Regarding point 2. - how big did you think Bitcoin could scale? - after a SC has more fiat value assuming thirs fiat is interchangeable for real wealth not just zim$, at this time the side chain can scale to bigger than Bitcoin and via the arb. If we are thinking things like Bitcoin will have a market cap of gold in a couple of years, this value must come from an investment into Bitcoin. With a SC token one could investing in the side chain and grow that overtime if one intended to invest over $4 billion there would be nothing left on the Bitcoin blockchain, and the SC would be the master chain.
How many do you need to repeat this. symetric 2-way-peg (you are free to move in and out 1:1 conversion rate) 1. move BTC into SC and create more scBTC 2. sell scBTC -> extract fiat 3. buy more cheap BTC 4. goto 1 edit: if SC has all bitcoins then SC is better coin. as far as arbing goes, i agree that it will be done. it's the consequences of that where i disagree with you. once again, you're taking a chunk of highly valued, highly secure BTC from a blockchain ledger thats never been hacked and moving them over to an insecure blockchain ledger that has every potential of being hacked. those scBTC will be less valued straight away. as arbitrage begins to kick in, the equilibrium will result in a lower BTC price. we've already seen evidence of this dynamic playing out in the market place; Adrian-X. he's front running/selling b/c of this leeching of value that he and others perceive. yes, i'll go out on a limb and say that is why the BTC price has been falling since the whitepaper. see chart i posted above. it's quite probable dumping comes in stages with each incremental step that the Blockstream ppl are able to advance their for-profit ball. |
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Considering the apparent serious implementation and backing behind the sidechain, the market starts using it and finds considerable value in it. price of BTC goes UP
why would price do this?  People find value in the ability to make anonymous transactions. Buy BTC to use particular sidechain. Price of BTC goes up ah, but in your world it's not possible for a sidescam to cause the price of BTC to go down? No. 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. wow, listen up everyone! SC's, whether scam or not, can only make the price of BTC go up! never down! this is so blatantly economically naive that i am forced to give brg444 a pass; after all, he's a 24 yo kid with a self admitted shitty job. otoh, please explain to all of us in detail how SC's, real or scam, can only make the BTC price go up? |
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MM SC costs a lot of resources.
MM SC has to keep(and collect) all transaction from SC.
No one will be able to keep all sc-blockchain (for 1,000,000,000 SC) and MM them.
this sounds reasonable => There will be only few (1 .. 5 ?) MM SC's
MM will be only used for change bitcoin protocol.
but it doesn't solve the increase in mining centralization as only larger mining pools will be able to MM. You can choose mining pools. Mining pools operators will offer you more than 1 pool. They will offer you a) 1 pool for MM SC1, b) 1 pool for MM SC2 c) 1 pool for MM (SC1+SC2) d) 1 pool for NO MM not sure how that helps. as you said, only larger actors can afford storing the huge data reqs for MM. since they are the only ones who can derive income from MM, they push out at the very least solo miners and smaller pools. that's centralization. and it doesn't solve the increased susceptibility to attack.
