They should have set up mining farms as well as maybe buying bitcoin on the quiet, so that on March 20th they could start selling oil for bitcoins, driving up the price of bitcoins thus multiplying their secret bitcoin holdings...

Why does it seem unlikely "they" would have that much foresight, I wonder?

Maybe they figure the U.S. would start attacking the bitcoin network as well as the oil shipments?

-MarkM-

Maybe we can also start with initial investors, so that 100 people or more all buy in before launch.

The genesis block could have one huge multi-output coinbase transaction in it, issuing coins to the initial stakeholders...

-MarkM-

I still think though that it will be too easy to take over. Look at how large Deepbit always tended to be, from people giving up some of their profit in return for regular payments. I think something like that will happen, with more and mroe of the total nubmer of coins being tied up in that large pool as stake, until maybe only 1/121th of the total coins in existence are circulating, the other 120/121 of them being permanently tied up in maintaining an unbreakable monopoly.

It probably won't actually need 120/121 of the total coins, maybe q mere 51% of all coins will suffice, in which case it will be even easier.

But the more coins permanently tied up, the more the few in circulation should go up in price due to "rarity" maybe? unless just knowing that one pool controls the majority of the coins causes people to flock to yet another different cryprocurrency, one that is not controlled my some monopoly.

In fact the answer every time to monopoly might be simply to make another altcoin. The big players might ignore some of them as too puny to worry about of something, of they could keep quiet, growing across freenet and i2p and Tor, an underground grass roots person to person currency instead of a widely publicised scheme like bitcoin seems to prefer to be.

If coinbase transactions take 120 blocks, lets say, for their outputs to mature, then the first miner won't start being able to put in any stake for the first 120 blocks. Then, however, they can put the full number of coins minted per block in as stake on each of the next 120 blocks.

Basically each stakeholder will only be able to put 1/120th of their stake into each block if they manage to mine 120 blocks in a row.

If someone else gets a block sometime within those 120 blocks, that frees up an extra full block's worth of minted coins to use to increase your stake going forward, but it means there is someone else out there now who can put a full block's worth of coins into the next block they mine. Then 120 blocks after they manage to mine a second block, they'll have twice that amount they can put in.

I suspect it will get very hard very fast for new miners to enter the mining biz with any chance of actually making a go of it.

So it seems likely to degenerate very very fast into a "final outcome" whether that final outcome is Cunicula's (1), monopoly, or his (2), Oligopoly, or his (3), perfect competition. (Of which number three seems very unlikely to me in this scenario.)

-MarkM-

P.S. Maybe not starting PoS until many blocks in, or phasing it in slowly by having it only count fractionally, like multiplied by min(10000/blockheight,1) or something, could help some but maybe not really much. (And if not much then little point adding it to bitcoin either...)

Maybe recycle the "free as in freedom, not free as in beer" thing? It is free money and you can use free software to work with it.

-MarkM-

Except that ripple doesn't seem to be working or something, at least not working well enough to bother actually implementing some kind of p2p protocol for it. Maybe a lot more people have to actually use it before anyone will consider it worthwhile to do some work on a p2p implementation?

-MarkM-

You do know about the #bitcoin-otc channel on Freenode IRC network, don't you?

Right now people even mention exchange of bitcoins for fiat out in public there.

Maybe someday we'll need to know some secure, encrypted way to contact the people we learn to trust there, and knowing their GPG codes from back in these good old days we'll be able to know it is really them when we contact them through some crypted channel.

Thanks to #bitcoin-otc I do know a few people who use bitcoin and are willing to trade them.

I don't know anyone locally in meatspace but so far #bitcoin-otc has sufficed for my needs.

-MarkM-

The start-up of such a chain could be interesting. First person has no stake. Each new person has no stake unless they buy it from an earlier person...

-MarkM-

If you bought it at $15 because you thought it is worth more than $15, then hold on to it. If you can afford to, buy more any time the price drops below $15. The further below $15 it goes, the more of a bargain you are getting.

