Bitcoin Forum

I'm not talking about the short-term, not the medium-term, but the long-term.

What are best arguments that Bitcoin won't last?

So far I'm convinced by the pro-arguments decimating the con-arguments. But what if there are some damning arguments out there?

Please try to present them, and please present the prerequisites for why those arguments could be valid.

And just posting "there are no negative arguments against Bitcoin" or "up up up" is not going to further the discussion.

We need good con-arguments and attempts at destroying them, if possible.

when prices crashed cause of china whole reddit sub talked about india and downvoted china-posts. bitcoiner are trolls with money and promoting bitcoin only to become rich. with every wave of incomers greed and stupidity grows. new bitcoiner are fanatic to promote btc. only reason is greed. btc is no ponzi, but bitcoiners behave like it is one.

people typically live day to day in cities and don't care about this whole Silk Road craze, bits, etc..

money is working well for average citizen and for the economy. only criminals NEED to use bitcoin. they earn a lot. the ebthusiasm of bitcoiners makes criminals rich. u want that to be tbe basis of a new financial order?

edit the idealism and the greed of innocent bitcoiners make criminals rich.

The best argument I've seen against Bitcoin is that it'll be another cryptocurrency that we use mainstream in the future. Just because Bitcoin is first, doesn't mean it's the best.

Other arguments I've seen against Bitcoins or even cryptocurrencies in general, are just flimsy imo. Cryptocurrencies will be a part of our future, there's no turning back now. The only question is which one?

What about the infrastructure, the mining power, the network effect and that Bitcoin could be adapted?

Most people are not technically savvy enough to store their bitcoins themselves.  Without a trusted, insured deposit institution, they'll lose their savings to trojans, social engineering, and computer failures.  There may be regulatory difficulties in creating such a service down the line.

Has the scalability problem been solved yet?

This argument only works if you view Bitcoin as software. But in reality, Bitcoin is a protocol (like TCP/IP, HTML, DNS), and the difference is that protocols adapt because they're only the basis on which other software structures are built. We are still using protocols that were designed in the 60s and 70s, but what we have built on top of them makes today's internet unrecognizable from the networks of that time.

Just about the only argument against Bitcoin that has any credibility (that I've come across so far), is that governments could try and squash it by going after not Bitcoin itself, but the entities on the periphery of the network (exchanges, Bitcoin-based businesses and startups and so on). Of course, the counter argument to this is that there is no such thing as "governments" that act in a completely homogeneous manner. There are many different governments, each with its own set of priorities, and each in itself also in constant flux.

So if China decides to ban deposits to Bitcoin exchanges (to come up with an example), you can be certain that other countries will take a different approach. And, really, all you need is a handful of jurisdictions where Bitcoin can thrive.

Over the next 70 years or so quantum computing might become an issue, but then there will likely be consensus to change the protocol so that it isn't that big of a problem.

Many Bitcoiners might behave like cultish people but many of them are hard-headed independent-minded people who think for themselves, this can be inferred through the ways of thinking that lead people to learning about Bitcoin as a technology. In other words, I don't think i people here are as sheepish as they many look, and there are many objective careful people here. In addition there is good reason to believe Bitcoin is going up, and telling other people about it is naturally something one would do, not out of greed but because how great it is. If I was greedy I wouldn't tell anyone about it so that I can buy more cheap.

This is not true. People need faster, cheaper and easier ways to use money. Also criminals make a lot money using cash or greedy bankers, strawmen and financial engineering to make money, they don't need Bitcoin.

the way it is right now it will always just be a proxy-currency.

This argument is not true. Anybody can print a paper-wallet for storage of wealth from blockchian.info, if they know how to do it (which is simly the case of watching a 30sec youtube video. For spending money you can have some change in an e-wallet.).

christians are less likely to adopt it when giveen the choice of choosing JesusCoin vs. bitcoin.

Yes, blockchain.info is probably the best out there for now, but long term it might not be enough.

First of all, someone has to know that taking those steps is even necessary.  I've made a special effort to convince the people I've introduced to bitcoin, but it's a hard sell.

Second, as malware becomes more sophisticated attackers may well gain the ability to capture a user's blockchain.info decryption key. 

Down the line, as paper wallets become more common, burglars will learn to recognize them, and even they won't be safe if you live in a high-crime area and lack access to a vault.

There's also the risk that blockchain.info might be compromised, and the attacker could insert some malicious javascript to gain the coins that way.

You also completely ignored the possibility of phishing/social engineering.

Think about how many people are victims of identity theft as it is, then consider that bitcoin offer zero of the protections that existing financial institutions do.  A lot of people don't even know how to create a secure password. 

The only real arguments is that Gavin could be convinced to include hidden backdoors/weaknesses in the client and so on.

The second is that the price would drop so low that it would no longer be profitable to mine with the increased difficulty, the currency could then potentially die from what I understand.

Two major obstacles:
      1.Lack of trusted exchanges to properly trade bitcoins.
Me sent money orders (significant amount) to those crooks at Camp BX.
They don't answer phone, no email return and keep claiming not received money.
Next week I'll call FBI to put these scammers where they belong.
     2.Lack of proper info. on line(even this board is not caring about) how to open a stuping wallet and get keys for it.
For. ex. I downloaded one from bitcoin.org but unable to get the keys of that stupid wallet.
Very frustrated process and ended up to uninstall the software .

I and others refuted that in the Problem with Altcoins thread. Not the OP, see our comments downthread.

There are serious problems with Bitcoin in terms of mining, transactions fees, anonymity, and cartel takeover. I've covered these in detail in my November posts. I am not going to resummarize here. Suffice it to say I am nearly certain a new altcoin will seriously challenge Bitcoin in 2014.

The other big problem with Bitcoin is that it isn't legal tender, and thus it is taxed on changes in its value unlike legal tender. Thus Bitcoin can NEVER be a non-anonymous currency.

So Bitcoin has very powerful arguments against it. The OP is naive.

Bitcoin could be superseded by another technically superior cryptocurrency. Smart analysts could be rewarded handsomely by being early adopters of such a currency. Technological lock in could help keep bitcoin "numero uno" for some time however.

I'm with the guys who say security for the average Joe is the biggest obstacle.  I work with many business people on a day to day basis and most of them have no clue about even the simplest of security measures and what the consequences are if their data is stolen.  With bitcoin, we are talking about securing wealth.  People MUST understand it.  They would not understand that no one should ever see that private key printed on their paper wallet.  No camera of any type should come near your paper wallet.  Trojans, man-in-the-middle, etc are all potential threats that could potentially wipe out a life's savings in a heartbeat with no recourse.  It is for these reason i have yet to encourage anyone to try it.  Let the pros work out the kinks first.  I believe a viable solution will come but until then bitcoin is not ready for mainstream.

I am proposing a physical solution (https://bitcointalk.org/index.php?topic=310859.msg4067509#msg4067509).

Too complex to use for people as dumb as me.

I agree. Another serious problem is the distribution. Some early adopters may hold a ridiculously large amount of BTC that may make them some of the richest men in the world. Most people have to buy bitcoin from those who have them which are, early adopters (since half the bitcoins where mined in the first 4 years). These people have got an unfair advantage over others.

The only way to fairly distribute bitcoin would require the mass scale infrastructure of the goverment. And we all know how much goverments would like to see their currencies become useless.

If someone has 1 Million BTC and the price goes to 10k then they will have more monetary power than Bill Gates. This money however hasn't been created in goods and services but has been redistributed almost arbitrarily. I somehow doubt really early adopters will just give away 99% of their wealth. Even if they should. 

A risk exists that copycats will fragment the market for Bitcoin-like currency and reduce the value of bitcoins, making them a poor store of value.

I too think the arguments for Bitcoin greatly outweigh those against, and that the aforementioned is unlikely, but of all the risks Bitcoin faces, I think it's the least insignificant.

1. 51% attack
2. Centralization of the coin due to various factors which undermines its purpose (it will continue to exist, it just won't be good anymore)
3. Ever growing chain length does not recognize the ending of moore's law.