Please explain, I do not understand. How somebody will attack. currently mining pie includes Discus 29%, ghash 18%, Knc 7%. let's say Austin convinces all 3 of these pools to MM his SC. well, right there all it would take is for Discus unilaterally to perform a 51% attack. see Peter Todd explanation as to why this might be beneficial for Discus: https://www.reddit.com/r/Bitcoin/comments/2k01du/peter_todd_on_twitter_the_sidechains_paper_is/clgpjpx>as you said, only larger actors can afford storing the huge data reqs for MM As I said, there will be only few MM SC. (for purpose of protocol change). There will be 1B SC's using different security model (oracles, trusted entities, SNARK, .. who knows) It is possible to create SC what is resilient to 51% attack of MC(every SC what is not MM with MC). This makes 51% attack on MC even more worthless. and these 1 Billion SC's will move all tx's off the MC making mining failure almost guaranteed. Not ALL. MC will be clearing network between SC. It is not possible to change amount of scBTC in SC without MC transaction. This can keep block size of MC smaller -> more people can run full node (not only few companies) No. scBTC is interchangeable with other scBTC. Clearing system in SC's is meaningless. Reserve system is meaningless. Once moved to scBTC they are gone and an independent new asset is born and may never return to MC. If you have 3 BTC in SC1 and 5 BTC in SC2 then you are only able to change owners of 8 BTC (SC1 will always contains 3 and SC2 5 BTC) => no new BTC can be added/extracted without MC transaction. You can only change owners of this coins. btw: If you re-read "Appendix A Federated peg" then no changes are required to current bitcoin protocol. The key observation is that any enhancement to Bitcoin Script can be implemented externally by having a trusted federation of mutually distrusting
functionaries evaluate the script and accept by signing for an ordinary multisignature script. That is, the functionaries act as a protocol adaptor
by evaluating the same rules we would have wanted Bitcoin to evaluate, but cannot for lack of script enhancements
right. but since we were talking about "clearing system" and what you've previously mentioned as "reserve system" in describing Bitcoin in the context of SC's, i just want ppl to be clear that those two descriptions are inaccurate. once BTC escape the Bitcoin MC over to a SC in the form of scBTC, they could be gone forever. meaning that they are newly created assets within a new blockchain/ledger system with their own properties and which can be traded with other scBTC's on other SC's. these will have their own fiat pricing and exchanges. nothing mandates that these scBTC "clear" or get routed back thru a Bitcoin MC "reserve" system. they are independent and may be gone from the Bitcoin MC forever. |
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MM SC costs a lot of resources.
MM SC has to keep(and collect) all transaction from SC.
No one will be able to keep all sc-blockchain (for 1,000,000,000 SC) and MM them.
this sounds reasonable => There will be only few (1 .. 5 ?) MM SC's
MM will be only used for change bitcoin protocol.
but it doesn't solve the increase in mining centralization as only larger mining pools will be able to MM. You can choose mining pools. Mining pools operators will offer you more than 1 pool. They will offer you a) 1 pool for MM SC1, b) 1 pool for MM SC2 c) 1 pool for MM (SC1+SC2) d) 1 pool for NO MM not sure how that helps. as you said, only larger actors can afford storing the huge data reqs for MM. since they are the only ones who can derive income from MM, they push out at the very least solo miners and smaller pools. that's centralization. and it doesn't solve the increased susceptibility to attack.
Please explain, I do not understand. How somebody will attack. currently mining pie includes Discus 29%, ghash 18%, Knc 7%. let's say Austin convinces all 3 of these pools to MM his SC. well, right there all it would take is for Discus unilaterally to perform a 51% attack. see Peter Todd explanation as to why this might be beneficial for Discus: https://www.reddit.com/r/Bitcoin/comments/2k01du/peter_todd_on_twitter_the_sidechains_paper_is/clgpjpx>as you said, only larger actors can afford storing the huge data reqs for MM As I said, there will be only few MM SC. (for purpose of protocol change). There will be 1B SC's using different security model (oracles, trusted entities, SNARK, .. who knows) It is possible to create SC what is resilient to 51% attack of MC(every SC what is not MM with MC). This makes 51% attack on MC even more worthless. and these 1 Billion SC's will move all tx's off the MC making mining failure almost guaranteed. Not ALL. MC will be clearing network between SC. It is not possible to change amount of scBTC in SC without MC transaction. This can keep block size of MC smaller -> more people can run full node (not only few companies) No. scBTC is interchangeable with other scBTC. Clearing system in SC's is meaningless. Reserve system is meaningless. Once moved to scBTC they are gone and an independent new asset is born and may never return to MC. |
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way more difficult. with fiat at least one has some guarantee and recourse. digging out cold storage wallets to transfer to the SC is inconvenient, risky, and identity revealing. how many times do i have to say this before it registers with you?
