actually, that may not be true. hardware is entering commoditization and the cost of hashing has dropped 10 fold in the last year. so there may be some hope for solo mining still. or at least for individuals holding hardware that want to pool mine.
did you see this: over $3.6M in hardware, one of the risks of centralized mining, the guy was consuming 5.5MW of power and only had 2 security grads.  link? wow, that looks like that Chinese mine with huge fans in opposite walls? |
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The problem that me, and seemingly a couple others, have with Cypherdoc's concerns is that most of them boil down to the creation of altcoins, something that sidechains did not introduce and do little to enable. I hope you have come to understand this part because the accusation that you make of SC proponents being "unreasonable" can equally be applied to most, if not all, of the SC opponents in this thread.
You seem to be a reasonable person who has a great ability to distill his ideas in thoughtful and concise manners. Maybe you want to share with us notable weaknesses of the 2wp and what considerable risks you can foresee?
I don't know that there are any SC opponents in this thread. I also don't claim there are any weaknesses in the SPV mechanism, and find it weird that you would see that anywhere in anything I wrote. I like SC's, I think it works and does pretty much what it says it does is the blockstream white paper. There are however risks, some of which have been discussed here already. Most of the more interesting risks fall into two main categories. 1) Economic risks (changes to miner incentives, centralization issues, and practical concerns, ZB's is one of these) 2) Confidence risks (both "cons" in the scam sense, and misplaced confidence in the mechanism as a panacea, or else misplaced confidence in any particular SC - what you call the altcoin risk, and loss of confidence in Bitcoin generally due to its new ease of change). As mentioned upthread, the SC mods present a new upgrade path. Introducing upgrade paths is something to do carefully, and I like that there is this discussion to work through some of the more obvious issues. There are all sorts of dystopian varieties of these two categories. Some may imagine a distant future where with a click of a button (or it is done automatically) where one upgrades their bitcoins from Bitcoin 17.4 to 17.5 moving to yet another new chain, and something goes horribly wrong and they find themselves on Central Banker Inflation Coin of something. Or what is more likely historically, they do this willfully because the news is telling them that it is necessary to do it for their survival in the new important war of the day. Edit: there is a 3rd category of risk, technical risks (of which SPV brokenness would be an example, but these haven't been much discussed here). don't forget that Blockstream is a risk as well. |
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Is the price of BTC going down because of altscams? In fact, a successful sidescam might push BTC's value up since it would essentially increase the scarcity of the remaining coins.
Scams depress price. Alt scams, exchange scams, pirate@40 scams, these all depress price, reduce confidence, encourage regulation, and suck wealth and productive resources out of the crypto economy. SC scams should be expected to do likewise. absolutely. the "oh, my coins will only be worth more" crowd is missing this point. especially considering that Bitcoin proponents/owners would be the ones who could get wiped out. |
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Then we agree. Side chains accommodate arbitrary crypto (good bad or ugly) and which crypto is used for a particular chain matters. It is my understanding that while the transactions can use arbitrary crypto, block hashing would be limited to sha256 (or possibly a small list of others). In order to ensure a malicious attacker can not simply lie, the bitcoin miners supporting SPV proofs will need to verify the block hash is valid for the headers provided. The transaction's details that destroy the pegged coin and unlock the bitcoin will be used, but the signature can be trusted since it is in the block with the highest amount of work. If nobody presents a higher difficulty block header that contains a contradicting transaction within the contest period, the bitcoins unlock. But, to verify all this, the miners must be able to hash the headers. Is it possible for attackers to do this in reverse? Take someone's cold wallet and lock them into an SPVPROOF on a SC while the true owner is indisposed for some reason? Or is this impossible because they would need the private keys to begin with? Presumably the sidechain would still require a valid signature to allow a transaction in a block. you mean the SC block? yes, don't these SPV proofs require 2 tx's each, one in MC and one in SC? Essentially, what you are dealing with is a set of headers and a transaction. The headers prove the transaction was added to a block. (See section 8 of bitcoin.pdf).
there is no section 8 What the sidechains idea adds is that instead light node verifying a bitcoin transaction, the bitcoin miners verify that the sidechain has a transaction that destroys sidecoins. If this transaction goes uncontested, the SPV proof is accepted and the previously locked bitcoins are sent to the address specified in the destroy transaction.
