dont take any notice of the "market cap" valuation.. its not a 'holding' but an estimate. in short its just maths.

EG
if i make a altcoin of 10trillion coins.. and then sell just ONE coin on an exchange for $1. that altcoins market cap is purely mathematically valued at $10trillion. but the reality is only $1 has been traded. so just take no notice of the market cap valuations. they are meaningless

bitcoin is not creating money at home. money is FIAT (government legal tender)
bitcoin and crypto's are currency, which can be anything. yes even cigarettes/food in prisons are a currency. and yes so is wheat

wheat is a commodity currency (raw material used to create other products(bread))
bitcoin is an asset currency(property that holds value based on market supply demand)
money is a fiat/forex currency(legal tender controlled/regulated by governments/banks of the country laws are linked to that fiat)

bitcoin is like farmers growing wheat or making computers with a quota of only producing 12.6btc every ~10 minutes to a ultimate max production of 21million of them ever.

governments for decades, even before bitcoin have laws inplace with banks that banks should only offer services for fiat. and as such banks will not create a bitcoin ATM themselves or directly offer bitcoin purchases. but for moral/honest customers/partners banks dont care if those customers/partners offer bitcoin trades/services.

the issues many banks have is not the currency itself. but scammers.
facebook even stopped its 'suggested advert' of bitcoin/crypto schemes because of the amount of fake sites that dont actually offer customers real bitcoin holdings.

banks also have found scammers buying bitcoin and then FAKING that the scammer itself had been scammed to get a chargeback, so many honest exchanges and well known honest OTC traders have had red flags put on their accounts because of chargeback scammers. which is the real reason banks do not tolerate bitcoin trades, because they see the high risk of a chargeback/fund reversal due to scammers abusing the chargeback facility.

banks do not lose out on any economic impact of bitcoin. because bitcoin does not economically impact fiat.
when a bitcoin is bought. fiat is NOT burned/destroyed. instead fiat moves from the buyers account to the sellers account. which is the same as someone selling wheat or a computer. fiat just changes hands and makes no impact to the economy

moral/honest bitcoin trading does not affect peoples lives. but scammers/false investment schemes where banking customers lose out or where banks apply red flags to users because they dont realise/cant prove the scammer is not the victim but the perpetrator

the reason is because most bitcoin adverts and ICO adverts are scams

trying to get people to use 'investment' schemes where the people never get to own/trade real coins, but instead gamble the scammers database entry using a price that 'emulates' a real exchange price

and facebook just dont have time to vet all these scams or become liable for causing people to become victims.
imagine all the lawsuits of "facebook told me to go to this site and hand a scammer my life savings"

the truth is that although there are 16.8mill bitcoins.. hardly any are on exchanges
there have been times where it only takes less than $1k of a users money, to move the whole market cap by $168million

EG
if there was a orderline of 0.1btc and filing it changed the price from $10,060 to $10,070... thats a market cap change of $168m caused by buying 0.1btc($1k)

yep.. thats right.. i said it. bitcoin price/market cap is not true value


in short the bitcoin price or market value can be manipulated cheaply. this is not due to supply/demand. because the real supply demand is not found on exchanges. a large % of exchange trades are day traders, playing on speculation(gambling) not hoarders/sellers.

if there were 16mill coins on an exchange.. and they were forced to put their coins on the line at the lowest price they would be willing to sell for. you would see a far different resistance point(much higher) then these exchanges are 'playing' with

just look at most exchanges where the order lines are just mbtc/satoshi amounts .. not millions of bitcoin amount

it doesnt take a masters degree to understand blockchain tech, so its something you can learn real quick.
id say learn blockchain and then data science to then expand beyond blockchain, because the next evolution of data security is coming.

blockchain is mainly about cryptographically securing blocks of data. and as you may know, or soon learn the main gripe is getting thousands of users to store all that data for years. the next evolution is going to be about cryptographically securing the UTXO (unspent value) set without having to worry about storing decades worth of spent/meaningless transactions(blocks).

