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1781  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 05:03:07 PM
i see this as all positive:

"We are now going to use our name, reputation and global index provider stature to provide bitcoin values that the rest of the market can look to," says Tom Farley, who serves as president of NYSE, the venerable financial institution that has come to symbolize Wall Street and capitalism more broadly."

"New technology does not intimidate us, it excites us," Farley says, effectively summing up the new mindset of NYSE. Bitcoin in particular excited him, both because of the interest in the currency and the blockchain technology behind it, which serves as a transaction database. "It was that curiosity and also... let's not wait for this to fully evolve; let's get a seat early on and see how this matures."

http://mashable.com/2015/05/19/new-york-stock-exchange-bitcoin/
1782  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 04:45:40 PM
Altcoin investment has always come across to me as pure financial speculation, simply hoping that Altcoin x will rise in price faster than Bitcoin for a given time period. I never get the sense that Altcoin investors want to disrupt the corrupt banking world and replace it with something better, just that it is a way to make a fast buck.

Since this is the hard money thread, I'd like to query the group:

How can one understand that Bitcoin is first and foremost about store of value and still be interested in the idea of an altcoin (alt-ledger) taking over Bitcoin?

To me, accepting the precedent that the ledger gets replaced when the protocol does, means throwing away the entire concept of crypto as a store of value. How would the market value any cryptoledger as a store of value if you had to actively switch out of it every few years (months?) as new protocols came along? Worse, you'd have to pick the winners correctly.*

I'm in the "we don't switch ledgers" club, because I think that's the only one the market will ultimately support. Anything else subverts the entire basis of money. It's pushing the proverbial red button on the whole concept of cryptocurrency. The only time to switch ledgers is when it is absolutely necessary to avoid total catastrophe. It should be a once in several centuries event, or at most once a generation (~30 years).

Perhaps the argument is, "We only do it once, because we just got this bit wrong with Bitcoin. This altcoin is the ideal form. No more changes after that." But to the market, the precedent has been set. Everyone knows what happens when some obscure flaw comes to light requiring another protocol change. Store of value goes *splat* again. The whole concept has been set back decades.

*Lottery ticket investing (Pascal's Mugging investing?) only works when the set of credible lottery tickets (investment candidates) is somewhat limited; if this dynamic takes hold there will be thousands of plausible "next top dogs" because the incentive will be overwhelming to create and cleverly market them.

i agree completely.  

altcoin early adopting devs and their supporters would rather have everyone switch to their "new, improved" altcoin for maximum individual profit at the expense of Bitcoiners losing value from having to be later adopters.  working to improve Bitcoin isn't sexy or motivational enough for most of them despite the fact that any BTC holdings they might have would likely increase in value from their contributions to the Bitcoin protocol.  most of them probably don't even have BTC hence there is no motivation for them to become later Bitcoin adopters (even though it is still EARLY).  

constantly switching to newer altcoins, even if they represent true improvements, is destructive to SOV.  thus, the whole concept of cryptocurrency as a SOV fails miserably.  they fail to see this thus their activities are destructive to the SOV concept.  ideally, they should help Bitcoin improve and keep all innovations on the mainchain so the market can develop confidence.  otherwise, as you say, we could be set back a hundred years.

i think the cryptocurrency market senses this which is why the relative value of all the altcoins to Bitcoin is decreasing.  eventually the losses will pile up and there should be a final capitulation of most altcoin supporters in deference to Bitcoin.

1783  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 04:31:38 PM
here we go again.  will we break the $DJT support once and for all?

a bad sign; gold is turning down again:

1784  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 03:53:45 AM
Quote from: smooth
There is no "natural mixing" that occurs, really. Inputs to a transaction are all controlled by the same party, unless you are using a mixing protocol like coinjoin.

Let's imagine a bitcoin thief sends three "black" outputs to three recipients whom were not involved with the original crime.  The first recipient then uses this black output along with two other white outputs to purchase something from Overstock.  The output that Overstock receives can now be thought of as gray and is an example of "natural mixing."  

It is the Overstock customer who screwed up here, and and Overstock may well reject the purchase, or require additional documentation and reporting. Let's say Overstock rejects the purchase and sends the coins back. The customer now has mixed gray coins that may be difficult to use for anything, instead of white coins that were clearly usable.

...

I think I see what you're saying Smooth, but I think you're missing the point I'm trying to make: the black listing can occur after the transactions took place.  So suddenly Overstock is stuck with coins that it accepted according to the rules (they appeared to be "white"), but that are now suddenly gray or black.  And if this can happen, then either the currency system is essentially unusable or the blacklisting efforts are largely ignored.  

