worlds 6bn inhabitants. Even if all future Bitcoins were available today, that would mean 0.0035 BTC per person. The most likely outcome is that most of those BTC would sit idle and never be used, which would stymie the growth and innovation in the Bitcoin environment. It is far better to have the BTC in the hands of people who are willing to use them today, thus promoting ongoing growth and innovation. The people who do this must be willing to buy in with their own capital and do take on substantial risk, because despite many claims to the contrary, there is in fact no guarantee that Bitcoin will amount to something much more valuable in the future, and like any investment it is indeed possible to end up with zero value as an ultimate outcome.

It might be argued that it would be more democratic to give everybody in the world access to the same information and opportunities (which always come with risk). Realistically of course this is impossible. But if every person on the planet knew of and had access to Bitcoins, each individual could then decide whether they are willing to take this risk or not. Certainly not everybody will. Still, my bet is that every current Bitcoin owner would be entirely supportive of such a global education program if it could be done!

I still think the distribution curve would be similar to Bitcoin, however as you said, it would probably become much flatter eventually, as if Satoshi had the same amount of resources required for Lifecoin to advertise the system before it began.

Early adopters of Bitcoin have gained so much, because they did work for almost zero anticipated gain. It is the curse of knowledge that makes it seem different for newcomers. I had made a bet with an economics research associate about Bitcoin's success, which at the time he called an utter waste of time on our part, even though I personally wasn't involved in mining. Even the time trying to utilize it seemed like a loss (and this was 2011, not 2009).

Lifecoin could have a much higher advantage in this aspect (depending on implementation), which would help it develop in a more homogenous manner. Having Bitcoin as an example is also a huge plus.


Well said.

They tried to solve this problem with LiteCoin (probably the 2nd best crypto-currency) by making it harder to run away from a CPU/GPU.

Anyone who can build a mining rig with non-off the shelf components like FPGA or ASIC can gain a huge cost/speed advantage over the other miners in the market especially if they keep it to themself.

That seems to be happening with ASIC right now and I do worry about it concentrating the network and killing the project. Bitcoin is becoming less and less the peoples coin, and more and more the coin of the select few.

Are you living in some parallel universe or something?  How with adoption that is happening in front of your very eyes do you get to 'the coin of the select few'?!!

On the other hand, asics bring bitcoin mining in the reach of the average user. they're end-user products for non-technically adept people and thats a good thing, isn't it?

bitcoin is based on the principle of rational players. those who hold large stocks of bitcoin or hashpower do not want the system to break, so they'll likely find measures to prevent this.

The same complains can be heard about mining pools. But in the recent chainfork they basically saved the day by downgrading to .7. so everything has its two sides,.

ASIC's will bring mining to any person who can plug a cable to a socket. You just need to be patient until the market settles. The current situation is the fault of failing ASIC manufacturers.

Besides, as long as the wealth gets distributed, what does it even matter? Even if ASIC's bring mining to every person who wants a coffee warmer, less and less people will be able to run full nodes. In the future, there might be fewer full nodes than miners. It still won't make it the coin if the select few.

Mining is completely irrelevant to the currency, as long as it is able to prevent attacks.

Anything based on 100% rational players or 0% rational players are equally stupid, I think.

Well, they have an incentive to both keep it technically secure and to keep the exchange rate up. But this isn't sustainable in the long run. Unless somebody starts providing goods and services that are cheaper or better when paid for with bitcoin, it will collapse. Shops that peg their BTC pricing to USD do not count, since due to its infinite divisibility, even if there was only 1 BTC in the wild with you holding all the rest, your customers would just pay with 0.00000000000000000000001 BTC or whatever. And if there was another guy who held the other half of the bitcoins, he could just sell bitcoins for less USD than you're selling them for. And nobody else would accept them for payment due to their volatility, so your hoard would be next to worthless if you tried cashing out. A vicious cycle. If you, however, priced your goods and services in BTC, there would be a market for buying BTC as a sort of futures instrument on your production.

You could say that one guy holding all the coins and the coins starting out evenly distributed are both "corner cases" of a cryptocurrency. If your system can't handle both, and move between them without collapsing, it's not a good system.

wat o_O?

0.00000001 BTC = 1 satoshi = smallest possible unit.

I like how so many people think there's a meaningful distinction between the two.

No

There are a number of ways in which subdividing Satoshis could be achieved, if desired some day.