And this is exactly why it will be more convenient for the community to agree to fork the main chain with a feature that has been proven successful on a sidechain than incite a mass exodus. Brg444 I don't think you have any skin in this game. I suggests you find someone to lend you a $100K and put your money where your mouth is, buy some Bitcoin it's cheep if you're correct and it's only going up. I've been buying every dip untill the release of this paper my support has switched I'm now a net seller and will be untill there is more clarity. I don't trade on the biggest exchanges but I can tell you it's going down it's not often I see an effect like this. Your support if you can find credit will holed the price for a minute but it will help restore confidence. The gross lack of judgment says to me many Bitcoin proponents have sold out and are thinking this is a trigger. Well it's not. They sold out just in time and are now killing Bitcoin. My economic energy has enabled the wrong people the greedy.  where is this coming from? what would satisfy you? a SS of my wallet ? No just you having some skin in the game. Just make a big bet your attitude will change blabbing along when you think you know everything changes when you have something at stake. I'm not trying to create a win lose proposition. Bitcoin is win win, my economic energy has been growing this idea, I've put a lot of savings on the blockchain knowing the only exit is price. This changes everything that value can now be extracted leaving me with worthless private keys. No thanks. Let's see you turn this around I'm selling are you buying? sorry to hear you're selling but i have to agree with you:  |
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why? you already said consensus is impossible. what migration % of BTC to scBTC will force the implementation? give me a %. and at what % would it be too late?
The consensus required for a total exodus to a sidechain is the same as a hard fork. Moreover, such an implementation will not necessarily require a hard fork. sigh. then why go thru all the risk and trouble if SC's aren't going to significantly push Bitcoin forward?
They can push Bitcoin forward by enabling features that are not natively available through sidechains that work in synergy with the main one not worth the risk given the potential for SC to destroy the MC  it's totally different b/c the MM helps bootstrap any SC, with or w/o altcoin. Any altcoin is able, at this very moment, to be MM with BTC and yet they're not. but you want to create SC's with altcoins which will enable this on a widespread basis? |
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way more difficult. with fiat at least one has some guarantee and recourse. digging out cold storage wallets to transfer to the SC is inconvenient, risky, and identity revealing. how many times do i have to say this before it registers with you?
And this is exactly why it will be more convenient for the community to agree to fork the main chain with a feature that has been proven successful on a sidechain than incite a mass exodus. what %migration to scBTC would elicit the MC devs to fork in the innovation? |
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like i said above, user anonymity should be a widely sought after feature. and your security argument is a logical fallacy in that it is perfectly reasonable to expect that faster tx times will be achieved in the future that doesn't effect network security, point being SC's coupled with that innovation will obsolete Bitcoin
If it is so then it will be implemented in the mainchain why? you already said consensus is impossible. what migration % of BTC to scBTC will force the implementation? give me a %. and at what % would it be too late? you should. but how inconvenient, insecure, along with identity compromise from having to move all your BTC to a SC every few years.
As inconvenient, insecure as it was to move your fiat to BTC. way more difficult. with fiat at least one has some guarantee and recourse. digging out cold storage wallets to transfer to the SC is inconvenient, risky, and identity revealing. how many times do i have to say this before it registers with you? Every few years? the scenario I'm proposing would need to be, in my mind, a paradigm shift of the order of fiat money/Bitcoin. I wouldn't bet on such innovation pace because as I have said previously, Bitcoin is close to as good as it gets as is.
sigh. then why go thru all the risk and trouble if SC's aren't going to significantly push Bitcoin forward? if a SC employs sidecoins/altcoins, the risk for Bitcoin is even greater than that of a simple SC alone just paying fees. miners who defect would now be getting paid not only tx fees but also block rewards on a SC that everybody has migrated to b/c of the innovation.
That's not what I'm saying. My point is the sidecoin scenario is no different than any altcoin ie. the sidechains does not enable them in any significant way. it's totally different b/c the MM helps bootstrap any SC, with or w/o altcoin. |
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MM SC costs a lot of resources.
MM SC has to keep(and collect) all transaction from SC.
No one will be able to keep all sc-blockchain (for 1,000,000,000 SC) and MM them.
this sounds reasonable => There will be only few (1 .. 5 ?) MM SC's
MM will be only used for change bitcoin protocol.
but it doesn't solve the increase in mining centralization as only larger mining pools will be able to MM. You can choose mining pools. Mining pools operators will offer you more than 1 pool. They will offer you a) 1 pool for MM SC1, b) 1 pool for MM SC2 c) 1 pool for MM (SC1+SC2) d) 1 pool for NO MM not sure how that helps. as you said, only larger actors can afford storing the huge data reqs for MM. since they are the only ones who can derive income from MM, they push out at the very least solo miners and smaller pools. that's centralization. and it doesn't solve the increased susceptibility to attack.
