Quote: "Economically speaking, eating it is indeed a drain.  Medically speaking, the drain is necessary.  Production has the potential to create wealth, but consumption always destroys it."

Feeding it to a living being is a capital investment, investing in living-being capital.

Quote: "Point being, before there can even be production of those things consumers consume, there must be investment in the means by which that product will be produced. Whether it be storefronts, factories, UPS trucks, whatever. And whoever puts up that money is taking a huge risk. What if nobody wanted burritos and the "grande opening" had been a complete flop? They would be out all that money."

Someone had to feed people *something*, even if not yet those specific burritos, in order for someone to live long enough to even try to organise such a complex organisation as that shop.

How many dollars worth of meat are you? How much resources and effort are expended "merely" on efforts to prevent others from using you as meat instead of going to all the trouble of participating in some vast burritos-made-from-nonhuman-beings enterprise?

At some point I have found it useful to seriously consider something along Buckminster Fuller's forward person-days of life-support for inhabitants of this planet measure of wealth instead of counting how many pieces of paper Scrooge McDuck and his ilk get to swim in without even taking seriously the idea that using that stuff for swimpools for his ilk might well be depriving someone else somewhere else of life or limb or liberty...

-MarkM- (If they have no paper, let them eat [scrooge mc] duck?)

The fact that so many people who already adopted the original bitcoin imagine mining a new but similar currency to be a waste of time might allow late-comers a window of opportunity each time they start yet another similar currency, because it seems possible that not a lot of huge mining corporations will immediately jump on their blockchain and mine a few million coins of it "just in case it does take off".

Thus simply start yet another one yourself, or jump on one of the ones the bitcoin-plutarch-cabal considers beneath their notice and large mining pools seem like they might actually be able to resist the temptation to throw lots of processor power at.

Maybe it will only take a few iterations to accomplish something or maybe it will have to get close to "one blockchain-based currency per person" but hey, is it really so much more wild a gamble than Satoshi's gamble of gosh knows how many programmer hours gallons of skullsweat etc?

There are more and more new blockchain-based currencies springing up all the time. If original bitcoin is not quite to your taste pick another or create one tailored to your precise tastes.

-MarkM-

Look on the bright side: your failure to take advantage of the current opportunity in mining is one less GPU others have to compete against, so by refusing to mine you are helping make mining more profitable for others who are less short-sighted and bigoted (against communities of less than a million people) than you are.

So thank you for doing your part in that way.

Furthermore if this FUD you are trolling here turns anyone else off of mining that again helps those who do grab the bull market by the horns to profit so maybe even that is a good contribution in a backhanded kind of way.

-MarkM-

Actually, if the price of coins does go down so low compared to difficulty than only people who get "free" electricity can "profit" by mining, that will probably *increase* the number of small scale miners, because having to pilfer probably cuts down the average amount of electricity used. There might be some people who can pilfer enough electricity for ten years straight to run a significant number of rigs but but there are probably more people who could, if it were profitable to do so, buy enough electricity for ten years straight to run a significant number of rigs.

So quite likely if mining is "unprofitable" for anyone who pays for electricity the ratio of small miners to large miners will change in favour of small miners, which could well increase the chance of getting a million small miners with minimum competition from large miners...

-MarkM-

When bitcoins are worth only a mere US$10 each, happening to win a block would be a win of US$500.

If you actually *invest*, long term, as you seem to plan to have your million high-IQ people do, instead of living rig-to-new-hardware selling off your bitcoins instead of sitting on them until they go up to at least ten times the value they had when you actually mined them, then yes you might see mining as unprofitable, because by being so short-sighted you will be competing with all kinds of wannabe-get-rich-quick people who are trying to make a quick profit in only a year or few instead of looking at it as a long term business and bearing in mind that typically long term businesses need at least a couple of years to break even (and then benefit from the huge percent of their competitors who dropped out before even lasting a couple of years in the biz).