It could be argued economy-philosophicaly whether the unequal distribution (http://eprint.iacr.org/2012/584.pdf) of economical power creates a risk for a system which is grows and get ever pathological as that unequality passes a critical threshold.

In that line of reasoning ,for example in bitcoin , anonimity & a huge balance of few persons doesnt create a risk for the system in the form of strong incentive to become a market maker and speculator and enhance value volatility and faith strength  ?

Ironically bitcoin is implemented in libre code where the zeigeist is "more eyes catch the bug" and "sharing is good" and the common case in each new libre program is reusing ideas and libre code from other programs ,a case that puts each creator in more earthly status among his peers.

please let this thread die  ::)

You obviously have no idea about the design of Bitcoin, nor about communism.

I do think it is fair because I expect 1 bc to be worth more then 1.000.000 € in the future. I today bought 0,12 bc to be sure that my life is ok if the case comes true. :D

seriously... a communists here... and with 1500 posts. You do realize bitcoin is a purely free market phenomena.

I find it funny that this technology has attracted anti-capitalists.

They have always wanted to abolish money.

"...houses, fields, and factories will no longer be private property, and that they will belong to the commune or the nation and money, wages, and trade would be abolished."

— Peter Kropotkin, The Conquest of Bread

4. The End of the Money Trick
Two features of capitalism are essential to its existence—the wages system and a thorough and all-reaching system of money relationships. Unfortunately men are now so used to living by money that they find it difficult to imagine life without it. Yet it should be obvious that no libertarian and equalitarian society could make use of money. Syndicalism, as well as ending the wages system, also aims at the destruction of money relationships.

WAGES. The abolition of all wages and the establishment of the principle of equal income for all. What that income would be cannot be expressed in money terms, the only terms known to capitalist society, but it should certainly be more than double the present average wage.

EDUCATION. Education will be free to all able to benefit from it and wishing to enjoy it, free from kindergarten to university. Classes would be smaller, equipment improved and new schools built. The recent trend of education from coercion and terrorism to freedom and co-operation of teacher and scholar would be accelerated.

MEDICINE. Medical treatment would be free—medicine, attendance, clinics and hospitals. But the new society would increase the health of all, not by a new flood of physic, but, in main, by a better diet, right working and living conditions and the end of industrial fatigue.

http://webcache.googleusercontent.com/search?q=cache:b3QPiFzdlAcJ:libcom.org/library/principles-of-syndicalism-tom-brown+&cd=1&hl=en&ct=clnk&gl=us&client=firefox-a

Karl Marx hypothesized that, as the productive forces and technology continued to advance, socialism would eventually give way to a communist stage of social development. Communism would be a classless, stateless, moneyless society based on common ownership and the principle of "From each according to his ability, to each according to his needs".

http://en.wikipedia.org/wiki/Marxism

It is embarrassing that someone in the 21st century can hold these views.

From each according to his brain wallet, to each according to his performance.  :P

srsly though, I think Marxists may see Bitcoin as transitional, mainly because it's immaterial.

There presumably won't ever be state enforcement behind it (see pirateat40).

In that sense, Bitcoin might just be a distributed, better reputation system.

For real? What are you doing here? You literally sound like a communist, which is about 100% against what Bitcoins are all about LOL.

I see it as very likely, but 120.000 € in the future may be average monthly wage  ;D

bitcoins will rise in price for 100 years

as long as there are people who don't use bitcoins, you are one of the "first"

7 billion people on the planet, maybe a few million know

It's rather shocking how little people understand about money and the distribution thereof. I remember reading not long ago about how some organization (one with socialist roots, by the way) claimed that the worlds wealthiest people could end poverty 4 times over...it's simply not true - not even close.

The thing is, anything other than a fiat currency is a resource that is available in finite supply. Taking from the rich and giving to the poor doesn't solve that problem. In addition, the more money that one has, the less they actually value it. Compare somebody who makes $30,000 a year to say Bill Gates.

The $30k guy will probably balk at paying $3 for a 16 ounce soda in a movie theater and probably prefer to either sneak one in or just go without. Bill Gates on the other hand wouldn't really care; he's got so much money that the $3 doesn't really mean anything to him. To him it's worth the convenience of buying it there rather than sneaking it in.

Another way to look at it is if you compare your currency to a material good. I tried to explain this to a socialist guy who likes his nokia lumia 920. I asked him if owning a second lumia 920 would be every bit as valuable to him as the first one he owns. Of course not. The more he owns, the less he values them. He'd be more willing to trade one away for something else than to just keep it - even if that something else is worth less on the open market than what he gave them.

