I would say that it's about time to start at least pushing into the phase where there is organic competition and fees start to become a factor. Who knows what Satoshi would say. Not that I ever really ever considered the guy to be an infalable oracle of infinte wisdom, but it is certainly not a crazy idea that there would be competition for space in blocks either.
An artificial constraint can't be the basis for organic fee pressure. Bitcoin does have it's network effect / first mover advantage, but the currency has a head start, not a monopoly. People will and do pay a slight premium for access to Bitcoin's stability, liquidity and security, but any attempt to overcharge and people will take their business elsewhere, to other cryptos waiting in the wings. Organic fee pressure would exist on the basis of the increased block orphan risk with each added tx. In the long run, if those fees are not sufficient to pay for adequate security, I would expect miners to form a cartel to enforce some minimum fees. I could understand a cartel seeming like an artificial constraint as well, and in some senses it would be one; though having a different basis than a software hard-limit would give the nature of the constraint different properties. For instance, a mining cartel would be able to adjust their fee policy in real time if they so desired. The limit is not "the basis for fee pressure". The limit acts as a boundary beyond which the network is at risk of centralization. The ensuing demand for this space in blocks will result in fee pressure. As for "overcharging" this is obviously subjective and your argument starts from the premise that capital flowing into Bitcoin does so because of economic friction inside the fiat system. I argue it isn't, large holders do not move value into Bitcoin because they are after "cheap transactions". What they are after is monetary sovereignty, something which only Bitcoin offers at this point. Another mistake in your argument is that somehow "other cryptos" is the obvious alternative for transactional demand that can not be fulfilled on Bitcoin's blockchain. I cannot agree with this. In fact it seemingly is the less likely of scenarios as trust in a new form of money, especially crypto, is almost impossibly hard to build. As long as it exists the fiat system will be the obvious option for consumer spending and general retail transactions, Gresham's law would seem to support this idea. Then within a few year at most users will be given a plethora of alternative open-source payment systems that all leverage Bitcoin's network effect. As for the suggestion that fee pressure would exist as a result of orphan risk (the Peter R argument), it holds only in a vacuum and seems patently unaware of the actual real-world dynamics of the network. Even if that were true, the security of the network can not be left to the very naive assumption of altruistic behaviors between miners and their costs to orphan. |
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What happens if your friend Alice gives you counterfeit cash, you go to spend it in a store, and they confiscate it?
Counterfeit cash is more easily detectable, and if it's a good counterfeit it will probably fool other people too. Maybe. I've seen stores uses counterfeit detector pens quite a bit, and in a few cases run the bills through a machine (usually only larger bills). Banks routinely run cash you deposit through fancier machines and probably catch more. I don't do any of these when I get cash from a friend, and I wouldn't necessarily detect whatever it is those tests are doing. The point is, you can lose money this way, so losing money due to receiving bad Bitcoin is nothing qualitatively new. I'm not saying it is a good thing though. ..... how did we even get into counterfeiting? Because the question was what happens when you receive Bitcoins from someone and when you try to spend them you find they are blacklisted and lose money. That's very much analogous to counterfeiting. Right, this just might be the most stupid thing I've read all week. If you enter a transaction that involves any type of blacklisting it is your own undoing and you deserve it. Bitcoin exists precisely to enable monetary sovereignty & bypass any of these stupid fiat rules. Government doesn't have any right to know or be aware of the existence of any wallet in my possession therefore any coin I receive I'm free to spend at its current market value, no matter what its history is. I mean who the hell are we kiding here!? We have the USG currently trying to get their hand on every chip of all DNM and either keep it for themselves or "sell it" to their friends possibly over market price. You think they really give a damn where the coins are coming from? If you wanna use Bitpay, Coinbase, Circle and all them USG exchanges then by all means no one is stopping you or your rapist's interests but Bitcoin don't play these batty-boys games. But then don't you dare fancy you using Bitcoin. Cause Bitcoin is a peer-to-peer market and what you're doing doesn't sound like bitcoinating to me. |
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I wasn't aware of that. I assume that only goes one level deep. In other words, if I have stolen coins (.5 BTC) and normal coins (.5 BTC)
and I send that to another address of mine, and then send you 1 BTC, you can't separate out the stolen coins from the normal coins.
