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1  Bitcoin / Project Development / "Consensus!" Fiat to Crypto P2P Exchange Concept on: February 20, 2014, 12:05:34 AM
I'm reposting this here. Originally it was in the Bank Run! P2P thread but don't want to distract from that thread or coattail it.

I'm just thinking out loud here but maybe something can come of this.

Western Union has a way to send cash to their agent locations. These transactions can by picked up in cash by a person by simply presenting the MTCN (Money Transaction Control Number) along with ID at the agent location. Once cash is picked up, it is obviously not reversible. There's a period of about 3 days for the cash funds to be available for pickup. The downside is having to show ID.

My thinking is that there still needs to be an escrow system that works anonymously. The escrow system can rely on mining for escrow fees. A not-yet-solvable block can be created once Bob deposits BTC plus escrow fee and enters his first and last name. In order to be solved, additional information has to be input from the transaction. When Alice sends the Western Union Three Day payment, she gets a MTCN from Western Union. She then enters that MTCN into the client, the country it was sent to, and amount. She also must enter a BTC address to receive the BTC when the block is solved. Once that information is entered, A waiting period of 96 hours is created. This creates time for Bill to obtain the cash, making the fiat transfer irreversible. The escrow system encrypts all the information and checks Western Union online to verify the MTCN is valid and the receiver matches, etc. If it all matches, then the block becomes solvable. Once solved, the btc gets paid to the bitcoin address supplied by Alice. The escrow fee gets divvied up amongst those who solve the block.

This solution would have to integrate well with checking Western Union online. This might require people to do this manually. In that case it adds an actual human work component to the escrow system. Now of course, a person might just say yes or no to whether the transaction information on Western Union's website matches the information in the block. To facilitate this, I think several people would have to confirm the transaction. If your confirmation or rejection of the transaction doesn't match with the other transaction checkers, you lose points. Lose enough and escrows won't be assigned to you anymore. Truthful responses will be rewarded with small amounts of points, leading to more escrow verifications coming your way. Those who verify blocks, leading to them being solved, get a portion of the escrow fees.


I'm not a programmer and don't fully understand how blocks, etc., work so this might be full of flaws. Hopefully, not so many that it is useless even as a beginning concept.


2  Bitcoin / Bitcoin Discussion / Here's a ray of sunshine for this current downtrend on: February 14, 2014, 04:44:32 AM
Since Overstock uses a payment processor to accept bitcoins, essentially removing any risk of loss, they are not being hit by this downtrend. Well, except for any holdings in BTC that they possess. However, that was not a requirement in order to be able to accept BTC.

There are probably a few merchants that were taking a wait-and-see approach to getting on board with accepting Bitcoin. When they see that it is possible to accept Bitcoin even through a halving of the currency's value without risk of loss, they may be willing to start accepting BTC. You can't really do that with US dollars or any fiat currency for that matter. If the Fed Reserve decides to double the Dollar money supply overnight, merchants would have to double their prices. Since the payment processor takes on the risk of sudden fluctuations instead of the merchant and calculates the amount of BTC needed, the merchant will weather these types of storms without having to concern themselves with BTC's changing value.

I think merchant adoption rates will depend on how Overstock does through this downtrend, and it appears they are doing just fine.
3  Other / Beginners & Help / Mining and Fishing on: February 13, 2014, 07:31:23 PM
Mining bitcoins is a lot like fishing.  It starts out with hearing stories of people catching lots of fish and and selling them for lots of money and then you think you should do it too.

Try to imagine a small lake with about 21,000,000 fish. The first people to fish it were getting lots of fish but the fish weren't worth a lot of money yet either. Suddenly, the value of the fish goes up and now more people show up to fish. However, to keep too many fish from being caught too quickly,  the size of the lake adjusts every two weeks. Since the lake keeps getting bigger and bigger, the fishermen start using better tackle and more poles. Eventually,  they buy boats and trawlers, nets, etc. The lake is now an ocean. Soon, fishermen put their resources together to catch more fish and split the profits. All the while, the ocean keeps expanding, making fishing difficult for anyone who doesn't have the means to buy fancy boats, etc.

Enter your plans to mine:

You decide to get in on the fishing because the fish keep going up in value. Online you find a tiny boat and pole and buy them. Well, the local fishermen are fine with you joining their pool of resources but you quickly find out that your split of the fish isn't that much because you are only a small boat and pole, while they are bringing up large nets full of fish. If only you had the equipment they did. Then you come to the realization that your boat has been consuming gas this whole time. Well, you sell some of the fish you got but it isn't enough for gas...

