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6921  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 02:19:29 PM
Does just 21 million iPhones packed in some obscure warehouse tell us anything about scarcity?

If it does tell, then is this quantity of iPhones scarce or abundant? If it is neither scarce nor abundant, what the heck does it have to do with scarcity at all in the first place? On the other hand, if this number alone doesn't tell us anything (which would be contrary to your claims, just in case), then what does then? I guess it is a number of people potentially buying these flashy phones, or rather a change in this number, which would define scarcity of iPhones (e.g. more scarce or less scarce). But the latter is defined exactly as I said above, i.e. through a supply and demand mechanism

i think somewhere along the lines you have ignored me saying UTILITY is important. not scarcity.
also scarcity is a sliding scale from scarce to abundant..
which is more of a local/real ability to get your hands on/availability thing.

having scarcity is a limit of production.. but how scarce or abundant is a separate question.
also i said that "the latter is defined though supply and demand"

My point doesn't consist in proving you wrong

This comes as a nice bonus, though I'm mostly trying to explain why you are wrong so that you could understand that. Scarcity is in no way a limit of production since I could just as easily claim that a volume of production is in fact a measure of abundance, not scarcity ("half empty glass is half full"), and what does it tell us exactly?
which is where i said being scarce.. abundant.. is a separate detail to scarcity.. where scarcity is a sliding scale

If production increases does it imply that what is produced becomes less scarce (and vice versa), which should directly follow from your reasoning?
my reasoning is not that. i stated a few posts ago.. bitcoins limit is known. has been known since day one.
the scarce<->abundance is separate question within the sliding scale.

I guess we can't generally say that, and the reverse is also true. This is another argument that shows that your approach is futile and meaningless.
my approach?? lol sorry but your the trying to confuse the matter. by ultimately saying im wrong but then saying the exact same thing i said to claim your right.

It pretty much proves that volume, or limit of production can't be scarcity or a measure of it. Scarcity is an abstract concept which in real life can be used only as a relative measure. We can't even say that something is scarce as such since we should always refer it something else over which it is more (or less) scarce or over itself if we consider the issue on a time scale. Regarding utility, it is more complex concept than scarcity, and until you get familiar with this simple concept in a correct way, it doesn't make particular sense to discuss utility

seems your trying hard to muddy the water..

things can have scarcity..
but how scarce<->abundant is a separate question (remember the WITHIN word you failed to pick up on)
also yes scarce<->abundant is an abstract concept.. hense why in earlier posts i was saying no one cares much about it and its UTILITY thats important.

but if you think no one should talk about utility (the important thing) until they circle jerk you about less important things.. then you are a fool

now lets just drop this unimportant scarcity meander you have rabbit holed down. and get back on topic.

UTILITY creates value, lack of UTILITY removes value
6922  Bitcoin / Bitcoin Discussion / Re: How to create great BTC lending service? on: January 12, 2017, 01:47:34 PM
People with alts collateral might need a loan cause they think that alt might go up in price. If they dont have collateral, they re not eligible for a loan. This is how financial sector works and operates for hundreds of years. Dont you think banks would find another way if there is any other way!

im more of a traditionalist.
if i cant afford something then i dont buy it. if i want something then i use my own savings to buy it.
ive never been into becoming a slave to a bank while making them profit

i know how banks do it. because you need to nearly sign your life away first. they even create the money(money out of nowhere by signing a credit agreement) so that its still a no risk game, even if you do default. they never lose even if you default at day 1.
they even sell the agreement onto debt collectors so its no cost to them chasing you, and instead let a debt collector chase you. while the bank takes the agreement sale (pennies on the dollar) as their profit. they(debt collector) only chase you with a wet fish to take your house, as more of a deterrent to others aswell as to make sure they(debt collector) breaks even/gets profit.

but in a decentralised world where your thousands of miles away, and costs to slap someone with a wet fish are higher. the scam risk is higher.
and if someone did have collateral.. the problem then becomes how to secure it.

which is where i was more thinking about stupid examples around the forum i have seen, where people use their forum username as collateral. or a picture of a car they say they own (i was facepalming reading those)

yes altcoins are an option but you would need to ask for alot more altcoin value than the loan request is for. because (thinking about repayment) if the loanee took the loan but the altcoin he then wants to buy did not rise to sell for profit to repay you. you not only dont get repaid. but you also lose because the price did not rise.. meaning it fell so the collateral is worth less that the time of the agreement.