that is true indeed. You can separate them until the two are spent together, since they are separate outputs as explained in the last few posts. Once they are spent together, they can't be separated. What I expect will likely happen in a system with widespread regulation and blacklist once they are mixed (spent) together is that you would then have to send the 1.0 to some government (or other third party service) address, along with your identifying information, and you would get the 0.5 clean back. That would be the end of bitcoin, since there's going to be some amount of taint going on almost all the time. Can't see it happening. Agreed, you will get people that are unlucky and receive coins from an exchange that did not support blacklisting, and then that user will have effectively lost money. So effectively you are saying that if people using an unregulated exchange that is not compliant they will lose money, and therefore the end of Bitcoin? Is that really what I just read? If I get Bitcoins privately from my friend Alice and her coins had some taint and I then used those Bitcoins to buy a T shirt on a web shop and then they tried to cash those Bitcoins out to their bank account with Bitpay and Bitpay told me I don't get my T shirt but if I send them a scan of my passport I can get half my money back, then either it would be the end of Bitcoin or it would be the end of people using payment services. How about merchants will stop using BitPay because fiat will be.. ya know... dead. |
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I wasn't aware of that. I assume that only goes one level deep. In other words, if I have stolen coins (.5 BTC) and normal coins (.5 BTC)
and I send that to another address of mine, and then send you 1 BTC, you can't separate out the stolen coins from the normal coins.
that is true indeed. You can separate them until the two are spent together, since they are separate outputs as explained in the last few posts. Once they are spent together, they can't be separated. What I expect will likely happen in a system with widespread regulation and blacklist once they are mixed (spent) together is that you would then have to send the 1.0 to some government (or other third party service) address, along with your identifying information, and you would get the 0.5 clean back. Jesus the FUD is strong here. |
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What happens if your friend Alice gives you counterfeit cash, you go to spend it in a store, and they confiscate it?
Counterfeit cash is more easily detectable, and if it's a good counterfeit it will probably fool other people too. Maybe. I've seen stores uses counterfeit detector pens quite a bit, and in a few cases run the bills through a machine (usually only larger bills). Banks routinely run cash you deposit through fancier machines and probably catch more. I don't do any of these when I get cash from a friend, and I wouldn't necessarily detect whatever it is those tests are doing. The point is, you can lose money this way, so losing money due to receiving bad Bitcoin is nothing qualitatively new. I'm not saying it is a good thing though. ..... how did we even get into counterfeiting? "Bad Bitcoin"? Wtf... I know you have some Monero to sell but this is beyond ridiculous |
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Everyone's spent outputs combined with everyone's spent outputs? Not all the time.
LIke I said in the OP there will come a day when a new user will buy bitcoins (say locally for cash) and when he goes to use them at a business or exchange or where ever they will be rejected. Not 100% of the time...but it will happen and we all know how the media today loves to jump on anything bitcoin related that is negative.
Please reference the OP as it was a prediction and just that.
Ok, I'll grant you that, but is it really a big deal if it outputs aren't combined "all the time"? The people that have the "hottest" Bitcoins are obviously going to go to the most trouble to mix and detaint them...and they do that already not because of blacklisting, but because they need to remain anonymous and stay out of jail for theft. It's not about ANONIMITY, it's about FUNGIBILITY You can try to be (somewhat) anonymous on the BTC network, but that doesn't mean the coins are fungible Ask yourself... If you earn a legal income in BTC, will you voluntarily mix your coin with criminals? You might not have a choice. What are you going to do if I'm a criminal and decide to "taint" your Bitcoin by sending bits to your wallet? Sell your bitcoins? |
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You order 2 units x 400$ ? 800$ for this useless raspberry “miner” wtf dude....and you are looking for ROI ? Made my day  He's obviously trolling |
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The problem with having a transparent blockchain is the lack of fungibility. This is way gmaxwell is working hard on features like confidential transactions. We NEED to improve the anonymity on Bitcoin before it goes mainstream. You don't want people's money being rendered useless because of a lottery based on the origin of said money (if its legit or if it has a trace of some criminal activity which you had no idea and no control of).
Stop conflating two very different issues. Privacy/traceability != fungibility |
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I answered in other topic favoring Bitcoin being used to make small payments and micropayments. I think that it is important to defend this, as it has a lot of monetizing potential for blogs, music, and earning a life by the payment bits of many people.
Bitcoin enables all of those things to happen but they don't necessarily have to each individually be settled on the Bitcoin blockchain. That would be an enormous waste of resources. |
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I'm afraid it will indeed be a big problem in the future just because every coin can be tracked through the blockchain. Fiat does not have this problem, unless you steal it from a cash truck and your fiat gets a good splash of paint on it..
How will you know what coins you will be paid with? Impossible. After you receive some supposedly linked coins, you will never be able to spend them? Quite a problem.
Again, absolutely wrong, you will be able to spend them anywhere or with anyone that uses Bitcoin. |
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LIke I said in the OP there will come a day when a new user will buy bitcoins (say locally for cash) and when he goes to use them at a business or exchange or where ever they will be rejected. Not 100% of the time...but it will happen and we all know how the media today loves to jump on anything bitcoin related that is negative.
