I think part of the point is that Bitcoins are scarce and that the elite would not be able to create money out of thin air to the detriment of the working class.

I don't see this happening. The cases of stolen BTC show that there is no viable way of quarantining "evil" addresses. Is the thief passing the coins back and forth? Are third parties involved? An Analysis of Anonymity in the Bitcoin System

Even if the black/grey market can be tracked effectively, what happens when somebody sends money from a "tainted" account to a "legitimate" account without permission? Will the business be required to immediately return the coins to the sending address? What happens if that money is sent to an off-line wallet? Would you be able to use legitimate businesses for laundering money by forcing them to give you "clean" money? If client changes are used to prevent the initial send, I smell blockchain fork.

This has happened in Canada, and was not pretty. Many students were abused. Many of the churches running the schools were recently facing the prospect of paying out bankrupting compensation.

Canadian Indian residential school system

I think a compromise would be a mandatory basic cirriculum, then let parents teach whatever they want after hours.

Google claims lots of results, but by the time you get to page 14 it says:

Many of the suppressed hits are from blockexplorer.com.

People are social animals. Ostracism can be fatal, even neglecting emotional issues.

If you don't see that, it may explain why you have so much faith in the free market.

To paraphrase  Oliver Wendell Holmes: your right to property ends when another is deprived of the necessities of life.

While it is good to be suspicious of government (and majority rule), there are limits to private property. If I dislike my neighbour, I am not allowed to buy a ring of land around his house and kill him when he goes for supplies, for example. In most cities, you can't even buy such a ring of land since the city retains a "right of way" (for roads and utilities).

The problem is that goods are allowed to freely move across borders (due to free trade), but people aren't. It is not easy for a foreigner to come to America to take advantage of artificially high wages, conversely, it is not easy for an American to go overseas to take advantage of lower unemployment rates at lower pay.

If I really believed in the free-market, I would be advocating "free migration" where countries compete for workers over who has the best system. Some people may prefer Communist states, other may prefer Capitalist states. Many would prefer to stay near the place of their birth. The free market should be able to decide which system is best.

I think the free market is ideal for determing prices. The difficulty is that the free market "knows the price of everything and the value of nothing."

I generally advocate a mixed economy. I have no problem with natural monopolies being under state control since any corporation in charge of such a monopoly would have government powers anyway.

The free market relies on the price system. It imperfectly approximates the desires of the population. It ingores externalities that are not easy to price. To blindly honour the free-market is just as dangerous as blindly following any other religion.

Economics is "The study of how people allocate their scarce resources to satisfy their wants." You can not separate the study of economics from the study of culture. The "reasonable assumptions" taught in micro-economics break down when applied on the macro scale.

You missed my point about the caste system. Some people are considered more valuable because of their class, not their skills.

Interesting point. The problem is that even leveraging automation, it is impossible for the blue-collar worker to out-produce the CEO because the CEO is deemed to be responsible for all of the production of the workers under him or her. Sometimes CEO bonuses don't even seem to rely or performance measurements.

If income disparity really was tied to productivity, I would not have a problem with it. Workers would naturally gravitate to jobs where they are more productive and thus paid more.

Income disparity, by itself is not a problem, it is a symptom of structural problems in society. As mentioned in that illustrated essay, income disparity would not be a problem if the "American Dream" of making it big was a reality.

Without upward mobility, you essentially have a caste system. The CEO does not work so much harder than a production worker to justify 300x the wage. The CEO may have some personal liablilty attached, but the whole point of coporations is limited liability for shareholders.

I also think Governments are very useful to society. They allow the population to pool their recources for infrastructure (generally a natural monopoly), dispute resolution, and a social safety net. I think giving money to poor people can stimulate the economy more than giving tax cuts to the rich: the rich are very good at aquiring money. The poor will spend it.

Possibly relevant to most of the free market/government intervention discussion:
CHARTS: Here's What The Wall Street Protesters Are So Angry About...

I'm sure the Libertarians will come to the conclusion that all of the problems listed (if they actually agree income disparity is a problem) are the result of government intervention.

In the case of bitcoin, I'm not sure if the apparent disparity will really be a problem in the long run. The network (and markets based on it) are not able to distinguish between a hoarded Bitcoin and a lost bitcoin. The value of bitcoin will always be based on coins actually in circulation. The biggest risk is that some of the large holders suddenly decide to sell everything, crashing the price (by putting more coins in circulation).