6923  Economy / Speculation / Re: Chinese Bitcoin Exchange Inspections Cause Price Drop and FUD on: January 12, 2017, 12:43:58 PM
its a sheep mentality.

there are several exchanges in 'eastern world' and several in the 'western world'

logically if a genuine price drop happens in the east, you would expect the people in the east to move coins to the west to sell at the still higher price. meaning due to the delays of arbitrage caused by confirm times you would see a change in the wests prices 10minutes+ later.

this would be a true indication of real market trading.

but when you analyse the charts of exchange results combined. the sheep follow the east far sooner than natural arbitrage times.
this is either the exchanges sharing reserves and instantly arbitraging with their back door method (elements), for the western exchange owner to be the first mover profiteer. leaving the sheep on the losing end.
or
its not the exchanges secretly taking first mover profits using private reserves, and instead its users "emotionally reacting" like sheep instantly (not a result of arbitrage, only panic,worry), rather than "financially affecting" smartly(arbitraging) delayed following.

as for everyone continuing to think all 1.3billion chinese are bitcoin holders or they are all colluding..

what if i told you out of 1.3billion chinese. it was only a few hundred people all with under 1btc each, using bots to trade multiple times a day.
eg imagine 100 people with 0.3btc each.

and they traded once every 6 minutes each (100 times a day each).. the daily volume is 3000btc
imagine they had 3btc and a bot that trades every 36 seconds(1000 times a day).. the daily volume is 300,000btc

it does not mean there needs to be.. nor mean there are millions or billions of asian bitcoiners.. just a few hundred
it does not mean there are bitcoiners each holding 2000btc each trading daily.

i would only cry wolf if we seen 2000(random large whale number so dont knitpick) being traded every few seconds/minutes.
but the trade history is not showing this.

i know the western exchanges want someone to blame. but the western exchanges shouldn't EMOTIONALLY sheep follow the east.

instead of trying to make the east look bad by saying its the whole countries fault. because then you are only crying into your own hands to try making yourself feel better, but not actually understanding the issue to make sure you can guard yourself from it in the future.

best advice dont point fingers in different directions while crying. instead man up be responsible for your own funds and realise a price drop is not a death sentance but a discount day to buy in cheaper and average down
6924  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 12:12:00 PM
How do you know that fore sure? There are many exchanges, and in the chinese exchanges, there are mostly chinese people trading.
Looking at the volume of 1,609,323.75 BTC daily, I hardly doubt those are all bots.
Who the heck would do 1000 trades / day? Even if you run a bot that is absurd.
Maybe there are a handful of market maker bots, but the rest are just probably young chinese guys trading 1-10 BTC with their savings.
The chinese are known to be big gamblers, and they also spend a lot of tech items, so its easy to assume that there are probably tens of thousands of chinese trading 1-10 btc.

did you look at the trade history image.. right column.. trades under 1btc...
they are not large 1000btc trades per hit..

as for 10's of thousands of chinese trading.......... well thats still not 1.3billion.. so lets not continue the endless racism of thinking "china"(whole country) own/control bitcoin

when we all know its only a small percentage playing with small amounts repeatedly.

