Spin-of will create 13M worthless units ... it will take ages and millions(billions) $ until you build solid market cap. (so it never happen, or bitcoin must die)
Very valid point. I recognize the value of sharing the same ledger but this does not necessarily mean the value is shared. |
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Would it not be possible to create spin-off coins through a sidechain?
Technically I suppose, but such a coin couldn't be backed by bitcoin or offer the 1:1 conversion feature. This coin could benefit from spin-offs' idea of Bitcoin-blockchain distribution and also from sidechains' convenient, integrated, merge-mining.
I guess we should define some terms here. By "side chain" I mean the on-chain convertibility feature. This is usually described as 1:1 but doesn't need to be that, it could use some other fixed ratio or a non-fixed formula. Merged mining can be done with or without this sort of side chain. They are independent. Right, I also realise there is a fundamental error in my proposition. Sidechains issuing assets (sidecoins) are responsible for their security (through their own mining algo). Of course, sidechains are able to support their own assets, which they would be responsible for maintaining the scarcity of So a sidecoin type spinoff is no more secure than a regular altcoin spinoff |
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I think it is best to understand side chains as a Bitcoin feature that facilitates Bitcoin being used as backing for altcoins. This creates demand for Bitcoins to be held in the form of backing.
So, put simply: Bitcoin adds feature -> Bitcoin demand increases. That is the hope of side chain advocates at least, but the reality will be decided by the market, not by advocates. A new feature may increase demand, but only if people choose to use it.
From that perspective it is understandable that spin-offs would not be supported by side chain supporters, since spin-offs don't need the feature they are promoting.
I do agree that spin-offs are non-dilutive. So side chain supporters should really stop using that argument. It is incorrect.
Of course. I'm not sure exactly how spin-offs compete with sidechains. Would it not be possible to create spin-off coins through a sidechain? This coin could benefit from spin-offs' idea of Bitcoin-blockchain distribution and also from sidechains' convenient, integrated, merge-mining. The mining and security part is where I could be wrong though since these are technical issues I am not always comfortable with. Another thing is a normal sidechain concept requires the user to effectively "lock" their BTC to the sidechain. For the idea I have in mind, the user should only need to claim their stake based on a particular snapshot of BTC blockchain i.e. his BTCs are not locked to the sidechain but are only used to claim his stake. |
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Who think it's worthy to mine it. As far as I know peter r idea it's a way to bootstrap an alt-coin with a bitcoin-blockchain-based initial coin distribution, nothing more than this. As far as I remember peter even proposed to clone ethereum with this method. In the case of ethereum clone it's impossible to merge mine i think.
True, it seems merge mining, in that case, would require significant change to BTC. While the idea of bootstrapping an altcoin with bitcoin's distribution is interesting, I don't see how this solves the security issue. |
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I'm beginning to doubt Maxwell (nullc) has a grasp on the economics of money as a ledger, and he seemed like the best of the sidechain team on the economic aspects. This seems like a basic error: http://www.reddit.com/r/Bitcoin/comments/2k7xwj/aantonop_sidechains_could_unleash_even_more/cliw3miWhat if sidechains, or a large part of their motivation, comes from not understanding the idea of spin-offs? Peter R has in places proposed spin-offs as a way to bootstrap an altcoin launch, but the relevance here is they serve many or perhaps even all the functions of sidechains, but without need to mess with Bitcoin. I get a general sense from the sidechain crew that they don't understand Bitcoin as ledger, that the ledger is what matters, and that the protocol is secondary. To them, as coders, it must seem like the ledger and protocol are inextricably linked, but if you take Money as Memory seriously, the ledger is something outside the protocol and is merely updated by it. Understanding spin-offs requires fully internalizing this insight, and that is what I see no evidence of from the sidechain team. Thinking about it, it seems to me Maxwell is suggesting this creates two competing markets while sidechains are complementary markets at worst, if not integrated. It's simply incorrect to state that it's not an altcoin; it's a seperate orthorgonal ledger that immediately doubles the supply of cryptocurrency and creates a base of people with commercial interests directly opposed to Bitcoin; who stand to profit by driving the adoption of their alternative in parallel to Bitcoin. It does seem to me like his comment about supply is wrong but the rest remains true. People that start trading on the spin-off and accumulate more spinoffcoins then they had Bitcoins have competing interests with Bitcoin holders. The difference with sidechains, from what I understand, is that accrued adoption through usage of 1:1 pegged sidechains features creates additional value for Bitcoin |
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Nah, you're just shitting up a perfectly good thread with your rude faggotry.
