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The internet could very well evolve into a giant distributed artificial neural network of unimaginable intelligence. A breakthrough in AAN technology could see the such systems all sorts of tasks, in the "real" world and on the internet. Before long these systems will be communicating with eachother, then, I think something amazing will happen.
Seems inevitable.
What role will humans play in this world?
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There has been some debate over the ability of the xtfee/mining economy to function. You know, the whole tragedy of the commons thing. http://bitcointalk.org/index.php?topic=6284.0If a solution is found, it may involve a drastic protocol change, which at this stage of bitcoin may be impossible. However, I believe I have come up with a way to bootstrap the new system off of bitcoin, sidestepping the whole get-currency-into-the-economy problem and allowing us to keep our hard earned value. The idea is to spend bitcoins into the new currency (bettercoin). First generate a keypair in bettercoin. There will be a function F, which maps a bettercoin address, x, to a bitcoin address, F(x). The function isn't so important in implementation except that it's output must be a valid bitcoin address. F could be a hash or it could truncate the bettercoin address (if it's longer), flip the bits, whatever. Now, in bitcoin, to transfer bitcoins to better coins you simply spend your bitcoins to F(x). As far as bitcoin is concerned, these coins are lost forever, because no one has the private key of F(x). This eliminates the possibility of double spends. Bettercoin systems have to read the bitcoin blockchain to check if coins have been spent to F(x). If so the bettercoin address x has the equivalent amount in bettercoins. If bettercoin is indeed superior, all bitcoins will soon be spent into the new system in this fashion. |
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I've noticed some web sites are publishing addresses on their sites for donations, etc. over unencrypted connections. I thought I'd point out, to anyone who doesn't realise it, that you are vulnerable to man in the middle attacks.
Any MITM can rewrite your address to theirs and receive all your payments! Especially tor exit nodes, which are known to engage in this behavior.
Any payment related pages should be treated the same as a credit card payment gateway, in security terms. That means use SSL!
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It's too late to do that kind of changes. We'll just have to go along and hope it will be possible to raise enough donations. How much enough is no one knows.
If Bitcoin grows to the size of Paypal there will be about a million dollars worth moved with each block. If users can be convinced to pay just a 0.1% fee on average (and they have to pay some fee, however small) that's more than ten times the current block reward. The current block reward has already made Bitcoin the world's biggest computing project.
Hopefully most people won't care if they pay 0.1% or 0.0001% when they buy a pair of shoes. Particularly if 0.1% labels you a Good Guy and 0.0001% takes an active effort and makes you a Freeriding Bastard.
It's true that if users voluntarily paid 1/100 of the typical fees paid in todays systems, we'd have no problem. If they didn't and we lost this gift of bitcoin, it would be truly a tragedy of the commons. I don't think it's too late to make changes. If the "change" is clearly awesome and infallible, then I don't see anyone currently mining objecting to the change. The problem with putting some protocol based restriction on fees is that there is no way to algorithmically determine the value of a bitcoin and the restriction must be a function of value. If yield from fees is too high, we'll have a ridiculous number of miners and it will cost too much. Too low, we have a weak network. But how much many miners is the right amount? This is the kind of equilibrium which can only be achieved by market forces. Any protocol change will need to introduce market forces which balance the number of miners. We need more debate on this. |
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@Mashuri @tomcollins
You've opened my eyes. Speculators serve society in their way. [No sarcasm]
@Mashuri
I just want a currency that performs the function of measure of value. If the only way to achieve this is by heavy market intervention, I'm out. In fact, if there's needed any market intervention I'd probably don't like it.
I think Ripple or Terra (none of them public) could achieve this.
What I've been trying to tell you is that a fixed supply currency precisely achieves the function of measure-of-value. price inflation/deflation is then only a function of supply and demand of goods/services/labour. Whereas monetary expansion and artificial interest rates distort the true price of currency and everything else, necessarily resulting in a miss-allocation of resources that retards economic growth. I don't want all the products in the market to have a stable value (that's impossible), I just want to prevent inflation and deflation. Not even that, I just want to prevent its effects.
You seem to have a bizarre concept of inflation/deflation. prices are inherently unstable due to fluctuations in supply and demand. Please distinguish between price deflation/inflations and monetary deflation/inflation. If the money supply is fixed and population is stable then an overall decrease in prices is simply a result of economic growth: Society is producing more goods for the same amount of labor, so the same dollars are chasing an increased supply of goods. Prices will fall. This is the beauty of capitalism, not some evil that you need to negate. Things are supposed to get cheaper! |
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asdf:
aren't inclusion costs independent of difficulty? Are you saying, Moore's Law will stop AND people won't build dedicated hardware AND pooled mining won't dump the problem into oblivion AND processing power will not be spread to bigger parts of the population?
You call the issue of a disturbingly low difficulty equilibrium "resolved" when the global cost of a transaction approximates a single verification? Sorry, are you serious, or have I misunderstood something about the verification cost scaling? Also, the discussion at hand would fit better in the other thread.