That is bitcoin mining in a nutshell. If you can't afford the fancy trawlers, don't expect to catch much fish now.

Why not just buy some of the fish now and wait for the price to go up?
4  Other / Beginners & Help / password security on: February 13, 2014, 07:00:34 PM
A password I've created shows on howsecureismypassword.net to need about 4000 years to crack on a desktop pc. Is that strong enough or should it be made stronger?
5  Alternate cryptocurrencies / Mining (Altcoins) / Rate my mining performance on: February 10, 2014, 02:03:33 PM
I am using an ASUS HD7790 DirectCU II OC 2GB card on GUIMINER-Scrypt. Ran the card overnight from 10:30pm to 7:00am. I was getting 246khash and using middlecoin.com's pool which mines the most profitable coin at any given time. 95 shares accepted, 10 stale/invalid (seems high to me).

Thread-concurrency 8000
vectors 1
gpu threads 1
worksize 256
intensity 18
gpu-engine 860
gpu-memclock 1500

Any suggested tweaks? How is my stale rate? Stales seem high this run but on longer runs it is usually half to 1/3rd this amount.
6  Bitcoin / Bitcoin Discussion / proper syntax for gpu-engine and gpu-memclock on: February 06, 2014, 04:23:51 AM
I have a 7790 that I'm trying to get an optimal hashrate for scryptmining. I'm using guiminer-scrypt. I've read several discussions on here about setting the gpu-engine to 800 and the gpu-memclock to 1500 to get best hashrate. However, I'm stumbling to get the proper syntax to accomplish this. Any help?
7  Bitcoin / Mining / minershare.net questions on: January 19, 2014, 04:30:07 PM
A search on here didn't get much information. Price of$4/gh seems better than most cloud hashing prices I've seen. Their website estimates a $300 USD income per share but different machines on their site have different size shares. I assume they refer to the $24 share being worth $300 in expected ROI.

Anyone have any firsthand information to share? Also, if you feel this to be an unprofitable venture, feel free to chime in as well.
8  Economy / Long-term offers / anyone ever sought a home loan via btc on: January 14, 2014, 05:17:39 AM
I'm under contract to buy a home in AZ,  contingent on obtaining financing. I'm considering seeking a BTC loan instead. If I go this route, obviously I expect the lender to hold title as collateral same as a bank would and for me to go through the same qualification process.

So why not go through a bank?

I'm self-employed. Banks average your last two years income. If I was a w2 employee,  they would go off my last 30 days paystubs and I would be in like Flynn. My two year returns look low because I desire to pay as little income tax as possible, which is a conflict for a bank that wants to see you make as much as possible.  Prior to the housing crash, I would have done a stated income loan with my good credit but that type of loan program is unavailable because it was the scapegoat for the last housing crisis.

The house I'm trying to buy is a site built home constructed in 2006. The seller wants out soon and so the house comps out well. I'm buying it for $129,900 and expect the appraisal to be at least $145,000 due to being on a larger lot than the comps, which have sold higher than this one. I'm getting a good deal because this time of year is slow for real estate and the seller priced for a quick sale.

Any loan would have to be pegged to USD because I expect BTC to keep rising and I'm not paid in BTC. This is not a loan request at this point but would look at any terms proposed.
9  Bitcoin / Bitcoin Discussion / PACs and lobbyists on: January 12, 2014, 01:40:35 AM
Are there any PACs in the US to try and advance crypto-currency at the political level? I found a news story for a PAC that existed for 2 days. I think it would be good to push for legislation that expands freedom for the currency such as dealing with issues with fincen, etc.
10  Alternate cryptocurrencies / Mining (Altcoins) / Need help picking out a 7770 GPU on: January 10, 2014, 05:40:39 PM
I realize this isn't the fastest card but this is for passive mining anyway. I'm looking at several 7770 GPU's, each with slightly different specs. Can you help me get the best bang for my buck among these 4 choices:

(1) Asus HD7770-DCT-1GD5 Radeon HD 7770 Graphic Card - 1120 MHz Core - 1 GB GDDR5 SDRAM - PCI-Express 3.0
     Price $138

(2) Asus HD7770-DC-1GD5 Radeon HD 7770 Graphic Card - 1020 MHz Core - 1 GB GDDR5 SDRAM - PCI-Express 3.0
     Price $148

(3) Asus HD7770-2GD5 Radeon HD 7770 Graphic Card - 1020 MHz Core - 2 GB GDDR5 SDRAM - PCI-Express 3.0
     Price $209

