I was going to ask for a link to his analysis of side chains, until I read that myopic "analysis" on the block size limit.
Did this guy every hear of arbitrage? If the market is undervaluing the peg, then there is an incentive to trade back to main chain, vice versa back to side chain. The technical peg insures that arbitrage will destroy any deviation. NuBits only has an algorithmic (qualified) arbitrage peg to $USD and it appears to working. An absolute technical peg is even stronger. http://bit.ly/1wlut8ahttp://www.reddit.com/r/Bitcoin/comments/2k9fcp/pdf_on_sidechains_sidechained_bitcoin_substitutes/Whenever an SBS changes hands through a transfer of control on its own
sidechain,
it
should
be
expected
to
do
so
at
some
floating
market
rate
(
barring
legal
price
controls)
.
However,
this
rate
may
well
not
perfectly
match
current
m
arket
rates
for
bitcoin,
that
is,
an
SBS’s
technical
conversion
rate
with
bitcoin
may
not
be
the
sole
factor
influencing
its
market
rate.
The
se
rates
could
match,
but
the
grounds
for
assum
ing
that
they
actually
would
in
any
given
case
do
not
seem
compelling
.
T
he
two
-‐
way
peg
,
while
certainly
expected
to
be
a
large
valuation
factor,
coexists
with
other
complex
discounting
and
premium
factors
.
These
could
combine
to
result
in
each
SBS
trading
at
a
market
rate
that
diverges
from
that
of
bitcoin
within
some
unpredictable
and
changing
range
.
Each
SBS
might
likewise
differ
in
current
market
value
from
each
other
o |
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Let's talk nominal:
I was writing about the nominal amount of each transaction fee, in that smaller transactions will pay a higher percentage to match the same nominal value as a larger valued transaction. to achieve the same security ignoring transaction fees. $8,000 / BTC is a very modest price if we assume this level of growth.
In 2032, how do you know $1 won't be worth a $0.01 in current purchasing power? My point was never about absolute values but relative weight of transaction value versus debasement value. You entirely missed my point, as indicated below... If there's 2,000 TPS in 2032, that's 1.2 million transactions per block...
Any way you slice it, if we assume continued growth, the network security should be greater in 2032 than now.
The point of my logic was not about whether we would have network security, rather whether we would have decentralization. Why do you always construct strawmen and lose the plot?
And that's precisely why we need to keep all those TX's on the mainchain.
So you can kill decentralization. |
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Here's what it might look like graphically
Visa level right about when the debasement becomes so miniscule it has essentially stopped funding mining and the effect of block variance on delays due to nominal transaction fees will destroy any remaining decentralization Bitcoin. Realize the miner cares about nominal not the percentage of the value you are transacting. Refer to the logic. |
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5 yr after 1MB, the network is much bigger, stronger, and more resilient. one can always obsess about these theoretical problems but the fact is that Bitcoin hasn't been broken and hasn't been attacked. there are quite a few network experts who've agreed with Gavin that scaling shouldn't be a problem. of course, the proof is in the pudding.
If you repeat illogical myopic nonsense STRAWMEN enough times, perhaps the readers will forget the logic. You consistently construct STRAWMEN arguments which stray far from the logic that must be weighed. |
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In order to make that critical high-value transaction you are going to have to move a high volume of BTC to the sidechain
Unless you buy BTC on the sidechain to start with. For example, they spend BTC to buy mining hardware to mine anonymously. Isn't that how you got your XMR. It's hard to envision how this works in the foreseeable future. If you buy mining equipment and mine the merged-mined sidechain, the vast majority of your rewards will still be main chain BTC. You will get only some small fees in sidechain coins. Who said all side chains will be exclusively merged mined, i.e. it is possible to combine two PoW simultaneously? I believe it was PPCoin that combined PoS and PoW? |
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In order to make that critical high-value transaction you are going to have to move a high volume of BTC to the sidechain
Unless you buy BTC on the sidechain to start with. For example, they spend BTC to buy mining hardware to mine anonymously. Isn't that how you got your XMR. And anonymity is not likely the only feature that can appeal to slower transactions from the high valued demographic. You can see every possible feature now? Wow you are omniscient. And slow transfers between Core and side chains for high valued is not the only case, as I pointed out upthread. |
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tvbcof, I agree with you that two days isn't out of the question for critical and high-value transactions, but Bitcoin main chain handles those perfectly well too, without the added cost and delay, and without security compromises. The competitive advantage of involving a sidechain specifically for critical or high value transactions is nil or negative.