Thread was perfectly fine until you came along, troll. |
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I'm beginning to doubt Maxwell (nullc) has a grasp on the economics of money as a ledger, and he seemed like the best of the sidechain team on the economic aspects. This seems like a basic error: http://www.reddit.com/r/Bitcoin/comments/2k7xwj/aantonop_sidechains_could_unleash_even_more/cliw3miWhat if sidechains, or a large part of their motivation, comes from not understanding the idea of spin-offs? Peter R has in places proposed spin-offs as a way to bootstrap an altcoin launch, but the relevance here is they serve many or perhaps even all the functions of sidechains, but without need to mess with Bitcoin. I get a general sense from the sidechain crew that they don't understand Bitcoin as ledger, that the ledger is what matters, and that the protocol is secondary. To them, as coders, it must seem like the ledger and protocol are inextricably linked, but if you take Money as Memory seriously, the ledger is something outside the protocol and is merely updated by it. Understanding spin-offs requires fully internalizing this insight, and that is what I see no evidence of from the sidechain team. Interesting idea. Question : who mines the spin-offs? Can the same concept of merge-mining be applied ? |
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Nah, I can spot butthurt when I see it. I realize that constant loss of money due to stupidity is hard on you, but it doesn't excuse your abysmal manners  Butthurt? I'm just having fun here rebutting each and everyone of your childish claims and disingenous arguments  Carry on, troll |
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not mad, this is how trolls deserve to be treated, as inferior posters. stay disingenuous & dishonest |
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The burden of proof is on you to demonstrate they don't believe in their product.
... I never made that claim. You fail at reading just as badly you fail at basic etiquette  Where did you get the illusion that you deserve respect ? |
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My understanding is that the exchange rate BTC <> sidecoin will not float, only the exchange rate sidecoin <> fiat will float. Is that true?
If 10 000 BTC back 10 million units of sidecoin (so the fixe exchange rate is 1 BTC = 10 000 sidecoins) and that side-currency is deemed as crap by the free market (ie. the fiat exchange rate implies a valuation 1 BTC >10 000), then people will just doesn't sell their sidecoins on the free market and moved back to the BTC blockchain and take back their BTC.
Now if the free market loves a new feature of that sidecoin and the fiat exchange rate imply a 1BTC = 1 000 sidecoins rate, then people will have made a 10x profit.
So barring an improbable technical failure of the sidechain that would prevent to get back the BTC, people will have only benefits by exchanging bitcoins to sidecoins.
It's a lethal mechanism for Bitcoin. Imagine the size of the altcoin market if people were able to sell their bitcoins to buy altcoins while being able to reclaim the exact same initial amount of bitcoin if the said altcoin end up underperforming BTC.
It seems you are again confusing two ideas of the sidechains. IF a sidecoin is created through a sidechain, then yes the sidecoin will have a free floating market exchange rate. If people pledge their BTC to that sidecoin then they are effectively buying an altcoin. If this sidecoin tanks then they CANNOT reclaim the exact same initial amount of BTC they "invested". Remember, implementation of new features in sidechains do not require creation of an alternative currency. |
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They're hoping to be the first publicly traded Bitcoin company in the USA. You really think they "don't believe in the future of Bitcoin".
... brg444, if you were planning to take your company public, would you announce that you don't believe in your own product? Regardless of how you actually felt? *And lrn to polite, faggot. The burden of proof is on you to demonstrate they don't believe in their product. So far, every thing indicates they are extremely bullish about it. Try harder, troll |
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There's no guarantees that these miners will be fine in the long run. That's why they'd be selling their BTC for fiat trying to expand their hashrate asap and getting a bigger share of the pie and maximize their profit potential. The mining companies who are simply holding their BTC as you say will go the way of the dodo soon.
