scenario: SC + sidecoin + innovation + MM + scBTC
is it possible for scBTC to take advantage of the innovation or is that impossible b/c the SC MM is specific to sidecoin?
I do not understand how creating more units (sidecoin) can be advantage. I think SC + innovation + scBTC is better chain. And if it is better than MC then innovation will be implemented into MC. Except that we know from experience that this is not true. MC ossifies or has unbreakable social contracts, so better doesn't get implemented into MC. Instead what SC offers is that MC may 95% migrate to it and leave behind those that don't agree that the change is better. Except that for the SC to become the mainchain it requires the same consensus that a hard fork to the original BTC mainchain would so "ossification" is not an eligible argument IMO except that the dynamics are different. the hard fork we had with 0.8.1 was abrupt and caused a 20 block disparity right after it was introduced. SC's otoh may encourage a slow creep as migration moves to the SC over years time. brg444, do you know if scBTC can take advantage of a faster tx time when the SC simultaneously creates a sidecoin? |
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Side Chains present new existential risks to Bitcoin that may result in the end of Bitcoin.
Side Chains present new opportunities that may lead to vastly more adoption, reducing risks to Bitcoin, improving its value, and making it more secure.
Both of the above statements are true.
If you think only one of them is true, you don't understand Side Chains.
> "Side Chains present new existential risks to Bitcoin that may result in the end of Bitcoin." How can you prove this ? - SC is not new. We have a lot of SC. (Exchanges, WebWallets, payment processors, OT, ...) - Blockstream whitepaper only gave them names 2wp, SPV proof, blockchain concept ... and brings new ideas how to use them. it's not the same. you are separating the currency units from its original secure blockchain. yes, an exchange keeps its own internal order book and tracks trades but the actual aggregate BTC still sit securely on the exchanges private keys. when an exchange gets hacked its those private keys that get stolen, not the order book. |
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http://www.telegraph.co.uk/finance/economics/11206596/Dollar-smashes-through-resistance-as-mega-rally-gathers-pace.htmlDollar smashes through resistance as mega-rally gathers pace
HSBC says we are at the early stages of a dollar bull run that will change the world You heard it here first, but nice of AEP to confirm.  (New & Improved! Hat tip to da2ce7.)
The USD is entering the 'red giant' phase, having exhausted its primary fuel of gold and silver backing and now being powered by the less dense energy source of hydrocarbon hegemony. Although less productive, the economic bloat of malinvestment results in a higher apparent magnitude via the financialization process....
c'mon man. i've been calling for a USD rally and putting up this chart even before summer when i put up this interview of AEP by McAlvaney. can't find the post buried in this thread somewhere: http://mcalvanyweeklycommentary.com/tag/ambrose-evans-pritchard/ |
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If it's 1:1 then the end of Bitcoin is fine. More adoption is good. No problems here.
cracking open cold wallets to move to a SC would open up all sorts of risks. And we'd leave behind those that can't or won't. that will be so sad if this happens before bitcoin grows up. - all those Bitcoin wont survive pundits will have more political clout. and i wont hit my target exchange steps. cypher there is a little risk in opening cold storage, but docent the risk increase the more valuable they become? if we make a mistake here it cost us a hundred years until ppl get another chance. i'm talking theoretical risks. if you're on the tail end of a migration to a SC, supposedly the SPV proof will be reliable i would hope. just the act of digging them out for some ppl is inconvenient and may be a risk to security and identity. just saying. |
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oil? who the hell needs oil?  |
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If it's 1:1 then the end of Bitcoin is fine. More adoption is good. No problems here.
cracking open cold wallets to move to a SC would open up all sorts of risks. So Bitcoin system stability is predicated on cold wallets which are not touched??? (Actually, I would not rule it out. In some ways they are indeed acting as a deflationary force in what is currently a massively inflationary system. That's a little pathetic.) pathetic being your opinion. Daniel K wouldn't agree with you and neither do i.
edit: security --> system stability
agreed. and we have that right now given all mining is concentrated on MC currently. |
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If it's 1:1 then the end of Bitcoin is fine. More adoption is good. No problems here.
cracking open cold wallets to move to a SC would open up all sorts of risks. While I recognise the possibility of a SC taking away all the miners, the miners would no longer be able to verify their chains based on Bitcoin. They could attack each other. Catch-22. this is yet another possible problem i mentioned pages back; the fragmentation of mining that could lead to widespread vulnerabilities. brg444 will say this won't happen but who knows? |
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If it's 1:1 then the end of Bitcoin is fine. More adoption is good. No problems here.