1. People are, in the majority, pretty fucking thick.
2. Majority Rule is the system of governance in most Western nations.

Maybe Keynes was right?

Perhaps a currency that loses value is better?

HERETIC!!!

BURN HIM!


(Actually I don't know the first thing about economics. But apparently neither do economists so that's okay then)

Re: What are the most convincing arguments against FIAT?

1.pickpocketing
2.card cloning
3.bank robbery
4.minimum wage
5.taxes
6.fraud
7.government control
8.bank double spending
9.government debt
10.bank freezing accounts
11. banks emptying accounts (cyprus)
12.money laundering
13.fiat used for illegal activities

so many more, but i think you get my point

In Germany, neither Gold nor Gold 2.0 is taxed (VAT).

http://www.welt.de/finanzen/article120823372/Zahlungen-mit-Bitcoins-sind-umsatzsteuerfrei.html
http://www.zerohedge.com/node/477785

Why do you think that?

Most convincing argument for failure? Ok, I'll try. Complacency and greed should do it.

Too many people are here to line their pockets by starting that next great Bitcoin gambling site or develop that next great multimillion dollar app that skyrockets them to fame and fortune or to buy cheap and sell high. In other words - profiteering scumbags.

Too few people exist on the planet that would use Bitcoin simply for altruistic reasons. The average person (not the ideologically pumped up college student or recent graduate) is concerned more about themselves and their little life than how great Bitcoin would be for the end of (insert name of the political philosophy/economic system you don't like here).

tl;dr

Mass adoption requires humans that don't exist en masse. Most are too greedy and stupid for Bitcoin to spread much beyond the pseudo–intellectual fringe and common crooks.

I don't. But Keynes thinks we should all lose wealth to big corporations that have first dibs on new money before it loses value.

Yep, I don't like Keynesianism either; a most fraudulent economic system. It has caused a lot of harm.

Having to use fiat to use bitcoin is probably enough of a reason to stop A LOT of people from having a desire to use bitcoin. I would assume a lot of people don't care about any of the downsides of fiat so long as it's working for them right now.

I'll give you an example. If someone was about to walk into a coffee shop with $5 to buy a cup of a coffee and you said "hey give me that $5 an ill give you $5 worth of bitcoin and you can buy your coffee with it" MOST people would have zero interest in that because they see no point in it and it's extra one extra step just to buy something they can already buy.

With that said, that's fine. Bitcoin doesn't have to be used by everyone nor would it probably even be practical to use in certain situations, but I do believe everything I just said is a big reason why people would or do have no interest in bitcoin. It just seems pointless to them. 

Even if someones fiat currency crashed, they would still need to use it to use bitcoin if they didn't have any bitcoin. So again they would ask the question "why use bitcoin when I can already use the fiat currency I have".

1. less of an issue as time goes on. regardless, not much can be done with a 51% attack anyway.
2. not really an issue. every argument ive seen about centralization misses key points on how they are wrong.
3. Pruning.

(this has all been gone over a crazy number of times and people still post crap after proper answers. and people still never look for answers)



i think one basic counter point to this is that no matter what, the gov waters down our USD. our money loses value. bitcoin may have its ups and downs currently but over the course of 6 months to a year, no matter what is happening, the bitcoins you hold are worth more now then they were before even if you included buying on the top of a 'crash'. If you have money to put into bitcoin that you can leave there then there really isnt a reason not to. having the ability to easily access that money and buy things with it is also really nice. once in the bitcoin system you dont have all those pesky bank and 3rd party fees. it may tie cash for ease of use. but eventually we may see some really interesting security features t protect your bitcoins from in person theft as well as online theft. really its only a matter of time before such things are history where it will be like "wait you used to have your wallet on your PC? no hardware encryption, multi sig or dedicated wallet system? dam i cant imagine risking half a bitcoin! that would have been my salary for year!"

Volatility will always be a major character for bitcoin, so it is not suitable for day to day spending, only for long term saving

In the long term?

It's called a quantum-computer and it can make a bit be 0 and 1 at the SAME time, potentially solving any hash in a matter of microseconds.
So far, this still a theoretical thing, but scientists are working and getting closer on the concept.
If anything can destroy bitcoin at it's core, its that thing.

By that time, we will have quantum cryptographic coins.... Qubitcoin.  ;D

But that will not increase the amount of Bitcoins being generated. The rate of creation of new BTCs will remain unchanged. So this will only be having a minimal effect.

Fiat is NOT working for us. 

Our savings (i.e. buying power) are being stolen by the greasy corporatocracy through excessive money printing and ponzi betting in the form of derivatives which is estimated to be over 1 QUADRILION.  Global GDP is roughly 70 trillion.

There is a crisis of trust and people want out of fiat.  At least from US funny money.

We are expected to act honestly within a system that is stealing from us and parasitising us.  We have to figure out a way to protect ourselves from those who wield power over us.  One way is fair money.

There is currently a great window for Bitcoin until:

1) China or the BRICS nations, who are all buying gold like crazy, release a gold-backed currency that is again a stable store of wealth.  The masses I believe would rush to adopt that and fiats of endebted nations would collapse.  People might in that case also move somewhat away from Bitcoin.

and/or

2) Gold / Silver prices start rising again and some people move back from Bitcoin / cryptos.

Until then I think Bitcoin or maybe some other crypto have an awesome window of opportunity as people are looking for a store of value that isn't stealing from them.

The fact that governments could simply ban it, like China almost did. China officials even said that "legitimacy of our national currency can not be chalenged" or something along those lines, so there's one reason for governments to ban it. And governments banning Bitcoin would effectively push it back to underground where it's only used by hackers and drug dealers.

Also, the fact that there's no central authority regulating the price means that Bitcoin is not very suitable for exchange for goods and services, due to volatility. But that might? change when/if Bitcoin becomes bigger.

Piper,

not being in CS, could you elaborate further on the distinction btwn a protocol and software?  software can be adapted too, right?

Half of China are watching porn behind VPNs anyway, what stops them from broadcasting transactions as well?

i believe the Mycelium cold storage BIP38 encrypted QR code solution is a game changer.  the privkey is only held in RAM long enough to sign a tx and then is wiped upon closure.  great for on the fly usage.

http://www.reddit.com/r/Bitcoin/comments/1rkojh/bip0038_supporting_in_mycelium_is_targeted_for/

I think there are four major arguments against Bitcoin, which are at least on the surface strong arguments against mainstream acceptance of BTC:

1) Volatility. As long as the exchange rate fluctuates wildly, BTC as a currency is highly unlikely to become mainstream. However, I think this is a short-term problem, as more acceptance/use of BTC will lead to less volatility, or more importantly, less tying the value of BTC to the dollar.

2) Technical Hurdles. Frankly, Bitcoin is currently too hard for "Grandma" to use right now. I also think this is a short-term problem, as the Internet was too hard for Grandma in 1997, but now just about everyone uses it with no problems. Entrepreneurs will solve this problem.

3) Lack of understanding. People today just don't understand what currency is. You see this in every argument against Bitcoin: What is the value of BTC? How is it different from Beanie Babies? Etc. As long as the average citizen thinks money gets its value from Big Brother, BTC will not be accepted mainstream. This is potentially a very serious long-term problem, but I do think this can be overcome as BTC is used by more and more merchants, and its "value" becomes more clearly understood.

4) Government oversight/pressure/crackdown. I think this is the biggest long-term challenge to BTC. Governments don't need to make BTC illegal, they just have to make it shady. By creating huge hurdles or onerous regulations regarding BTC transactions, the average Joe will not want to use it. Remember, most people on this forum are willing to go against the stream, but the average person wants to be right with their government and won't get involved in anything that even hints of trouble. With the fact that BTC upends many government controls, I can see this being the biggest long-term obstacle to mainstream BTC use.

Bitcoin doesn't scale. Saying that 3rd party companies and offchain transactions will solve this goes against the very idea of bitcoin.
Also the deva saying "ohh, don't worry, we will look into it when it becomes a real problem" is a very bad sign IMHO.