For the millionth time this is only true if you choose to do business with a company who does not actually accept bitcoin but fiat. If you happen to transact with a user or a company in a peer-to-peer manner on the Bitcoin network there will never be such a thing as "transaction rejected". The fact that people will have to worry about which merchants will accepted all btc and which may reject btc based on some list is not a good thing for encouraging mass adoption. If BTC was perfectly fungible this concern would not exist. If merchants support such a blacklist then it's likely they are not actually using or accepting BTC. Bitcoin is perfectly fungible, the government though would like you to believe otherwise. |
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LIke I said in the OP there will come a day when a new user will buy bitcoins (say locally for cash) and when he goes to use them at a business or exchange or where ever they will be rejected. Not 100% of the time...but it will happen and we all know how the media today loves to jump on anything bitcoin related that is negative.
For the millionth time this is only true if you choose to do business with a company who does not actually accept bitcoin but fiat. If you happen to transact with a user or a company in a peer-to-peer manner on the Bitcoin network there will never be such a thing as "transaction rejected". |
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Any bitcoin business that went along with say adding code that obfuscated transactions to a point that there is unlinkability and untraceability would have problems with regulators assuming they were AML/KYC compliant etc or whatever the regulation is.
There lies the issue with your logic. In the world we are heading for these type of things don't exist. This is what I mean when I propose you are too mindfucked on fiat to see straight. At the chance you have cared to read and didn't quite grok this part this is what Mircea means here: First off, I do understand why you would think there is. Honestly. You're used to a certain system, you grew up in a certain system, you expect the trappings of that system anywhere you go.
Ever gone camping, fishing, hiking, and turned your eyes looking for the faucet or power outlet or wifi modem lights or whatever ? Sure, rationally you know and understand that you're in the bellybutton of fucking nowhere, and there never was and never existed such a thing as you're looking for within a hundred miles. Nevertheless, at some level, your brain expects that faucet. What do you mean nobody has ever laid a hundred miles of pipe/cable/bacon trails all the way to right over here ?! Impossibru! http://trilema.com/2014/guidance-there-is-no-such-thing-as-bitcoin-taint/#selection-39.0-45.507Just because I used that example does not mean it doesn't exist to have legal implications elsewhere. let's say it is outlawed to deal in blacklisted addresses determined by your local government...yes you can move but to a certain degree what if that happens in that other country? How exactly do you propose they enforce this blacklist. Simple I don't propose they do. But it is possible it could happen. I'm telling you they can't. Just because you say something doesn't make it true. I believe it is possible. I'm sure some people thought that something called the "income tax" was impossible...it is unjust in my mind but it exists. Governments these days are getting away with a lot, so I believe there are things we wouldnt dream would be put into place and enforced upon us. What you are saying is absolute nonsense. The only possible ways to enforce blacklists into Bitcoin is to hard code them in the protocol. Otherwise any peer on the network can transact with any other peer and his bitcoin will not be subjected to any discrimination whatsoever. Any other scenario involves trust in a third party which means you are really in fact not using Bitcoin at all. |
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Any bitcoin business that went along with say adding code that obfuscated transactions to a point that there is unlinkability and untraceability would have problems with regulators assuming they were AML/KYC compliant etc or whatever the regulation is.
There lies the issue with your logic. In the world we are heading for these type of things don't exist. This is what I mean when I propose you are too mindfucked on fiat to see straight. At the chance you have cared to read and didn't quite grok this part this is what Mircea means here: First off, I do understand why you would think there is. Honestly. You're used to a certain system, you grew up in a certain system, you expect the trappings of that system anywhere you go.
Ever gone camping, fishing, hiking, and turned your eyes looking for the faucet or power outlet or wifi modem lights or whatever ? Sure, rationally you know and understand that you're in the bellybutton of fucking nowhere, and there never was and never existed such a thing as you're looking for within a hundred miles. Nevertheless, at some level, your brain expects that faucet. What do you mean nobody has ever laid a hundred miles of pipe/cable/bacon trails all the way to right over here ?! Impossibru! http://trilema.com/2014/guidance-there-is-no-such-thing-as-bitcoin-taint/#selection-39.0-45.507Just because I used that example does not mean it doesn't exist to have legal implications elsewhere. let's say it is outlawed to deal in blacklisted addresses determined by your local government...yes you can move but to a certain degree what if that happens in that other country? How exactly do you propose they enforce this blacklist. Simple I don't propose they do. But it is possible it could happen. I'm telling you they can't. |
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Any bitcoin business that went along with say adding code that obfuscated transactions to a point that there is unlinkability and untraceability would have problems with regulators assuming they were AML/KYC compliant etc or whatever the regulation is.
There lies the issue with your logic. In the world we are heading for these type of things don't exist. This is what I mean when I propose you are too mindfucked on fiat to see straight. At the chance you have cared to read and didn't quite grok this part this is what Mircea means here: First off, I do understand why you would think there is. Honestly. You're used to a certain system, you grew up in a certain system, you expect the trappings of that system anywhere you go.