If you figure it is a long term good investment, you surely ought to be figuring the coins you mine will be worth at least ten times as much within oh gosh maybe less than a decade even than when you initially mined them.

So if you do happen to luck into a block when it is only worth US$500, you will be thinking oh cool, that is at least US$5000 in my mind as I don't expect to sell it until it *is* worth at least that...

Most competitors will be thinking shorter term, and maybe running equipment they intend to burn out in only a few years instead of running gear optimised to last a decade or two. (Maybe heating units for the winter and solar units for summer, heat pump engines recycling heat, industrial 24/7 chips instead of gamer chips intended to be used flat out only a few hours a day, and so on.)

Thinking of high IQ long term investors burning out units not intended for flat out 24/7 use seems a little oxymoronic. Can you run ten times as many units at one tenth duty cycle or one tenth power or something and make them last more than ten times as long or something? Or just build units with 24/7 duty cycle in mind from the chip-design up? Or *something* more intelligent than abusing consumer low duty cycle hardware?

(How about your million smart people each put a dollar or few toward a specially designed chipset and a datacentre to put it in, forming a mining corporation they each buy into?)

-MarkM-

It might make sense for companies producing something to be the first lenders.

Like an automobile manufacturer, for example. "I will loan you bitcoins to buy my automobile" kind of thing.

Basically, any case where really it is not in effect actual bitcoins that are being loaned, really what is being loaned is "whatever it is that the borrower had been thinking of borrowing bitcoins to buy".

In other words loans *denominated* in bitcoins but not involving actually putting any actual bitcoins into the borrower's possession.

Two of the blockchain-based currencies my IRC bots support are already doing this; it has also the advantage of causing the loans to be at least to some extent "secured" (the extent being a combination of the effectiveness of the repossession facilities in use and the re-use value of the used merchandise, and this can be priced into the cost of the loan aka the price of the merchandise when purchased "on credit" in this way).

-MarkM-

In fact if miners tend to be major investors in hardware as compared to non-miners, wouldn't at least some miners figure the vaster the blockchain the better, since they can better afford "vast" storage space (due to "economies of scale") than smaller players can?

-MarkM- (Isn't it typical in many or most industries to actually *want* {|such} "barriers to entry"?)

Quote: "I don't understand how people expect BTC to have a stable price if the market for their use keeps expanding."

Okay lets take an extreme example to illustrate a point by using exaggerated figures.

If only a few trillion dollars worth of bitcoins exist by, say, the end of the Mayan calendar in december 2012, then, yes, a few trillion more dollars choosing to enter the market could still cause quite a jump in price.

But if many trillions of dollars are in bitcoin form by that time, then a paltry few trillion entering ought only cause the price to rise by a small percentage.

Get the drift? (Stability increasing as sheer value of the whole shebang increases compared to potential "outside" influencers.)

-MarkM-

Pump and dump might work a whole lot better when there are more such currencies on the markets, not only because it might be easier/cheaper to aquire a big enough chunk of any one currency but also because one could  invest in mining rigs too and hint about which currency huge amounts of hashing power is "thinking of moving to" and other such rumour-mongering.

For people who like playing markets, a bunch of currencies all based on bitcoin code/concepts would be really great, allowing much scope for playing among them without the current constant recourse to old school fiat currencies and pecunix and liberty reserve and such.

-MarkM-

Okay, lets tailor a blockchain-based currency to address your concerns.

Mostly it seems you want to distribute coins among at least a million people before allowing an arms-war to start among them whereby they compete with each other to enrich processor manufacturers instead of each other.

How about this:

- Our AfterburnerCoin system will not recognise a coin-production transaction as valid unless it designates a specific address as beneficiary, or one of a "jury of peers" of addresses maybe.

- The institution / committee / whatever controlling that address or those addresses commits to issuing the coins to many people, no more than 21 coins per person, so that a million people are required in order for all 21 million coins to be issued.

(Or even, only 1 per person so a million people can be equipped with one when only 1/21 of the total have even been minted yet.)

-MarkM- (Or a faucet issues them, oh wait, that is already done, did you get your free faucet money yet?)