(4) Asus HD7770-1GD5 Radeon HD 7770 Graphic Card - 1000 MHz Core - 1 GB GDDR5 SDRAM - PCI Express 3.0
     Price $115

I'm looking to mine primarily LTC but will consider other alts. Also, since GPUs tend to get bought up pretty quick, it's possible I might not have all the choices listed above. If you're feeling particularly helpful, please respond in preferential order such as 2,1,3,4 or 3,4,2,1, etc. Thank you in advance.
11  Economy / Trading Discussion / IDEA: BTC "cards" with public key but no private key on: January 10, 2014, 07:53:25 AM
This idea is more theory than anything else.

The basic concept here is to create a type of paper money or card that is tied to a wallet containing an amount of BTC same as denominated on the card. The issuer of the card retains the private key for each wallet. Obviously, this makes it impossible to move money out of the wallet. A QR code on the card allows the holder to check that there is in fact BTC associated with that card. The issuer must be willing to redeem the card in exchange for BTC. This could be possible by either giving the holder the private key to that wallet but there is a more desirable method. That method would be for the issuer of the card to transfer BTC to the wallet of the redeemer upon surrender of the card. This allows the issuer to re-circulate the card or destroy the card if worn out and print a new replacement.

I think these would have to start out as small denominations at first such as 0.005 BTC to facilitate small, everyday transactions as well as to foster development of trust. The issuer would have to be trusted to not spend the money in the wallets. To facilitate this trust, I think the issuer should publish all the wallet addresses of each card online so that people can check activity on those wallets to verify that all cards issued are legitimately backed by BTC. This has a distinct advantage over FIAT currency which are redeemable for nothing and backed by nations that are trillions of dollars in debt. Also, if historical patterns continue, these cards would gain increasing purchasing power whereas FIATs like USD are losing purchasing power.

I think this idea bridges the divide between online currency and in-hand currency. You wouldn't need a computer or anything electronic to perform a transaction, just acceptance between the two parties.

By not having the private key on the cards, they can't be spent by any holder of the card and that means that any in circulation would have BTC tied to it.
12  Economy / Marketplace / question about accepting credit cards online on: January 08, 2014, 04:59:50 AM
Is it possible to limit credit card transactions on a website such that a first time customer could only spend a smaller amount? Could such restriction be lifted automatically after, say, 30 days? Also, could someone be limited to only one transaction on such account with that card during that same period? Is it possible to limit credit card acceptance to only those transactions where the delivery address matches the billing address?
13  Other / Beginners & Help / Looking for ways to earn BTC/LTC on: January 06, 2014, 06:52:21 AM
I would like to earn some BTC/LTC the old-fashioned way...by earning it. I've looked at some of the sites where they pay you to do tasks but the payout is miserably low. I've got a lot of knowledge and am also very good at finding things online, researching, etc. I've got a regular full-time job that I enjoy which is installing satellite systems. Not sure how that translates into anything useful here but thought I would put that out there. So, basically, if you've got a task that you can't perform, post here and if I can help, I will give it a shot.
14  Economy / Scam Accusations / google sponsored result for mtgox is fake on: January 05, 2014, 06:35:24 PM
If you google the word mtgox, the sponsored result takes you to smarthome-egypt.com/mtgox and looks exactly like mtgox. I haven't investigated it further but it might be a phishing site. It also says login to our official site and displays the mtgox url under the search result.

Always double check which domain you are on after  clicking a web search result.
15  Other / Beginners & Help / effect of 10 petahash on difficulty on: January 03, 2014, 01:35:32 AM
Has anyone figured out the effect of the addition of 10 petahash to the current btc network?

16  Other / Beginners & Help / What makes some GPUs better than others on: January 02, 2014, 12:11:08 AM
I'm considering GPUs for LTC mining and have a question. I've noticed that some GPUs that might be comparable in the gaming arena are very different in terms of hash rates. For example, NVIDIA cards all seem to be piles of garbage for mining despite being powerful for gaming. So what causes the disparity between cards. I understand memory, clock, etc., but can't understand what features make for a good GPU for mining.

Also, I notice there are specialty manufacturers making ASICs but I'm not aware of anyone making specialty GPUs for scrypt-mining. I mean if some combination of GPU features makes for powerful hashing, why hasn't any company come up with a GPU that is designed to incorporate those combinations?

