I never plan on selling all my bitcoins. That was one of my biggest mistakes from years ago -- deciding to sell everything because of a temporary bear market. By the time I bought back, I was buying back much higher than I sold.

My overall "exit strategy" is to take partial profit during future bubble periods. You can never know where the market will stop going up; all you can do is take some profit off the table when the market is skyrocketing. A year or three later, hopefully I can buy back my coins much cheaper, and then rinse/repeat.

I'm not too worried about Coinbase's banking infrastructure. The main thing that worries me is the size of their customer cryptocurrency storage. If they get hacked or embezzled, it's game over. Don't store your coins there!

If user losses are capped below 10%, things might actually just go on as normal. Remember when Bitfinex got hacked for 120,000 bitcoins? They only got bigger after that. Never underestimate cryptocurrency investors. They're born gamblers.

Cryptopia has never really come across as shady to me, either. Maybe stretched too thin and supporting too many coins, but not particularly shady.


Maybe some angel investor will step in so Cryptopia can compensate the losses, like Coincheck. Wouldn't that be nice?

I'm guessing they'll issue tokens for the losses like Bitfinex did.

Since 2013 or so, I'm guessing most newbies start out on the "get rich quick" path. Many have this idea that Bitcoin is too expensive and they throw their money at shiny altcoins. I did this myself when I first arrived on the scene. I paid dearly for it when prices crashed!

Getting scammed or hacked a couple times early on also seems to be a formative experience for most newcomers. Cryptocurrency really brings out the scammers thanks to nearly instant/irreversible payments. Newbies usually don't have the security mindset that's necessary to avoid being parted from their money.

If you're right, I'm fairly sure it's not the first time they've accumulated that much hash power. The discussion about Bitmain controlling a majority of the hash rate has been going on for 2-3 years now.

I'm sure many other miners point their rigs at Bitmain's pools. If Bitmain stepped out of line, miners would move elsewhere. And there goes that huge hash rate under their control. Plus, their reputation could implode -- surely not a wise move with an IPO on deck.

Based on these considerations, I'm not too concerned.

That's definitely an issue. Ideally, miners would buy excess energy at a discount where it's abundant, rather than adding load to a high-demand or low-supply grid. There already exists some natural incentive to promote this: Where electricity is more abundant, prices are cheaper. I think as we see more businesses of scale enter the mining sector, we'll see an ever increasing share of operations moving towards more sustainable situations where they won't threaten power grids or drive prices up.

There's also the likelihood that green energy sources like wind and solar generation will become increasingly efficient and accessible to the market. That will lower the footprint of what miners consume beyond excess supply.

This is the trade-off. It used to be a very obvious choice -- Localbitcoins, hands down. It has much more listings and also just a superior UI. But now that you need to do KYC with Localbitcoins and individual traders are sometimes asking for ID, it sucks for privacy reasons.

Bisq is an option to trade without KYC, but volume is lacking.

Next time I need to do a P2P cash transaction, I'm probably going to try Paxful so I can avoid giving up my ID, but I'm not sure how long that'll last.

Fiat money isn't the only problem. Fractional reserve lending, debt securitization, banks using collateral posted by clients... The entire financial system is a house of cards. We would need a complete overhaul of the banking system to prevent a major financial crisis like that from occurring again.

You're just dodging the issue, though. It doesn't even matter if everyone in the world wants to use BSV. The entire design is based on the idea of not allowing scarcity of block space. There is no way to pressure fees above zero. How the hell are miners going to be paid? Or do BSV miners just secure the chain out of the goodness of their hearts?

BSV is setting itself up to implode when the mining subsidy starts winding down. Not that it matters to Craig Wright and Calvin Ayre. They're just here for the cash grab.

Nonsense, this is just for private key storage. There's no interfacing with any exchanges, let alone Korean ones. I'm pretty sure what Samsung is doing is integrating a hardware wallet into the Galaxy S10. Where you buy your coins is up to you -- they're just providing a storage mechanism.

I think we'll see in the coming years that BSV simply isn't sustainable.

It's funny that you mention "economic incentives." A deflationary supply with no fee pressure? 1 TB block sizes in the next 2 years? How is that supposed to incentivize miners to secure the chain? It sounds ludicrous.

How would that work exactly?