so dont spend to much time on blockchain, especially not wasting a year to get 'certified' in blockchain. because that term will get outdated quickly.

just learn to understand it (not to certify for prestige ego reasons) and then look to get ahead of the game by developing the next evolution

i think some dont understand "bubble"

so here goes

for example, the real estate bubble: houses exist and have function. this means that a bubble is not about investing in imaginary/fake things. it means investing in things that exist and have value.... but if it is in a bubble, then the PRICE is speculated far higher then its underlying value

EG
imagine a bath/sink of soapy water
bitcoin/houses are the water, true value is the water level. and the PRICE is the speculative vapour above the water line, because when many people try to stir up the water, a bubble forms (over priced).

when the water calms and settles and the bubbles burst, the real value underlying can be seen

in short bitcoin is not a bubble.. but bitcoins PRICE is currently in a bubble(over priced)
and only when you can see the true underlying value (a new low price that it never drops below) you learn the difference between price and value.(bubble and water line)

i read it. and then thought about the bitcoin utlity... not traditional meaning
hint below:

oh look MUsig for bitcoin can be K-of-n
but anyway, on this bitcoin forum, i was thinking of bitcoins utilisation (which WE BOTH noted k-of-n is possible) and which insuch scenario the poker players wont know about the backroom guys if non interactive
(sorry i summarised it in the context of a ELI-5 bitcoin utility pitfall... shame on me for worrying about bitcoin pitfalls)

but to ELI-5 traditional.. instead of ELI-5 bitcoin
non interact = not asking to see the backroom before playing poker
interactive= asking to see the backroom so the 2 backroom guys cannot hide

ELI-5 bitcoin: easy to be a fund manager scammer if non interactive.. (as many devs/fund manager propose to have it k-of-n for bitcoin)

(maybe i should avoid dumbing down to ELI-5 and instead do ELI-21 step-by-step as a multipage detailed explanation to avoid the laughable knitpick..... rather than the summation and simplification based on what devs and 'fund managers' are hoping will be in bitcoin)

emphasis: i read the paper. then thought about bitcoin. i did not limit my summary to the 'traditional meaning' but the bitcoin possibility
so dont limit your rebuttles to the 'traditional meaning'(that skirting of the issue doesnt fly with me) but to the realistic pitfalls of possibilities of a bitcoin version
afterall this is a bitcoin forum

in short
non-interactive
k-of-n: backroom fund manager scammer risk
n-of-n: whole fund locked risk if one party offline/loses key/PC crashes  

achows post above proves that you cant just connect to anyone. you have to meet their terms and conditions.
(should i open that can of worms debate)
and as i said. although on day one B might have 10btc available.... IT CAN GET RAIDED
meaning 'he decided to setup the channel with B then because in the "lets make a channel" message,' it WAS available... so they created a channel
but due to other channel payments lets say minutes after the channel opening. NOW that amount is not available

also achowe highlights that people instead of just onchain sending funds of $100,000 to someone. if they wanted to use LN. they would have to make a tx of many channels splitting up the funds to have the hopeful best possibility of being able to transmit some-all of it (no promise/guarantee)

i personally see the network(IN THEORY) like a 8degrees of separation theory. meaning that in theory people only need 8 peers to connect to, who have 8 peers themselves, who have 8 peers.. etc etc.. whereby everyone is connected..(well a few million if you into maths)
but in practice. its not the case due to daily spend terms/conditions and if users are online, etc.. 8 channels per user wont work

so lets say 1000 outputs to start up 1000 channels that have a $100 limit (safe daily spend limit many would agree on) to be able to shift $100,000 easily in one day, to have the fluidity and no debate to get those 1000 counterparties to all agree to send $100 through their routes to hope that the whole $100,000 can get aggregated to the desired destination

yep most peers would have a $100 daily spend limit as a safe goal

which then raids 1000 other peoples other channels their $100 spendability.. meaning they have to close channels to move their $100(if thats all they are holding in total)
EG
lets use 2 counter parties(for simplicity) to A.. lets call them B and X, and whereby destination is C
[a:$0- B:$100] [B:$0- C:$100]
[a:$0- X:$100] [X:$0- C:$100]

if B only had $100 in [b-c] then B needs to close [a-b] and then onchain send that $100 to a [b-c] channel

however.. here is a kicker
for B to survive more than a day without closing. B would need to have say ~$3k(depending on how many days of month there are,.. in each channel, with a $100 a day route spendability, just to allow the channels to stay open for a month.