(Weird, firefox thinks faucet isn't a word, maybe I somehow have set it not to use an American dictionary?)

(If so, what is it in English? A tap, I guess?)

P.S. How to get rich quick with such a system: (1) Tell people they can get a free [something] from you simply by picking up free coin at a faucet and giving it to you in return for that [something].

Yes, for sure, if it is so much better get it up and running.

-MarkM-

No-one mentioned the checkpoints, blocks that the client code knows enough about to realise the blockchain it is downloading is corrupt if any of those checkpoint blocks fail to match the values hard-coded into the client.

An attacker with >50% of the processing power cannot automagically convince the lesser percent of the network's processing power that those hardcoded checkpoints are wrong, so the attacked network will know for sure that any node trying to tell it a checkpoint block that does not match its own hard-coded checkpoint values is to be regarded as an attacker.

Thus, ancient (as in pre-existing the latest hard-coded checkpoint) coins are protected by those checkpoints. Do they still need constant adding of new blocks? Surely not? The entire network could simply stop completely and only transactions after the last hard-coded checkpoint will be at risk.

It seems to me to make a lot of sense that if "hoarders" (long term savers saving in actual unspent bitcoins rather than by investing or whatever) and "traders" (people making new transactions) have even slightly divergent goals that is an excellent reason for having at least two complementary blockchain-based currencies in use at any given time: one for saving and one for spending.

This whole thread seems kind of "moot" in an ecosystem of more than one blockchain-based currency. Get over the whole "there can be no blockchain but bitcoin's original blockchain" hangup and this whole problem can go away naturally.

From time to time a new blockchain can be started, with an explicit understanding/announcement that processing power is going to start moving toward the new chain, leaving the old chain to be secured primarily by means of the hard-coded checkpoints.

Eventually everyone interested in making new transactions and having them verified relatively fast will move to the new blockchain. People leaving their coins to their great great grandchildren will probably not worry too much that the Smithsonian, archive.org and other long term historical-storage facilities might take more than ten minutes to eventually release those coins come the century that their heirs finally choose to prepare to use them.

Announcements could even be made of at which block of both the old and the new chains the old chain will receive it's "final" checkpoint, after which no attempt to process a block every ten minutes will be made with the old blockchain. How to work out any later transactions on the old chain with the historical archive institutions need not even be detailed if this whole changeover is allowed a lot of time to happen, maybe even telling people that if they do want to leave their stash to their great great grandchildren they should in fact exchange it over to the new blockchain rather than depend on anyone being interested in buying ancient coins from ancient blockchains at some far future date.

Maybe we could simply add a -savingsnet flag like the -testnet flag for those wanting coins to save instead of (the default?) coins to spend...

-MarkM-

Has Canadian Tire become a central target for government(s) due to their issuing of Canadian Tire money?

If not, is it maybe due to some security blanket effect produced on the government(s) by some kind of record keeping of which serial numbers of Canadian Tire money notes were issued to which customers? (I think I recall cashiers handing out used notes though without any apparent attempt to make sure they gave out precisely the serial numbers the cash register thouht they were giving?)

-MarkM-

I am not convinced that having many variant blockchain based currencies would devalue bitcoin.

For one thing if it constantly pointed out that it is in fact using the bitcoin software or modifications of the bitcoin software, all of its marketing would also to at least some extent also be marketing for bitcoin.

Ideally it would even be able to serve the demographic that feels left out of bitcoin by the escalated cost of entry into the bitcoin-minting business.

Maybe an alternate route from hobbyist earnings up toward full buying power new currency could be games. It has long been a problem that it is hard to set up gaming as something people can legitimately make a living at, such as by their character's actions in a game serving to make the game sufficiently more interesting to play for other players that the value of the game as a whole is increased.