Cripes smooth wtf happened to you? Has the real smooth been kidnapped? Er. Anonymity? Hiding the value of that transaction with Blockstream's C.T.? |
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tvbcof is being brash about 2d tie ups. that would be a catastrophic loss of his coins in a SC failure. he'd never get his scBTC mined back to BTC.
FUD. we know Larry Summers...
...take on the impending Greek crisis
gatekeepers (u+he) |
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You continue to assume that merged mining is necessary and I don't make that assumption because I know something which hasn't been revealed to you yet. Even without my secrets, there are other ways to do consensus that can't be 50% attacked.
1) PoS
2) A cartel of trusted servers such as Coinbase, Paypal, Facebook, Circle, Bitpay, etc.. Maybe not trusted by you, but trusted by the masses who use their services and don't give a fuck how it is done technically.
I find 1 and 2 uninteresting. If you want to recreate a centralized banking system using inferior technology, go right ahead. I have no doubt the masses will like that though, since they like centralized banking just fine. You are missing the most salient point. The difference is it is pegged to BTC thus free to access all of Bitcoin's network effects AND speculation fever. So there is a carrot that isn't available in a fiat bank account. Wow smooth it is like you suddenly lost your former astute self. <joke>You been smoking pot again?</joke> (seriously I have no idea if smooth has ever inhaled, lol) Of the methods proposed by Blockstream, merged mining is the only one that is conceivably decentralized, except that it isn't either.
If you have a third way you aren't disclosing, we can't discuss it, so it is pointless to keep bringing it up. Vaporware is also uninteresting.
Vaporware is quite interesting to those designing and investing in it. I have reason to believe they are lurking. What network effects are lost when the pegged side chain is denominated in BTC and can be spent back to the Bitcoin Core blockchain at any time?
They can't. They can only be spent to a recipient on the same chain, or by using a redeem transaction (very slow and expensive), or by way of a cross-chain swap, which adds a third party intermediary (someone who wants sidechain coins at the same instant that you want main chain coins). Sounds like all the bases are covered then. I think you've made no point. Sounds like normal finance to me, e.g. using a credit card instead of cash. Who said Core will have the most transaction volume? There is tension in Core between TPS and scaling. That entropy has to go some where. That added complexity and cost will discourage moving coins to a sidechain in the first place, especially for casual use, and especially if there is ever more than one side chain (many people all picking different chains just adds even more overhead to all of them and is even more likely to be nonsense in practice)
I don't see any substantiation of this FUD. For one, a few dominant side chains might emerge. Secondly don't underestimate the desire of finance for leverage and gaming opportunities. (ignoring differences in the strength of the pegging mechanism itself)
We wouldn't be discussing the same thing any more. Make it a pegged BTC side chain or go extinct.
In the long run we're all dead. In the short run, pegged sidechains don't even exist. In the middle, we'll see. Those with vision get an early mover advantage. Btw, I heard that is why only in the Philippines are the police the first ones on the crime scene and in fact rumor is they are so prescient they are on the scene before the crime is committed.  |
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I think you are making a catastrophic mistake to ignore them. I hope your view doesn't represent Monero's position?
Nobody is ignoring them. I just think they won't really have much relevance, or if they do they will destabilize the greater Bitcoin system. But I doubt the latter because the obstacles of relying on far weaker security such as merged mining, ... You continue to assume that merged mining is necessary and I don't make that assumption because I know something which hasn't been revealed to you yet. Even without my secrets, there are other ways to do consensus that can't be 50% attacked. 1) PoS 2) A cartel of trusted servers such as Coinbase, Paypal, Facebook, Circle, Bitpay, etc.. Maybe not trusted by you, but trusted by the masses who use their services and don't give a fuck how it is done technically. ...along with giving up most of Bitcoin's network effect, are simply too great. The vast majority will just stick with vanilla Bitcoin, which will force the rest to do the same.