Please explain, I do not understand. How somebody will attack. currently mining pie includes Discus 29%, ghash 18%, Knc 7%. let's say Austin convinces all 3 of these pools to MM his SC. well, right there all it would take is for Discus unilaterally to perform a 51% attack. see Peter Todd explanation as to why this might be beneficial for Discus: https://www.reddit.com/r/Bitcoin/comments/2k01du/peter_todd_on_twitter_the_sidechains_paper_is/clgpjpx>as you said, only larger actors can afford storing the huge data reqs for MM As I said, there will be only few MM SC. (for purpose of protocol change). There will be 1B SC's using different security model (oracles, trusted entities, SNARK, .. who knows) It is possible to create SC what is resilient to 51% attack of MC(every SC what is not MM with MC). This makes 51% attack on MC even more worthless. and these 1 Billion SC's will move all tx's off the MC making mining failure almost guaranteed. |
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Considering the apparent serious implementation and backing behind the sidechain, the market starts using it and finds considerable value in it. price of BTC goes UP
why would price do this? People find value in the ability to make anonymous transactions. Buy BTC to use particular sidechain. Price of BTC goes up ah, but in your world it's not possible for a sidescam to cause the price of BTC to go down? No. 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. wow, listen up everyone! SC's, whether scam or not, can only make the price of BTC go up! never down! |
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you could be right about anonymity being a niche feature, altho i'd bet you're wrong on this. the vast majority of Bitcoiners, i believe, want increased privacy. as far as faster tx's, you are definitely wrong on this. ask anyone, "would you rather have your tx confirmed in 1 min or 10min? every single one of them would pick 1 min.
point being, when the block subsidy in MC runs out in 2140 or sooner, the SC will be competing with the MC simply on tx fees but the SC has the added advantage of faster tx's and/or anonymity. which chain would you rather be on, especially if you were a miner?
I'd bet the picture your are painting of current BTC user does NOT represent the vast majority of future Bitcoin holder. Privacy should absolutely be user-defined in my opinion and the mainstream, right or wrong, has little need or want for anonymity. As far as faster tx, remember that they come at the cost of lesser network security. I don't believe you can simply provide faster transactions on a POW algorithm without a tradeoff in security because if that were the case then Bitcoin would've had it by now. you are seriously twisting your argument to support your claim. who knows the future? to assume there will never be any innovation that gets added to a SC on top of a MC clone that won't make it more attractive to migrate to is asinine. that's what SC are for! and your security argument is a logical fallacy in that it is perfectly reasonable to expect that faster tx times will be achieved in the future that doesn't effect network security, point being SC's coupled with that innovation will obsolete Bitcoin. and the whitepaper even acknowledges this migratory effect. why won't you? |
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I don't begrudge Cypherdoc not going into detail on dismembering these, because they aren't all that substantial as critic defenses go. I don't know if it was sincere claim that these "debunk" all concerns for all people reading this or if that is just baiting.
Mistake 1 : Sidechains can protect the value through merged mining.
If at some point in the future, there is a particular SC that consumes the bulk of bitcoins in circulation, there is a non-zero risk to Bitcoin that there will be insufficient bitcoin transactions to support bitcoin mining in the later days. It will have ended Bitcoin (albeit presumably for something better). People are not always right, that's how we got to where we are with pervasive central banking
The bolded is what I cannot comprehend. To suggest such a thing would happen is essentially to suggest that a sidechain would be created that carries all of Bitcoin features and more. So essentially, what you are speculating is that a sidechain could be created that is so innovative it removes the need for the Bitcoin blockchain. But it begs the question : what features could be so compelling? Anonymity? My opinion is this should be user-defined? Faster transactions? This comes at the cost of network securitylike i said above, user anonymity should be a widely sought after feature. and your security argument is a logical fallacy in that it is perfectly reasonable to expect that faster tx times will be achieved in the future that doesn't effect network security, point being SC's coupled with that innovation will obsolete Bitcoin
If such a chain emerges that offers these features in a user-defined manner without any tradeoff, then why should we not welcome it with open arms?