We can see already from games such as World of Warcraft, Second Life and Eve Online that currencies used in games can become tradeable directly with "real" currencies, maybe either setting up more and more games that use bitcoins and also variants of bitcoins, or some existing large games introducting such currencies into their games or rationalising their games' economies by restricting the total supply of various things in the game by means of such blockchains, could be at least as practical a way to start up new blockchain based currencies as would iTunes issuing AppleCoins or Canadian Tire issuing Canadian Tire Coins.

A lot of the value in many private currencies seems to be the sheer number of people they get to spam with whatever they want to spam them with. Whether it is air miles or the customer loyalty points of some particular chain of shops, just having lots of people own some seems to almost have value in itself though more likely much of that value rides upon actually having some means of and excuse for spamming them with some form of promotional material promoting possibly even more things than just one's own products.

So to some extent especially during boot-up it might be more important to get coins out to vast numbers of people than to have those coins initially seem to have any actual value. The more people that have some the more value just the sheer number of people will maybe tend to lend to the things.

-MarkM-

What if the so called "third party" is simply another department of an enterprise?

Might this be useful within enterprises for internal security against individual employees or small conspiracies of employees subverting the enterprise's bitfinances?

Maybe even cases where the type of "rooting" going on is that the individual having the "root" password to a particular machine or departmental pool of machines contemplates embezzling?

-MarkM-

Quote: "I can't believe that someone would actually propose "restarting" the original chain as something other than a bad joke! Cheesy Takes all kinds to make the world... "

Yeah well I had a hard time believing they were seriously going to scrap the testnet blockchain, too, but they did it.

I have now implemented seven new blockchains each one being implemented by hacking only the -testnet switch section of the bitcoin code, so that each of the new blockchains can be run using software that does the normal bitcoins normally but does one of the new blockchains when you set the -testnet switch.

I only need seven variants because I don't bother with the actual testnet at all. If it is subject to restarts, it is useless to me. So I don't bother having the normal version that does the normal testnet when its -testnet switch is set.

I think to make one to release to the public though I would hack it to re-calibrate difficulty twice as often, halve the number of coins minted per block at least twice as fast maybe four or eight or sixteen times as fast, and start with more coins minted per block so that despite the faster halving it will still end up at 21 million coins.

The objective of this would be to very rapidly leap into a future in which mining reward is mostly the transaction fees. I would want to get the coins out to people fast and without regard for how much processing power they have available to them. So that from a mining company's perspective it would be as if an entire already-populated far-future blockchain suddenly showed up looking to pay them to build a blockchain, not to mint coins.

How to distribute the coins is a begged question though. One advantage of having many blockchains is each can choose a different method of initially distributing coins. Maybe we could build at least one into an open source virtual reality game, much like Lindens were built into Second Life. Maybe we could give some to every one year or more old facebook account that wants one, Heck we could try all the crazy methods various people have suggested.

It would be fun to have even literally hundreds of new currencies with a nice big exchange where they can all be traded against each other, like a stock market / forex game kind of thing.

Also instead of having to make their "shares" through some centralised exchange, anyone interested in issuing "shares" could simply start their own blockchain for them, with any "value" they are to have being provided by their willingness to buy back such shares (coins) as they issue. A whole lot of fun could be had. But so far I have seen very little interest, I don't think anyone at all has even "ident"ified themself to my NickelBot on the IRC channels that handles these seven new blockchains I have so far implemented.

-MarkM- (For hundreds, maybe the shared work ideas could be really useful of course...)

I have been seeing a lot of times comments that make it sound as if a US$300,000 development cost for an ASIC is a crazy-high cost, far out of reach.

Yet I also recall having read this same day that the bounty for an open source GPU miner was BTC50,000.

How much is BTC50000 nowadays?

Isn't it actually *more* than US$300000 ?

So whoever picked up that previous BTC50000 bounty might single-handeldy be in a postion to be able to afford to have an ASIC developed?

How many others have BTC50000+ lying around, maybe from back when they picked it up for a penny a coin or so?

Surely a mere US$300000 to US$500000 or so is far from out of reach for the bitcoin community?