but B cant just have 1 channel open (as achowe admits to) so B would need to he a hub. with lets say 1000 channels.. which means B has to have 1000 channels. each of $3000, each with a $100 daily spend limit.. meaning he has to have 'invested' $3,000,000 to be a hub

again.
hop model does not work (peer-to peer direct) because of terms/conditions, routing agreements it ends up being a hub model whereby there are terms that need to be met and agreed (like a bank application)...

oh.. and of them 1000 channels when being set up. each channel agrees a 50:50 of the onchain closing fee meaning of a $2 onchain fee, $1 from each side is deducted .. costing A $1000 in total in closing fee's for his 1000 channels and same goes for B because B is also acting as a hub for other people too

---

achowe stop thinking about the beauty of developers coding/promoting the dream. and wear a critical hat and run scenarios. and stop being afraid to admit things can go wrong/ have issues/limits/problems

yes i remember you(with lauda) charging people a fee to act as a middle man when someone couldnt open their wallet. but then failing to submit the problem to devs to find a workaround that didnt involve middlemen so that users would never have that problem.

imagine its much like the 1990's where wordpad didnt have underline. so you would prefer to charge someone a fee to print out their paragraph, use a pen and ruler to underline what they wanted. and say it's 'fixed' ..rather than scream at devs to add a underline feature. all because you think wordpad has no errors and its the users problem for not being able to underline

in short
admit lightning is not the dream thats being promoted and highlight the issues.. dont hide/deny the issues
lightning is NOT the scalability solution..
hint:
each month B closes his channels of 1000tx's of 2input-2output (each channel is a 2 output to show A then has 0 and B has $100)

just to then open fresh channels in the next block of 1tx of 1000 outputs to open a fresh set. (where each output goes to each channel)
..AND his 1000 counterparties who connect to him will have to send the same 1tx of multiple outputs for their "well connectivity"

.. can you not see the tx mempool bottleneck cause by just one hub

ill shut up for now and let achowe and others process what is said above (hopefully without the core/dev defence hat on)


P.S  i have been doing 'bank reserves' trades using multisigs (much like a joint bank account where couples leave money in account but on paper argue over % share of account holding).. for a few years. and yes even i had to do onchain tx's at certain points to get funds out and also put funds back in. so i recognise the limitations.

its also funny how achow admits that B can refuse acting as a route...
which kills the 'trustless' "infinite" "barriierless" argument.. and it proves the banking 2.0(hub) debate. because now B is admitting he has control of other peoples payment choices much like a bank can refuse a wire transfer if it doesnt like you moving say $100,000 in on lump. thus you have to withdraw your funds(close channel) and move to a different 'bank'(open new channel)

but anyways, lets explain it:

"well connected graph"
translation
each person has MANY channels(many onchain fee's to set up) to have many routes, to be 'well connected'..(hub model)

translation
at $2+ per onchain fee.. it cost more then $4(2 channels) to set themselves up as a well connected peer to have more than 2 directions/connections

translation
its not cheap to be a peer if you want to be well connected.. unless you want to be connected to a hub(bank2.0)

translation
HOPS do not work, and HUBS (bank2.0) become the routing model


as achow REVEALED
if an unbanked african guy (A) spends a weeks salary of $2 to set up a channel to B. if B refuses to accept A's villages life savings of 10btc to be moved because B refused to handle such amount,.
A has to close the channel (another $2 fee) to unlock his 10btc from the A-B channel and then open another channel (another $2) to connect to another peer who might allow 10btc payments.