i would cry wolf only if you see trade history results of 10-1000btc+ every few minutes.
these small 0.xbtc orders happening is not "china (the country) own bitcoin"
6925  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 12:02:52 PM
If people insist to use bitcoin only as commodity that is the gold standard 2.0 because of its digital scarcity correct me if  I am wrong but I believe the network performance will not be a very important matter because the transactions would not be particularly high so will not have an overload network traffic. On the other hand the vision of Nakamoto about a peer to peer payment system using the internet without the need of any third trust entity disappears. This means that banks will reinforce their dominance due to free knowledge of blockchain technology which will allow them to create their own digital currencies. Therefore all scenarios about a dream world without banks will collapse in the very near future. To summarize first we must consider the utility and after the value of bitcoin

bitcoin is not a commodity.
a commodity is a raw product used to create other products.
EG crude oil =fuel, plastics
EG gold= jewellery, circuits

gold specifically sits on MULTIPLE markets because it has multiple USES/desires/demands for it. dont confuse golds commodity(manufacturing industry) market as the same thing as its asset value(speculative investment financial industry)

bitcoin is an asset currency. not a commodity. but if it loses its utility of being an active currency and just sits on some hardware wallet, much like a bearerbond. (which is still a currency but not an active currency). then its value dies because it lacks something concrete backing it. meaning the asset value declines.. which snowballs down
6926  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 11:42:32 AM
no. i said supply and demand work within scarcity not define scarcity

I know that you didn't say nor implied that. But this is exactly how scarcity is determined, i.e. through a supply and demand mechanism (strictly speaking, through change in supply and demand)

EG a apple store may know there are 21million apple phones in a warehouse but are only able to sell 20 phones at the shop (supply=20, not 21m)
there are only 2 customers wanting it. so after 6 months, the store reduces the price of the phone before the next-gen phone hits the market (demand=2, not 20, not 21m)

Does just 21 million iPhones packed in some obscure warehouse tell us anything about scarcity?

If it does tell, then is this quantity of iPhones scarce or abundant? If it is neither scarce nor abundant, what the heck does it have to do with scarcity at all in the first place? On the other hand, if this number alone doesn't tell us anything (which would be contrary to your claims, just in case), then what does then? I guess it is a number of people potentially buying these flashy phones, or rather a change in this number, which would define scarcity of iPhones (e.g. more scarce or less scarce). But the latter is defined exactly as I said above, i.e. through a supply and demand mechanism

i think somewhere along the lines you have ignored me saying UTILITY is important. not scarcity.
also scarcity is a sliding scale from scarce to abundant..
which is more of a local/real ability to get your hands on/availability thing.

having scarcity is a limit of production.. but how scarce or abundant is a separate question.
also i said that "the latter is defined though supply and demand"

this is not a fight over who got the answer right first, but it seems your trying hard to make it sound like i think scarcity is important when in MANY posts i have said UTILITY is important.. so i dont know why you are meandering down the 'scarcity' rabbithole..

but getting to the point. UTILITY means/affects value, not scarcity

most traders dont even know the exact number of coins in circulation. nor the supply in an exchange.. they only think about the demand and desire aspect of the speculation.

which UTILITY has the major impact on
6927  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 11:35:13 AM
Much of the debate surrounding bitcoin's scaling problem seems to stem from two different visions of what bitcoin should be right now: a store of value or a peer-to-peer digital cash system. Both sides agree that in the long run both of these properties should be met, but the question is: Will bitcoin hold value even if TX throughput does not scale soon or do we risk losing our first mover advantage if bitcoin is not able to fulfil its promises as a peer-to-peer cash system soon.

I would love to hear some arguments from both sides of this debate
As long as China has monetary problems, I dont worry about Bitcoin, since that is the main source of cashflow into Bitcoin.
But as a global vehicle for wealth storage. Well, first you have to get these smartasses to listen to you.

what if i was to blow your mind and say that OKcoins 30k volume is not actually 30,000 people exchanging 1btc once. or 1person exchanging 30,000 coins once

what if i told you it was just 100 people exchanging just 0.3btc each ...1000 times a day

china (1.3billion people) are not hoarding 1-30,000 coins each.
china (1.3billion people) are not hoarding 1 coins each.
china (1.3billion people) are not hoarding 0.00000x coins each.

china (1.3billion people) are not even involved in bitcoin.. only a couple hundred people and only small amounts are played per day. once you realise how day trading works.

many miners dont use 'public' exchanges. they do private OTC exchanges with VC's behind closed doors.
the mining pools are not that impacting of public xchanges with their hoards of fresh minted coins..

all they need to do is use a small amount on an exchange to day trade multiple times a day to cause a volume rise and also affect the price.