It's for this reason that if you just play Robin Hood with available supply money, all you end up doing is causing inflation. Inflation is generally defined by people valuing their money less, which leads to a general rise in prices. Giving people more money does exactly that. While they may have more cash, their purchasing power has not increased. The scarcity of goods remains the same. Poverty isn't defined by how much money one has, but by how much wealth they have. Note the distinction between wealth and money. Money can buy wealth, but if you reduce the value of money in the process of redistributing it, then money can't buy as much wealth, so you haven't done anything to end poverty.

While on paper the worlds wealthiest people may have enough *money* to end poverty four times over, they really can't do anything about the scarcity of goods. That study should look at whether they have enough wealth to end poverty, rather than enough money. They'll probably end up with a much different conclusion. And even then, their figures won't account for things like a large yacht being given away. This is the kind of thing that, while worth a lot to somebody who is wealthy, isn't really worth anything to say a guy who has a regular 9 to 5 job that can't be done while at sea, and if its a big enough yacht, he probably can't afford to hire a crew either.

True. Examples of ways to end poverty are these:

• Cut out middle-men and those who are in the way of innovation and progress, by holding monopolies on territory, patents, currency, and tariffs. States, banks, big oil, big corporations must be circumvented.
• Spread cheap (or free and open source) technologies: Hydro- and aquaponics, 3D printing, solar power (underlies Moore's Law!), industrial hemp. Self-sufficient individuals will be less corruptible to do things that are morally wrong (like joining the army), strengthen the establishment and perpetuate the status quo.
• Give a fish vs Teach how to fish: Go to poor areas and look for the reason why developments don't happen. What keeps them from helping themselves and self-realization? Ask them what they want; donate basic necessities, infrastructure and education (without making them dependent on Monsanto like today).

Litecoin. (No FPGAs, No ASICs)  ;)

next risk

+1

If the money ends up in the hands of a few, there is indeed a risk of some sort of social revolution to change the system, or just a rejection of the currency.

For example, if you paid an enormous princess' ransom to some evil dragon in your own fiat currency, you could just replace your currency after the princess was released and safe back home. Of course it shows bad faith, but so does kidnapping princesses.

Another example: Let's say a few captains of industry got huge piles of money by offering much needed commodities or services to a population; if the people could choose to devalue their currency by hyperinflation after those services were offered, that would in effect be a case of the incompetent masses screwing over the captains of industry, so said captains are left with a pile of worthless money afterwards. The reverse of this is a small cabal of the president's buddies that pays the people for hard work and goods, and aquire property by going into debt; those oligarchs could screw over the people by causing hyperinflation of the currency so the people are rich in money but poor in wealth; the oligarcs owe the people money, but since the money is worth so little now they can easily pay the money back and be left with huge amounts of property; finally the people start a black market using USD (as in Zimbabwe).

The final example is a small cabal of nerds who define hashed bits as the new money. Since they provide no wealth, goods or services to the rest of the world, the systemic risk was realized from day one as the world rejects it as a currency. This might change if there are people out there who will provide a service or commodity exclusively in BTC, or cheaper in BTC than in other currencies. <- hint for those who want BTC to succeed as a currency and not just as a USD transfer system.
Yes, this is what happens if you just give people money for nothing, or for useless proof of work. So that's why unfettered money redistribution is a terrible idea. However, after an initial distribution, the money will accumulate in the hands of those who perform useful work or sell desireable commodities over time. It doesn't mean that limited taxation, limited inflation or limited welfare is a bad idea.

I completely agree with your analysis as a critique of how if "the wealthiest just were forced to give their all their money away all at once would make everything better".

See http://www.fool.com/investing/general/2013/04/05/why-bitcoin-is-doomed-to-fail.aspx

Bitcoin will fail because a substantial number of hoarders control most of the supply
Blockchain.info, which claims to be Bitcoin's most popular wallet (every user needs a digital "wallet," which is something like an anonymous checking account, to transact Bitcoins), provides the following statistics on its userbase and on Bitcoin itself. I've rounded some numbers for convenience:

• Total wallet users: 180,400.
• Bitcoins created to date: 11,000,000.
• Bitcoin transaction volume (weekly moving average): 344,000.
• Wallet users engaging in transactions (weekly moving average): 10,000.
• Total Bitcoin exchange dollar volume (weekly moving average): $9,600,000.
• Estimated Bitcoins transacted on exchanges (at $135 price): 71,000.