but.. for how long will this new peer X have 10btc 'available' to always be open to help A out
maybe X advertises having 10btc open to a hub... but X is also connected to Y, Z and Y raided that 10btc before A got to use it

achow.. lightning is not a infinite moneypot of money that is always open and infinitely usable.
stop thinking with the "i have to promote this" hat on.. and wear a "critical thinking" hat

pre-empting rebuttles:
peers wont use lightning for life saving amounts, its meant for coffee drinkers:-
in which case if each channel only has say $60 of btc 'available' then they would get raided within 30 payments
meaning at most a channel costing an onchain fee of $2 is only open for probably a month (not forever as promoted)
or only 1 day if that peer has 30 'connections' raiding its $60 'availability' because those 30 people want coffee tomorrow

in short
imagine B would have to have 30 channels open with normal people offering each channel only 1 coffee payment a day. but with its 31st channel to starbucks it has to have $60 a day spendability to starbucks

in short
starbucks eventually becomes the bank2.0 with thousands of channels connected with each channel having a $60 a day spendability with middle men
but then has to close the channel at some point to then move the funds from each middle man. to then pay out wages/supplies/leasing costs

after all with only a $60 available channel with the middle men.. starbucks cant exactly sendbackwards $1000 through the middlemen to pay just one staff their monthly salary or the many $thousands for the monthly building lease via the already established middlemen channels. because the middle men only have a $60 daily limit

achow. again please take off the "i have to promote this" hat.. and wear a "critical thinking" hat

but have a nice day

^philosophy of 2009-2014... but not now^

just to make 1 transaction costs those 'unbanked' a weeks wages and if your going to start talking about how LN will be the saviour it wont.
because it still needs a onchain tx (weeks wages) just to open a channel.

now if you want something world changing. that will screw the FIAT economy, here goes:

stop measuring bitcoin against USD
instead measure it against the cost of living index or more simply the price of bread
EG 10,000 loafs of bread

when watch the finex fiat exchange rate change while everyone realises if they converted their USD to a fiat of a country with cheap bread. to then buy btc, they can get more btc for their 'buck'

and that would change the finex world rates

your about 3 years behind in your research. here is a tip
hyperledger

regulations do not do a single thing to protect customers   <- emphasis
regulations are just after-the-fact responders. not crime preventers. infact regulations create criminals by making innocent business people b guilty of something that in a rational world is not a crime, but do so months after the 'incident' occurred to not allow the innocent person to have prevented it.


and it is the businesses themselves that have to make up their own policy/compliance rule book to show they are atleast trying to prevent a crime. but if the business itself is the criminal.. its too late and useless..

bitcoin does not need regulation, because regulation wont help

what needs to be done is have less regulations and more consumer protections
EG

businesses selling(legit) goods and services have to show their real working address and contact details, so that if a customer does not get the goods as described its easier for the customer to slap the business with a wet fish(court order) if the business refuses a refund/send out goods properly

this goes for exchanges too.. none of this P.O box, virtual mailbox crap so they can run off with a "we been hacked" excuse while living on a sunny beach. they have to have a real world address to be able to be audited

also known as a k of n multisig
this means that in a 2-of-5 multisig where 3 people dont have to sign,

as oppose to
interactive, where by its n of n, meaning it has to be a 5 of 5 or a 3 of 3 where everyone has to sign



this means when users see the funding public key, they dont know how many other signers there are or are needed in total
and when the funds do move.. never get to know who specifically did sign

because the address doesnt tell them it is a 2 of 5..
because the address doesnt tell them who the other 4 people are

making it easy for whomever set it up to tell 3 guys its a 3 of 3 when in reality its a 2 of 5, and in reality whomever set it up owns 2 keys himself

so the 3 innocent guys dont realise its a 5 counterparty address.. all they can see is that their key is part of AN address.. but not know how much of a part...