just look at the trade history.. you dont see orders of 12.5btc every 10 minutes or a large 75btc order an hour or a 1800btc order hit the market each day.
instead its lots of under 1btc orders. which make the lack of real liquidity because theres only a few thousand coins in reserve get smacked around a bit not needing thousands of coins to smack it but single to double figures done repeatedly


6928  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 11:02:22 AM
as for scarcity. knowing that once it reaches X production, thats it.. no more.. means scarcity.
unlike renewable resources, such as tree's that produce seedlings which can produce more tree's endlessly and forever..
bitcoins scarcity is a known number, right from day one.. its a fixed number.

supply and demand then takes over within this scarcity amount

You are self-contradicting in your arguments. At first you assert that bitcoin scarcity is a known number from day one, and then you proceed to basically claim that supply and demand define scarcity. While I agree on the second case, in the first case 21M bitcoins have nothing to do with scarcity as such. It is simply a number, it doesn't tell us anything about scarcity on its own as I'm trying to explain it to you for the nth time

So it kinda looks that you are not a few boxes outside mine, you are just entirely out of your own box

golds "speculative asset" as you said is not based on scarcity(supply). its based on demand. and gold has UTILITY which drives the demand. which drives the speculatory value

~snipped~

You again lump together and confuse different concepts

no. i said supply and demand work within scarcity not define scarcity.

EG a apple store may know there are 21million apple phones in a warehouse but are only able to sell 20 phones at the shop (supply=20, not 21m)
there are only 2 customers wanting it. so after 6 months, the store reduces the price of the phone before the next-gen phone hits the market (demand=2, not 20, not 21m)

bitcoins current 16mill circulation and 21m scarcity has nothing to do with supply and demand.
EXCHANGES.. here is the kicker you missed. EXCHANGES are not hoarding all 16m-21mil coins.
at most the SUPPLY is a couple hundred thousand coins per exchange.

and the EXCHANGE price is based on the supply and demand of the couple hundred thousand coins (not 16m not 21m)

which is where the supply and demand is the speculation within scarcity. but not impacted by scarcity

EG think about food. some regional distribution centre may have tonnes of baked beans.
but people dont care about whats in the regional distribution centre. they only care about whats available at the local store.

if an crisis happens where everyone buys up the stores food because there wont be a delivery. (supply drop) everyone speculative their need and demand for it. and suddenly food becomes a premium priced product where people are literally willing to sell their oldest daughter in an extreme crises event..
6929  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 10:56:25 AM
The biggest concern of bitcoin today is not the issue on value versus utility but the survival of bitcoin. The issue should be bitcoin versus fiat virtual currency. The biggest threat to bitcoin is now closing and will be released this year and it is a big question if bitcoin will still be up to the challenge and continue to survive or will be replaced by the fiat currency.

yep
bitcoins threat is fiat. if bitcoin becomes no better then fiat no one will want it.

the threat is Hyperledger. which is the banks own blockchain currency powerhouse of multiple interchangeable chains. which laughably the blockstream paid core devs are actually helping the bankers with.. and yes them hyperledger crew have been invited to have special secret talks at this months 'satoshi roundtable'.

so incase your wondering why Sipa, Gmaxwell, adam back matt corallo and other blockstream devs are so ademnt to cripple bitcoins onchain growth for no RATIONAL reason. and why they have changed the fee estimation engine to push the average fee more biasedly up rather than down.. it becomes obvious once you look at who is paying their salary and sitting with them over cocktails at an all inclusive weekend this month
6930  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 10:30:09 AM
Store of value, and utility are not dependent on each other. Did gold drop in value because gold coins ceased to be used as a payment method? Increased value may well reduce use as a payment system. The current UK £100 gold coin will cost you getting on for £1,000 to buy, so who would use that for a £100 purchase. I can see Bitcoin being used as a proof of stake for an alternative currency in the future. How will that affect Bitcoin? I believe it will reduce pressure on the blockchain, and stabilise the price, this could lead to a gradual increase in value.

the gold coin rose in value ven when not used as legal tender because gold had other UTILITY. EG jewellery, circuit boards. so it was not just about scarcity as the remaining feature. it still had utility which impacted scarcity

You evidently totally neglect the financial aspect of gold (and gold derivatives), i.e. its utility as a speculative asset

just look at all the altcoins that have no utility even if they have scarcity. such as 42 coin..
42coin is not 500,000x the value of bitcoin.. its not even 1x the value of bitcoin.. even if its scarcity is 500k more scarce.

