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1  Economy / Speculation / Re: WANT TO ASK IF IBITCOIN BEEN DEVALUED TO ZERO ? on: August 18, 2017, 06:24:28 AM
Here's the thing about "zero".



Even Zimbabwe banknotes are worth a little money.

Not as currency, of course; Zimbabwe itself switched to USD years ago.

But people buy them on eBay regardless. Why? Well, because it's an interesting object, a funny gag gift, or a conversation starter.

So let's say, for some reason, that one day people stopped using bitcoins. Stopped accepting bitcoins as payment. Let's say the big mining pools all close up shop because it's impossible for an unused currency to pay their electric bills.

Then, even in that world, I imagine the system would probably still live on in the same capacity that Zimbabwe Dollars have survived. Folks buying mining ASICs on Craigslist for a pittance and running them out of nostalgia, or because it's funny, or just because it's something to do.

So we return to pre-2011 prices - sub-$1 prices - from back when BTC was just a funny crypto-nerd novelty. It won't be worth anything as an investment vehicle.

But that's not zero.
2  Bitcoin / Development & Technical Discussion / Re: Post your SegWit questions here - open discussion - big week for Bitcoin! on: August 15, 2017, 03:24:21 AM
I am not a technical person. So I am still confused about SegWit. I have still no clue what actually it is. The only thing I know that it helped the BTC value rise. Can anyone describe easily what SegWit  actually is?
The very short version of the story is this:
  • When people send their coins to someone else, that's a "transaction".
  • They "sign" the transaction to prove to the network that they have the right to spend the coins.
  • Before SegWit, transactions and signatures were sent out as part of the same document.
  • After SegWit, they're sent out separately - like signing the back of a piece of paper instead of the front.

Why does this matter? It turns out it's useful for letting the Bitcoin network process more transactions per second. Right now there's a limit on how many transactions can be processed per second, because everyone has to double-check whether the transactions are 100% correct, and we want to make sure they can keep up.

It turns out, moving the signature out of the transaction itself helps that in two ways:

1) Partial Verification
Part of what makes double-checking transactions a slow process is that they have to be sent to you before you can start to check them. Moving the signatures means that Alice can check the transactions, and then start forwarding them on to Bob right away, even before she's had a chance to check the signatures (she can tell Bob later should the signatures turn out to be bogus). This means less latency in passing along transactions - they travel faster - and so a block can include about half again as many transactions as used to fit inside.

2) "Fixing Malleability"
The way Bitcoin has worked up to now, since the signature is part of the transaction, changing the signature changes the transaction's identity. Even though all the same coins are being spent in the same way, it's a "different" transaction than before. And it turns out anyone can "smudge" a signature slightly, such that it's still valid, but it's "changed" enough to trigger this situation.

This made it harder to write more complicated chains of transactions - where the transactions depend on each other.

One example of these "complicated transactions" is a "payment channel". The idea here is that if Alice and Bob send coins back and forth a lot, they can compress all of their sending back and forth into two transactions - one to "open" the channel, and one to "close" it and settle up. This saves everyone the hassle of double-checking all of Alice and Bob's payments individually; they can just check that the settling-up at the end was valid. (If you've heard the phrase "lightning network", it's basically just a much more advanced version of this same idea.)

With signatures stored inside their transactions, this was really hard to set up correctly, because if the transaction that "opens" the channel gets its signature smudged, the "settling-up" can't find that transaction anymore, so the coins will be left in limbo.

But with SegWit, the signatures aren't inside the transactions. So even if the signatures get smudged, the "settling-up" transaction can still find the "open" transaction, and the technique works.


Together, in theory, (1) and (2) can significantly increase the amount of Bitcoin transactions that can be sent per second. And that means transaction fees go down, and Bitcoin gets cheaper to use. And at the same time, (2) increases the number of interesting things you can do with your bitcoins.

Since both of those make Bitcoin more valuable, the price goes up. ^_^
3  Bitcoin / Development & Technical Discussion / What percentage of the gossip network is still on 0.13.0 or equivalent? on: August 15, 2017, 02:26:44 AM
Do we know how many of the full nodes have upgraded to a version that understands SegWit style scripts?

I did some websearching but couldn't find many details. Not even sure if this kind of info about a distributed system can be feasibly collected.
4  Economy / Speculation / Re: Old hands, what is your current engagement level? on: August 13, 2017, 05:09:07 PM
Joined the community in early 2012, have been sort of disengaged since early 2015. More watching-from-a-distance than anything. But now that a malleability fix (SegWit) is finally landing I've started to pay more attention again.