Not true. The devs have been saying for quite a while "we're looking into it, and we'll be ready with a solution by the time it becomes a problem", which is quite different.

What you're suggesting is turning the steering wheel now because there's a bend in the road three miles ahead.

He's right, the steering wheel might need to be turned sooner than you think. Remember what Erik Voorhees did to the system with SatoshiDice? When confronted about bombing the blockchain with micro transactions he didn't care because he was "testing the system". Greed will force things on Bitcoin before it's ready. The only thing that can really destroy Bitcoin are the users or lack of users (see my previous post above).

The usage pattern might change if the blocks are full, people will plan their transaction more carefully and less frequently. You don't change bank just because it is not open during weekend, you simply stop doing transactions during weekend

1. ASICs & Mining facilities. 51% lets you do anything from ruining the currency to implementing modifications to the protocol.
2. Centralization makes it a lot easier to make a 51% attack, but besides that, centralization could result in governments taking over bitcoin and destroying every single one of its benefits over fiat.
3. Reduces the security of bitcoin.

The biggest argument against Bitcoin - and all crypto currencies for that matter - is that everyone thinks everyone else is out to rip them off in one way shape or form. It's sad but when you can't trust anyone, how far can it go?

To use Bitcoin trust is unnecessary. Consensus is necessary. As with trading anything, all parties involved must agree with the value of the item being exchanged. Fiat is backed by trust in the issuing authority. Even transactional trust is unnecessary if you use escrow.

ugh.. you really need to look into this yourself. Ignoring uses with a bright yellow "ignore". its lit up for a reason.

1. Thats not what a 51% attack is and doesnt let you do that. do research.
2.bitcon isnt centralized, pools are false centralization. ie. if someone pulls some shady stuff, the people 'get out of the water' and they lose the hashrate and peoples faith in them, pool owner then loses their income stream. any other form of centralization is just as much BS. do research.
3.no it doesnt... do research...

Pruning, Larger block sizes, faster internet speeds, specialized equipment if needed and continued bitcoin development.

I was meaning that you have to trust that the person you are buying BTC for example from will actually send it - escrow is all well and good - but you still have to trust the person acting as escrow to do what they should.

Well there usually is one or two trustorthy members - that's all it takes to get an escrow.

Cryptocurrencies are here to stay but maybe Bitcoin will die. There could be a cryptocurrency ecosystem which includes Bitcoin and several other cryptocurrencies with various advantages. As the cryptocurrency market matures, we will see systems that interface with all major cryptocurrencies. Banks might co-opt Ripple/anothercoin and credit transactions could work on top of it. Zerocoin/something-similar may offer better anonymity and might subvert protocol detection attacks better.

That being said, software sucks and most people probably won't use systems that interface with all major cryptocurrencies, for whatever reasons. Banks are subject to regulation, and Bitcoin could get around those regulations (and at the same time, Ripple/anothercoin).

Bad news about bitcoin makes the price go down and vice versa. When the prices go down a lot, then people will buy more bitcoin because of the low price, so the price will go up again. It could potentially hold up a long time. It only ends if there is no more trust in the currency whatsoever.

And it is precisely my naiveté that prompted me to make this thread.

After reading the latter parts of the Problem with Altcoins (https://bitcointalk.org/index.php?topic=279650.0) thread, I am inclined to agree that there are serious issues with Bitcoin in the long term.

One being the problem of mining cartels forming in a post mining-boom (when returns on mining are minuscule) where the plutocrats dump the transaction fees to zero to capture the entire mining-market and only those with the deepest pockets could afford to spend money getting no return on mining. Maybe even governments could play such a role, with the excuse of "guaranteeing the infrastructure of the Bitcoin network". This group of people could then hold the currency hostage, and there would be no monetary incentive for selfish miners to compete with them. A selfish miner would either accept the status quo or get out of Bitcoin.

The other being anonymity. How the anonymity offered through Bitcoin is weak, becuse using Tor to hide one's IP address is not good enough when fighting a global enemy using a timing attack as explained here (https://tails.boum.org/doc/about/warning/index.en.html#index7h1). A global enemy (like the NSA) could also has a myriad of other exploits to find out your identity. At first glance, this might be seen as a huge problem. But think of what happens if the global financial system collapses and the masses move into Bitcoin, then there they will a large amount of blame given to Bitcoin and its early adapters. In the words of J.R. Willet in the Lifeboat foundation (http://lifeboat.com/blog/2013/04/bitcoins-dystopian-future):


Hence hard uncrackable anonymity is needed.

I assume that the elite, fearing their power being encroached by Bitcoin would both try to dominate mining and also drum up popular anger at Bitcoin instead of assuming their own responsibility in having created the current and doomed fiat system.

None of these two issues with Bitcoin are absolute flaws. One way to solve them is to think of these issues ahead of time and like the Lifeboat foundation wants to, advice regulators, wealthy Bitcoiners and other power brokers on how to proceed in a way that causes the least harm. And with the help of generous directed donations from those who made their wealth by Bitcoin as well as careful explanation and good marketing, it would be possible to at least somewhat abate public anger.

On the mining cartel problem one could set up some kind of foundation or institution to ensure that mining power is spread out and independent.

Both these "solutions" are big ifs (there might be other better solutions if these issues are addressed seriously by the Bitcoin community now rather than later - creds to the Lifeboat foundation).

There are some advantages to having Bitcoin public, but it does require fighting a PR-war to win over the masses of disenfranchised. That could easily mean Bitcoiners would resort to logical fallacies in order to convince people, just the kind of behavior that can be seen all around these forums now (imagine what that would be like when wealthy people are trying to justify why they are rich when the world economy is grinding to a halt.

About setting up organizations that would provide safety and stability to Bitcoin-mining and make sure no one co-opts mining when returns drop to the point where transaction fees are the main income - this is clearly possible. It might even work quite well, but organizations can also be co-opted or just become myopic over time. This is also not a foolproof solution and more similar to the current system than the apparent flawlessness that attracted me to Bitcoin in the first place. 

because now we have dogecoin.

How's that a valid argument? Dogecoin is a joke coin.

The most convincing argument against mass Bitcoin adaoption to me is this:

1. The average human IQ is 100. Let that sink in for a while: 100 is average.

Think about what a massive challenge that represents.

You could have used that argument against the mass adoption of computers 30 years ago...

1. I have done my research. Do yours
2. I wasn't talking about pools. I was talking about mining cartels and ASIC manufacturers. Or in the future, just banks. If bitcoin is accepted I can see many governments spending a lot of money to make massive mining centers to ensure they control the currency. They can then treat it like they do regular banking today.
3. If this was the case we would have prunning already

IQ is a test designed specifically and explicitly for detecting learning disabilities that prevent someone from succeeding in mainstream school systems. The test had 5 iterations so far which meant to refine its ability to detect issues such as dislexia and other learning disabilities. The revising also were used to adjust to cultural changes as scores rapidly shifted, eg, when 120 became the average they refactored it so that 100 is the average again.

Scores over 100 are largely meaningless because of this.

Furthermore, the score is calculated as 100*X/Y
where X = The average age of an average student in the K12 system whose academic performance matches yours
where Y = Your actual age.

So a 10 year old who has the academic performance of an average 15 year old has an IQ of 100*15/10 = 150. If you haven't realized it yet, IQ is a percentage.

This also means it is a completely meaningless score for adults.

As far as I have understood, Gavin and the developers have promised that pruning will be ready "when it is necessary". I have no reason to doubt the developer team, but when is it really necessary to prune, at 1TB? Has anyone come up with a timeline? What proof is there that pruning will be possible when it really is necessary?

In the long term I don't see how this could be a problem. There are several people making more and more secure and easy-to-use wallets, besides, with the current technology the problem isn't the infrastructure but how to get the information. When it comes to money spreading that information will be quite easy and fast. I mean, grandparents can use facebook and internet banking no problem, why wouldn't they be able to understand that you could print a paper wallet for ultimate security with a click?

After that it is just a matter of hiding it in a safe place. Besides, for smaller amounts of money, a usb stick could easily provide more than enough security.