Oh, you seem to have learned the lesson that scarcity itself means nothing

Namely, that being scarce without being useful doesn't amount to anything. That's good but the next thing that you should understand is that there is no absolute scarcity, scarcity is always relative in respect to some amount, quantity, or number. In this way, 42 shitcoins may be less scarce that 21 million bitcoins. For example, when 21 million people are interested in Bitcoin (1 bitcoin per capita) and only one individual in that shitcoin (42 shitcoins per capita), Bitcoin will obviously be more scarce on the whole per unit of coin

i know your trying to think outside the box, which is commendable compared to other people. but im a few boxes outside of your box.
im just downplaying it to the most simplistic explanation for normal people to grasp.

as for scarcity. knowing that once it reaches X production, thats it.. no more.. means scarcity.
unlike renewable resources, such as tree's that produce seedlings which can produce more tree's endlessly and forever..
bitcoins scarcity is a known number, right from day one.. its a fixed number.

supply and demand then takes over within this scarcity amount. which is about speculation.
for anything that has utility, speculation has resistance points, there is always a resistance point where people refuse to sell for anything less because thats the point of what some deem true value. due to the utility element undrlying the speculation. and the value on top of the resistance point is the more variable amount where supply and demand plays out.

golds "speculative asset" as you said is not based on scarcity(supply). its based on demand. and gold has UTILITY which drives the demand. which drives the speculatory value both with the resistance point(normally not known about) then the variable bit on top...

however gold will not ever sink to absolute $0 because it has other utility (jewellery/circuits) so there is always an underlying resistance point of cost of production, utility and other factors keeping it above some level. yet bitcoin IF it has no utility CAN sink to $0... like many altcoins have proven.
one of bitcoins key resistance points is actually cost of production.. (usually about 25-75% lower than exchange rate price depending on volatility and miners costs)
but if demand and utility die off.. so will the miners. thus the resistance point can drop too when the difficulty drops due to less miners. double impacting the drop.

yes its not going to be an overnight occurrence. but a long slow drop to $0.. but it is possible IF bitcoin loses its utility

bitcoin is a payment currency. without being used as payment(merchants drop it because the fee's become too high to handle) then demand drops. the variable speculative xchange rate drops. miners dont make profit so they drop out, the resistance point drops.. and a snowball effect occurs slowly(compared to other alts) down to $0.
bitcoin has no other utility to eat up supply, such as jewellery creation, circuit creation. so bitcoin cannot speculate based on a supply..
yes you can throw some coin into some 'bitcoin eater' addresses. but we already agreed scarcity does not help something with no utility or desire


unlike gold.. monetary currency can tank to the bottom its monetary utility is lost.. even if they have some behind the scenes banking products (you mentioned derivatives for instance).. but even with these banking products in the background pretending to be 'of value' to hold up the front end currencies value.. they too are speculative. and again can tank to $0..

check out the zimbabwe dollar or other world currencies that have no utility.. they have no value at all!! even if they had banking products backing them.

so in a paradigm where no one needs to use it and supply is not even a factor.. demand drop = value drop = further demand drop.. snowballing into an endless drop of value.

bitcoin needs to have UTILITY to have VALUE
6931  Bitcoin / Bitcoin Discussion / Re: The Bitcoin has 'jumped the shark' on: January 12, 2017, 10:09:28 AM
its sure that nowdays the price and the bitcoin fees are turning into a pain but currently its still payable because we pay more in our local services and with bitcoin we actually getting a good profit + a good servic which has no comparison in the whole world. but soon it will be started to be neglated and bitcoin transactions will be smaller in compared with todays date.maybe we should think of some offchain transactions which can save some fees

your thinking of it from the narrow ideal from the euro/american mindset.