My BTC are still in a "long-term storage" mode. I could theoretically earn more profits by putting them on an exchange, but I don't want the counterparty risk; when shapeshift.io supports Tether, or when a proper distributed market appears (thus allowing BTC/USD market making without having to leave my coins in someone's webwallet), then maybe I'll get into it again. But even then, a big chunk of that stash is destined to sit quiet until I can spend them at the grocery store's NFC terminal. "Current money or bust", right?

That said, the BitcoinCash split has been a wonderful opportunity for me, since now I have what amounts to a 10% dividend to use for diversification. I'm planning to buy into Ethereum, mostly. My comment above about a "malleability fix" should clue you in that I'm extremely bullish on the potential of blockchain-enforced business logic, and there are a couple killer apps in that space that Ethereum contracts can support but Bitcoin scripts can't. That said, I've got no interest in direct ICO investment; why try to pick the best individual product, when you can invest in the platform they all use? ^_^
5  Economy / Speculation / Re: I am a pro-Core, pro-Segwit small blocker who has a hard decision about BCC on: August 09, 2017, 05:42:50 PM
Usually, if someone likes a coin, that person will think it has a bright future.

That said, if you're worried that you might be getting off the rocket by selling your BCC, I'd suggest hedging! You can sell most of it, take profit immediately, but still hold the rest Just In Case it sees major appreciation after all.
6  Bitcoin / Development & Technical Discussion / Re: Could PoW mining be more decentralized by giving rewards for other tasks? on: August 01, 2017, 04:34:19 PM
Another proposal was to embrace the fact that people seem to be storing data "on-chain", and make the financial incentive system revolve around that. A certain coin balance would be allowed to have up to a certain UTXO size, but these balances would gradually drain to pay the people storing the UTXO set (who would "mine"/get paid by proving to the network that they have the blockchain saved and publicly available to download).

These proposals, I'll reiterate, are most useful when discussing possible altcoins. There is a lot of momentum behind Bitcoin as a pure SHA256 proof-of-work thing; I think changing the proof of work would be too big a difference for people to keep thinking of the new consensus mechanism as still being Bitcoin.
7  Bitcoin / Development & Technical Discussion / Re: Post your SegWit questions here - open discussion - big week for Bitcoin! on: July 25, 2017, 02:40:49 AM
I'm trying to get a handle on the current state of various SegWit activation mechanisms. Please forgive me if these are stupid questions; I've been tuned out for a while and it's hard to sift through all the partisan jargon to find out what's going on.

  • At this point, due to BIP141 activation windows, SegWit can't become active until about August 8th, right?
  • At this point, assuming BIP91 miners don't change their minds and they continue to ignore non-BIP141 blocks, BIP148 is a no-op, right?
8  Bitcoin / Bitcoin Discussion / Re: Will you sell your BitcoinABC or hold on to it? on: July 22, 2017, 11:08:21 PM
it's the pet of jihan wu. he probably controls over 50% of the hash rate.

i don't think he's dim enough to attack the original chain or go all in with this new one, but i believe he could if he wanted to.

difficulty is gonna be a bunch lower so it might attract a bunch of older miner mining machines.
Ahhhh. Yeah, if some of Antpool's hashpower hops on, then the chances of it existing for long enough to unload some coin are a lot better than I was thinking.

Still, he'd have to commit pretty significantly to the project. Otherwise, if his name is on it, the project is vulnerable to any other big miner that dislikes him enough (and after the contentious year we've had, I imagine there's a few).
9  Bitcoin / Bitcoin Discussion / Re: Will you sell your BitcoinABC or hold on to it? on: July 22, 2017, 10:54:00 PM
IMO, Bitcoin's main strength (compared to Dash, Ethereum, etc) is that it's chain with the biggest hashrate, and thus, the hardest to double-spend against.

This is an especially real risk when we start talking about ideological hardforks. When Ethereum Classic happened, one ideological ETH-loyal miner made public threats to use his hashpower to double-spend on ETC and render it useless; it was only an influx of ETC hashpower that stopped him.

So for BCC, BitcoinABC, etc to be useful, they need to win over a significant % of BTC's current hashpower.

Do you consider that likely, when the /NYA/ presents a less risky road to increased blocksize?

Edit: I just realized I didn't answer the original question.