-MarkM-

Trashing the blockchain to start over is crazy. It was bad enough that testnet suffered that horrible fate, at least with testnet we were warned not to expect that it would not happen. I still see that as a horrendous waste though. What the heck was so awful about testnet's blockchain that it had to be trashed? I don't know but I hope it was truly godawful as wow that was such a horrible waste.

I do think we should have more blockchains, and I regret that the ones I have had a hand in starting up are all such carbon copies of bitcoin that their backers have not been able to figure a reasonable way to simply open them up to the public like bitcoin and testnet are open to the public.

Basically I went with too simple a hack, I should have changed more, maybe not to the extent of creating 21 million coins in the genesis block, but certainly something that would have speeded up the initial creation of coins and brought much much closer in time the day that there would be no more minting of coins.

The problem though has been backing. The groups I have been working with want to back the coins they issue, not millions of coins created by people who have no intention of actually backing them. If I had hacked more I could have gotten the majority of the coins into their hands fast so they could open the blockchain building to the public sooner.

I have seen comments that if Gavin started a chain in which he had all 21 million coins there ever would be, that would be a problem.

I do not think it a problem IF the person who mints them, and thus who issues them, BACKS THEM.

Someone recently wrote about a bunch of ecological electricity generating folk he was thinking of using a blockchain based system for. To me it would make more sense for those people to issue enough of their coins for customers to use to buy the eco friendly electricty they generate than for them to issue coins they "mine" simply because they "mined" them without any intention of honouring them with actual eco friendly electricity to "back" them. So I suggested to him that instead of letting the electricity generating people mint the coins he mint them himself and, in effect, issue to them as many as their customers would require in order to buy the electricity.

That way the coins are backed. They only give out as many coins as they are prepared to accept back in return for electricity. The problem of not having merchants is avoided by having the merchants be the issuers of the coins and only issuing as many as are needed to buy what they are selling.

Basically instead of just saying hey I will sell you a pair of alpaca socks for X dollars, I say hey I will instead give you sockcoins sufficient to buy those socks, if you would prefer those to actually taking the socks today. You can turn them in for actual socks any time, these coins you are buying are backed, they are tokens I am willing to accept back from you.

It seems likely to me that a whole bunch of alternate blockchain coins none of which are actually backed by anything would likely tend toward zero value, as it would always be easier to start a new chain of difficulty one than to mine an existing chain whose difficulty has risen higher than one. But if the initial bootstrapping of a blockchain involved something actually backing the coins, wow, that seems to be a big feature over any arbitrary un-backed new blockchains.

That is part of why I came up with the idea of BitNickels as fractions of a bitcoin: I wanted them to basically be backable with bitcoins, or with any other currency amenable to division into twentieths or to comparison with / exchange with twentieths of some other currency unit. The idea was simply not to give anyone any BitNickels unless, and until, enough actual nickels or bitcoins or *something* was on hand with which to BUY THEM BACK.

That is why I designed my IRC bots to actually deal with the currencies in a way that amounts to backing them with each other. Any bitcoins spent to buy bitnickels resides in the NickelBank's bitcoin account ready to be used to buy back bitnickels. Any bitcoins used to buy CDN (Canadian Digital Notes) resides in CDNbank's bitcoin account ready to buy back CDN, and so on.

The technical problem around this has been that one probably cannot rely upon arbitrary tom dick and hairy out on the net "mining" any of these coins themselves to actually "back" the things, therefore the blockchain building has to be limited to a private network of "branches" of these "banks". Hopefully when "thin clients" come along this will seem less of a problem. If not maybe more hacking is needed to come up with versions wherein tom dick and hairy can "mine" transaction fees but not "mint" coins...

-MarkM-

"As far as the lump sum request; what is a scenario that might happen with bitcoin?  Someone putting in a 7M BTC @ $10/each type order in an attempt to push prices up to 10?  Probably there is something more subtle I am missing.."

Okay, it is a little less likely an occurrence with bitcoins and fiat currency than it is with weird/unusual/rare currencies, possibly even including currencies such as World of Warcraft Gold, Linden Dollars, or even rounds of silver, bars of gold,ice cream cones or pizzas.