you should. but how inconvenient, insecure, along with identity compromise from having to move all your BTC to a SC every few years. This one is simply wrong. Further, it makes several claims in succession that are not entirely related. These are specifically a risk that SC do introduce. In the same way that if physical bitcoin were what everyone wanted, and we traded those instead, there wouldn't be any Bitcoin TX fees. These do have greater value in the free market than electronic bitcoins. There is no peg, what there is, is inclusion and embedding of btc in another block chain which is separately traded off Bitcoin's block chain.
Analogy to physical bitcoin is asinine. There are transaction fees for every sidechains transactions and every miner is able to process and profit from these. And no, as I have stated in my previous comment, the features of a sidechain are user-defined and so I don't believe it is correct to assume "there wouldn't be any Bitcoin TX fees". There are several reasons for why I would prefer my transaction to take place on the main chain. I don't need anonymity or faster confirmation time for every transactions. This is your mistake.
SC assures neither of these.
SC does not assure any preserving of the Bitcoin ledger.
The additional features are not in the Bitcoin ledger, they are on the SC.
They are "possible" effects. You are using the word "can" here and pretending that it means "does", and suggesting that this answers the concern. Many people do this subconsciously, it is human nature. Don't feel too bad about it.
The essence of my argument throughout this thread is that the real innovations in sidechains are the utility of 1:1 two-way peg to make additional features possible WITHOUT disrupting the ledger/affecting the scarcity. You can argue all day that altcoins could be created booted on top of sidechains and that they COULD be a danger to Bitcoin but this is not something that was enabled by sidechains. This risk (altcoins) was always present. if a SC employs sidecoins/altcoins, the risk for Bitcoin is even greater than that of a simple SC alone just paying fees. miners who defect would now be getting paid not only tx fees but also block rewards on a SC that everybody has migrated to b/c of the innovation. |
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Considering the apparent serious implementation and backing behind the sidechain, the market starts using it and finds considerable value in it. price of BTC goes UP
why would price do this? People find value in the ability to make anonymous transactions. Buy BTC to use particular sidechain. Price of BTC goes up ah, but in your world it's not possible for a sidescam to cause the price of BTC to go down? |
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... when the block subsidy in MC runs out in 2140 or sooner, the SC will be competing with the MC simply on tx fees but the SC has the added advantage of faster tx's and/or anonymity. which chain would you rather be on, especially if you were a miner?
my take on it... afaik, the peg is maintained algorithmically. there aren't new coins issued on the side chains, but rather, when you convert btc to SC, the units no longer reside on the MC. they now reside on the SC. there is no new issuance of coins. the total number of units is maintained. this is the peg. as for merge mining. this means you mine both chains, or multiple chains simultaneously. no extra cost. no extra coins. what are the incentives for miners to also merge mine SCs? fees most likely, just like nmc, devcoin etc. whatever they are, they are in addition to the incentives for mining bitcoin. so its not creating a choice of which to be on. they are merge mined and you can transfer your coins back and forth. they reside on the main chain or side chain. the risk is that if you send your coins to a SC and something happens and you lose em, you can't send them back! same as burning them. i think the idea is fascinating, and worth considering. but MM does come at a cost; data storage. that's what odalv was saying above. therefore when the MC has to compete with a SC simply on fees, miners and BTC holders will have to switch to mine the SC primarily b/c the innovation will have caused defection of BTC and miners and then choose what other blockchains might be out there to MM. and it probably won't be Bitcoin. |
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MM SC costs a lot of resources.
MM SC has to keep(and collect) all transaction from SC.
No one will be able to keep all sc-blockchain (for 1,000,000,000 SC) and MM them.
this sounds reasonable => There will be only few (1 .. 5 ?) MM SC's
MM will be only used for change bitcoin protocol.
but it doesn't solve the increase in mining centralization as only larger mining pools will be able to MM. You can choose mining pools. Mining pools operators will offer you more than 1 pool. They will offer you a) 1 pool for MM SC1, b) 1 pool for MM SC2 c) 1 pool for MM (SC1+SC2) d) 1 pool for NO MM not sure how that helps. as you said, only larger actors can afford storing the huge data reqs for MM. since they are the only ones who can derive income from MM, they push out at the very least solo miners and smaller pools. that's centralization. and it doesn't solve the increased susceptibility to attack.