I only part with it when I absolutely have to, because people are undervaluing it ridiculously. Somewhere up above $15 I might not feel like I am being forced to sell off some of my valuables second-hand to meet my bills if  I am forced to spend some bitcoins, but until then I look around to see if I have anything else I could sell off second hand first before dipping into my precious collection of bitcoins.

I have already been in the position of facing a price of $30 per coin for replacing spent bitcoins, I don't want to face that again until I have a whole lot more bitcoins than I have right now.

Even if I only earn them through mining, because the higher the price the more people also try to mine; when the price floors, the amount of competition in mining sometimes drops a little. If the price had stayed at $2 a whole lot longer that would've been more money for me once it goes back up.

Look how easily it hit $30 even when it was almost un-known and still imagined to be about to die at any moment. Surely by now it is clearer that it isn't that fragile? So it should be able to easily hit higher than $30 next time around...


-MarkM-

It will be interesting to see if the people currently selling ASIC systems will go on to mass-mass-produce them to the point that anyone can afford a few chips. Maybe instead of letting the public have them in huge numbers they will, as soon as they have their "stake", use their proprietary hardware to make a bid at the monopoly.

-MarkM-

I anyone running a thin client server yet modified to use litecoin instead of bitcoin, so that a thin client modified to use litecoin instead of bitcoin has at least one server out there to work with?

-MarkM-

People exchange actual commodities for fiat regularly/constantly, it happens all the time.

So obviously the problem of how to deal with the reversibility of fiat has already been solved.

But, the solutions might not be very scale-able down to individuals who only occassionally sell something in return for fiat.

The suggestion users of Kijiji are given is only accept cash in person.

Basically being a seller in today's world is not very scale-able. If you aren't going to do enough trades to package your statistical losses from chargebacks into your price without thereby driving your price up above what people are willing to pay, you are likely to lose customers to a larger / higher volume merchant. So maybe commerce itself is not really very susceptible to decentralisation nowadays? Maybe if it ever was it was only because the technology had not arrived to allow really large operations?

On the other hand, there have been worldwide networks of money-changers and money-transmitters operating without regulation (other then by themselves / their network and their customers and how many troops / thugs their customers can raise up against them) for centuries. How did they do it? Maybe friend to friend, basically? Trust networks?

-MarkM-

Fiat is just another commodity. So you might as well be thinking about how to exchange irreversible, blockchain-based currencies into in any commodity in general instead of worrying about fiat as if it is so special.

Besides, if you can convert it into alpaca socks you can in turn convert those into fiat. So solving the problem for "goods and services in general" is maybe where we should be looking when thinking about fiat. Instead of thinking lets convert into fiat so that we can buy "things in general", leave fiat out of it and just convert directly to "things in general". Then if you really, absolutely cannot live without fiat, convert some "things in general" into fiat.

-MarkM-

And not letting it happen without surveillance is a holy grail of despots, fascists, etc... oppressive/repressive governments/thugs in general.

Every over the radar / over the counter purportedly irreversible fiat-outlet other than person to person physical cash ends up reneging, basically.

DId Liberty Reserve renege yet? How about Pecunix? Egold tried not to and look where that got them.

So unless you want to mail paper money in unmarked envelopes or meet strangers in bars/cafes/alleys for hand to hand transfers friend to friend looks a pretty likely method of initially getting irreversible currency.

Maybe one could also consider saying outright heck I don't want your stupid fiat, how about accepting some of my cryptocoins instead of currency for whatever it is you do that people give you the fiat for in the first place...

...Which, if it turns out not worth buying, maybe just says even more about the fiat world: it pays people to do crap that shouldn't be done in the first place...

Okay that was uncalled for. What I mean is, don't come to me looking for bitcoins, ask your frickin' employer to pay you them.

-MarkM-

I guess friend to friend is different from peer to peer, since peer to peer seems to mean neither person trusts the other.

It still seems most likely that the problem of converting reversible to non-reversible will be best handled on a friend to friend level.