I was thinking of these weird things mostly. Like lets say I want to buy an automobile that I can buy on Craig's List for X number of item Y or alternatively can buy on eBay for A number of item B.

Obviously I want either X number of item Y or A number of item B, unless I am prepared to go into the possibly horrendous can of worms that might be involved in trying to convert some number of item B into some number of item Y or vice versa.

Now with highly liquid easy to access markets, such as in the case of item B being USD and item Y being GBP or CAD, I can quite likely face the "can of worms" of getting a bunch of one and a bunch of the other and then converting one or the other so I end up with the desired amount of one or the other, which one that ends up being becoming the deciding factor in whether I buy from the Craig's list seller or the eBay seller.

But as soon as item B and item Y are not so easy to "convert" ("exchange") as USD, CAD, GBP and such, I can face challenges I simply do not want to face.

I would then much prefer to offer to buy A number of item B for bitcoins OR X number of item Y with bitcoins but NOT to want any less than A of B nor any less than X of Y.

Maybe item B is silver rounds, because the eBay guy likes to deal with that lakota bank place, and item Y is World of Warcraft gold, because that is what the guy on Craig's list is asking for. Do I want to try to figure out how to convert silver rounds to world of warcraft gold or vice versa?

Or would I prefer to simply offer bitcoiners so many bitcoins for exactly A number of silver rounds OR exactly X number of world of warcraft gold, with a sorry I will not buy less or more of either, I need this many of those OR that many of these, no fractional parts, fractional parts are frankly more trouble than I want to deal with. If you can't give me enough of what I need to buy what I want to buy then I don't need any, because no lesser amount is going to buy me what I want.

Basically I guess in a totally liquid market the apparent need for this maybe goes away.

Oh but wait, suppose I want to own 51% of the shares of a company. Is it not then reasonably to say I want enough to get that percent and any less is pointless, as all it will do is make it actually harder to get the last little bit that would put me in control of the company? I want control of the company or I will buy some other company instead, one that I *can* buy control of? If you cannot sell me enough IBM I dont want IBM, how about Microsoft, can you sell me enouh of those? No? Then how about penny stocks, got enough of any of those that I'd get control by buying them?

Is that maybe a real life case where buying a certain number and no less makes sense?

-MarkM- (If you can't sell me enough bitcoin to buy a Cadillac I'll instead buy enough GBP to buy a Rolls?)


(In games it can be things like I want EITHER 2000 metal to build a metal storage facility OR 1800 metal and 500 crystal to build a crystal storage facility, I want to actually build something so I need these amounts not fractions of them.)
 

That kind of "freedom of association" trading is something I have had people ask for a lot too. Freedom to pick which offers to go for. Admittedly part of why I see a lot of requests for that is I am very often looking at in-game uses of currencies thus some players do not like the idea of financing enemies or non-allies.

Another request I get a lot is for lump sum offers, since if for example you want 50,000 somethings to buy a battleship and 49,999 will not buy it you miight prefer to play around in other ways with your resources instead of tying them up in not quit enough somethings to actually buy a product you want. So people often ask me for ability to offer to buy a certain number and no less than that, or to sell a certain number and no less than that.

I do however see potential for abuse in such setups, since for example a person could keep moving the scale of their offer up and up and up to ensure it is always actually just out of reach.

(For example if I know no-one in all the galaxies, or maybe not even all of them combined, can raise a hundred million deuterium so I post an offer of lots and lots of bitcoins for one hundred million *and no less* deuterium to try to psych up the value of deuterium whilst knowing I will never actually have to spend any bitcoins on the stuff...)

Similarly trade ith who I wish could also be abused especially by a player runing multiple accounts. They could pay themselves - but under another name/account - and *only* themselves, high prices in bitcoins for deuterium, again to drive up the price of deuterium, again without ever really having to fork out any actual bitcoins...

-MarkM-