Again, or they just act conservatively and try to avoid accepting coins that place them at this risk, which means rejecting coins of unclear or uncertain origin. If your coins come from some part of the explicitly-legal the walled garden (Coinbase, Bitpay, etc.), they will welcome you with open arms. Otherwise they may take a pass, even if you coins are (or might be) perfectly fine.

I don't disagree the currency system may become unusable under these conditions, or have limited potential. Fungibility is very important. It just isn't assured by the technology in any way I see.

you're missing the point that it might not need to be assured by the technology.

what might assure fungibility is mere market behavior.  it's quite possible the community herd instinctively understands that by accepting blacklisted coins we encourage a massive crowd effect which might positively determine Bitcoin's outcome as a successful currency despite your individual technical privacy concerns.

1785  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 03:22:53 AM
Correct about diamonds. Incorrect about cryptocurrncies. Fungibility means that units are interchangeable. Bitcoins are not interchangeable as long as they have an identifiable history. And in practice participants such as Coinbase are taking that history into account in evaluating coins and users.

If Coinbase was the processor of BTC, then I would agree with you. But Coinbase is not.

The P2P and mining network is the processor of BTC. The P2P and mining network will always consider BTC to be perfectly interchangeable, 1 BTC is always equal to 1 BTC regardless of history, law or anything else. The P2P and mining network will always consider 1 whitelist BTC to be of equal value to 1 blacklist BTC, and process transactions accordingly. This maintains perfect fungibility.

If you argument is that entities (goverments) will try to make individuals value certain coins (whitelist) more over other coins (blacklist). However if they can dictate usage of bitcoin, they can dictate usage of anything, including Monero. Either way it does not matter though, to the P2P network BTC are all still identical, this is fungibility.

If Bitcoin was not perfectly fungible, then you'd have a situation were the P2P network and the blockchain processes 1 blacklist BTC as somehow equaling less than 1 whitelist BTC. That is impossible with the current network and would require a hard fork.

Well I disagree with your definition, as I explained earlier. Fungibility exists within a social context. If nobody cares about the history of Bitcoins, then they're fungible, but if people do care, they aren't. I have some Bitcoins that were mined by me. I'm not interested in trading them for Bitcoins that for all I know might have been stolen from bitstamp and blacklisted by btc-e or others, or might otherwise cause me problems in the future. Not even for a small premium. That's not fungibility by the accurate definition.



that's your choice.  but i expect that you continue to accept USD bills routinely despite them being covered in drug taint.

Sure because literally no one cares or has ever cared about the drug taint on bills. That's not quite true with respect to serial numbers, so there is a bit more of a concern there, but not so much in practice.

Quote
likewise if most of the actors in the Bitcoin system don't care or more importantly understand that tracking tainted addresses makes no sense in light of the fact that UTXO's are what gets joined and split in essentially non-trackable ways then what you decide personally to do doesn't matter.

and this is what i see as happening; at least for the last 6 yrs.

You can't say that no one has ever cared about bitcoin blacklisting, whitelisting, tracking etc. It is unquestionably the case that actors such as Coinbase (which may well be the largest actor in the entire Bitcoin system by reasonable measures) do care about it. It is also clear that discussion and proposals for blackisting, whitelist, etc. have repeatedly occurred, etc. Finally it is certainly the case that the original BitLicense proposal had language about banning tumblers/mixers, etc. (I don't know about the current status).

You can speculate about how that might play out in the future but that is exactly what you are doing (I'm doing so too, I'm just acknowledging more uncertainty about how things will work out).




the way i see it, the market has already beaten down most of your concerns.

yes, there has been lotsa discussion but i'm just looking at the results.  and that is that there is no formal blacklisting services that exist yet that i know about.  and if there is one, i'm sure it's not significant.  do i care when about origin when i buy coins nowadays?  no.

also, i view what CB is doing differently.  i do believe they are dedicated Bitcoin advocates and know and care deeply about fungibility.  it's just that they don't want to go to jail so they track the first hop and i'm sure they'd cooperate with any legal investigation.  but that doesn't mean they are in favor of blacklisting.  in fact, i'm quite sure they aren't.
1786  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 02:45:31 AM
Correct about diamonds. Incorrect about cryptocurrncies. Fungibility means that units are interchangeable. Bitcoins are not interchangeable as long as they have an identifiable history. And in practice participants such as Coinbase are taking that history into account in evaluating coins and users.

If Coinbase was the processor of BTC, then I would agree with you. But Coinbase is not.