According to these figures, only about 3% of all Bitcoins are in circulation at the moment, and less than 1% of all Bitcoins currently in existence are sold on the exchanges. With less than 10% of wallet users actually engaged in transacting their Bitcoins, it becomes easier to see why even a little bit of news can cause massive price swings.

The huge sword of Damocles hanging over the heads of the current bitcoin gamblers is that only maybe 1% of the coins is what is traded on exchanges right now.

Market cap of $1.6 billion is purely ficticious, if only 10.000 coins a day are traded. And those are coins that are used by a lot of speculators buying and selling or trading between BTC and LTC many times a day. You can estimate that maybe 2000 coins a day are truly bought.

An awful lot of coins is hold by early adopters, people with 10K-100K wallets that have been inactive. Remember the 10.000 coins for 2 pizza's worth $20 days ? Even if a few come to the market wanting to cash in, they could drop the price down to $10 just by offering 20.000 coins for sale since it would dwarf the real demand to buy cash for coins, which is tiny compared to the huge amount of bitcoins held by people whose only goal is to sell to suckers that think prices will go higher.

If OP can read some posts on reddit.com/r/bitcoin, then you will notice many early adopters who are considered rich now are actually being very generous tipping other newbies. They took the risk and time to be the pioneer on something that they believed. This is fair to everyone.

Those days must be long gone, I can't find anyone willing to donate me even 0.01 mBTC.

Hi jerkoff and welcome to the forum :)

Just fyi there is generally a thread for the discussing of each news piece or notable blog that comes along which you'll find in the Press section.  For the one you're referring to here the discussion has been going on at https://bitcointalk.org/index.php?topic=168333.0

Whilst I'm here I will comment on a couple of the points you made:  Regarding your supposedly 'fictitious market cap' would you say the market cap of gold is 'fictitious' just because the vast majority of it hasn't been traded for some time?  In neither case does it need to have been traded for it to be providing value to its owners.  As for 20k BTC  crashing the market 'down to $10 I'm guessing you've not spent much time watching the size of the trades that go through even those markets we can see let alone many p2p ones we can't?  5k btc trades are pretty common and recently barely cause a blip in the charts.  10k trades are not that infrequent and 20k trades are not unknown either.  If you are really interested in researching how realistic your assumptions are there are those over in the Speculation subforum who are pretty adept at finding their way round the figures and could give you something more concrete on which to draw your conclusions.

I've read that thread now, and obviously it has a few negative replies. In a bubble, everyone has rose tinted glasses and is unable to see the risks.

Regarding gold, even though 99% of gold remains in vaults, last week gold dropped from $1600 to $1540 (and then rebounded to $1580 to close for the week). That's the danger, if a large majority of a commodity is held for keeps, the remainding few percent that speculators hold can fluctuate the price up and down a lot, causing the inactive stashes profits and losses way beyond the capital used for influencing those markets.

I am a stock investor, and I see the market that way. There is always risk. In a bubble, gamblers ignore that and only consider profit, yet in the end they're the ones suffering the losses.

Neither you nor I know what proportion of the money currently held is in the hands of those ignoring risk and considering only profit.  Of course there are some whilst others are very aware of the risk and even if invested heavily, see an immense potential.  You're right about the disproportionate influence of smaller amounts if most of it is inactive - such as with gold.  And with gold it is even worse because the institutions holding the bulk of it have both the means and a vested interested in ensuring it doesn't look attractive a proposition despite the dire straits of their fiat.  I fail to see why (unless the conspiracy theorists are right with their claim that the FBI or Illuminati are behind Bitcoin) early adopters holding on to a lot would want to destroy that which is in their best interest to succeed.

I know for at least some of us (if one counts as some!) here, one of the reasons we read all the negative reports and try to give adequate attention to forum posts supporting them is there may be some gem of information or a different perspective that could help us understand the risks better and empower us to act accordingly.  Of course it is a challenge for those heavily invested not to be biased towards perspectives that support our position just as it is a challenge for those who have decided not to invest much (or at all) - especially those such as the piece's author who have watched and not not bought for some time whilst watching those that did gain - not to see arguments against their own viewpoint.

You say stock is your bag and I think I'm tending to see a trend with stock traders and mainstream economists both who seem to be looking for Bitcoin's fundamentals in all the wrong places - and will draw their conclusions accordingly.  Each to his own.