I did notice a significant spike in fees earlier and was wondering what was going on, especially since the market seems so dead. When these spikes in network activity come out of left field like that, you have to wonder what's causing it. After the spam attacks of 2016/2017 I always think of the BCH camp first.

Indeed, this is a really important aspect of the fee market that people often don't account for. It's one of the reasons why limiting block size is really important for scalability.

Fee pressure naturally causes services and users to make their use of transactions more efficient. This not only frees up block space and lowers fees as transaction batching becomes the norm and Segwit (and later Schnorr) adoption increases, but it's a way of organically encouraging a more scalable blockchain. If fees were perpetually cheap, then users would have no incentive to optimize for scalability.

I'm aware of how Stellar works and I've read through the whitepaper. It definitely uses federated consensus, which implies lots of trust. I think that was one of the original purposes of Ripple/Stellar -- to leverage trust on the blockchain. An interesting concept, but absolutely not worthy of comparing to Bitcoin's security. There's no incentive to be a validator. The choice exists to trust whoever you want, but logically who will users trust and what is the default behavior? It tends towards a hub-and-spoke model where trusted banks, exchanges, and other services dictate the network consensus.

The incentives just aren't strong enough to keep everyone honest. Bitcoin's rational mining incentives are much more reliable.

There's no ideal situation here.

You can do 2-of-2 and hope that your client never loses their key/seed, but if they lose them, the money is gone.

You can do 2-of-3 where you hold two keys (in separate physical locations to prevent compromise) and your client holds one, but this effectively places the funds in your sole custody. That raises liability issues if the funds are ever stolen.

You can do 2-of-3 where you hold one key and your client holds two (in separate physical locations) but again, this opens the possibility that your client has his keys/seeds compromised.

Whatever you do, I would avoid any liability in case things ever go awry. You don't want to be on the hook for a 20 BTC loss.

You could also consider an institutional custody service like Bitgo. I'm not sure exactly how their setup and pricing works but lots of services use them for multi-sig storage.

Aren't they buying and selling? They probably sell BTC for gift cards at x% discount, buy BTC with gift cards at y% discount, and their profit is y-x.

There are several gift card reselling sites out there like GiftCardGranny and Raise.com. I'm not sure if the rates are worth it or not, but that's another way to liquidate them as well.

That sounds about right to me.

I was hoping there would be some good blockchain analysis that might back up the fractional reserve theory. The circumstantial evidence -- especially when you consider the losses from the ETH smart contract bug and the ongoing delays in paying customers -- was already pretty strong.

I wonder if the owner really died or not. If so, I wonder why the other managers/directors thought they could hide the insolvency this way.

It has to be a secure element setup like a hardware wallet. The security assurances there -- as far as we know -- are pretty good. We'll only really know years down the road when this technology is sufficiently hardened.

I'm pretty surprised to see Samsung jumping into the fray with consumer key storage this soon. I agree the optics will be bad if there are any serious security holes with their implementation.

What's the G20 definition?

I don't think there can be any all-encompassing definition for digital currencies. Some seem like commodities while others -- like ICOs and STOs -- seem much more like securities. We should probably expect different regulatory structures depending on the type of coin.

That only works on insecure POW altcoins that share a hashing algorithm with a superior coin. For example, a relatively small subset of Bitcoin miners could attack Bitcoin Cash because it has such a small hash rate. The reverse could never be done. The incentives against double spending attacks are much stronger in Bitcoin or even Ethereum because of the extreme costs incurred by mining.


You don't necessarily need to purchase that many coins. Groups of stakers can collude together. Altcoin supply distributions also tend to be highly concentrated, whether because of early accumulation when hardly any users existed or scammy initial distribution of coins.

Your entire investment wouldn't become worthless just because of a temporary 51% attack. Attacks like this have happened on lots of chains which still carry value today.

I'm not entirely opposed to POS myself, but I think its theoretical security guarantees are weak. I think if you want something close to irreversibility then you should use something like Bitcoin.

Who's going to download the 3rd party Gboard app just because it has a Bitcoin symbol? That's got to be an extremely tiny niche of people. Gboard doesn't even have 10K ratings in the Iphone app store. People (like me) are just going to keep using their default Iphone keyboards.

The whole thing is bizarre, almost like a joke. This would actually be kind of cool if they added it to the Android app because Gboard is built-in on many Android phones = many millions of people using it.