Hmmm... I see, inclusion costs are independent of difficulty and will converge to zero with time. I confess that I didn't really read all of the relevant threads. This is indeed a mathematical/game theory problem. There are too many free variables that need to be tied together. This is a deep problem. I'll put more thought into this before posting again. |
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There will be no block size limit in the future. It's only there to stop spammers at the moment and will be lifted when the network it bigger.
Did you read Gavins post (#4) in the thread you linked? I believe he resolved the issue.
Transactions aren't free for a miner to include. If people pay no fees, they probably won't get included at all. If miners charge too much, they leave a gap in the market for cheaper fees, new miners will enter the market and accept those slightly-less-profitable-transactions bringing fees back down. This will crowd out less efficient miners.
"whole system will optimize itself to be wonderfully efficient." - Gavin
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Can someone tell me how BTC is going to the moon when it is still relatively difficult to acquire in the first place? I imagine there are a lot of people who think Bitcoin is really cool but don't get involved much past playing around with the small amount of BTC from the Bitcoin Faucet. Given the difficulty of acquiring BTC, I think the fact that BTC made it to almost $2 is amazing in the first place.
Bitcoin is getting easier to acquire every month. I imagine this trend will continue, accelerating adoption. The more bitcoin usage there is, the faster it grows, at least in these early stages. This is the definition of exponential growth. |
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To the bears.
less than %1 of people on this planet even know bitcoins exist! I expect that many more will discover it soon and want some. Bitcoin is on an exponential trip to the moon!
Unless bitcoin gets destroyed somehow (government) or something better comes along, I fully expect bitcoins to replace every currency on the planet. Why wouldn't they?
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Let me try again. So if the supply of gold were theoretically infinite, but limited at any one point in time, it would be a poor choice of currency? Not only a poor choice, in fact, but an anti-market choice?
Gold is practically close enough to a fixed supply to make it good money. The inflation part isn't necessary and only serves to redistribute wealth to gold miners. My question is whether this aspect of gold is unfair. Do people with gold deserve to see the supply remain fixed, and gold miners are cheating them out of their dues? And stored electrical energy (in the form of, say, batteries) would be a terrible form of currency because more could be generated? Again, not only a poor choice but an unfree one that redistributes wealth to the undeserving?
I'm not sure what your trying to communicate, but yes, I think that electrical energy would make a bad currency. Again, my question is not about electrical energy itself (though I do think sealed battery packs would make good trade items in a collapse scenario). Is the ability to make more batteries unfair to people who have batteries now? Would only an anti-market zealot support battery inflation? Yes, the fact that there's more gold / energy / carrots will reduce the trade value of other gold / energy / carrots. I agree that this is unfortunate for people holding large carrot reserves, but why is it anti-capitalist?It's different for currency which can be created at zero cost, like bitcoins and dollars. These are abstract things, so creating more of them is not like creating more batteries. It's more like stretching an inch. You can't apply arguments about commodities to currencies. Straw man. |
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bitcoin can be transfered electronically, gold can't. gold can be traded physically, bitcoin can't. otherwise, for the purposes of money, they are the same, but due to this distinguishing feature, they each serve different markets for money: the physical and the electronic.
Gold and bitcoins are complementary. Both have different uses and both are usefull.
Bitcoin can be traded physically (flashdrives, printed certificates). I agree with your vote though. True. I was coming more from the angle that bitcoins depend on the internet and computers to be useful, but gold doesn't have this problem. |
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I'll go out on a limb here and boldly claim that an inelastic money supply is better than an elastic money supply. Inflation/Deflation is moot. Or, if you really want to get to the root the ideology; free markets in money are better than regulated markets in money.
Free market money tends toward using commodities such as gold and bitcoin, which are inelastic, which tend toward deflation (in a growing economy). So deflation isn't "better" so much as unregulated money is better.
Interesting. Can you give me your opinion on the terra? Would it achieve stable prices? http://en.wikipedia.org/wiki/Terra_(currency) Without thinking too hard about it, I'd just say that I think bitcoins are much better. Interesting idea, though, but once again, I don't feel the need to maintain a stable CPI. All you really want to do here is make sure that prices are the same on average, why? Especially when the only solution is to reallocate resources by giving someone new money. Stable prices are an illusion; relative prices will always change even though the cpi might be stable. Prices are not stable by their very nature. Why do you want to fix nominal prices? Is it really that important? We seem to be getting by today with constantly changing prices, what's the problem you're trying to solve? People seem to have a real fetish for this "stable prices" dogma http://www.economicenquiry.com/archives/75 By stable prices I mean the absence of deflation and inflation. The changes in relative prices move the economy to what the demand wants. But when everything is rising or falling people have to calculate which things are rising/falling faster in order to do successful business. But everything will be rising and falling anyway. The price of electronics goes down while oil prices go up. This still happens with a stable CPI. If there's no innovation and supplies are stable and the money supply is fixed, then prices will be stable. If some innovation means that a good can be produced at half the cost, why shouldn't the price half? Why do you want to inject more money into the economy just so the $ tag on the item stays the same? Maybe those cycles are unavoidable as you probably think.