Miners are industry insiders at the top of the pyramid. I'm sure they are pretty confident about BTC's future. BitFury founder and CEO Valery Vavilov indicated that the new funding will allow the company to complete production of its 28nm ASIC chip without selling the reserve bitcoins it has mined from its three industrial-scale data centres. Vavilov told CoinDesk that it decided not to tap its bitcoin reserves as it remains bullish on the long-term value of bitcoin.
"We believe in the long-term perspective [the price of bitcoin] will grow and we decided to not to sell [our bitcoin] at such a low price," Vavilov added. Lol, a company whose worth is pegged to Bitcoin price is not going to announce "we're dumping these things as fast as we mine them, because don't believe in the future of Bitcoin." They're hoping to be the first publicly traded Bitcoin company in the USA. You really think they "don't believe in the future of Bitcoin". They are making MILLIONS in profit from the sale of mining rigs to other smaller mining farms. Their BTC mining is an extra curricular activity with little to no impact on their bottom line. Try again, troll. |
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thank you. very very helpful. not at all. The discussion in this thread have moved way beyond the limited concepts in that paper.  surely I didn't hurt your feelings so much that you would argue with me for the sake of arguing please let's keep it civilized. the paper was a worthy contribution and certainly helped clear out some misconceptions. that's it. |
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There's no guarantees that these miners will be fine in the long run. That's why they'd be selling their BTC for fiat trying to expand their hashrate asap and getting a bigger share of the pie and maximize their profit potential. The mining companies who are simply holding their BTC as you say will go the way of the dodo soon.
Miners are industry insiders at the top of the pyramid. I'm sure they are pretty confident about BTC's future. BitFury founder and CEO Valery Vavilov indicated that the new funding will allow the company to complete production of its 28nm ASIC chip without selling the reserve bitcoins it has mined from its three industrial-scale data centres. Vavilov told CoinDesk that it decided not to tap its bitcoin reserves as it remains bullish on the long-term value of bitcoin.
"We believe in the long-term perspective [the price of bitcoin] will grow and we decided to not to sell [our bitcoin] at such a low price," Vavilov added. |
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They're trying to get the largest market share, and as stated their costs are bellow $400. By selling they're raising capital to expand, as long as it's above their costs they're at profit (and get the benefit of squeezing other guys out). It's a win/win sell at (some) profit and guarantee more profit. They're not wall street to play the risk game. Even if they were true believers VCs would force them to sell.
They don't necessarily have to sell to raise capital. As previously stated, all of these major companies have millions from selling mining gears. They're not wall street to play the risk game. Even if they were true believers VCs would force them to sell. I'm sorry but this is not true. BitFury, probably the biggest venture backed mining company is not selling ANY of the coins they mine. |
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I'm talking about centralization of mining and this crook Sam Cole milking BTC for fiat. Meanwhile, you're talking about BTC becoming the dominant world currency and decentralizing the global economy? I think we're on totally different pages.
And I'm saying centralization of mining is not happening and miners in majority are not dumping BTC for fiat. Well if the mining profit margins are so narrow, how are they staying in operation without dumping BTC for fiat to cover their costs? They must have endless reserves of cash to hold all that BTC until the price rebounds right? 1. They have millions of dollars from selling mining gears 2. They have millions of dollars from VC investement 3. They have millions of dollars in Bitcoin profit from mining in the early days So yes they must be burning through quite a lot of cash right now but in the long run they will be fine and they know it. Of course I am not suggesting they are ALL holding 100% of the Bitcoin mined but my guess is they are holding a good majority of them. Additionally, I don't see a problem for them to cover some costs by selling to fiat during a bear market. You can be certain though that they will not "dump" their BTC during a bull market. |
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https://vimeo.com/108437163What terrible spokesperson these guys are. "Bitcoin's monetary policy could change" Really !? Just cause you dropped a couple millions on Coinbase certainly does not make you an authority to speak on Bitcoin and utter such nonsense. This video is so disappointing
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thank you. very very helpful. I guess these are more reasons to not worry about the potential for a sidechain to "takeover" Bitcoin. |
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thank you. very very helpful. |
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