What network effects are lost when the pegged side chain is denominated in BTC and can be spent back to the Bitcoin Core blockchain at any time? Long-term divergence of BTC value for pegged chains that deviate from the 1-to-1 peg doesn't matter in the short-term wherein stampedes of change take place, e.g have you never heard of fractional reserve banking and how the masses trust it to be fully backed? The masses will stick with Coinbase, Circle, etc and the decision will be made for them. Also there are certain features you can't get in Core, such as anonymity that are really needed. And if the controlling group of a new altcoin needed to store $10 million from an ICO in an anonymous unit, do you think it would be wise for the controlling group to store it in XMR which has insufficient liquidity and higher volatility? What if you XMR whales sell as that group is buying? Much better to put BTC peg on side chain and store the ICO proceeds there. I been trying to convince you core Monero devs to make the anonymity more reliable, and so some ICO funds could be stored in XMR but I can't tell if you guys are rushing to fix the anonymity or not. Monero is a piece of software and doesn't have a position, but if against all odds sidechains become widely used the equivalent functionality will likely be added to Monero, and then Bitcoin can become a sidechain to Monero (no, I'm not kidding).
You are delusional. Monero has one chance. Make it a pegged BTC side chain or go extinct. I am trying to help you. |
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I hope the core Bitcoin devs are reading this, so they will get an idea of who in this thread is on their level. Someone should send this post to Blockstream, so they can see they win with huge blocks or with small blocks. It doesn't matter. The only future is pegged side chains (for those of you so dumb upthread to claim that pegged side chains don't matter  ). Excellent and timely post by Kondrad! Impressive--I recall he also posted a comprehensive article on sidechains, shortly after the Blockstream white paper was published. I was going to ask for a link to his analysis of side chains, until I read that myopic "analysis" on the block size limit. Challenged minds require 30 pages of obfuscation in eloquisms to avoid proceeding directly to the point, because they don't have a lucid generative essence map in their mind. Eloquisms
Posted by TheFascistMind on Mon 2 Nov 2009 - 13:17
Elegant or novel ways to say something.
Next time you do not understand something, try asking with inverted grammar to illustrate your point humorously...
"Yoda Master tells understands he you not, {something} can be
how, you clarify please asks he to."
The main and long-term salient reason transaction fees have much correlation to the number of confirmations is because different miners would have different costs and absent a block size limit the ones with lower costs would include transactions with lower fees. One implication is that to do fast micropayments on block chain (thus small nominal transaction fees), would be forced to a pegged side chain that excluded the diverse miners who are causing that variability — aka centralization. (The huge block variance that Cypherdolt pleads for will kill the decentralized micropayments goal he claims ) Also that author completely ignores the centralization impacts widely variable block sizes have on centralization due to bandwidth, propagation, orphan rate (or IBLT which is also centralization). In short this n00b and anyone who thought his anal-sis was "excellent" should STFU. Even if you argue the other possible outcome which is centralization of mining will be good for reducing variance of block sizes, you are still admitting the Bitcoin is headed for centralization of mining with larger block size limits by some means of squeezing out smaller miners. But I also acknowledge, even if you restricted the block size, you would end up with centralization, because the rising transaction fees would send transactions off chain (to centralized pegged side chains; or proprietary off chain, e.g. cartel of Coinbase, Paypal, etc). Thus as I wrote upthread, until someone invents a better model for the block chain which can scale, then centralization is inherent with scaling. Those who can’t build, talkOne of the side-effects of using Google+ is that I’m getting exposed to a kind of writing I usually avoid – ponderous divagations on how the Internet should be and the meaning of it all written by people who’ve never gotten their hands dirty actually making it work. No, I’m not talking about users – I don’t mind listening to those. I’m talking about punditry about the Internet, especially the kind full of grand prescriptive visions. The more I see of this, the more it irritates the crap out of me. But I’m not in the habit of writing in public about merely personal complaints; there’s a broader cultural problem here that needs to be aired.