much like a rigged poker game where 2 people set up the game, but hide in the backroom, letting  another 3 people play a table thinking they are only playing a 3 man game between themselves... then the 2 backroom guys can crash the poker game and steal all the chips. leaving the other 3 penniless and wondering who stole their chips. blaming each other

coding may work for privacy and lack of sole control.. but those same utility and features allow the ability to steal/blackmail

even carlton banks highlighted last year that a 'fund manager' with a special key can be sole controller while everyone else is offline, when he was describing how he can get rich offering services as a fund manager/escrow/arbitrator for second layer / multisig proposals.

lets hope bitcoin goes down the n of n (interactive) route to avoid fund manager thieves while others sleep. and not the k of n(non interactive) route
though the pitfall of n of n. is that if one users system crashes and they lose their key.. everyone elses funds are locked.

so i feel musig still needs ALOT more work and running scenario's before even being close to being a BIP

^ and here shows the problem ^

imagine 5 people (a.b.c.d.e) opened a channel and each funded 10btc
[A:10  -  B:10]  [B:10  -  C:10]   [C:10  -  D:10]  [D:10  - E:10]
in this case A has 1 channel(to B)
in this case B has 2 channel(to A and C)
in this case C has 2 channel(to B and D)
in this case D has 2 channel(to C and E)
in this case E has 1 channel(to D)
in total there are only 4 channels open because they are shared

now imagine A wanted to pay E 10btc
here is what happens
1st 'hop' - A pays B 10btc in channel 1 using channel 1 funds
[A:0  -  B:20]  [B:10  -  C:10]   [C:10  -  D:10]  [D:10  - E:10]

2nd 'hop' - B pays C 10btc in channel 2 using channel 2 funds..  channel 1 funds do not move
[A:0  -  B:20]  [B:0  -  C:20]   [C:10  -  D:10]  [D:10  - E:10]

3rd 'hop' - C pays D 10btc in channel 3 using channel 3 funds..  channel 1 and 2 funds do not move
[A:0  -  B:20]  [B:0  -  C:20]   [C:0  -  D:20]  [D:10  - E:10]

4th 'hop' - D pays E 10btc in channel 4 using channel 4 funds..  channel 1, 2 and 3 funds do not move
[A:0  -  B:20]  [B:0  -  C:20]   [C:0  -  D:20]  [D:0  - E:20]


now you may see the problem.
A has raided B's ability to pay C, D or E because B has nothing in channel 2 to 'pay forward'
A has raided C's ability to pay D or E because C has nothing in channel 3 to 'pay forward'
A has raided D's ability to pay E because D has nothing in channel 4 to 'pay forward'

so imagine you were B. and you only had 20btc to your name
you open 2 channels.. one with A and one with C

before you can even buy a coffee(C) for yourself .. A has leached you dry
before you can even buy a doughnut(D) for yourself .. A has leached you dry
before you can even buy a eclair(E) for yourself.. A has leached you dry

your only options are to close your channel with A (costing you a onchain tx fee to get it added to a block) then open a new channel to redeposit your 20BTC from [A-B] to go into [B-C]. costing another onchain fee. just so you can buy a coffee

big emphasis
you cannot take the funds from [a-b] and put them into [b-c] without closing [a-b] to then reopen a new [b-c]

another way to imagine it
Aguy has a Beautiful wife, they have a joint bank account
the Beautiful wife has a separate joint Cashcard account to monitor her Childs allowance

Aguy tell the wife she can have $10 of their joint account if she pays $10 to the child out of her separate cashcard account
that payment agreement is done
.. but now the Beautiful wife doesnt have $10 in her cashcard account to pay the child next weeks allowance.... unless she withdraws funds from the joint account (costing a fee) and deposits them into a new cashcard account(costing another fee)..