40cents is only a few minutes minimum labour in developed countries.

but

40cents is HOURS of minimum labour in MANY developing countries.

being charged 2+ hours labour to buy groceries in any country is a laugh.. and if you think that is acceptable, then please go travel the world

6932  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 12, 2017, 09:25:15 AM
Store of value, and utility are not dependent on each other. Did gold drop in value because gold coins ceased to be used as a payment method? Increased value may well reduce use as a payment system. The current UK £100 gold coin will cost you getting on for £1,000 to buy, so who would use that for a £100 purchase. I can see Bitcoin being used as a proof of stake for an alternative currency in the future. How will that affect Bitcoin? I believe it will reduce pressure on the blockchain, and stabilise the price, this could lead to a gradual increase in value.

the gold coin rose in value ven when not used as legal tender because gold had other UTILITY. EG jewellery, circuit boards. so it was not just about scarcity as the remaining feature. it still had utility which impacted scarcity.

but if bitcoin ever got to a point of no transactional use. and people just treated them as hoarded assets. then there is no utility, no "NEED" so desire shrinks and the supply/demand ratio changes to less demand.

just look at all the altcoins that have no utility even if they have scarcity. such as 42 coin..
42coin is not 500,000x the value of bitcoin.. its not even 1x the value of bitcoin.. even if its scarcity is 500k more scarce.

in short bitcoin needs utility to have value.

anyone desiring to remove bitcoins utility should just go play with the fiat they dream and hope about everynight
6933  Bitcoin / Bitcoin Discussion / Re: How to create great BTC lending service? on: January 12, 2017, 09:16:49 AM
1. if people had collateral. they wouldnt need a loan
2. if they had collateral. how would this collateral be held.
3. if they had collateral such as a car or house. how can they send it to you from india to EU
4. if they had collateral how can you be 100% sure the ID they used is legit for you to have an address to visit them to claim the collateral in person.

in short. if the value of a loan is less than a couple hundred euro. its not worth taking someone to court as the travel costs, let alone legal/admin costs would mount up. so the victim just takes it on the chin and moves on with their life.

if the value is higher, then the collateral item should be secured into a mutual location(escrow). where the collateral value exceeds the loan value to cover costs of loss and tempt a loanee to not default. as i said how such an item can be secured/escrowed is a risk. and if the loanee had such large value collateral to hand over. they might aswell just sell the item instead of asking for a loan.

lastly my main rule for internet trading is something everyone should think about
if you dont have enough real, guaranteed to be valid and correct info on another person you are handing funds over to. and if you dont have the capability to physically slap them with a wet fish/court order should they do you wrong.. dont give them your funds!
6934  Bitcoin / Bitcoin Discussion / Re: The Bitcoin has 'jumped the shark' on: January 12, 2017, 08:57:33 AM
about the utility of LN in regards to peoples false ideals of the fee's they expect.


anyone also notice how blockchain.info removed the "days destroyed" stat.
this is because if you analyse that stat against other stats, it reveals that people DONT on average do several transactions a day or week.

many peoples funds are used once every 5 days. some peoples funds sit for months and yes years. thus something like LN with a 10day n-lock is useless utility for these people who do 2 or less tx per channel period.

so dont expect "cheap" tx fee's as the norm because LN isnt designed for people that only do 2 or less tx's per LN channel period.



next we have the CLTV which when confirmed(settled) stops funds from being respent for the CLTV period (laymans: much like banks/paypals 3-5business day delay on ''funds available", or like bitcoins blockrewards 100confirm maturity)

so people who do desire 'regular' spending wont want to have funds maturing for a few days.

however, LN have a scheme/plan for that too.



an LN hub can circumvent the CLTV maturity by revoking the funds to a destination in the CSV revoke commitment to push the funds into a new LN channel. meaning an LN hub can lock peoples funds permanently into LN contracts.(laymens: bank chargeback/reclaim)