The profit-maximising hoarder would be wise to sell their coins as slowly as they can; unless they expect the value to eventually drop to zero (I think it will approach that within about 25 years, but not the near term). Selling coins puts them back in ciculation: likely spreading them out among more holders.

If the case of a widespread DDOS attack, mining solo is better so that you can relay transactions, taking load off of the pools. I am currently reading the forum instead of geting some CPU miners up. If the attack continues, I may have two (relatively power hungry) CPU miners at two separate IP addresses.

I have been planning on setting up a netbook CPU miner drawing 12Watts (for the near term), but have not set that up yet. The other CPU miners I have available probably draw 100W each. I am also concerned about bandwidth use and have not set up Bandwidth monitoring on my end yet.

You fail to explain why a completely serial Proof-of-work would be better than the current system. As others have pointed out, a serial proof-of-work has two major problems:

• Fastest node wins every time. If you think FPGAS are scary now, wait till they are optimized for your serial problem. (Actually, an ASIC may be needed to achieve a higher clock speed). If high clock-speed paid, I might just invest in liquid nitrogen cooling for 5+GHz clock-rates.
• Verification requires the proof-of-work to be repeated by every node. If there are two competing POWs sumbitted, the network must stall until at least 1 is verified. Some nodes may elect to blindly start the next proof-of-work without verification, but that only compounds the problem.

Edit2: That machine I mentioned earlier would still be able to do better than most competing nodes. It would be able to verify 32 Proof-of-work candidates in parallel, while speculatively generating a "proof-of-work" block based on each.

Edit: You brought up trust. It appears you want to eliminate "wasted" computations by having a distributed central authority choose the winner ahead of time. If that is the case, why use proof-of-work at all?

Don't know about the "average person", but "work" is a physics term that measures energy consumed in Joules. One Joule is equal to a watt.second. Finding the "magic number" proves that on average, you expended a certain ammount of energy (given reasonable assumptions about your mining setup).

You lost me here: as others have said, you can parallelize by buying more computers. If you want to use a lot of memory and branching to remove the advantage of GPUs, I can still parallelize if I have more money than anybody else.

Oracle quotes me just over $44,000 USD for a fully loaded SPARC T4-1 Server (PDF) with 256GB of RAM, supporting 64 simultaneous compute threads. It can consolidate 64 virtual machines (with 4GB of RAM each) in 2U, while drawing under 800 Watts. Granted, the 4MB L3 cache becomes 64kB afer being split 64 ways (128KB L2 becomes 16kB split 8 ways (8 cores)),  but each "machine" is only costing you about $687.50 USD.

If you had money to burn you could probably put 20 in a rack for 1280 virtual machines in a rack. How is anybody doing this not taking advantage of parallelism? Edit: assuming your "racks" of 4 GPUs are 4U each, your example for the "parallel" case has only 8 times the density (256 threads per U vs 32).

Bitcoin: legal headache.

The line I usually use: "Bitcoin is a peer-to-peer crypto currency backed by proof-of-work and a public psuedonymous transaction record."

I was worried you would take "trace" too literally. I meant the raw materials have to come from somewhere. Not everbody has the same opportunity to privitize raw materials. I understand people attach value to something they have refined/modified into something else. My point is that "ownership" is not absolute. There are only so many reources to go around.

Some people even go so far as to claim that Capitalism is the most efficient way to distribute resources. I disagree: the "price system" constitutes government intervention that ignores externalities. The reason it constitutes government intervention is that property ownership and contracts are enforced by the courts. Any body controlling a private malitia alternative would become the defacto governement.


When people take from or poisen the commons, they are plundering. They are killing me not with a gun, but through resource depletion. If you think you don't need society's help. You are welcome to become a hermit.

A  parallelizable problem also makes it easy to tune the difficulty. If you were able to claim a block reward by finding large primes, the block interval would be a lot less predictable.

Also, the chosen method (cryptographic hashing with a result below a target value) is a problem that is difficult to solve, but easy to verify. The hash serves a dual prupose: poof-of-work and integrity verification. Combining the two makes pre-computing the work ahead of time nearly impossible (exception: block-chain fork).