Long story made short, I don't think I'll have the chance to sell my BitcoinABC, because I don't think there will be a market for it.

If there is a market, I'll probably sell most of it. Not all - might as well hedge a little. But most.
10  Economy / Speculation / Re: Bitcoin price starting to rise on: July 20, 2017, 05:26:55 PM
I suspect this is the proverbial "bull trap".



But I'd love to be proven wrong.
11  Economy / Speculation / Re: When will BTC be at $5,000? on: May 26, 2017, 01:10:53 PM
My guess is that either BTC hits $5000/coin before the end of June, or it doesn't happen until after 2020.

We're in turbobull fiesta territory right now, but when the party ends, it's usually with a splitting hangover that prevents any further partying for quite a while. The only question is whether the night is still young.
Where did you get your crystal ball? Can you teach us how to make such insightful predictions?

Really now, please back up your conclusion with a concrete analysis not with gut feel and your crystal ball.
I mean, it's not a crystal ball. Just extrapolation from how BTC has behaved before in these overheated periods.

The most recent example would be Q4 of 2013, we ran up the price all the way from $75/coin to $1000/coin in the span of a few months. Then the price crashed, slowly dwindled to ~$240, and it took three years to get back where we'd been.

Or you could go back further, and look at Q2 of 2011, when we ran up the price all the way from 50/coin to $32/coin, and then the price crashed, slowly dwindled to to $2, and it took 'til early 2013 to get back on track.

My guess - and yes, I'll admit it's a guess, because anything in this thread is gonna be - my guess is that the current turbobull orgy will fit the same pattern. (Of course, there's a chance that we get something like Q1 of 2013 instead - where the bull market took a much shorter 3-6 month break. If that happens, I'll consider it a pleasant surprise Smiley )
12  Economy / Speculation / Re: When will BTC be at $5,000? on: May 25, 2017, 03:05:44 PM
My guess is that either BTC hits $5000/coin before the end of June, or it doesn't happen until after 2020.

We're in turbobull fiesta territory right now, but when the party ends, it's usually with a splitting hangover that prevents any further partying for quite a while. The only question is whether the night is still young.
13  Economy / Speculation / Re: BTC 2500$ / $3000 ? on: May 25, 2017, 02:52:10 PM
But does anybody have a solid prediction when the value will peak? Any additional statistics that could give a good guess when it will do so before it drops?
Nobody has a solid prediction. That kind of technique would be some serious black magic.

But as a warning sign? Watch for local newspapers (outside big cities) running an article on Bitcoin that talks more about the price movements than the technology.

Bubbles have occasional spike drops on the way up. Why do they recover from those drops? Because there's people who were waiting for that opportunity to buy in.

By the time word of the rally spreads to the sort of people who'd put it in a suburban/rural community's local newspaper, the pool of such "patient investors" has grown thin. Smiley

The last big bull run (in late 2013, when the ATH broke $1k/BTC), I encountered such an article less than a week before the crash.
14  Economy / Speculation / Re: A question to the bitcoin "hackers". on: July 13, 2015, 05:44:34 PM
As a reminder: as of the current state of the art, 40 years is nowhere near the right time horizon for cracking a wallet that was generated in a secure way. Even Tianhe-2, the most powerful supercomputer in the world, would take hundreds of thousands of years.

I mean, it's still an interesting hypothetical - plays into a lot of classic economic allocation questions - but I want to make sure you realize that it's not a realistic one, for the moment.
15  Economy / Speculation / Re: NEXT 48H ARE CRITICAL!!!!!!!! on: July 10, 2015, 07:14:47 PM


Oh, bull rush Speculation forum. How I've missed you.
16  Bitcoin / Development & Technical Discussion / Re: Pruning OP_RETURNs with illegal content on: February 18, 2015, 03:51:13 PM
Even if it were implemented, it would create a mess if some nodes pruned a transaction while others did not. Also, the inputs of fully pruned transactions could be double spent.
Nah, see, the whole point of OP_RETURN is that unless you're bootstrapping new clients you don't actually need to store it. If pruning is implemented, you're not pruning the transaction - you're pruning the output. The coins that were used as inputs are still used up in your local state.

Of course, that's easiest when you're taking the approach of using the blockchain for bootstrapping only, and just using the UTXO set for day to day transactions. If you want to store the blockchain too, you need some extra mechanism if you want to support redacting OP_RETURN data blocks. You could theoretically do it with ZKPs, though - basically attaching a proof that "for transaction X, I blotted out their data, but I totally know an input that still makes that transaction hash to its txid".

