"Quite frankly the credit card security system is awful, bitcoin doesn't have to work hard to beat it."

You forgot to add "...in the US".

The rest of the developed world has chip and pin and 3D secure, that obviate the vast majority of credit card fraud for merchants.

"Full blocks on average" is impossible unless every block is full.

The main problem is that the blockchain (as designed) will exist publicly forever. That means analysis tools will get more and more sophisticated and any leaks of information will be immediately aggregated and used to identify controllers of addresses. I predict that in the future as these tools get better most mixed transactions from the past will be completely transparent.

If I meet someone at a meetup and hand him $1000 cash and he sends 4 coins to my address, then nothing links me to those coins. However once I spend them and gain value (goods, services, etc) then any little bit of leakage of data (e.g. a shipping address, etc) will immediately link me to that original 4 bitcoin transaction.

I think before people start using the word "consensus" they should actually read the one use of that word in the whitepaper.

Consensus is not a thing you achieve before a change, it is a thing that happens after a change.

The BitcoinXT thing is a perfect example of consensus as envisioned in the whitepaper. Someone builds a new version of Bitcoin and puts it out there. The users and miners of Bitcoin vote with their feet (ie: processing power) and reject it, and we move on.

The idea that we need to discuss a change until we achieve consensus is deeply flawed (and the most bearish indicator for Bitcoin to-date IMO). Stop looking for agreement. Just build it, ship it, and see who uses it. Just like Mike and Gavin did, and as Satoshi predicted.

The pussyfooting around we've had for the last 4 years with these network-breaking softforks is not what should be happening - i.e". make a change but hack it so we don't hardfork". There should be regular hardforks and the users (merchants, miners, PSPs) of Bitcoin should be set up to work around them. The lack of them makes the network weaker, not stronger.

Now we have experienced Bitcoiners literally and figuratively (and proudly!) sitting on their hands until the core devs utter their next commandment. And woe betide anyone else who drops a new version of core in the meantime.

I am convinced that the consensus concept is broken and misunderstood by the community. I think people are afraid of forks because they fear it will damage the public perception and price. I think that the lack of progress in the technology is damaging adoption WAY more.

Just my 0.02c




 

This shouldn't normally be a problem to own a casino business from the US while it operates in London. However if you are "running" it from the USA you are effectively taking bets over the internet which is illegal in all but 3 states. The US authorities don't have a problem with gambling, just a problem with offering gambling services FROM the US or TO the US.

The big issue in Europe is that there are a plethora of low-cost instant and risk-free payment methods already in place.

For example;
- Spending 300 euro on a credit card costs less than 0.2%, and most transactions are not subject to fraud due to 3D secure (online) or chip and pin (point of sale).
- I paid for my coffee this morning (3.65 euro) via a contactless card which cost the merchant about 4 cents to process (due to being contactless).
- Even for those without cards inter-country bank transfers are generally free and often instant.
- For those who love anonymity there are tens of millions in anonymised payments transaction monthly via PaySafeCard, Ticket Surf, and others.

...as a payment method, it just doesn't have a use case at the moment (other than darknet retail).

As a store of value in Europe, sure. However it is still inflationary and volatile, and people have low cost access to other inflation proof investments. Again, no real use case (other than hiding wealth effectively).

I don't understand what you mean by this?

But I think the point here is that many people believe (and interpret the whitepaper as stating) that a plethora of different implementations with regular post-fork swarming to a new consensus is actually the natural state of Bitcoin.

The idea that consensus means pre-fork agreement is wrong (as pre-fork agreement is impossible in a trustless decentralized system).

I believe the recent XT events should be the norm; new implementations being released, and standing or falling on their merits in the community, with regularity.

I think that while a lot of the "team XT" stuff was nonsense and dangerous, I think that the deliberate slowing of the blocksizes by those people with an apparent anti-competitive commercial incentive to do so, is FAR more dangerous and insidious.

If Bitpay came out and said; "we've created BIP111 and are suggesting people who like adoption run it, as we need it to process zero confirmation transactions to reduce fraud and increase adoption, so we can make money and grow" than at least that's honesty. What's going on at Blockstream is much more subtle, and much more disingenuous.