Please explain, I do not understand. How somebody will attack. currently mining pie includes Discus 29%, ghash 18%, Knc 7%. let's say Austin convinces all 3 of these pools to MM his SC. well, right there all it would take is for Discus unilaterally to perform a 51% attack. see Peter Todd explanation as to why this might be beneficial for Discus: https://www.reddit.com/r/Bitcoin/comments/2k01du/peter_todd_on_twitter_the_sidechains_paper_is/clgpjpx |
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that was not his argument. a simple SC with an innovation should be able to defeat the MC w/o the innovation once block rewards disappear. why? the risk free put and everyone taking advantage of the innovation to transact.
No, because a 1:1 SC with an innovation only serves as a subset of Bitcoin's money function. Example : An anonymous sidechain is only useful to those wanting to participate in private transactions. A faster transacting is only useful to those needing faster transactions. BTC, on the other hand, sit on the most liquid & secure chain, are supported by the biggest infrastructure, carry the most important network effect AND can move freely, back and forth, between the two aforementioned sidechains. The features are effectively user-defined and can be used at will, depending on the user's need. I don't see exactly how the block reward is relevant considering there is no block subsidy on "a simple SC". Miners will mine both chains and profit from both chains' transactions. you could be right about anonymity being a niche feature, altho i'd bet you're wrong on this. the vast majority of Bitcoiners, i believe, want increased privacy. as far as faster tx's, you are definitely wrong on this. ask anyone, "would you rather have your tx confirmed in 1 min or 10min? every single one of them would pick 1 min. point being, when the block subsidy in MC runs out in 2140 or sooner, the SC will be competing with the MC simply on tx fees but the SC has the added advantage of faster tx's and/or anonymity. which chain would you rather be on, especially if you were a miner? |
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Considering the apparent serious implementation and backing behind the sidechain, the market starts using it and finds considerable value in it. price of BTC goes UP
why would price do this? |
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MM SC costs a lot of resources.
MM SC has to keep(and collect) all transaction from SC.
No one will be able to keep all sc-blockchain (for 1,000,000,000 SC) and MM them.
this sounds reasonable => There will be only few (1 .. 5 ?) MM SC's
MM will be only used for change bitcoin protocol.
but it doesn't solve the increase in mining centralization as only larger mining pools will be able to MM. and it doesn't solve the increased susceptibility to attack. |
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See, you don't listen. Imo, all of my prior arguments still stand, even my base case of 1:1 with a simple SC. I think Adrians long term economic assumption is valid that miners will migrate to SC for fees plus the innovation.
No they don't. I have proved why it is so repeatedly. You are the one not listening. Adrians long term economic assumption depends on the creation of an altcoin that is better than sidechains. Sidechains does not enable that risk. It existed ever since the first altcoin was created. that was not his argument. a simple SC with an innovation should be able to defeat the MC w/o the innovation once block rewards disappear. why? the risk free put and everyone taking advantage of the innovation to transact. |
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Yeah it should be crystal clear that ANYONE holding btc would be very very very unhappy if the 21,000,000 cap were lifted either directly or indirectly.
It seems clear that with a fixed peg the 21 million limit of btc is not altered in anyway. If anything with the likelihood of side chains messing up it will probably lead to more lost coins.
which won't necessarily lead to an increase in BTC price. cbeast gave me a hypothetical of losing all BTC to a SC leaving just 1 BTC. the implication being that, no problem, we'll all just divide up that 1 BTC and off we go again on our merry way. i think that is naive. first of all, it ignores all the owners of those, what would be the 13,455,849 BTC lost, getting wiped out. those ppl include guys like me who are Bitcoin's most ardent supporters who would turn against any further trust in cryptocurrencies and set back the project by 100 yrs i'd guess. so no, continual loss of BTC on SC's will be damaging, not helpful to our cause. |
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