Ease of use is not a long-term issue.

Lack of information online is not a long-term problem as more trustworthy exchanges will arise, and more secure and easy to use wallet solutions will come for the less technology savvy.

This is clearly an issue. The more unequal the spread of wealth the more problems. 

Here is a great video: Paul Piff: Does money make you mean? (http://youtu.be/bJ8Kq1wucsk)

Personally I believe that unequal spread of wealth is both a cause and a symptom. But the symptom is deadly in itself and should therefore not be ignored.

Some of the solution will come from philanthropy, some will come from better education/culture and I can't help some of it will come from some kind of voluntary basic income though I have no idea of how it would look.

The altruism/egoism debate is a sidetrack. It is impossible to be completely altruistic or completely egotistical.

Germany is an example of a country that so far has managed to balance it's socialism with strong individual rights in many cases, after the war it has always championed a hard currency (even if it is a hard fiat currency) in addition to having a strongly federal political system as well as having a populace generally more politically aware than most others. However, they have no freedom of speech for neo-nazi groups, and much worse, criticism of Israel is still taboo.

I think many of Germany's good policies are remnants of guilt after the second world war and memories of the DDR. These things will eventually fade.

Other way around.
Equal spread of wealth = everyone is poor, downtrodden, and live short brutish lives.
The more unequal the spread of wealth the more prosperous a society is for everyone, even the people at the bottom.

This was a problem in the US when the gold standard apparently led to panics that created an unstable economy and thus hardship for many. Savings accounts and insurances could help solve this though, it is a matter of culture, not Bitcoin or any restricted-supply currency in particular.

I think your admiration for the German solution to be misplaced.  It's not just that neo-nazi based ideologies or israeli dissent that is verboten.  Any kind of subculture at all is verboten, although (obviously) some are ignored.  Notablely, however, Christian based homeschooling is not ignored; and a ban on home education of any kind remains in effect as the last edict started by Aldolf hitler still in effect.  Put another way; while politics in Germany functionally ignores the dark side of Islam, but puts devout Christians who consider German state schools to be contrary to their faith in the same catagory as neo-nazi hate groups.  One might come to the conclusion that German polticos fear the idology of such (non-state) Christian spreading into a greater percentage of the electorate. 

This is no more true as an absolute than the false meme that an equal spread of wealth leads to prosperity for the greatest number.  The causes of such wealth disparity is also important to consider.

No, maybe I was to brief in my wording. I'm not saying wealth has to be spread exactly equally for everything to be perfect, only that grossly unequal societies tend to have problems because of the gross inequality (see my video and countless other evidence). It is definitely possible that a really unequal society can be better for the poor than a more equal society, but not if every other factor is equal between those societies.

Look, complete equality should not be the goal of any society, but ignoring gross wealth inequality as an issue is simply not realistic and not backed by science.

I recently inquired about this issue, and the general response was that pruning is already emplimented in the reference codebase, but isn't yet enabled for the offical client.  This is mostly because of concern about what kind of impact widespread pruning would have on the "many copies keeps data safe" stragedy that the blockchain employs.  Some of the developers don't believe that there are enough full clients at the moment, and that enabling pruning would result in a significant drop in the number of compete copies of the blockchain from which new clients could bootstrap.  I'm not a programmer, but it was strongly implied that certain power users with the programming skills to enable this code themselves already do prune.  So when they say that pruning will become available when it's necessary, they kind of mean that they will turn it on when they feel that the burden of running a full client is reducing the number of full clients, and that we are not to that point yet.

I probably was too positive to the "German solution". I do not agree that any kind of subculture is verboten as such, in fact I saw much more subculture in Berlin than I have seen in any western European capital ever. Maybe I got lucky, but my impression was that it was less distance from the general populace than elsewhere - though other places in Germany are supposedly less subculture-friendly as far as I've heard.

Personally, I don't think having one religion gives one more right to homeschool a child than having another or none. I think obligatory schooling should be verboten. I agree that Germany is not good for homeschooling, but even though many other countries allow it it is not an option for most people, and hence a somewhat, though not entirely, moot point. Germany uses law where other countries use propaganda.

Sounds fair. So if we trust the developers on this, then scalability is pretty much solved?

ASIC mining farms. I believe Satoshi intended for BTC to be cpu only

You complain that Bitcoin isn't completely anonymous, and then your solution is a impossibility.  Anonymity is a scale that is derived from the actions of the user, not an absolute attribute of any currency.  While cash is certainly more anonymous than Bitcoin, even cash in person isn't 'uncrackable anonymity' because you have to do it in person.  Any detective with the resources to do so can determine who you are by interogating your business counter party and/or tracking location data near the location around the time of meeting.

Keep in mind that Bitcoin is a compromise solution to a preexisting condition, and while it's certainly not perfect, I consider it unlikely that any or all of Bitcoin's own shortcomings will prove to be fatal to it's market dominance.  You shouldn't put to much faith into AnonyMint's musings either.  While he can turn a phrase quite well, I have personally put the lie to all of his arguments that I've seen thus far; to the point that he doesn't even like to respond to me at all.  Feel free to research his and my interactions on this forum, and you will learn more than you did from him alone.

At some point though you would have to trust somebody (maybe not in a financial way), at least in order to be able to feel fully at ease with someone (or anyone). Trust is a great issue with the Bitcoin community, but I believe it already has improved and is improving further, so it is not a long-term issue.

Well, I wouldn't say 'solved' because the greater scalability issue isn't the resident size of the blockchain, but the real time latency and bandwidth requirements of the network.  I don't even know if there is really much that can be done with 'solving' scalability within the main network itself.  I tend to think that external solutions, such as overlay networks (such as Stratum) taking over a majority of small transactions.  There are a number of ways this can be done, all of which are a balance between the trustless security model of the main bitcoin network against speed and cost, that I think will end up competing in any future that Bitcoin assumes more transaction volume than Visa can deal with.

Your belief is in error.  Sataoshi expressed a desire that Bitcoin remain cpu only till the "kinks" were worked out, but he didn't get to decide that issue alone either.

I'm not a programmer, so to some extent I have to trust that those who program my client aren't hiding a backdoor.  If you're not part of the US Federal Reserve or related monetary industry, you have to trust that they will continue to accept such paper for taxes and legal debts.  Faith in some group or another is a reasonable expectation.  Bitcoin shines in that it doesn't require faith in any particular institution, nor is would the Bitcoin economy at large be at risk if (for example) the Bitcoin Foundation were to simply close up shop.

I highlighted the operative part of my prior post for you.

I'm not putting too much faith in AnonyMint's arguments(/musings). And I will for sure research more as you said. The reason I started this thread in the first place is that I realized that I was not informed enough (which I thought was ok as I thought there was more time, but now btc isn't play money anymore, but something that has grown all too real faster than I could ever have imagined - I figured it was really time to understand where my play money really have gone, and more importantly where they are going).

I have also not seen any of AnonyMint's arguments (that I agree with) saying how Bitcoin won't come to market dominance, but what got me thinking is the argument that what if Bitcoin does come into market dominance - what then? How will we prevent a backlash against the early adopters?

edit: but having a completelty anonymous way to pay and hold money would make it sooooo much harder for anyone to track...

Sorry, I was obviously not reading carefully enough - thank you for pointing that out. The question then becomes how many subcultures are ignored and how many are verboten? And how does this ratio compare to other countries?

I admit I am not qualified to answer this as I do not have enough experience with German subculture.

I agree. But I was talking about trust in the community in general. That most people have to be able to trust at least someone to be able to feel safe. For many people, family means great trust. For other people, it is certain friends. In less unequal societies people trust strangers less than in more equal societies. This has good and bad implications. Bad implications because it makes people naĩve, but good because it is a lot less hassle.