LN actually initially wanted to penalise users by taking all their funds to the LN hubs non multisig address(fraud penalty).. as the ultimate penalty.. but morally they should only use the CLTV and CSV features to reset a new LN contract* to then get the customer to agree a new honourable agreement of who owes what. suggesting that due to CLTV its better to just use LN than resettle again.
*https://github.com/bitcoin/bips/blob/master/bip-0112.mediawiki#lightning-network
Quote
To allow a commitment transaction to be effectively revoked, Alice and Bob have slightly different versions of the latest commitment transaction. In Alice's version, any outputs in the commitment transaction that pay Alice also include a forced delay, and an alternative branch that allows Bob to spend the output if he knows that transaction's revocation code.

so LN hubs can actually hold funds to ransom and even if you broadcast your own copy, they can CSV revoke to honourable put funds back into a new LN agreement.. or maliciously allow the hub owner to take the funds into his own private ownership (non multisig).


yes i left the best for last because i know people are itching to say they will save on costs if they need to do more than 2 transactions per channel period...

lastly there are the internal penalty fee's too.
LN have come up with many penalties. such as, if there is a multihop transaction happening.
you can be penalised for not promptly agreeing to it, as it would cause a extra delay on the other commitments agreements.
you can be penalised for not signing your agreement
you can be penalised for attempting to spam/DDoS the hub with excess data
you can be penalised for sending the wrong agreements to be signed by the hub



they actually envisioned a 0.006btc fee as a minimum entry into a channel ($4-$7 at this weeks volatile price) to cover their expectant fee's over time. yet again rules out micro payments of developing countries where $4 is 2weeks wage (cuba, georgia, etc).. $4 is 1 week(Kyrgyzstan, gambia, ethiopia, etc)

imagine having to deposit a week or 2 wage just to cover fee's for a 10 day lock. before you factor in how much you would deposit ontop to actually spend.

the problem with the devs, both calculating the onchain fee war and the LN fee penalty acceptability. is they are thinking with a western world mindset of being only slightly cheaper than paypals 20-30cent fee. before the devs would even consider lowering their 'spam' limiter down. they should spend a week outside their basements and travel the world and experience currency usage outside of the corporate america setting.



overall summary
LN is not the ultimate scaling solution. it is and should be just a niche/side voluntary service much like third party exchanges are.. for things like gamblers, faucet raiders and day traders who usually spam the blockchain frequently.
however malicious spammer who want to spam the blockchain will avoid LN because LN defeats their malicious purpose. thus LN wont mitigate intentional spammers.
also infrequent bitcoin users (under a few times a week) wont need/want LN due to the settlement delays and the costs of setting up/settling would be more then just paying someone direct onchain infrequently
6935  Bitcoin / Bitcoin Discussion / Re: Site investigation conducted to the top 3 Chinese Bitcoin exchange on: January 11, 2017, 11:08:46 PM


Why you frucking asians always think everybory running illregal exchange? Mind you own biness! Market manipruration not you probrem. Fruckers

he is french though.. lol
6936  Bitcoin / Bitcoin Discussion / Re: Value vs. utility on: January 11, 2017, 08:46:17 PM
This is a good question and debate. The more liquidity we see across the entire available coins the lower price we'll see, and certainly more stable. The more people hodl, the more the price will rise.

I realize that throughput constraints may turn some folks off, it will lower liquidity. But that doesn't mean it will lower the value of bitcoin. A decrease in value will only come when there are more sellers than buyers, literally. So if liquidity becomes tough, but people still see "store of value" value in bitcoin we'll continue to see the price rise over the long term.

The shorter term fluctuations will always  occur and are indicative of direct buying an selling moves. We see a dip after the holidays, perhaps people are taking earnings in bitcoin to replinsh their fiat reserves or simply because there has been a run up.


The greatest challenge in trying to find causation in bitcoin price movements is doing so with social or business events...the currency is so global that it's hard to attribute one country's actions to the movement of the price of bitcoin.