Maybe the answer is I'm a lot less educated on this than I previously thought.
17  Other / Beginners & Help / Idea to protect merchants against volatility on: December 28, 2013, 08:47:41 AM
My first post here, btw. I tried searching to see if this idea had been proposed but to no avail.

Problem: Some retailers and merchants scared to transact in BTC due to volatility.

Many retailers would likely be willing to transact in BTC but they fear being left holding the bag, so to speak. Retailers place orders for their merchandise in the local or global fiat currencies. They also pay their taxes, employees, R&D, etc., in those same currencies. That ties them to the exchange rate between fiat and BTC. It can be difficult to pay $700 for some piece of merchandise and then try to sell that merchandise in BTC only to see a major correction possibly wipe out their profit on that transaction.

Scenario: Merchant unprotected against loss of value in BTC

A contract is offered to retailers by a Company seeking to sell protection against volatility and erosion of Bitcoin's value. The company analyzes the retailer's day to day business volume and determines that the retailer is likely to hold at most 10 BTC in their wallet at any given time. The unprotected retailer has a maximum risk of loss of $10,000 if BTC were to become worthless in that case. Company offers protection (insurance) against such losses by guaranteeing to buy their bitcoin at a specified price at a specified time. Company charges a fee for this service and retailer can offset this fee by pricing their goods and services to account for this additional business expense. An example fee would be $1,000 for up to 10BTC of buyback protection for a period of 6 months. Retailer can renew this contract policy after 6 months.

Solution: The policy functions similar to a put option where a buyer of a put contract has the right to sell the underlying stock at the strike price at the end of the contract but does not have the obligation to do so. In this case, the Company will be the one with the obligation to buy the BTC at the end of the contract. This would likely only occur if BTC declined in value below the buyback price at the end of the contract, otherwise the retailer would be better off using exchanges if BTC is trading higher than the buyback price. I would suggest that the policy be non-transferable. Also, redemption would be limited to the end of the contract on a pre-determined settlement date. This means contract lengths would have to vary according to the desired liquidity of the retailer. If a retailer can hold those coins for a year during a down market, they might desire a 12 month policy but if they need more immediate ability to sell their coins, shorter term policies would be a possible option.

Benefits:  This idea protects the retailer from loss of value in BTCs, thus allowing him to price his merchandise knowing that he has a minimum redemption value on any coins he takes in from transactions. In the above scenario, an unprotected retailer would have to adjust the BTC price of his merchandise if BTC lost value. If BTC suddenly went down to $500 in the above scenario, he would have to double the BTC price of his merchandise to stay on par with fiat currency. On the other hand, if BTC went above $1000 in that scenario, the retailer can offer a sale on his merchandise for those customers paying with BTC since he will make extra revenue from the exchange rates. The benefits to the Company offering the policy is that for as long as BTC keeps gaining in value, redemption will be unlikely to occur, keeping losses to a minimum while earning profits from policy premiums. If BTC is on a long downtrend, premiums will have to adjust according to risk. The public in general benefits from more retailers accepting BTC as a result of having protection against loss of value of BTC. Also, with more retailers accepting BTC as a result, the demand for BTC is likely to increase, benefiting investors and those holding BTC for the long term. It may also smooth out volatility to a minor degree if protected merchants don't have to worry about panic selling their BTC holdings.

Implementation: I'm a fan of competition as it keeps prices down and companies more honest. I would like to see some startups run with such an idea with their own improvements, offerings, etc. If no individuals or companies exist or jump on this idea, another way to implement this would be to crowdsource funding for this project. Because the Company would have to pay out in fiat currency, it would be best if they had liquid assets in that form or possibly some form of bonding. Whatever redemption price the Company sets on it's policies, it would be best to convert BTC assets to the currency described in the policy during periods of higher BTC value. In the above scenario, again assuming $1000/BTC, if the Company had multiple policies issued with 100BTC at risk for redemption, they could sell BTC holdings if BTC went above $1,000. Assuming the Company had BTC assets exceeding that 100BTC redemption risk, they could choose to exchange a portion of those assets at ideal times. So, if BTC suddenly went to $1,200/BTC, Company could sell 100BTC at the $1,200 price, thereby assuring that they make an additional $200/BTC against all redemption that occurs at contract expiration. This would eliminate the risk out of the currently issued policies. However, I suspect that the Company may only want to exchange a portion of their BTC holdings depending on the state of the market. Policies could be varying term lengths, have a premium that is based on the number of redeemable BTC, and redemption prices could be below/at/above current market rate with adjusted premiums.




I'm open to feedback and suggestions/improvements on this idea as well.
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