They are all verboten, and some are still ignored.  just because they are ignored, does not mean thty are not verboten.  Germany is, thankfully, unique among democracies in that the legal code assumes all things to be banned, until they are explicitly permitted, while just about everywhere else, all things are assumed to be acceptable until they are explicitly banned.  The fact that actual Germans ignore the flailings of their own politicos is a sign of progress socially, but it also means that the generations of strong social cohesion among Germans is drawing to a close.  The Japanese were once as socially cohesive as a nation as well, and look at what the influence of Western culture(s) has done to them.  Unlike the Chinese, the Japanese mafia are a relatively recent phenomenon.  Have you ever een heard of the "German mafia" or "Swiss mafia"?  Of course not, because it's a clash of cultures that presents the opprotunities that give rise to organized crime.  The original Italian mafia is so old because there has never been such as thing as a single Italian culture, only the dominate one.

True; and if's & but's were candy and nuts, we'd all have a merry Christmas.  If you can come up with a workable way to do this, feel free to share it.

1. what video?
2. When someone says wealth inequality they always misuse examples. They point at examples where you have LIFESTYLE inequality brought about by communism and say that the solution is to prevent WEALTH inequality.
Wealth inequality comes from either a capitalistic society where the standards of living for the poorest are better than they are for the average communist.
Or from a slave owning society where the slaves have 0 wealth and as such the ratio between the richest and poorest is infinity (X/0 = infinity) where the poorest have horrible conditions
Or it comes from a totalitarian society where the king is said to literally own anything in the nation, even if its owned by someone else its still the kings property (I can't think of an example where this didn't overlap with slave owning society)

The thing is, the latter two examples are non existent and are a binary status while capitalism and communism are a continuum where the more you move towards equality (communism) the worse life is for the average person.

The first link is news to me! Thanks!

No VAT on Bitcoin spends in Germany. Fabulous!

  Every argument against Bitcoin is a hypocritical one.

Power grid goes down and gold might still matter. Nothing else will. Unless you like wiping your ass with thin green presidential toilet paper.

1.
2. First of all I think you are wrong. At least in the sense of using the word "communism" - that is surely not what I'm taking about.

Rather I think you should use talk about the use of force. Taxes in a liberal democracy are collected at gunpoint.

What capitalist societies are you talking about anyway? I was not aware that there where any? Surely not the US, right?

What I'm trying to say is that while I don't approve of the use of force, one should not brush of the inequality as a non issue. Imagine immense ghettoization with just a few extremely wealthy and almost no middle class, yes one could argue that it is better than communism, but what we are talking about is whether it is a fortunate situation or not. In fact wealth disparities that big, make it hard for anyone to change their wealth position and these conditions are ripe breeding grounds for revolution.

I have indeed heard of the "German mafia". They are a bunch of large companies with tentacles far into government and their control freak buddies in government that do their bidding. The difference you are talking about when it comes to cohesiveness is just that the crime is legalized and even more organized.

At least the Italian Mafia is honest about that they are forcing you to pay them. But the German mafia are much better organized and hence a devil that is easier to deal with.

Do you have any English-language sources of everything being de jure verboten in Germany until it is explicitly allowed? And are you actually saying that this applies de facto as well? Would I be arrested for picking my nose even though it is not expressly allowed? I don't believe it. At best it is a construct of no practical application.

Christianity or Islam is never 'non-state'. The complicity of militarism and 'patriarchal' religion constitutes the State (organized violence).

Like i said, if it's banned, then it will only exist in the underground.

If you gathered all the criminals in the world, then collected their total assets, and then looked at how much of it is btc, how much btc would be in their possession? And would they by any chance be involved in fiat money??

https://yourlogicalfallacyis.com/black-or-white

There are many historical examples of either being quite 'non-state', or at least anti-the-current-regime.

Yes, many historical examples, but of course not christian examples, which is hypercollectivist terror against the human nature. Patriarchy is the opposite of anarchy.


LAW AGAINST CHRISTIANITY

Given on the Day of Salvation, on the first day of the Year I

(— 30th of September 1888 according to the false calendar)

WAR TO DEATH AGAINST VICE: THE VICE IS CHRISTIANITY.


Article. I. — Vicious is every sort of anti-nature. The most vicious sort of human is the priest: he teaches anti-nature. Priests are not to be reasoned with, they are to be engaoled.


Article II. — Any participation in church services is an attack on public decency. One should be harsher with Protestants than with Catholics, harsher with liberal Protestants than with orthodox ones. The criminality of being Christian increases with your proximity to science. The criminal of criminals is consequently the philosopher.


Article III. — The execrable location where Christianity brooded over its basilisk eggs should be razed to the ground and, being the depraved spot on earth, it should be the horror of all posterity. Poisonous snakes should be bred on top of it.


Article IV. — The preacher of chastity is a public incitement to anti-nature. Contempt for sexuality, making it soiled with the concept of ‘impurity’, these are the real sins against the holy spirit of life.


Article V. — Eating at the same table as a priest ostracizes: one is excommunicated from honest society by doing so. The priest is our Chandala, — he should be quarantined, starved, driven into every sort of desert.


Article VI. — The ‘holy’ History should be called by the name it deserves, the accursed history; the words ‘God’, ‘Savior’, ‘Redeemer’, ‘Saint’ should be used as terms of abuse, to qualify criminals.


Article VII. — The rest follows from this.

The cost of the electricity requirements to secure the transactions will eventually outweigh the benefit of the transactions.

Too much imagining too little reality.

I don't need to imagine, I can see it in every communist country in history, ever.

And the fact that people use this as an argument for pushing communist agenda is absurd. You are stoking fear to attack the only thing that prevents what you claim to fear.

IT IS COMMUNISM. You are insisting that capitalism IS communism.

This isn't wealth disparity, its freedom disparity.

Precisely. I'm saying that todays so called capitalist societies are not really capitalist. I'm saying that we don't really have any good examples of free markets anywhere.

I don't believe in taxes as I think it is forcing people to do something. But that doesn't mean I don't believe that truly free market capitalism might be prone to big wealth disparity with all the problems that lead to. I'm arguing that those wealth disparities are a problem in themselves.

Therefore it is important to think about what one can do to make sure that the wealth disparity does not become big enough to be a problem. What I'm talking about is that in a truly anarcho-capitalist society, culture is really important. A culture that embraces the fact that we live in a community and shouldn't stranger to one another, that one should try to help other people intelligently (by teaching them the skills they need to help themselves).

Wealth is important for your opportunities and if your culture is so confoundedly stupid that you can't understand that nor think that it has negative consequences, then I suggest you think again!

Well, yes. The biggest problem is all this communism that is being introduced into falsely labeled capitalistic societies.


You are using the terms of the enemy. Wealth disparity is the rallying cry of communists as they dismantle capitalism. A society with no middle class and masses with nothing has a disparity of freedom and of qaulity of life.

Wealth disparity is when people say "the top 1% has 70% of all money/property in terms of dollars". But in a communist society with no middle class there is no 1%, the people at the top are so very few, and relatively if you compare the ratio of wealth its not that big because society is so backwards that the only way for the wealthy not to live like animals themselves is to import it from non communist nations

The labels are not the biggest problem.


"The terms of the enemy"? Come on, this is typical 1950s McCarthyist rhetoric. There are examples of so-called democracies with a high living standard on average and high median living standard as well as low poverty, and there are examples of the same with big income disparities, high average living standards, lower median living standards and high poverty. Both type of societies have high taxes and lots of bureaucratic rules, but the ones with lower income disparities are less stressful to live in because one doesn't have to face poverty, there is less crime and in general less tension.

There are examples of so-called social democracies where there is a lot bureaucracy like everywhere, but where the common man is well off middle class (as in absolute middle class on a western scale) and where markets do have a say and it is still possible to make one's own life according to pretty free rules in comparison to other countries that call themselves "capitalistic". I don't champion this kind of society at all, but pretending like all state intervention makes only complete ugliness for everyone at all times ever simply isn't true. Some of the best countries to live in for average Joe at the moment are rich social democracies in Europe - and that is a fact (these countries are also safe, have low prison populations and low recidivisy rates). Another fact is that we haven't really had any pure capitalist society in modern post-ww2 times.

I think your logic is completely binary, where everything is either communism or capitalism. If you want to use terms in this black-and-white manner you have to define what you mean by them. Both of these terms are loaded and need to be handled with care.