cracking open cold wallets to move to a SC would open up all sorts of risks. |
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yeah, sorry i'm not so clear. but in the scenario where a SC advertises a bogus innovation, the whale can pump BTC thru the 2wp, which is acting like a risk free put (if the SC fails, he can get this BTC back as advertised). the mere appearance of large #scBTC on the SC may cause a price rise originating on the SC which then drags up the price of BTC as well in arb. if he can sustain this then he could sell of scBTC on an exchange for profit (the dump).
If someone buys SCcoin and the SC fails, they don't get it back. (unless they do, in some weird scenario? i'm pretty sure that by default that coin would be permanently lost). I don't think there's any risk free put (it seems more like a call that you're thinking of - unlimited upside, no downside) here. maybe. but i'm just going along with what's being advertised here. a well vetted, tested SC thru a federated system that is then brought online as a Bitcoin linked SC is "unlikely" to fail. given that, the 2wp is acting like a risk free put. maybe a call is a better term, i don't know. but then, my question about manipulation still stands unanswered. to assume a stable 1:1 price relationship of BTC to scBTC seems naive i think. there's always volatility and we see signif disparities btwn exchanges today that fluctuate sometimes wildly. in the case of a SC with a true innovation, like faster tx times, it seems to me with time, all tx's would be incented to move to the SC as the block rewards diminish on the MC, depriving BTC miners of badly needed revenue. yes, MM is a possiblity to harvest those SC fees but lots of miners nowadays are losing money. they might be more than willing to primarily direct mine a SC if they can scoop up large tx fees (assuming of course MM is only a % of the BTC hashrate).
Transactions moving to a sidechain doesn't deprive BTC miners of their primary source of revenue; I guess you're already in this paragraph talking about far future when block reward is insignificant. So, fold into the below. in 2140 when all block rewards are gone and the MC and SC (with its innovation) only mine tx fees, which chain would you rather be on? if you say that MC core dev will upgrade Bitcoin before that, what metrics will they use before they feel pressure or panic by a SC beginning to take over?
I'm not sure we need to be analysing what happens so far into the future. But indeed if there are no longer mining rewards, then the 'classic' blockchain is no longer special. It's just one of many. But this is so far away from where we are today it seems pointless analysing it. true, it's into the future. but how far? there will be a transition point and if a risk free put (on BTC) exists today, why not move a major portion of your BTC to the SC today and leave it there? |
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Side Chains present new existential risks to Bitcoin that may result in the end of Bitcoin.
Side Chains present new opportunities that may lead to vastly more adoption, reducing risks to Bitcoin, improving its value, and making it more secure.
Both of the above statements are true.
If you think only one of them is true, you don't understand Side Chains.
now that's one helluva way to put it. and i agree. |
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it would've been alot easier to trust if Blockstream the for profit wasn't involved in MC core dev.
Everything about Cyph's panties being all bunched up on this sidechains thing screams exercise of fud-douche-iary duty. He's on the n-th pass of his tedious circle of fud, though occasionally I throw him a new line to play with (ironically since I'm a strong supporter of sidechains.) The OpenTransaction guys are outed, but not cypherdoc as far as I know. i just have serious concerns about my perceived breakage of the BTC currency to its blockchain link which i've always considered to be sacred. maybe my conception of Bitcoin is wrong. i'm looking for answers to those concerns. |
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I'm not concerned about small scale miners. This seems to be a bias based on business concerns rather than the technology. The incentive is available for those with that can aggregate the resources. Welcome to the big league. There are no rules of fair play, only math.
I'm not worried about them per se, and we don't really need them to have every chain... The concern for small miners is a different one, and is based in a component of security, resilience. Mining is the incentive to run a full node (which is otherwise uncompensated). So centralization by smaller miners disappearing reduces resilience. So to the extent that the hobbyist level miners disappear entirely and are not replaced 1:1 with larger miners' nodes, we lose some security. Bitcoin isn't even close to having enough hashrate by several orders of magnitude. We need many billions invested in development of mining hardware and applications. When it gets to that level, then it will begin to pique the interest of real investment. In other words if one big company decides to invest, then others will follow. until that point in time, we need every miner on board the MC pushing the hashrate. i view the mining community as a speeding train trying to stay just ahead of a 51% attack that's on its heels. there's an equilibrium there that will be disturbed by SC's, imo. |
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are you saying that it's not possible for a rising scBTC price in fiat terms to drag upwards the BTC price in a pump and dump? what might cause this is if a whale is persistent enough to transfer a signif number of BTC thru the peg into scBTC causing other speculators to follow thinking the SC may take over. as more scBTC appear on the SC steadily over time, wouldn't/couldn't that drag up the price of both scBTC and BTC despite the fact that the relationship of the two remain close to 1:1? what could drive this is the "illusion" that the SC is taking off in usage and utility.