"store of value" has a limit.

some people think scarcity is a thing.. but if only 10 people hold say 42coin.. this does not make 42coin worth a few billion dollars..
utility plays a part of it.

if it has no utility then it doesnt matter how rare it is, no one needs to use it so no one wants it so no one asks for it.
its why all of the altcoins with small supply fail. because they think scarcity alone is a value creator

another example.

housing market.
people think if they buy a house at say $500k their asset will always hold a store of value of $500k..

check out the last 9 years and see if thats true.

when there is no demand for houses because people cant afford them or doesnt see the need of a 5 bedroom house or there is something else people see that does have utility for them thats not your house.. after a while you start dropping your ask price below $500k to tempt a quicker purchase. thus the house loses value.

now imagine it for something someone doesnt "NEED" at all because it does nothing tangibly..
scarcity is no longer something to rely on as a value store
6937  Bitcoin / Bitcoin Discussion / Re: Site investigation conducted to the top 3 Chinese Bitcoin exchange on: January 11, 2017, 08:33:08 PM
"chinese" exchanges have been in constant communication with PBOC for years.

this topic is exaggerating a 'routine' inspection by regulators* into something sounding more like a raid.
it is not a raid. its just a routine inspection

seems like the OP wants to cause drama to cause some speculation and another discount day to buy in cheap.
and when people wise up to the truth and price then recovers, the OP can sell for profit.

*(yep many finance firms in fiat, asset and commodities get these as something treated as normal processes)


Quote
The operation is focused on checking whether the company is operating beyond its scope
BTCC for example has a regulatory agreement of what its business will do (scope of business).
the regulators are just doing a routine inspection to check

drama over

tip: this is temporary speculation drama. do not consider it a panic moment to cry about losses, consider it a discount day to increase holdings cheaply

Just what you would expect the chinese to say to the west while they dump on your heads..

im a brit. i just hate the FUD that turns into sheeple scripts everyone repeats and circle jerks to
6938  Bitcoin / Bitcoin Discussion / Re: Breaking News! PBOC inspects Chinese Bitcoin Exhcanges on: January 11, 2017, 08:29:05 PM
yes, and guess what

Their attack on BTC will serve nothing but to show to the world that they themselves are in fear. Furthermore, the crypto community will respond appropriately and move out of their grasp. Next, cryptos will grow in other nations, eventually catching up to China and causing China a huge disadvantage for having been so stupid as to attack cryptos. BTC will flee china temporarily and be harder to get back.

And here it is coming gradually the regulations but I still see this as a stunt they are pulling over there and this will affect the price of bitcoin in a way whether positive or negative because its this same China that the massive increase in the price of bitcoin started towards the end of last year as their exchanges were at the forefront of pushing the price upwards... And the down trend we are witnessing now cannot be totally ignorant of their activities over there...
Any nation with a brain will grab hard to get cryptos into their borders now. All economic models heretofore are outdated. That means that PBOC is making decisions based on a jurassic economic model  LOL


they are not in fear...

seriously calm your mind. try researching rather than speculating.
china dont care about the money supply in regard to bitcoin.. for every buyer there is a seller.. so the chinese money circulates the exact same as someone buying a loaf of bread. the fiat does not evaporate. it just moves from a buyers to a sellers account.

all that ultimately changes is whos holding the fiat..

china is just doing what it does to ALL financial firms.. it periodically does routine checkups to ensure the business is working within its scope. and periodically informs the nation that trading and investment is a risk.

it does not matter if it is an asset commodity stock or share or forex.. the PBOC drama is the same for all financial services.
its nothing special about bitcoin

seriously calm your mind. try researching rather than speculating.
6939  Bitcoin / Bitcoin Discussion / Re: OK Proof of life but why is the hash proof different? on: January 11, 2017, 08:13:48 PM
try 447506

not your 445706
6940  Bitcoin / Bitcoin Discussion / Re: Breaking News! PBOC inspects Chinese Bitcoin Exhcanges on: January 11, 2017, 07:47:23 PM
BTCC has an official license, making their operations perfectly acceptable. However, it seems the PBOC is mostly interested in potential market manipulation and “cooking the books.”

yes its a regular/routine checkup..which is part of their licence agreement

its not raiding an unlicenced exchange.. hence all this drama is FUD
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