The only way that we can break this cycle of BS is for multiple parties to be developing (as they are) and the community to be accepting and rejecting CODE not PEOPLE.

Too add to the above; it adds some other enhancements to the software too.

To OP: the reason it is so contentious is not really because of the software, it is because of the way it has been implemented. The Bitcoin world has been debating block size for about 2 years.

Some core devs think it's bad, and don't like the guys who did it. They think everyone should agree 100% on every change before it is released. One of those lads controls this forum and another big bitcoin forum, and has been accused of censoring debate. They also claim the extra enhancements are bad too as they sort of enable censorship on the Bitcoin network itself.

Two core devs think it's good (and they created it) and are annoyed at the reaction of the guys who don't like it.

So the second group has released it into the wild to see what everyone else thinks; some people are adopting it as they don't like the forum censorship, some people are adopting it because they believe it is in their financial interests to do so, some people are adopting it because they distrust the fact that the core devs against it all work for the same company, some people are adopting it because they think it is better for the Bitcoin network's long term viability, some people are adopting it see the world burn.

Most people are waiting to see what the nodes and miners will do, as their actions will pretty much seal the fate one way or the other.

In my personal opinion the approach of releasing it to the wild to see what everyone else thinks, despite the strong opposition, is exactly the way Satoshi wanted consensus to happen. i.e. anyone makes a change, releases it, and users flock to the version they prefer. In my opinion once some big users of Bitcoin (the PSPs and miners) make a decision on what THEY want, then that's where consensus and the money will flow.

The reason the price is dropping is that that this is the first time the process of consensus has been really executed via a hard fork. Despite the fact that this is exactly what was envisioned by Bitcoin's creator, it has frightened some holders in to selling bitcoin till it blows over.

No. I keep reading this over and over, and need to point out that it is wrong at the fundamental level.

"Consensus" is what happens AFTER a fork. Anyone can mine anything they want on top of the blockchain; then everyone decides which one they want to do business on.

The assumption that consensus is needed BEFORE a fork is flawed, because there is no methodology for participants to reliably (trustlessly) have consensus before a fork.

Even the whitepaper in it's single use of the word "consensus" uses it to describe an enforcing mechanism for forked chains. Not a pre-fork prerequisite. "They vote with their CPU power, expressing their acceptance of valid blocks by working on extending them and rejecting invalid blocks by refusing to work on them. Any needed rules and incentives can be enforced with this consensus mechanism."

So claiming consensus is needed prefork is (a) impossible (b) contrary to the main definition of consensus (c) contrary to the definition of consensus in the whitepaper.

The more I think about it, the more I think that this obsession with pre-fork consensus to upgrades is what will doom Bitcoin. On the other hand maybe it is protecting it from chaos...

Some problems with this idea;
1. Bitcoin ATMs currently charge a lot. Two ATM transactions will cost more than a single WU transaction for most (not all) transactions
2. In remittance markets, the ATM in the sending country would constantly need to be emptied of local currency and loaded with Bitcoin, and in the receiving country it would need to be constantly loaded with local currency and emptied of Bitcoin. If you were operating this service in the US and Philippines (say) you would end up with a lot of cash PHP sitting in the Philippines that you would need to repatriate to the US (not easy for a lot of money) and convert to USD to load up the US ATMs. There isn't a lot of people in the Philippines sending wads of money to the US to counterbalance it. Try running a business that needs to get a few million out of the Philippines or Brazil or Argentina every single month. I can tell you with absolutely certainty that this is not easy.

With WU, the sending of the transaction is not what people pay for; it is maintaining local cash liquidity and converting the transaction to local cash... that's the hard part and the expensive part.

It is only naive people who think that Bitcoin can replace WU entirely. Bitcoin can certainly replace part of WU, and provides a neat way to transfer value trustlessly. But it's the local cash handling bit that is the hard part that WU and Moneygram get right.

And before you say "all we need is local businesses to accept BTC so that the recipients don't HAVE to convert to PHP!" yes I get it, we all get it. Easier to say than to do.