Once you have irreversible currency of any denomination, converting to bitcoins is suddenly a whole lot easier.

I doubt if you can avoid some degree of centralisation, for example if you use some kind of web of trust it is likely that some people will emerge as more trusted than others. That is a degree of centralisation as they become more and more central the more their trust score outweighs others'.

How do you propose to secure an exchange with no trust without having both currencies being exchanged be blockchain based? Even if some kind of "smart property" is one side of an exchange can you really be sure the "smart property" has not been tampered with or will not be tampered with by the time you take delivery of it? Most likely the proof of ownership used for its smartness will be a blockchain?

-MarkM-

Okay, here is a scenario for you.

You ask around your dorm to see if anyone has any cryptocoins for sale so you can try them out.

One guy says "sure, I can sell you bitcoins, only $30 each, grab them while they're cheap, they'll be $100 each by Christmas".

Another guy says "sure, I can sell you DigiBucks, only a buck each, they're just a digital token representing bucks".

You buy $30 worth of each, try them out. You decide the stupid clients are too complicated, the offline wallet abilities are too complicated, the whole darn thing is too complicated. You really try mind you, heck you try all summer and fall.

Finally it is time to go home for Christmas. You tell both buddies you tried your best but cryptocoins are not for you, so you want your money back.

One of them says "are you crazy, have you looked at the price lately? That bitcoin is worth no-where near what you paid for it, no way I am giving you your money back, I got Christmas presents to buy."

The other says "no problem, how many you wanna sell me? Oh 30 was it? No prob, send them to this address. Thanks. Here's thirty bucks. Have a merry Christmas and a happy new year."

-MarkM-

Some clients have been leaning toward Torchat as a transport mechanism, or as sample code for how to set up connections. Apparently Tor itself normally only takes about three hops to connect to stuff, whereas with Torchat both parties reach out three ore more hops to set up rendez-vous. If that actually does provide better security maybe it is worth looking into.

There are gosh knows how many chatbots floating around so maybe one could be adapted to do a ripple type credit system on a friend to friend basis. I do not know whether ripple's basic concept - that friends can be trusted to settle up in a reasonable timeframe - actually works, but if it does it seems better to set it up on an actual friend-to-friend basis than to have "servers" per se.

I actually already suggested earlier that maybe if you aren't in a hurry you might be able to "exchange" simply by offering a higher exchange rate for the currency you want and a lower rate for the one you are trying to "sell", and basically all be running friend to friend trading-bots. Your friends' bots will notice you have raised your offers for the currency you want, and presumably "arbitrage" it with their friends and so on. Of course if each hop involved fees that might stifle exchange a lot over multiple hops...

-MarkM-

Set its trading accounts up to allow watching-only mode API, so people can watch it actually make money...

-MarkM-

I hope you have their binaries well sandboxed, remember these are the guys who lied about their code not including any "premined" coins given out and gosh knows what else. No wonder they went proprietary, they probably realised they could modify the alert code to put any kinds of trojans and worms in that they wanted to and send out a trigger for them later once it was on enough machines or they found a customer for such a service...

In other news, I have taken my "PRGcoin" template and made a very new code version of RUCoin in case maybe the code they used to make their binary was recent enough to have the checksums on messages turned on or something like that. No connections so far but its still flipping through address so maybe just hasn't found them hidden among all the actual bitcoin daemons yet.

By the way, is not giving out source code a violation of the BSD license? Maybe they are in violation of that like SolidCoin was?

-MarkM-

One of the attempts you desribed drops connection after version is sent.

So maybe they decided they don't want to connect to their old version and simply check that the version number is not too low.

So we could try using a higher version number.

-MarkM-

OK I changed it for main net to the magic ID you say above, and to the reverse, and neither got me connections in a short time.

I am using

char pchMessageStart[4] = { 0xDB, 0xBA, 0xBF, 0xFA };

again now for a longer trial as it has to flop through many many addresses that have no one at them at all it seems.

Is it still using same port number, even? (8883)

-MarkM-