Just because the state uses force to accomplish it's goals doesn't mean it is always only evil and never has accomplished anything worthwhile. I think that mostly it is inefficient and often evil, but not completely anything. Apple Inc., on the other hand, is pure evil - a malignant cancer on mankind.

1. He has since been proven right.
2. why shouldn't I call those who seek to make me into a slave an enemy?

You couldn't be further from the truth.
It is a continuum, but one where there is a direct connection between the variables. More communism = lower quality of life. More capitalism = more wealth "disparity" yet higher quality of life for even the poorest.

the main disagreement we have is on what the term "wealth disparity" means. You think it means "shrinking middle class, lots of extremely poor people"

Everyone else in the world thinks it means "if you take the X% top richest people, add up their property, you get a value which comprises a % of the total property in existence. The higher this value, the more wealth inequality"
This is a term that was invented by the communists and I am refusing to use it, but I don't pretend to seek to redefine it. There is no point in redefining it because it's definition is actually fairly accurate. The problem is that it looks at percentages instead of actual values.

I don't care if bill gates lives in a palace so long as I have a decent standard of living. I do care if stalin/mao/etc live in a palace if I have a horrific quality of living.

This is mostly because so few individuals had any wealth under such regimes.

The united states is also marching towards wealth equality. in 2012 we had 40% fewer millioneres than we had in 2008. It isn't JUST the poor that are getting poorer, the middle class are getting poorer, the rich are getting poorer. Everyone is getting poorer. Except for a few corrupt individuals who are getting richer, for now.

Investment in mining hardware leads to logarithmic improvements in hashing efficiency rather than more desirable linear improvements. So for example 10 billion dollars invested in infrastructure to produce asics will lead to way more than 10 times as much hashing power as 1 billion dollars invested in infrastructure. This coupled with that fact that IC fabrication is potentially the best example of natural monopoly to ever exist, means that no one will ever be able to produce chips even 1/10th as efficient as intel or amd and there is simply no room in the market to create a robust array of companies that operate on the economies of scale of intel or amd. This means that the government could, in theory, twist the arms of all of the COMPETITIVE asics manufacturers into installing back doors in all of the top of the line asics in the future. Or they could even contract with intel to produce asics for them and then murder the rest of the network with even a hand full of asics produced with that sort of economy of scale.

there you go thats my best effort devils advocate argument against bitcoin.

This is very well put. This is what I was talking about earlier about ASICs causing centralization of the bitcoin.
And the fact of the matter is, all the major governments have a history of twisting the arms of companies for backdoors. See the snowden leak for the USA, while the rest openly admit it and say its for the greater good

+1 for good argument against Bitcoin. Is there anything we can do about it? As far as I understand distributed manufacturing of high quality chips is far behind the most advanced chipfabs.

McCarthy was never proven right, the fascist post-war US was no heaven for ordinary people if not for their domination of other peoples making the ordinary American rich.


Too much wealth disparity is a problem. Firstly, it means protecting the wealthy will rely on using force against the poor to fend them off; secondly, it means people who are less well off don't have the same opportunities as the more well off and hence society is less meritocratic; thirdly, crime will increase.

I don't subscribe to the fallacy of "if the rich get richer in the relation to the poor, then the poor get richer in absolute terms". It is not an absolute truth, but merely something that happens sometimes.

To me, a true capitalist or anarchist society is one where no matter what amount of wealth you have, you have good (if not equal) opportunities to make your skills valuable and useful to their full and real extent. If inequality is too great this will not be possible.

I agree that if you separate wealth and political power by getting rid of the state, one could make room for larger "wealth disparities" than otherwise without sacrificing too much lost opportunity. But we have many problems, ie proto-governmental multinational companies, so jut getting rid of the state is not enough. As we see with Bitcoin, most things work better decentralized. And one of the biggest threats to Bitcoin is the centralization of mining. I think that a decentralized state of affairs would be in the long-term make less problems, better culture and as a result of that less wealth disparity.

In essence, gross wealth disparity is a hindrance to free competition, makes people estranged towards each other and encourages nepotism. I don't want to use force (taxes) to prevent this (as I think that will just make things worse), but I do think that it is important to assume the role of leadership when one is put in that position and hence one has responsibility for a lot of people. This is what I mean by wealth disparity. One cannot ignore it because if you have the faculty to help people out of a bad situation by teaching them how, you are morally obliged as a fellow human, that quite possibly have happened to end up in your comfortable position more by happenstance than by merit, to help out.

This is merely how I think it is necessary for a culture to be in order to avoid revolution (and in the end possibly shootings of early adopters of Bitcoin, just like the Russian imperial family where executed).

This.

And that it is not safe, or rather that it is too complicated a task to safeguard your Bitcoins.

I just got my first offline wallet after getting 10 LTC stolen from me. 

Actually, he was eventually.  McCarthy's core premise was that the Soviet Union had sleeper cells inside the United States, and he believed that spies held very high profile lifestyles, most likely in media.  It took until after the fall of the Soviet Union to prove it, but McCarthy's paranoid premise was correct even though a great number of innocent people were included into the project as well.

Yes, because the 'free market' is an oxymoron. Free humans are self-sufficient. They live (lived) in self-sufficient communities beyond the state, beyond the market, beyond labor division, beyond collectivistic communism/capitalism, which essentially is the same: working with and against everybody, against human nature and against the nature in general. They are growing rampant until they collapse. For the first time in the history of the citizen (a cartoon of the former human) the collapse will be global.

+1

Also Spricht Zarathustra!

Onwards to the grandiose being that stands above all irrationality.

it can only handle 7 transactions a second :/ 

Where did you get that one? I never heard of such limitation.

It's to do with the blocksize limit - currently all blocks can only hold a maximum of 1MB of data. I'm told by smarter people that it would require a hard fork to remove or otherwise change this limit. Given average time to generate a block as 10 min, and a minimum transaction size of ... whatever-it-is bytes, that works out to 7 transactions per second.

If the blocksize limit were increased, or removed altogether, we'd get the blockchain increasing at an even faster rate than it already is, but that may or may not be a problem depending on how storage hardware develops, and how drastically we implement 'pruning' solutions or lightweight clients. I'm told there are also economic reasons why a limited block size might be a good idea but I don't know what those are.

Well said economic reason are with fees I guess. When the size limit is reached on a block, transactions with higher fees are prioritized over those with lower or no fee. Or so, at least that is from what I understand with how bitcoin works.

I don't think it's a problem that some blocks might reach the limit during peak usage times. I would think it's a problem if a transaction could be delayed for more than a hour due to this though. Currently though, a lot of BTC... especially those traded for speculation on exchanges are all traded offchain and does not affect the blockchain at all. So this might be more of a problem the more people actually use BTC as a currency. Then again payment processors might cover this as well, but... inputs.io is probably still in recent memory amongst many of us.

But the bitcoin whitepaper does cover how to trim the blockchain down to a more manageable level (tl;dr, involves pruning old data after verification), and personally for everyday usage I tend to use a client like multibit to go around the space problem in general (though as a enthusiast I have bitcoin-qt installed as well).

I don't understand you completely; by issue, do you mean the kinks or CPU? And what did Satoshi try to decide?

He attempted to convince the users to hold off on GPU mining.  He didn't get his way.

This isn't true as of yet, since most blocks are not full as of yet.  The greater limiting factor seems to be Gavin's Cost; a theoretical risk of loss from including each additional transaction that Gavin Andreson estimated to be around .00033 BTC per KB of transaction size.  This number will naturally change over time, due to many variables, but efforts are underway to significantly reduce this cost per transaction in order to encentivize miners to include more transactions into the block.  The same effort will also improve the average transaction rate.

Total blackout, is a rather extreme case, yes it could happen, (EMP, CME X class, circa 1859 etc). Then, does it really matter? Any and all fiat currencies will collapse. Will the ATMs be operational?
Will the banks have access to people’s accounts? The most likely currency in such a case, would be water, food, fuel, guns, ammo, other resources, and maybe gold, silver. People would be in survival mode and instinct response.