Ever gone camping, fishing, hiking, and turned your eyes looking for the faucet or power outlet or wifi modem lights or whatever ? Sure, rationally you know and understand that you're in the bellybutton of fucking nowhere, and there never was and never existed such a thing as you're looking for within a hundred miles. Nevertheless, at some level, your brain expects that faucet. What do you mean nobody has ever laid a hundred miles of pipe/cable/bacon trails all the way to right over here ?! Impossibru! http://trilema.com/2014/guidance-there-is-no-such-thing-as-bitcoin-taint/#selection-39.0-45.507Just because I used that example does not mean it doesn't exist to have legal implications elsewhere. let's say it is outlawed to deal in blacklisted addresses determined by your local government...yes you can move but to a certain degree what if that happens in that other country? How exactly do you propose they enforce this blacklist. |
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All US money is numbered, so unless you have a large block of $100 sequential bills it is hard to trace. Fiat is traceable to a point, so is Bitcoin. I really have no idea why fungibility is so concerning. Bitcoin has mixers, convenience stores, grocery stores are fiat mixers, along with that nice restaurant you enjoy.
I don see this being an issue, but maybe my tinfoil hat isn't on tight enough?
Ufo
So if I stole bitcoin and sent it to a mixer and someone else got the coin and tried to spend it and let's say that merchant flagged that address because it was linked to a hack/scam/theft...how did mixing the coins fix anything other than allowing the thief to get away with the crime? How would the merchant have "flagged" that address? Surely this means he administers a list probably maintained by a third party to validate his Bitcoin transactions? If so then allow me to ask you what kind of merchant you deal with? I understand a lot of people feel warm and fuzzy about the novelty of Bitcoin transactions but maybe it is time to consider how stupid the idea is to pay a fiat accepting merchant with Bitcoin. (The BitPay model). Unless you deal with someone or a business on a peer-to-peer basis it really is not worth it as this is when you expose yourself to such shenanigans. How? Easy if everything is public on the block chain any transaction can be traced back to when the coins were created. Determine the addresses where a theft occured and trace from there. Pretty simple. Blockseer does this in a visual format. You're paranoiac. Nobody cares to go through this to enter in a transaction, what the hell are you thinking? No proper user wallet as they exist today keeps such lists of transactions. Bitcoin-qt does not include a circumstantial account of every coin and transactions in the network, only inputs and outputs. Why do you care if you accept a stolen bill, a "tainted" bitcoin? Are you really going to look up the story of each bitcoin you are trying to purchase. Have you? |
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Any bitcoin business that went along with say adding code that obfuscated transactions to a point that there is unlinkability and untraceability would have problems with regulators assuming they were AML/KYC compliant etc or whatever the regulation is.
There lies the issue with your logic. In the world we are heading for these type of things don't exist. This is what I mean when I propose you are too mindfucked on fiat to see straight. At the chance you have cared to read and didn't quite grok this part this is what Mircea means here: First off, I do understand why you would think there is. Honestly. You're used to a certain system, you grew up in a certain system, you expect the trappings of that system anywhere you go.
Ever gone camping, fishing, hiking, and turned your eyes looking for the faucet or power outlet or wifi modem lights or whatever ? Sure, rationally you know and understand that you're in the bellybutton of fucking nowhere, and there never was and never existed such a thing as you're looking for within a hundred miles. Nevertheless, at some level, your brain expects that faucet. What do you mean nobody has ever laid a hundred miles of pipe/cable/bacon trails all the way to right over here ?! Impossibru! http://trilema.com/2014/guidance-there-is-no-such-thing-as-bitcoin-taint/#selection-39.0-45.507 |
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All US money is numbered, so unless you have a large block of $100 sequential bills it is hard to trace. Fiat is traceable to a point, so is Bitcoin. I really have no idea why fungibility is so concerning. Bitcoin has mixers, convenience stores, grocery stores are fiat mixers, along with that nice restaurant you enjoy.
I don see this being an issue, but maybe my tinfoil hat isn't on tight enough?
Ufo
So if I stole bitcoin and sent it to a mixer and someone else got the coin and tried to spend it and let's say that merchant flagged that address because it was linked to a hack/scam/theft...how did mixing the coins fix anything other than allowing the thief to get away with the crime? How would the merchant have "flagged" that address? Surely this means he administers a list probably maintained by a third party to validate his Bitcoin transactions? If so then allow me to ask you what kind of merchant you deal with? I understand a lot of people feel warm and fuzzy about the novelty of Bitcoin transactions but maybe it is time to consider how stupid the idea is to pay a fiat accepting merchant with Bitcoin. (The BitPay model). Unless you deal with someone or a business on a peer-to-peer basis it really is not worth it as this is when you expose yourself to such shenanigans. |
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