It seems to me you're talking about two possibilities. 1, a whale drags BTC (both sc and not, since they're the same asset) upwards to try to effect a pump and dump. That's no different from today. Whether he buys one or another doesn't really matter, since they're fungible with each other. yeah, sorry i'm not so clear. but in the scenario where a SC advertises a bogus innovation, the whale can pump BTC thru the 2wp, which is acting like a risk free put (if the SC fails, he can get this BTC back as advertised). the mere appearance of large #scBTC on the SC may cause a price rise originating on the SC which then drags up the price of BTC as well in arb. if he can sustain this then he could sell off scBTC on an exchange for profit (the dump).
2, the possibility of large amounts of BTC being sent over to a sc. This latter possibility is certainly interesting, and possible, but since bitcoin creation is still only possible on the main chain, mining would still be incented to stick there. So this doesn't create a 'bitcoin main chain dies out' scenario; although of course it could reduce transaction volume there.
in the case of a SC with a true innovation, like faster tx times, it seems to me with time, all tx's would be incented to move to the SC as the block rewards diminish on the MC, depriving BTC miners of badly needed revenue. yes, MM is a possiblity to harvest those SC fees but lots of miners nowadays are losing money. they might be more than willing to primarily direct mine a SC if they can scoop up large tx fees (assuming of course MM is only a % of the BTC hashrate).
An example is that people switch a lot of their coin onto a 'lightweight' sidechain that's better in some way for fast transactions, but the "backbone" main blockchain is preferred for big, industrial scale money transfer (i.e. it takes the role of SWIFT). Also, if in some distant future where block rewards were insignificant and people decided to store most of their coins on the sidechain, then yes, the bitcoin mainchain would start to die out, but it wouldn't matter, because people would have voted with their feet and digital scarcity would have been preserved. But this is all very sci fi in 2014.
There are also interesting speculations to be had about how a sidechain might factor into a future scenario where there was some critical flaw or failure in Bitcoin. Those are interesting, but what I don't see is how a new sidechain is going to *create* a failure scenario, because Bitcoin seignorage is never going to be removed from the main chain in this proposal. If you print things on these new chains, that's business for that new chain. That's not Bitcoin.
in 2140 when all block rewards are gone and the MC and SC (with its innovation) only mine tx fees, which chain would you rather be on? if you say that MC core dev will upgrade Bitcoin before that, what metrics will they use before they feel pressure or panic by a SC beginning to take over? |
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I think somehow you believe that side chains are making actual bitcoin transactions, when they are actually just artificially Bitcoin flavored altcoins with a magical bridge to Bitcoin.
huh? there are real tx's with fees going on on SC's. my fear is that they stay there when the fees generated from those tx's are badly needed back on MC (in the situation where there is no MM). Yes, they are real SC transactions on the SC blockchain (or whatever security measure they use), but Bitcoin users don't see them on the bitcoin blockchain. The White Paper warns against using MM. In fact, scrypt ASIC miners might be tapped for SC security instead of SHA miners. Again your concerns seem to be about transaction revenue for Bitcoin miners. yes They can always reduce their fees and make the revenue up in volume by competing with the SCs. they're already losing money in some situations (small miners). what room do they have to reduce fees further?
But then they have a bloated blockchain. Don't you think that SCs won't have the same problem? They may end up with bloated SC block chains and won't even have the benefit of a block subsidy.
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MM does not save resources. It forces miners to keep track of more data and this leads to centralization by shutting out smaller miners.