In the mean time, a concern would be the block chain size (for most of the people who want the original most secure client/wallet), and of course the time to get confirms, some take hours!
Time will tell.

There will be no more currency without electricity. All nuclear plants will blow its inventories into the atmosphere and people wouldn't be in survival mode, but in death mode.

We watched the tragedy unfold
We did as we were told
We bought and sold
It was the greatest show on earth
But then it was over
We ohhed and aahed
We drove our racing cars
We ate our last few jars of caviar
And somewhere out there in the stars
A keen-eyed look-out
Spied a flickering light
Our last hurrah
And when they found our shadows
Grouped around the TV sets
They ran down every lead
They repeated every test
They checked out all the data on their lists
And then the alien anthropologists
Admitted they were still perplexed
But on eliminating every other reason
For our sad demise
They logged the only explanation left
This species has amused itself to death
No tears to cry no feelings left
This species has amused itself to death

http://www.lyricsdepot.com/roger-waters/amused-to-death.html

First, it would be much appreciated if you keep your offensive labeling remarks (Cry babies)to your self. No one attacked you personally.

Second, the block chain now is a true issue. It takes over 3 days to download and install the client - as of a couple of weeks ago- and that is NOT because of HDD space, inet speed or computing power or RAM. (syncing also takes considerable time if you skip a couple of days) Try this for Grandpa, Grandma, Dad, Mom and so on. 5-6 wallets in a household, it is a bit discouraging, as I said it is a concern at least for now.

If that is fixed in the future than it’s ok. But now it is a drawback for the average person trying to get into it, using the most secure client/wallet. Also as I noted above some confirms take over an hour for the first, and that is another drawback.

Let’s keep the discussions civil.

Maybe there will be a big fab plant in china, the us, Russia and somewhere in Africa and so there would be a bit of a prisoners dilemma problem for each government. Maybe by that time bitcoin will be so big that it will be like the internet in that it will be bad for governments in certain ways but so ubiquitous that its not in their interst on net to crack down on it.

Really though i think the ultimate solution is going to have to come from an altcoin. This may lead you to think that bitcoin will have all of its market cap sucked up by an altcoin at some point in the future but that is not necessarily what it means. The mere existence of an altcoin that solves this problem could be enough to convince governments not to crack down on bitcoin because they would know that if they did all the capital would just flow into the altcoin and they would have spent a large amount of money to fundamentally change nothing. Meaning that even an amazing altcoin that solved this very real problem wouldn't ever be successful on bitcoins level and maybe bitcoin would continue to rise in value capitalizing on its network effects despite this flaw.

It is aslo, i think, worth noting that 2 altcoins have solved this problem. one at the cost of introducing new problems (peercoin) and one with a brilliant solution that does not involve new problems (NXT). It is also worth noting that perhaps governments would use this method to crack down on bitcoin and capital would flow into an altcoin that solved this problem. after all governments are less than notorious for their wisdom and foresight. I have a reasonable amount of resources invested in NXT for this very reason.

The arguments that worry me most, in order from most to least worry:  

1.  Scalability.  Right now we're configured to do a maximum of 7 and a half transactions a second.  In practice, most miners refuse to build blocks bigger than 250K because the slower propagation time of larger blocks means they risk losing the 25BTC block reward if another block spreads faster.  So in most blocks we can get less than 3 transactions per second.  Occasionally a miner willing to build a 1M block wins the race and we get up to 7 and a half -- for that block.  So far it's been enough to clear backlogs.  

Assuming they figure out how to handle more transactions, there is still a scalability problem with the data.  As the number of transactions per second grows, the rate at which the blockchain gets larger also grows.  The blockchain can already take more than a week to download and more than 15GB to store.  Multiply the current transaction rate by 100 (which is still nowhere near visa scale) and it will become literally impossible for ordinary people (read: in a P2P network that isn't centralized by being limited to a few servers with massive bandwidth) to download the blockchain faster than it grows.  At the same time, the space required to store 2 years worth of transactions would be growing to about 1TByte.  In the future faster hardware and bigger bandwidth may help -- but it may not happen in time, and by the time it happens the need may be even greater than we suppose now.

Finally, the size of the stored blockchain affects the startup time of a full client.  Not badly unless your machine is very slow, but in the very long run, it's hard to imagine going through 20, 50, or 100 years of transaction history every time you start up.

2.  Security.  People who keep gold or large amounts of cash in a safe in their homes don't live inside the safes. People who use secure computers to send and receive Bitcoin should not do their email and web browsing and GUI crap and insecure OS and gaming and automatic software updates and cell phone syncing and passwordless logins and file sharing and etc, on the secure computer.  Yes, that limits a secure computer a lot -- just like the living space inside of a safe is very limited.  

I despair of explaining this to Homer Husband and Harriet Housewife, but using Bitcoin requires having some kind of digital device that you treat just like a safe.  You don't live your day-to-day life inside of a safe. Also, OS support for being used as a 'safe' is increasingly hard to come by.

3. Transaction fee roulette.  It is flatly impossible to anticipate what you will need to spend on fees in a given bitcoin transaction.  Not only are the fees different depending on features of your own txout set that most people have no clue about, but they are also different depending on the semi-randomized selection of *which* txouts you'll be spending and how busy the network is.  With no way to anticipate fees, merchants can't set prices accurately.  And the fees are still too small to motivate miners (by comparison with the block award) while already too high to permit small (vending machine size) transactions.

NXT makes a lot of claims, last time I checked it was a closed source project (that claims it will go open source "soon" TM) and doesn't explain the technical details behind HOW they supposedly solved it.

However, if it does I will dance a jig for joy.

You really have to dig around to find the technical details of how he solved it, its buried in the bottom of some obscure thread. And the code is still closed source so it is possible that he made a convincing facade rather than actually implement the elegant solution that he did conceive. However it doesnt seem all that likely since it would only be marginally more work to actually implement the solution than the convincing facade. Check out an article i wrote on it for a basic explanation of how it works, and the conversation i had with come-from-beyond for a technical explanation of how it works. Even if NXT is a total scam coin BCNext did solve this problem atleast conceptually in a really elegant way so its pretty exciting.

https://bitcointalk.org/index.php?topic=345773.msg4063478#msg4063478

1. Buying goods with Bitcoin decreases value as merchants immediately cash out.  New money doesn't flow into falling prices of Bitcoin.
2. Numbers aren't easily digestible.  Ever pay 0.004994321 BTC for a loaf of bread?
3. BTC is not deflationary.  Altcoins such as LTC extend the supply if adopted.

ltc != btc

LTC is to BTC as Dollars is to Yen.

I know a merchants that don't cash out.


0.004994321 BTC = 499,432.10 μBTC and what's and easier way of representing $499,432.10?


Whether or not BTC is deflationary will be determined by the market for altcoins. Capital may be mostly attracted to BTC and if BTC proves itself to be technically sound it will stay there.

People convert fiat to BTC, in order to purchase products. So this effect is neutralized.


That is why an increasing number of merchants use the mBTC.


Actually it is one of the drawbacks of the LTC.

jinni bitcoin is the future of money. Soon everyone will be using the bitcoins instead of dollars after all it is a great concept where Federal Reserve may not manipulate the market by printing money whenever he wishes to. In my opinion bitcoin shall glow in future in fact it is glowing even today. Just see how its prices escalated in short period.

main argument in my opinion: for me as an average joe, bitcoins don't improve my life in any way and don't open up new opportunities. they are hard to obtain and hard to spend. all i can do is to look at charts, gamble, get scammed, buy drugs or exchange bitcoins into other coins called litecoin or dogecoin. here and there you can pay for normal products with bitcoins but i already have a credit card and a paypal account which are much more convenient. i heard there is a deeper meaning behind bitcoin but it fails to reveal itself in a simple message that's relevant for me and my life. it's something about evil governments and money not being money. didn't get it as i am not so much into wearing teabags or tinfoil hats. one day the greed that's responsible for the rise of bitcoin will move to the next big thing and there won't be much left that's of relevance for an average person like me.