...
i hope this illustrates that channels are not limitless. nor are they trustless. because it requires counter party agreement. not sole control

i expect achowe to rebutt that if A was to sent 10BTC knowing it will wipe out B's future own spending ability with C,D,E.. that B will refuse..
but that raises the problems of:
1. not having many reliable hops willing to surrender their spendability to helpout the network of hops
2. it ends up requiring people to have MANY channels in the hopes that just one partner will agree to helpout
3. the onchain fee's to open and close these many channels are not cheap
4. the need to close and re-open to 'balance the books' and redeposit will spam the network

imagine it
costing onchain fee for every channel open and close..
would you use paypal if it cost you $2-$6EACH to open a channel knowing you will need to open channels with 2-10 ebay merchants ($4-$60) for the hope that oneone will agree to surrender some or all of their spendability to help the network

the devs are still stuck in the 'does it break' mindset but have never even thought about the 'is it useful long term' mindset
they are too busy looking for code bugs. that they cant see the FUNCTION/UTILITY bugs

with what i have said above.
blockchain currencies are NOT a threat to banking/credit companies.. but..
banking credit companies could adopt their own blockchain currency so that they can save money on:
auditors
IT staff
security staff
compliance officers
etc

because most of those tasks become automated due to how the blockchain self checks/regulates.
this is not to say it will replace credit/banking.. it will just change behind the scenes data storage and security method

bitcoin will not destroy fiat just due to 'going mainstream' (consumer popularity).

after all the euro is popular to hundreds of millions of people, yet it wont destroy the dollar.
after all a iphone is popular to hundreds of millions of people, yet it wont destroy the dollar.
after all a pepsi is popular to hundreds of millions of people, yet it wont destroy the dollar.

the reason is simple.

it has nothing to do with popularity or what people hold
its to do with laws.

7 billion people have held a bottle of pepsi atleast once in their life. this does not mean pepsi is going to take down fiat.
other legal tenders are as i just said legal tenders. but they wont tak down other countries currency, just by people using it.

laws need to change. which in most countries are:
minimum wage laws: - measured in a specific currency
court fee's and fines laws: - measured in a specific currency
tax laws:- measured in a specific currency

in short bitcoin will never become a legal tender of america and take down the dollar unless atleast those 3 laws above change the words "dollar" to then say "bitcoin".. no matter how popular bitcoin becomes people will still have to pay taxes and pay fines in dollars

.
also banks dont care about who holds bitcoin. bitcoin does not burn fiat. when someone buys bitcoin. the fiat does not disappear. it just moves from the buyer to the seller.. the same way buying an iphone, or a bottle of pepsi does.
so to banks bitcoin is no different than an iphone purchase and does not affect their monetary policy at all

if only people started using a bitcoin wallets 'sign message' feature

EG
using your bitcoin wallet and a specific bitcoin address. put in your secretword as a message, sign it whereby the signature becomes the password you would use online
that way no one knows the privkey. or the actual secretword(message) in someones head. and only the signature is used as the online password

this way. if you can only remember a secretword such as

Pa$$w0rd3d

then to have unique passwords that are different per site you only need to remember
Pa$$w0rd3d  + website name

EG
when setting a password for bitcointalk, you use your wallet and a certain bitcoin address to sign the message
Pa$$w0rd3dbitcointalk
sign it.
and paste the signature as your bitcointalk password

then when you want to set up a gmail password
Pa$$w0rd3dgmail
sign it.
and paste the signature as your gmail password

the password created via the signatures would all be different because the website name 'salts' the secretword and no one will know that all you have to physically remember is Pa$$w0rd3d  +website name because all they see is a bunch of gobledegoop of characters

a multisig allows more than one person to authorise a transaction

a smart contract can do other things to, such as lock funds for a certain length of time, (CLTV) or allow funds to be charged back to another party(CSV)

there are other features popping up as smart contracts in many alts, but bitcoin does not have really much smart contract utility yet

this is where wallet developers/coin creators need to stop copy and pasting code..

if coin developers just used an address that did not start with a 1. they could easily do an error check that tells users, 'seems you inputted a non-usdt address'

a survivalist investing in gold..
HA

survivalists currency will be bullets

as long as computers are still around, fiat will be around
no computers.. no fiat..
so if fiat goes its likely access to bitcoin and 'gold funds'(online trading) will be gone too

bullets are the survivalists currency