I'm not seeing that. 4. Sidechains should be firewalled: a bug in one sidechain enabling creation (or theft) of assets
in that chain should not result in creation or theft of assets on any other chain edit: OK I found it. Yeah MM bad according to the white paper. p 13 As miners provide work for more blockchains, more resources are needed to track and validate
them all. Miners that provide work for a subset of blockchains are compensated less than those
which provide work for every possible blockchain. Smaller-scale miners may be unable to afford
350
the full costs to mine every blockchain, and could thus be put at a disadvantage compared to larger,
established miners who are able to claim greater compensation from a larger set of blockchains. |
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scenario: SC + sidecoin + innovation + MM + scBTC
is it possible for scBTC to take advantage of the innovation or is that impossible b/c the SC MM is specific to sidecoin?
I do not understand how creating more units (sidecoin) can be advantage. I think SC + innovation + scBTC is better chain. And if it is better than MC then innovation will be implemented into MC. How about answering the question? What about telling me what innovation is ? and what this innovation will do with current Bitcoin. Yes there can be innovation what kills bitcoins with or without SC. (Bitcoin already has SCs ... How do you stop them ? ) faster tx times. |
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Isn't the point of SCs to allow Bitcoin to scale by mitigating its transactions through other chains? if that is the point, it won't work. Sidechains only have SPV security. If the entire main chain network does not validate a particular sidechain, then the resources required to produce fraudulent SPV proofs that redeem sidechains units for locked bitcoin are fewer. If every node in the main chain network needs to watch every sidechain, there is no scalability improvement. If every node on the main chain network does not watch every sidechain, then the security of the sidechains is low. The onus of SPV security is on the person risking their bitcoins. Bitcoin users don't care if the side chains succeed or fail. i very much do care b/c for each failure and loss of scBTC, an owner has to take a loss. the bigger these losses multiplied by thousands of SC's, the greater the set back in terms of public perception. we don't need that.
Bitcoin users don't care if those bitcoins go back to transacting or are lost forever. If the sidechain security is poor then the market will choose a better side chain. Bitcon doesn't need to see what is going on in the side chain, it only needs to see if it is broadcasting bitcoin transactions, which it should only do rarely.
it's your responsibility to secure your own house. that's why you don't leave your front door wide open all the time. I think somehow you believe that side chains are making actual bitcoin transactions, when they are actually just artificially Bitcoin flavored altcoins with a magical bridge to Bitcoin.
huh? there are real tx's with fees going on on SC's. my fear is that they stay there when the fees generated from those tx's are badly needed back on MC (in the situation where there is no MM). |
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scenario: SC + sidecoin + innovation + MM + scBTC
is it possible for scBTC to take advantage of the innovation or is that impossible b/c the SC MM is specific to sidecoin?
I do not understand how creating more units (sidecoin) can be advantage. I think SC + innovation + scBTC is better chain. And if it is better than MC then innovation will be implemented into MC. Except that we know from experience that this is not true. MC ossifies or has unbreakable social contracts, so better doesn't get implemented into MC. Instead what SC offers is that MC may 95% migrate to it and leave behind those that don't agree that the change is better. it would've been alot easier to trust if Blockstream the for profit wasn't involved in MC core dev. |
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Think of it, govSC may use compromised cryptographic primitives giving them a back door on all the money.
Then they essentially own key escrow on all the coins and can also automatically tax them as needed. Seize criminal assets etc.
That pretty much solves all the government's problems.
I agree with you. I'll not keep my BTC in govSC. But I would rather trade on gov secured exchange than on MtGox. If SC are implemented in Bitcoin then Bitcoin is my first choice. what's your answer again to the argument that all these billions of SC's are stealing tx fees away from Bitcoin miners? win:win Smaller MC -> save resources. There are a lot thing SC cannot do. 1. create new BTC 2. change amount of BTC in SC. And there will be thousands SC (every company can have 1 SC for internal accounting, and 1 for public btcShares) A lot of transactions for MC :-) This SC transaction(IN/OUT rebalacing) will cost more. (they will be bigger) Transaction fee per block is around 0.15 BTC now. No big deal for miners compared to 25 BTC (12.5 BTC, 6.75 BTC ... ) MM does not save resources. It forces miners to keep track of more data and this leads to centralization by shutting out smaller miners. |
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scenario: SC + sidecoin + innovation + MM + scBTC
is it possible for scBTC to take advantage of the innovation or is that impossible b/c the SC MM is specific to sidecoin?
I do not understand how creating more units (sidecoin) can be advantage. I think SC + innovation + scBTC is better chain. And if it is better than MC then innovation will be implemented into MC. How about answering the question? |
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