I know there is a strong expectation that government regulate banking, but the whole point of Bitcoin is that two consenting people can transact together without permission approval or taxation. If you start a business that effectively does nothing but break privacy and pass a tax along to your customers as a fee I do't see a bright future for you.

If Bitcoin becomes mainstream it will be because people don't want business as usual, not because they want everything to stay the same, but the name. We already have a process for name only change, it's called an election.

I don't understand this. In the extreme, if everyone left a pool, why would a miner join it? They would get a block no faster than working on their own and they would pay to previous workers who had shares.

I think this could be solved by letting everyone know that shares will begin to decay after some multiple of average time to find a block.

I know it isn't a problem now because there is only one huge pool, but when there are many and switching is easy an unlucky period could easily drive people away and no one will have proper incentive to rejoin until it is cleared.

Interesting article, I brought the subject up back when the first pool switched from current power to the contributed method, but I don't think anyone responded.

Maybe think of it this way. In a free market people who have good information the indicates prices should be different than they are will use it to buy or sell continuously until the price moves, or sell the info to someone who can. If the info is crap/uncertain/misinterpreted/already accounted for then people acting on it will tend to go broke, over time this leaves people who are only using relevant, accurate, unaccounted for information and prices will be the most accurate signal to look at.

Maybe phrase it this way. If you have better info about the value of something than it's current price then you can get rich by sharing it! Since you almost never will have this info, you should rely on the market price.

None of this applies to reality to any great extent because the number of free markets is zero.

Insider trading is illegal!

How would you know if a miner was moving back and forth between the pool and working on his own?

It would only be obvious if lots of people were turning off causing very high variance in time to find a block for the pool.

The attacker would have the advantage of knowing an attack had happened before all others knew. And a smart attacker wouldn't just trade his coins for different coins he'd try to get stuff. But as I've been explaining it takes a long time to get the stuff and you have to maintain the pullback ability for a long time, not 1 hour, if you want to get a bank transfer or bullion shipped.

Your calculations are garbage. You cannot spend coins 80 times in an hour. The attacker has the power to rewrite a history that doesn't include him spending the coins, that is all. He can't simultaneously convince 80 people that they have the same coins. In the slow shipping example you need to let the shipper think he has coins until after he ships, then you can pull them back. You can't do this 80 times in 2days. You would need about 40 days if people are shipping same day.

If you try to spend them twice in an hour at, say, MtGox you won't ever get credit and can't get dollars because he waits for 6 confirmations. If you go for 2 hours you can spend them there twice this will not get you double your money because you will be bidding the price down by buying quickly which you will have to do since your cover is blown when you stop paying $8560/hr.

Not to mention that Mtgox (the only site with anywhere near enough bids to get your 'investment' back) has some max withdrawal per day.

Once again, the reason this is not profitable is that you have to match the entire network, but you only get a little tiny slice of the flow, not "everything conceivably for sale for bitcoins"

And this attack does not get more profitable as USD/BTC increases. Difficulty has been increasing faster than price for a long time. It is getting more costly at a faster rate than the payout is growing.

As someone buys up coins the price required to buy the next few rises. If someone buys a lot the price will be very high, and then you will not need to get many coins to pay a salary. If the gov has bought all but 5 coins maybe the salary will be .000001/week.

The main thing that might help you understand is that money-printers buy up things they want to support, not things they hate. They buy government bonds because government gives them a monopoly on money, they buy mortgage securities because their banker friends have bought too many, they buy titanium toilets to install in tanks because they have dinner and sex parties with people from Haliburton. They are not going to do us the favor of increasing the value of bitcoins and killing their golden goose the dollar even earlier.

No problem. Explaining it helps me keep straight how it all works. And lets other people fix any wrong ideas I have.

There is not a lag of price rise.  

Apples for sale
---------------
9 pieces silver
8 pieces silver
3 pieces silver
2 pieces silver

The rate you get in the market is 2 silver. The absolute very same instant you buy that apple the new price available in the market is 3 pieces of silver. There is no lag. It is important to remember that the market price is simply what offer is accepted it doesn't have to be updated by a score keeper.