i asked you before about this contest period. what is the probability of an attacker constructing a fake proof in either direction. what is this all about? isn't this a fundamental change to how Bitcoin blocks are linked together? We require a change to Bitcoin so that rather than each blockheader committing only to the
header before it, it commits to every one of its ancestors. Yes a SC block. Yes, there needs to be a destroy transaction on SC and a SPV proof on MC. Did you try looking between sections 7 and 9? That's where I found section 8. (Hint, page 5). An attacker can only fake a proof if they can fake a block, so it is up to the security model of the sidechain. Can you put that quote in context (where is it in which whitepaper?).... I'm not sure quite what they are referring to. pg 20 Implementation why would an attacker have to fake a block when faking a SPV proof (tx)? blocks are created by miners... still don't see a section 8 on pg 5 |
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Boussac and I are trying to better figure out the details of the peg mechanism and their consequences at a higher level (economic). Basically, the question is the one asked by Boussac: Let's say I have locked one bitcoin to release one sidecoin. To release the locked bitcoin, does my sidechain-enabled wallet simply collect one sidecoin (plus tx fee) worth of sidechain unspent outputs or are there other constraints on my sidechain transaction transferring the coin back to the bitcoin blockchain ? Once a bitcoin is locked to a sidechain, it is entirely up to the sidechain rules what the terms are for the release. The obvious case is 1:1 equivalence, but there's nothing saying a sidechain must do it that way. Thanks but my (very basic) question is about the fungibility of the sidecoins. I rephrase the question. Is the release of a locked bitcoin (or any fraction thereof) tied to a specific sidechain transaction OR is there flexibility in the choice of the unspent outputs on the sidechain to release the locked bitcoin? Pratical use case: suppose I have locked one bitcoin in tx A to release one sidecoin in tx A' on the sidechain. Later, I lock another bitcoin in tx B to release another sidecoin in tx B'. Can I redeem the second sidecoin to release the first bitcoin ? If tx A and tx B are transferring from the same parent blockchain, they should be the same asset on the sidechain. Obviously you can redeem any "sidecoin" of the same asset type using any of the locked coins, since as soon as you do a transaction on the sidechain the original transferred-in coin is consumed. but aren't private keys created on the SC that are specific to a certain scBTC? and when redeeming back to BTC, wouldn't the owner of those same scBTC have to come back thru the same SPV proof where they originated from? |
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i told you this was gonna happen: Garrett Keirns isn’t the only bitcoin entrepreneur to come within the sights of the SEC, and some worry that his case may mark the beginning of a larger crackdown into the technically interesting and freewheeling world of crypto currency pre-sales—a crackdown that could affect promising Bitcoin 2.0 projects such as Ethereum, MaidSafe, and Counterparty.[/i]
http://www.wired.com/2014/11/crypto-ipos/ |
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why should i tell you? with your propensity to accuse me of conspiracy theories improprieties, maybe i was a supporter all along and i just wanted to manipulate Bitcoin lower so i could just buy more! like marcus said!
If you are not trading BTC then there is not much reason buying now b/c You already bought at better price years ago. but i like buying Bitcoin. |
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....
Then we agree. Side chains accommodate arbitrary crypto (good bad or ugly) and which crypto is used for a particular chain matters. It is my understanding that while the transactions can use arbitrary crypto, block hashing would be limited to sha256 (or possibly a small list of others). In order to ensure a malicious attacker can not simply lie, the bitcoin miners supporting SPV proofs will need to verify the block hash is valid for the headers provided. The transaction's details that destroy the pegged coin and unlock the bitcoin will be used, but the signature can be trusted since it is in the block with the highest amount of work. If nobody presents a higher difficulty block header that contains a contradicting transaction within the contest period, the bitcoins unlock. But, to verify all this, the miners must be able to hash the headers. Is it possible for attackers to do this in reverse? Take someone's cold wallet and lock them into an SPVPROOF on a SC while the true owner is indisposed for some reason? Or is this impossible because they would need the private keys to begin with? Presumably the sidechain would still require a valid signature to allow a transaction in a block. you mean the SC block? yes, don't these SPV proofs require 2 tx's each, one in MC and one in SC? Essentially, what you are dealing with is a set of headers and a transaction. The headers prove the transaction was added to a block. (See section 8 of bitcoin.pdf).
there is no section 8 What the sidechains idea adds is that instead light node verifying a bitcoin transaction, the bitcoin miners verify that the sidechain has a transaction that destroys sidecoins. If this transaction goes uncontested, the SPV proof is accepted and the previously locked bitcoins are sent to the address specified in the destroy transaction.
i asked you before about this contest period. what is the probability of an attacker constructing a fake proof in either direction. what is this all about? isn't this a fundamental change to how Bitcoin blocks are linked together? We require a change to Bitcoin so that rather than each blockheader committing only to the
header before it, it commits to every one of its ancestors. |
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that's funny. then why do i and 70% of hashing power on the network "do" it?