The following rant will not name names. But if you are offended by it, you are probably meant to be.
I have been using the Internet since 1976. I got involved in its engineering in 1983. Over the years, I’ve influenced the design of the Domain Name System, written a widely-used SMTP transport, helped out with RFCs, and done time on IETF mailing lists. I’ve never been a major name in Internet engineering the way I have been post-1997 in the open-source movement, but I was a respectable minor contributor to the former long before I became famous in the latter. I know the people and the culture that gets the work done; they’re my peers and I am theirs. Which is why I’m going to switch from “them” to “us” and “we” now, and talk about something that really cranks us off.
We’re not thrilled by people who rave endlessly about the wonder of the net. We’re not impressed by brow-furrowing think-pieces about how it ought to written by people who aren’t doing the design and coding to make stuff work. We’d be far happier if pretty much everybody who has ever been described as ‘digerati’ were dropped in a deep hole where they can blabber at each other without inflicting their pompous vacuities on us or the rest of the world.
In our experience, generally the only non-engineers whose net-related speculations are worth listening to are science-fiction writers, and by no means all of those; anybody to whom the label “cyberpunk” has been attached usually deserves to be dropped in that deep hole along with the so-called digerati. We do respect the likes of John Brunner, Vernor Vinge, Neal Stephenson, and Charles Stross, and we’re occasionally inspired by them – but this just emphasizes what an uninspiring lot the non-fiction “serious thinkers” attaching themselves to the Internet usually are.
There are specific recurring kinds of errors in speculative writing about the Internet that we get exceedingly tired of seeing over and over again. One is blindness to problems of scale; another is handwaving about deployment costs; and a third is inability to notice when a proposed cooperative ‘solution’ is ruined by misalignment of incentives. There are others, but these will stand as representative for why we very seldom find any value in the writings of people who talk but don’t build.
We seldom complain about this in public because, really, how would it help? The world seems to be oversupplied with publishers willing to drop money on journalists, communications majors, lawyers, marketers manqué, and other glib riff-raff who have persuaded themselves that they have deep insights about the net. Beneath their verbal razzle-dazzle and coining of pointless neologisms it’s extremely uncommon for such people to think up anything true that hasn’t been old hat to us for decades, but we can’t see how to do anything to dampen the demand for their vaporous musings. So we just sigh and go back to work.
Yes, we have our own shining visions of the Internet future, and if you ask us we might well tell you about them. It’s even fair to say we have a broadly shared vision of that future; design principles like end-to-end, an allergy to systems with single-point failure modes, and a tradition of open source imply that much. But, with a limited exception during crisis periods imposed by external politics, we don’t normally make a lot of public noise about that vision. Because talk is cheap, and we believe we teach the vision best by making it live in what we design and deploy.
Here are some of the principles we live by: An ounce of technical specification beats a pound of manifesto. The superior man underpromises and overperforms. Mechanism outlasts policy. If a picture is worth a thousand words, a pilot deployment is worth a million. The future belongs to those who show up to build it. Shut up and show us the code.
If you can live by these principles too, roll up your sleeves and join us; there’s plenty of work to be done. Otherwise, do everybody a favor and stop with the writing and the speeches. You aren’t special, you aren’t precious, and you aren’t helping.
I agree with him that the block size limit is an anti-spam feature and should be treated as such, but the question is why (for example) 20 MB of spam is considered acceptable now. I see no good reason to allow 20x as much spam, when little to nothing has been done to control spam in any other way.
That is closer to a correct view, but still myopic. Not necessarily. It could be more of a gradual process of spam being accepted into a system that isn't well protected against spam. The miners who are better equipped to produce somewhat larger blocks produce them (by including lower value, lower fee transactions aka spam), which puts more of a strain on smaller miners who drop out. As smaller miners drop out, the average block size then increases, which puts even more strain on the slightly-less-small miners, who then drop out, repeating the process.
The end result is larger spammier blocks, and less broad participation in mining.