I really don't get this kind of claim either. Why do you think the current price doesn't factor in that fact? If it happens every year then it is free money, but there can't be free money sitting there.

Looks cool. It's neat that you essentially found a way to make people wait 45 days for PayPal bought coins without it being to annoying since the buyer feels like they already bought and spent the coins immediately after tipping. And the person who got the tip can't complain too much since it was money for "nothing".

I have enough connections that I can get coins immediately with my PP, but I'm going to buy some from you if the 30 cents is a valid offer. Does that stay updated? How many can/will you sell at that rate?

 

I'm really confused. How can you say everyone is claiming it's going higher if the big players all think it's going lower?

I'm talking about your title, it is wrong. That's all I'm saying. It's not important. 

To change the subject: How does the probiwon bet work? I don't see an end date. 

Well, it isn't going to be the only one for long. Then you'll either have a wrong saying or have to change it. It's not a big deal, people do it all the time.  

edit: I'm at another bitcoin bookmaker right now. https://btcsportsbet.com/

Taglines claiming only always strike me as shortsighted.

I don't think it is positive.

The rest of my post gave a bunch of reasons why the return is lower than at first glance. Many types of merchants would be immune, many would be warned, etc. Shops are not going to mindlessly ship their entire stock without making sure nothing weird is going on. Even if they aren't savvy they are likely to know other bitcoin merchants. "Huh, all of your stuff was just bought too? Cool, I guess we're rich now."

Bitcoin price is up about 6x since I got here and difficulty is up over 90x.

The value of attack calculation is hard, but you aren't even looking at the right numbers. The attacker doesn't just get to turn bitcoins into cash via magic. He's going to flood exchanges and tip people off by buying to many sneakers. A lot of what you can do with bitcoin doesn't help him at all, so he can get a lot of credits at A Tale in the Desert, so what, doesn't help him at all. He can bet at bitcoinsportsbook, so what? The only thing valuable to him is the exchanges and they are likely to be the most alert to weird stuff.

The point is that you have to match the whole thing, but you only get a subset of a certain type of good. Except for a few exceptions you will get at most the total of bids at all exchanges.

In the future it will be even harder to get a hold of enough goods and money to justify the attack. Many of the goods will be meals and nights in a hotel. How many of those can you get?

 

That cannot be done. The transaction will not look valid to any clients no matter if it is in the longest chain or not. The attacker cannot send coins from a public address that he does not have the private key for. The way this attack works is that a legitament spend happens in, say, block 105000. After the merchant acknowledges it the attacker releases a new 105000 and as many blocks after it as needed to make it the longest chain. Now the network knows the attacker holds the coin because there is no record of the transaction.  

This doesn't seem right to me. I'm "fully invested" in gold, silver and bitcoin, but when I earn I don't hold the extra in dollars I put it in what I think will rise in value. In other words, I'm in that 98% and I'm still buying.

I don't think fiats are going to last much longer with or without bitcoin. They are inherently just the overvaluing of paper, the price has to come back down eventually.

Another thing to consider is that the people who run fiat are deluded, king of the world types, they can print dollars: United States of American Dollars. Nothing is better, no way something called Bitcoin eliminates the dollar, to even suggest spending millions to squash a little play money internet currency will get you laughed at, not funded. They are going to wait way way too long to act.

There will be a smear campaign about how we torture children and eat puppies, of course the puppy eaters aren't involved yet and when they hear about the perfect way to pay for a steady supply of puppies they'll get them some coins, the price will go up and the follow up report will be about how all the puppy eaters are getting rich and other people will want in on that, etc.

Lying nodes is a different attack which I think would be focused on just one target. The double spend attack spends a coin legitimately and then rewrites history and spends it "legitimately" again.

I didn't think of this when I was writing my last post, but doesn't this make it difficult for even someone with ~60% to double spend and make it look good for a whole day? Going all the way back a whole day would take about 5 days if you were writing 6 blocks for every 5. Am I thinking correctly?

edit to add: Actually I think that's wrong. The first spend batch is totally legit, at the moment the attacker starts making blocks keeping up with the real chain, but not publishing, if he is even a little faster he can publish at any point pulling back his coins. So a 24 hour later pull back only requires 24 hours of matching the speed of the whole network.