All that said, though, I feel like we should cross this bridge when we come to it. Sound technical solutions exist, at least once you decide that you want to delete a particular OP_RETURN output. But there's no point in implementing them if this is still just a theoretical attack.

The OP should consider that his computer contains a sufficient amount of '1's and '0's which could all be simply rearranged somewhat to form 1000s of child porn images - ON HIS COMPUTER.  But those '1's and '0's on his computer, just because they are presently out of order, nevertheless do constitute child porn.  He is clearly a pig.  That is right, your computer is loaded with child porn!!!  The cops are going to find you and arrest you for this and you will go to jail for life.
That's a little disingenuous. OP_RETURN data blocks are opaque binary data, and every image in a commonly used image format begins with a preamble that in practice make the interpretation of the blob pretty unambiguous.
17  Economy / Goods / Re: [WTS]Anything on Amazon Upto $800[25% Discount!] on: December 22, 2014, 08:55:55 AM
Does this kind of credit work on international Amazon sites such as .de or .jp?
18  Bitcoin / Development & Technical Discussion / Re: Bitcoin over tor [vulnerabilities] on: October 25, 2014, 08:21:13 PM
Brainstorming possible fixes:
  • Rethink the IP reputation protocol so that "known proxy" addresses are not held to the same standard as nodes themselves. This is a quick fix but is problematic in that spammers can then get additional leeway by running an apparent Tor exit node.
  • Users who want to run "pure Tor" should run their nodes as a hidden service and connect primarily to hidden service peers. Users who want to support the network and are not worried about being identified should run their nodes both as a hidden service and as a "normal" plaintext peer. This way, the visible IP addresses are not Tor exit nodes but actual Bitcoin nodes which should be able to pre-filter bad content before the network at large has to see it (and thereby avoid getting unknowingly banned out by an attacker). The downside here is that it requires overcoming a network catch-22; until there are enough real nodes visible as both Tor hidden services and as IP addresses, the few Tor hidden service nodes existing today ca be easily blackholed.
19  Bitcoin / Development & Technical Discussion / Re: Competing Bitcoin Networks on: September 21, 2014, 12:51:24 AM
This seems to me like it's basically what will become of the altcoin sea once trust-free cross-chain trading gets built into more clients. The "competing networks" thing is already going on there, with altcoin devs implementing new features that sometimes get back into Bitcoin and sometimes don't. And enough of the altcoins are Scrypt-based that they can share hashpower via merged mining, so the trade-offs are really based on features rather than chain hashpower security.

Of course, the exchange rate between BTC and LTC and BQC and all the rest is floating, so you can't just have coins from network A be automatically the same "value" as coins from network B. And that's as it should be; different "networks" have different properties, so their currency will be valued differently by the market, and any attempt to enforce an exchange rate by developer fiat is just going to push the real exchange rate underground.
20  Economy / Speculation / Re: What possible events would make bitcoin go to $0? on: August 26, 2014, 11:52:37 PM
For me, it's a short list.

  • An effective attack on the crypto - partial preimage attacks on 2SHA256, preimage attacks on RIPEMD160, forgery attacks on secp256k1. In this situation, the ledger becomes unusable and it becomes a game of he-said she-said to get a "clean" snapshot for forking to sounder algorithms.
  • A 75%+ hashpower vandal able to maintain that position for months. With a clean supermajority a bad actor can keep parallel blockchain branches within 6 confirms of each other (thereby keeping the ledger from converging and making it unusable) as long as they maintain that supermajority.
  • System failure of the Internet. Bitcoin is useless without the gossip network; we've discussed how to theoretically fail over to HAMs but I doubt that'll ever get built.

I think Shamir User A dumping their 2.8MBTC would push us pretty low, but it'd be temporary. I think the development of a significantly better Bitcoin-like system would cause most people to jump ship, but there'd be folks left who'd keep swapping them as collectibles. I think successful, high-profile reorg attacks ("51% attacks") would shake confidence in the system to its core, but that's a wound that the network can heal by changing its behavior. Those are all scenarios that could conceivably push us below the $2 wall that I've (colloquially) referred to as impenetrable, but zero? Zero is a long way down; even those debased Zimbabwe Dollars go for a couple bucks a bill just for the novelty value. Bitcoins becoming worthless would imply, at least to me, that something had changed such that ownership itself couldn't be established anymore.
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