Did not you tell us that you have no investment in altCoins. oh, just so you don't pop up here with some trivial allegation, smoothie kindly gifted me a coupla physical Litecoins last year, so yeah! i guess i LOVE altcoins. Maybe you have Monero too. So now it is crystal clear. yep, and i'm manipulating the price of gold lower just so i can BUY. So did we(SC proponents) changed your mind about SC ? Or do you still believe it is "Blockstream scam" ? Will you support 2wp by bitcoin protocol ? why should i tell you? with your propensity to accuse me of conspiracy theories improprieties, maybe i was a supporter all along and i just wanted to manipulate Bitcoin lower so i could just buy more! like marcus said! |
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looks like they want to get 2 hits on Bitcoin's rep for the price of 1.
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that's funny. then why do i and 70% of hashing power on the network "do" it?
Did not you tell us that you have no investment in altCoins. oh, just so you don't pop up here with some trivial allegation, smoothie kindly gifted me a coupla physical Litecoins last year, so yeah! i guess i LOVE altcoins. Maybe you have Monero too. So now it is crystal clear. yep, and i'm manipulating the price of gold lower just so i can BUY. |
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my gaud, that's ugly. sniff, sniff:  |
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that's funny. then why do i and 70% of hashing power on the network "do" it?
I don't know, you will have to answer that. I assume because it is trivial to do so. If you could pull profit out of it don't you think that even more people would be doing it? yes, but he was saying if a SC becomes the MC, miners would MM Bitcoin. maybe so, i'm just saying that Bitcoin would then be less secure as it would only have a % of the total hashrate.
Not necessarily, if SC creates an incentive for miners to mine them (txs) then it is perfectly reasonable to assume that maybe 100% of the miners would MM them. With sidechains, the mining revenue pie is now split between different chains. As a miner, would you choose to mine only a slice of the pie or MM all of the slices. I think the answer goes without saying. that's hyperbole to expect 100%. that's b/c there still is a % solo mining that won't have a clue nor the resources to facilitate such MM. even at the pool level, i wouldn't expect 100%. It is unfortunate but these entities (solo miners) are soon going to disappear from the ecosystem. We're entering the big leagues now and the professional want to it all of the pie. actually, that may not be true. hardware is entering commoditization and the cost of hashing has dropped 10 fold in the last year. so there may be some hope for solo mining still. or at least for individuals holding hardware that want to pool mine. |
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that's funny. then why do i and 70% of hashing power on the network "do" it?
Did not you tell us that you have no investment in altCoins. oh, just so you don't pop up here with some trivial allegation, smoothie kindly gifted me a coupla physical Litecoins last year, so yeah! i guess i LOVE altcoins. |
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that's funny. then why do i and 70% of hashing power on the network "do" it?
I don't know, you will have to answer that. I assume because it is trivial to do so. If you could pull profit out of it don't you think that even more people would be doing it? yes, but he was saying if a SC becomes the MC, miners would MM Bitcoin. maybe so, i'm just saying that Bitcoin would then be less secure as it would only have a % of the total hashrate.
Not necessarily, if SC creates an incentive for miners to mine them (txs) then it is perfectly reasonable to assume that maybe 100% of the miners would MM them. With sidechains, the mining revenue pie is now split between different chains. As a miner, would you choose to mine only a slice of the pie or MM all of the slices. I think the answer goes without saying. that's hyperbole to expect 100%. that's b/c there still is a % solo mining that won't have a clue nor the resources to facilitate such MM. even at the pool level, i wouldn't expect 100%. |
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that's funny. then why do i and 70% of hashing power on the network "do" it?
Did not you tell us that you have no investment in altCoins. Namecoin is not an altcoin in my book. it's more of a public service for a public good that's been around since day 1. also, BTCGuild where i now pool, does this by default. i just found this out about 3 mo ago as it was a setting i had to turn on in their control panel to view. voila! i had some NMC i didn't even know about! sure, i'll take it. |
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MM can only be expected to be a % of whichever is MC. like Namecoin, approx 70% of MC hashing. so more vulnerable.
Again, I disagree, there is little incentive for miners to MM Namecoin. that's funny. then why do i and 70% of hashing power on the network "do" it? If we expect that a significant amount of txs are processed on SC then there will be an incentive for the majority of the miners to MM them.
yes, but he was saying if a SC becomes the MC, miners would MM Bitcoin. maybe so, i'm just saying that Bitcoin would then be less secure as it would only have a % of the total hashrate. |
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