The fact remains that as I said there is no more of a mechanism to control spam other than a block size limit than there was when satoshi added the block limit, and I don't really see how spam is 20x8x less of a problem or potential problem now. I'd support a smaller increase though, since I do see technological progress as having reduced the threat of spam by a smaller factor.
Longer term I see the 8 MB and auto doubling every two years as even worse than 20 MB. There is no rational basis to believe with high confidence that gigabyte blocks would be acceptable in 15 years.
Even closer, but still it is not just a "spam" issue. |
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Comparing a successful fork to a runaway sidechain.
A chain fork, while painful, will succeed only if the fork is better than the original. A bitcoiner need only do nothing to join the fork.
A sidechain will either be less valuable and therefore be very small, or more valuable and therefore run away. A bitcoiner might be left behind, unless he converts to the sidechain in time.
I prefer a chain fork to a runaway sidechain.
Yes, chain fork = (Peter R's) spin off, though the latter carries a connotation of being done in a somewhat less chaotic fashion. As I said before, spin offs make a lot more sense than side chains as a way to (potentially) upgrade bitcoin. Even Adam's one-way pegs are better than side chains, but spin offs are better than one way pegs. But Blockstream's two-way pegged side chains don't runaway from your BTC value. Thus they are best, because they are not all-or-nothing choices, you can go back and forth, and your BTC value is protected. Pegging two different, however slightly, money types together is a problem in theory and practice. As long as they are different, they will have different value. If the value is smaller, they will be converted to bitcoins. If the value is larger, they will be converted to sidecoins. When a fiat system goes bust, a new one is created, and it is quite common to peg the value to for instance the dollar. This is to try to give people a reason to trust the new money. The reason to have local money at all, is to get the seigniorage, which otherwise would be wasted to another government. To peg the value, you need an institution to be the guarantor, that means a kind of bank with reserves in the other money type. In practice, exact pegging is not possible, because there will be leakage of value to speculants and money exchange services. Therefore there will be a band, where the value will be pegged to somewhere between the upper and lower limits. Even better, the exact limits are secret, to avoid speculation near the edge. This can go on for a while, until they have created too much (sometimes too little), the peg breaks and is set to another value. If there is a mathematical peg defined by protocol and secured by the blockchain, the difference in value will have to escape somehow, and that is either the coins disappear if they are worth less than bitcoin, otherwise all bitcoins will be converted to sidecoins. It is not rocket science. You are conflating a physical peg with a peg enforced by market exchange dominance. The latter is destined to fail when the dominator exhausts resources. The former fails only if the physical peg fails, i.e. the side chain breaks the protocol rules of the peg. |
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Comparing a successful fork to a runaway sidechain.
A chain fork, while painful, will succeed only if the fork is better than the original. A bitcoiner need only do nothing to join the fork.
A sidechain will either be less valuable and therefore be very small, or more valuable and therefore run away. A bitcoiner might be left behind, unless he converts to the sidechain in time.
I prefer a chain fork to a runaway sidechain.
Yes, chain fork = (Peter R's) spin off, though the latter carries a connotation of being done in a somewhat less chaotic fashion. As I said before, spin offs make a lot more sense than side chains as a way to (potentially) upgrade bitcoin. Even Adam's one-way pegs are better than side chains, but spin offs are better than one way pegs. But Blockstream's two-way pegged side chains don't runaway from your BTC value. Thus they are best, because they are not all-or-nothing choices, you can go back and forth, and your BTC value is protected. I consider the entire scheme unstable and unsound, and quite plausibly will never even be implemented (in other than federated form, at which point it instead becomes uninteresting). Because of the vulnerability of the network to 50% attacks? But what if a side chain isn't vulnerable to 50% attacks. In that case, assuming other more serious compromises aren't made, then your system is simply far superior to Bitcoin. You should replace it and not carry the Bitcoin system around as unnecessary and uncompetitive overhead. If you can carry those BTC units on your coin's network orthogonally to your coin's units, then you get the benefits of leveraging Bitcoin's existing network efforts while ramping up your own coin. Transition isn't instantaneous. Many may prefer to transfer BTC value and then later after convinced, they convert BTC to your coin. Any other reasons you think it is unstable and unsound?