Has anyone mentioned off-chain transactions yet? 

My guess is that they're not likely to be a problem for at least 6 reward halvings (ie: 24 years) but after 14 halvings (ie:56 years)  I would expect them to have already started impacting the hash rate and thus blockchain security in a major way.  That is, somewhere between 6 and 14 halvings total payout (block reward + transaction fees) in equivalent fiat at today's dollar value for mining a block will peek and start decling thus causing a peek and decline in mining.

What criminals are you referring to? The guy that drinks too much alcohol on his way home from work and then drives his car when he shouldn't.  We could call him a criminal, does he 'NEED' Bitcoin? Not likely.  Perhaps you are referring to the South American Drug Lord exporting millions of dollars worth of Cocaine into the United States every day, chances are he has never even heard of Bitcoin, so it cannot be him you are referring to.  Maybe you are talking about the Silk Road scandal?  No it can't be that, because that matter is still before the courts (innocent until proven guilty and all...) unless you have a magical crystal ball that lets you see the future.  Not likely.  So I am at a complete loss to understand how you can make that assumption, upon what factual basis do you make such claims.  Has there ever been a verdict handed down by any court in the world that linked Bitcoin with a crime? Ever...?
We need look no further than the Drug Enforcement Administration of the United States of America for statistics on how often 'money' (as you put it) is used in criminal activity's every day.  According to the DEA's own website more than 212 billion dollars in illegal narcotics was sold in the US last year alone, all done with cash.  Should we get rid of money?  As for your comment that 'money is working well for average citizen and for the economy', try telling that to the people all over the world still suffering from the affects of the 2008 Global Economic meltdown.  Unemployment (U-6) is at 14.3% in the US, and in some countries in Europe it is even worse, Greece has an unemployment rate of 27.4%, try convincing someone from Greece that 'money is working well', good luck with that.  The truth is our leaders failed, the banks failed.  If we leave the creation of money in the hands of those that have demonstrated failure in managing the most important aspect of our lives, we let ourselves down.  This cannot be allowed to happen again. Bitcoin is our response.

The problem with Bitcoin, if it's used %2 as much as the USD for drug lords, is that the CIA doesn't know how to take it's cut from the cartels in BTC. Plus the cartels might be able to hide some it's profits from the CIA so the CIA only gets %7 of the drug trade and laundering instead of %15.

Except that every bitcoin adress whith a balance on it will be compromised and the owner of the quantumcomputer can use all those coins as if they were in his wallet. LOL
No problem here surely! Did you know that a keypair is created using cryptography as well? :D
Herpderp. 8)

Bitcoins are not under great threat by the develpment of a practical quantum computer.  They're not magic, Bitcoin is fairly resistant to quantum brute forcing already, and can be upgraded if the threat proves real.

On what facts do you base that?

the wiki for quantum computing (http://en.wikipedia.org/wiki/Quantum_computer) very clearly states:


As far as i know SHA is one of the algorithms that is threatened by this. Show me what magical special defense system bitcoin has against this potential threath plz. :P

One thing that is clear to me now, is that Bitcoin is like gold, platinum or diamonds, it's not for the average joe, unless you're like me, middle class average Joe and can get %50 of your fiat (i.e., you are not living pay cheque to cheque and actually ahead by 3 cheques) into Bitcoin as your savings that you absolutely won't need for 3 months (and we know what happens to BTC over three months).  But otherwise it's for the very wealthy who live internationally across many different cities, resorts and casinos. Bitcoin is a reserve with high liquidity and very efficient transaction speeds while achieving high security.
We winter in an international surfing town, where I just bought a golf cart (which are hella expensive here). It was a pain in the ass to get the cash out in local currency and I knew it would be. So I talked the family selling me the golf cart into accepting BTC (even though they'd never heard of it) as payment 'cause that would only take 20 mins and I wouldn't have to spend a week at various ATMs that may or may not have connections to my banks back home over the holidays. With daily limits and 5 cards over multiple accounts I got it done with 4.5 hours of my time over two days , $25 in gas and at least $50 in banking and exchange fees. All because my wife vetoed paying in BTC because she wasn't risking BTC when we have a block on our exchange account because of accessing our account from the international IP. She was right, I got much of our last deposited money in at $667 just before the $120+ move over Xmas day, while the Chinese couldn't get money on and the West had bank holidays everywhere btw!

Now apply that to carrying million$ to a high roller poker game over international borders to Macau or Monte Carlo. And I know people who do this... Even who just keep $60,000 in their trunk in case, some purchase or bet comes up. And you start to see the supreme value of keeping even just %10 of your liquidity in the fine and secure reserve of Bitcoin.

Bitcoin is multiples higher more efficient and all around superior than gold ever was. That's why I see even $240,000 as cheap (5.6 billion ounces of gold in existence divided by 11 million BTC and you get up there pretty quick, without even factoring for how superior BTC is, of course many of us will likely be in jail for trading btc before it gets to $50,000...).

Interesting story. Next time keep some BTC in a wallet off the exchange so you can have it handy at any time you might need them!

I do agree with you to the extent that only the people who can afford to save money are those who can have Bitcoin. But I think you are being slightly socio-culturally myopic, as even poor people can afford to save. Just look at China or India, where even extremely poor people do all they can to save as much as possible. You don't have to make more than you can spend to afford to save, you just have to spend less than you make.

The number of inputs to check is exponential in the size of the input string. So if the input strings are n bits long, we need time of order O(2^n) to 'crack' SHA2 (any variant) on a classical computer. IIUC a quantum computer then reduces this time to O(sqrt(2^n)) which is the same as saying O(2^(n/2)). This is nothing to worry about with the bitcoin protocols (either the mining algo or the key finding algo) as the square root of an exceedingly long time is still an exceedingly long time.

Worst case scenario if it WAS a problem (which it isn't) - we double the length of all bitstrings on which we want SHA2 to act - e.g. we could just switch from SHA256 to SHA512 - and now the quantum computer takes as long to break SHA512 as the classical computer took to break SHA256.

Most of bitcoins weakenses can be solved by the market. whether it be  volatility, difficulty of use or lack of speed.
If it dies it will most likey be because the system has become hacked or some kind of selfish mining. 

I did have enough off the exchange to complete the transaction, but because Cavirtex is blocking cash deposits even from Canadian banks accounts if initiated from an international IP, the issue was that we couldn't buy more BTC (except for with the last $3000 we had on there), and my wife wasn't allowing us to part with any BTC while that was true.

I agree for the sake of making the point I was a little socio-economically myopic. One of my poorest friends was the one who got me into bitcoin, and was working his ass off and not spending anything to keep getting money in from $7. He's now one of the most well to do people I know.

The big reason I can say we're truly middle class now is because of bitcoin and getting fiat in there quickly. We now have a family code phrase - "times 7". Meaning if we don't spend it or put off the purchase and get the money into bitcoin instead, that those dollars will be worth 7x more in however many months.

A lot of people I tell about it these days, when they hear the price say or immediately think, 'oh, I can't even buy one this month or next.' I gotta get into telling them that even just buying .3 btc now is like buying 150 ounces of gold for $250.

For our domestic help, I'm starting to put their bonuses, that I don't tell them about into btc, and then come back 4 months later with, here's your massive bonus!

But why not just tell them? Maybe they will come around and ask to have some of their salary in BTC!

As noted very well by Nancarrow, quantum computing simply shortcuts some poarts of chryptography, but other parts are no faster.  The thinkg about Bitcoin is that it's not based upon the abiluty to hide a secret text from veiwing, but to make the proof-of-work system viable.  The most likley result of quantum computing on Bitcoin would be an increase in the hashing rate in the same way that moving from CPU's to GPU's to ASICs have increaced the hashrate, and even then, if we don't likel it, we can switch the algo to something more quantum resistiant.  The part that is most at risk in Bitcoin is the private keypaairs to the addresses, but even then, Bitcoin uses an upgrade path to address algos that permits a quantum resistant algo to be adopted in place of the current (version 1 address start with a "1") address algo.  Again, quantum computing is not magic.