I think those cycles come from the liquidity premium of scarce money.
What cycles? Do you mean the Business Cycle? Austrian economics has it that this is a problem with central banking. Anyone correct me if I'm wrong on that. Maybe you're right, the unelastic money is better and the monetary system cannot be designed to avoid these cycles. I think (don't know for sure) that according to you're definition ripple would be an elastic monetary system. I also think that a ripple network would tend to set the liquidity premium at zero. Maybe it could not avoid inflation/deflation neither. It's also free software (so "free market money") and hopefully will have a p2p implementation. I started a thread here about "stable prices" here (well, I didn't say it clearly at first) and people answered like if the title was "Inflation rocks and deflation sucks": http://bitcointalk.org/index.php?topic=3816.msg54368#msg54368I don't know about Ripple. |
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tl;dr version?
Does this paper talk about anything new, or is it running over the same points discussed many times in the forums?
Sorry, I'm just too lazy to read the 44 page document.
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I assume you are answering to me, but I have no idea what your point is. So if the supply of gold were theoretically infinite, but limited at any one point in time, it would be a poor choice of currency? Not only a poor choice, in fact, but an anti-market choice?
Gold is practically close enough to a fixed supply to make it good money. The inflation part isn't necessary and only serves to redistribute wealth to gold miners. And stored electrical energy (in the form of, say, batteries) would be a terrible form of currency because more could be generated? Again, not only a poor choice but an unfree one that redistributes wealth to the undeserving?
I'm not sure what your trying to communicate, but yes, I think that electrical energy would make a bad currency. I really don't think this argument generalizes very well.
If new currency is created, it has to be distributed into the economy. This process necessarily distorts the market all just for the sake of some useless and unachievable goal of stable prices. |
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Fixed money supply = Let the market determine prices
Inflationary money supply = Re-allocate wealth to an undeserving entity
Inflationary policy is the ant-market solution. And we all love free markets ;-)
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bitcoin can be transfered electronically, gold can't. gold can be traded physically, bitcoin can't. otherwise, for the purposes of money, they are the same, but due to this distinguishing feature, they each serve different markets for money: the physical and the electronic.
Gold and bitcoins are complementary. Both have different uses and both are usefull.
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The existence of the ego is only illusory in the same sense that cows and houses are illusory... and destroying that "illusion" is throwing the baby out with the bathwater, "I" think.
The biggest problem I see in the world today is the existence of nations.
But the baby is apart of the illusion! These guys don't seem to have a problem dealing with no ego: adyashanti alan watts mooji echart tolle Back to "reality": So what's the problem with nations? I think that if you're going to have governments, they should be as decentralized as possible, pushing scope to the lowest level that makes sense. Putting all responsibility at the highest level of government, currently "the nation", is certainly a destructive tendency. |
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HFT is a market, just like any other. Just because it's "high frequency" doesn't mean it's any different from "normal" trading.
How high does the frequency have to be before it stops becoming about supply and demand? Do you want to draw some gray line?
I didn't read the article, though. Feel free to ignore me if I'm way off topic or have no clue.
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Do you see any fundamental problems in our society?
The fundamental problem is ego, the concept of me/ I. This is the root of all problems and conflicts. For a beautiful illustration, please watch The Gods Must Be Crazy. The first 10 minutes serves as an introduction, and the problem is shown clearly in the first few minutes of Part 2. To do something radically about the problem, head over to Ruthless Truth — read more on the blog, engage in the battle in the arena. Cheers, This. If you really want to get "fundamental", it's the ego illusion that humanity holds which is the cause of all problems. When you understand that I is only a concept, it becomes clear that all is one and we are just expressions of god/tao. Our problems are only abstract in nature; imagined. As soon as you catch hold of the thought I am, you build a whole belief system upon it and make decisions based on this belief structure. Try to think of a belief that doesn't depend on I. Most conflict or "problems" with humanity is due to people following their beliefs and I'm not just talking about religion. e.g Bernanke: "I believe I must print money for the good of the economy." - Who must print money, Ben? you don't exist! You is just an idea floating around in awareness. see how that works? When I try to explain this to people it usually goes over their heads; no one will admit that their identity is "made up". But that's cool. What can we do about it? only what we're doing now. Who believes it's a problem? It's only a problem for me, you see... |
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Anyone wants to say openly that deflation is better than stable prices?
I'll go out on a limb here and boldly claim that an inelastic money supply is better than an elastic money supply. Inflation/Deflation is moot. Or, if you really want to get to the root the ideology; free markets in money are better than regulated markets in money. Free market money tends toward using commodities such as gold and bitcoin, which are inelastic, which tend toward deflation (in a growing economy). So deflation isn't "better" so much as unregulated money is better. Stable prices are an illusion; relative prices will always change even though the cpi might be stable. Prices are not stable by their very nature. Why do you want to fix nominal prices? Is it really that important? We seem to be getting by today with constantly changing prices, what's the problem you're trying to solve? People seem to have a real fetish for this "stable prices" dogma http://www.economicenquiry.com/archives/75feedback? |
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