Economically I don't believe that two different assets can be successfully pegged to the same price, especially not in a decentralized manner (though doing it in a centralized manner also likely fails to a version of the calculation problem). If you extrapolate from this premise, it is clear that various failure modes are inevitable, some quite catastrophic. But possibly people are mostly smart enough to stay clear of the whole thing in which case the failure mode is non-catestrophic (a whimper not a bang). Well long-term, it impossible to guarantee that the protocol of the pegged side chain will continue to warrant that it is not creating new BTC units, thus long-term there is no way the peg will be respected on the side of the side chain. The Bitcoin Core block chain wouldn't care because money supply there is not subject to change by what a side coin does. (ditto vice versa) So yes the BTC value in the pegged side chain can not be warranted long-term, but that is not the targeted purpose. It is a short-term (couple of years or so) test of flow from Core into a new network. If the flow is sufficient, then it succeeds and eventually diverges from Bitcoin Core long-term. Short-term is enough to meet investor expectations. I think you are making a catastrophic mistake to ignore them. I hope your view doesn't represent Monero's position? Why is federated uninteresting? The masses don't give a hoot about theoretical decentralization (otherwise they wouldn't buy Bitcoin nor Monero nor any other existing cryptocoin in first place because none are theoretical sound decentralization).
Whose leg are we pulling here.
I don't really care what the masses buy, except in so far as I can successfully front run them. Non-decentralized systems are uninteresting because there are many well known ways to implement them that don't have the cost and performance compromises nor the user-unfriendliness of blockchains. But if that semi-centralized federalism is a pathway to a superior decentralized network, then that centralization gets discarded... Careful the myopia... |
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I agree with the 'can't buy knowledge' part. Internet has made the cost of most knowledge almost free or next to nothing, something that people in the pre-internet era couldn't dream of. Hopefully these large amounts of knowledge available can bring some quality changes.
You are conflating past knowledge with knowledge creation. Go re-read the seminal essay in the opening post and make sure you make that distinction. |
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Building this userbase is where you and cypherdoc come in handy.
yep, you got it butthead. build it across Africa, SE Asia, Russia, & the Middle East. all territories in which your authoritarianism is impotent. A full node on every cell phone, a chicken in every pot. A full node in every stick of bubble gum, and a whole earth in every pot.* * when the hacker humor goes opaque, they shouldn't know they are being ridiculed.
OMG  : Topic: Gold collapsing. Bitcoin UP. (Read 11 66666 times) |
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Comparing a successful fork to a runaway sidechain.
A chain fork, while painful, will succeed only if the fork is better than the original. A bitcoiner need only do nothing to join the fork.
A sidechain will either be less valuable and therefore be very small, or more valuable and therefore run away. A bitcoiner might be left behind, unless he converts to the sidechain in time.
I prefer a chain fork to a runaway sidechain.
Yes, chain fork = (Peter R's) spin off, though the latter carries a connotation of being done in a somewhat less chaotic fashion. As I said before, spin offs make a lot more sense than side chains as a way to (potentially) upgrade bitcoin. Even Adam's one-way pegs are better than side chains, but spin offs are better than one way pegs. But Blockstream's two-way pegged side chains don't runaway from your BTC value. Thus they are best, because they are not all-or-nothing choices, you can go back and forth, and your BTC value is protected. I consider the entire scheme unstable and unsound, and quite plausibly will never even be implemented (in other than federated form, at which point it instead becomes uninteresting). Because of the vulnerability of the network to 50% attacks? But what if a side chain isn't vulnerable to 50% attacks. Any other reasons you think it is unstable and unsound? Why is federated uninteresting? The masses don't give a hoot about theoretical decentralization (otherwise they wouldn't buy Bitcoin nor Monero nor any other existing cryptocoin in first place because none are theoretical sound decentralization). Whose leg are we pulling here. |
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He wrote bullish support is at $222 - $228. What price did you buy at? I told you much better to buy in the $220s. You went and rushed in and bought > $250 after I wrote that  All bull rallies have flags (where they decline back to support before moving higher). I doubt very much this was a false start. |
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