The P2P and mining network is the processor of BTC. The P2P and mining network will always consider BTC to be perfectly interchangeable, 1 BTC is always equal to 1 BTC regardless of history, law or anything else. The P2P and mining network will always consider 1 whitelist BTC to be of equal value to 1 blacklist BTC, and process transactions accordingly. This maintains perfect fungibility.

If you argument is that entities (goverments) will try to make individuals value certain coins (whitelist) more over other coins (blacklist). However if they can dictate usage of bitcoin, they can dictate usage of anything, including Monero. Either way it does not matter though, to the P2P network BTC are all still identical, this is fungibility.

If Bitcoin was not perfectly fungible, then you'd have a situation were the P2P network and the blockchain processes 1 blacklist BTC as somehow equaling less than 1 whitelist BTC. That is impossible with the current network and would require a hard fork.

Well I disagree with your definition, as I explained earlier. Fungibility exists within a social context. If nobody cares about the history of Bitcoins, then they're fungible, but if people do care, they aren't. I have some Bitcoins that were mined by me. I'm not interested in trading them for Bitcoins that for all I know might have been stolen from bitstamp and blacklisted by btc-e or others, or might otherwise cause me problems in the future. Not even for a small premium. That's not fungibility by the accurate definition.



that's your choice.  but i expect that you continue to accept USD bills routinely despite them being covered in drug taint.

likewise if most of the actors in the Bitcoin system don't care or more importantly understand that tracking tainted addresses makes no sense in light of the fact that UTXO's are what gets joined and split in essentially non-trackable ways then what you decide personally to do doesn't matter.

and this is what i see as happening; at least for the last 6 yrs.
1787  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 02:39:00 AM
 The reason is that coins are always blacklisted in retrospect.  By the time the coins are blacklisted, taint will have already diffused across previously-white coins.  If these coins are suddenly un-spendable, then the currency system is pretty useless.  



exactly right. 

also, think about the edge case where an attacker decides to send blacklisted coins to every known address in the system.  are all the UTXO's in those addresses now tainted?  given my emphasis on UTXO's being the more valid way to conceptualize this topic, blacklisting addresses doesn't even make sense.
1788  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 02:32:09 AM
The coins remain traceable on the blockchain.


The coins are traceable, but the link between the coins and to whom they belong is less so.

That's irrelevant to the extent that blacklisting or whitelisting (or the prospect of such) impair the value of those coins.



Not true. There have been numerous attempts to blacklist and track coins from every failed exchange in Bitcoin's history all the way back to MyBitcoin. Yet we all probably have those coins in our wallets to various degrees.

Do you live under a rock? Cheesy BTC-e already showed Bitcoin has no fungibility and coins can be blacklisted.

yeah, and what has happened since Evo?  nothing as far as i can tell.  coins continue to move freely.

let's do it this way.  show me evidence of a blacklist of coins that is currently operational and effective.
1789  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 19, 2015, 12:06:06 AM
The coins remain traceable on the blockchain.


The coins are traceable, but the link between the coins and to whom they belong is less so.

That's irrelevant to the extent that blacklisting or whitelisting (or the prospect of such) impair the value of those coins.



Not true. There have been numerous attempts to blacklist and track coins from every failed exchange in Bitcoin's history all the way back to MyBitcoin. Yet we all probably have those coins in our wallets to various degrees.
1790  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 10:42:46 PM
We don't know that Coinbase limits their tracking of "bad" activity to "one hop."

doesn't matter. at some point, just b/c you might be in a linear linkage with an address owned by SR at some time doesn't mean you're a criminal.
1791  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 10:38:30 PM
after analyzing the report, i think 21 is going to be big.

1792  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 10:19:56 PM
Am debating what are the innate properties that constitute money. For the reasons stated in prior posts I do not consider privacy to be applicable to what makes good or bad money and do not see that as a factor towards driving adoption.

Privacy is not necessarily a property of money. Fungibility is a property of money though, and without strong legal guarantees of fungibility, it likely does require privacy because if you can trace "bad" or "good" coins then fungibility isn't there. Bitcoin currently doesn't have whitelisting/blacklisting, etc. (for the most part; there do seem to be some exceptions involving Coinbase, etc.) but as long as that concept is in play fungibility is a question.



i think privacy is an important aspect of money.

at least if you want it to be adopted by the broadest swaths of the population which you should.  and that even means adoption by druglords and money launderers who absolutely need their privacy.  not that i advocate those sorts of activities but that's unrelated to my point.

i also don't think Coinbase is a privacy destroyer except if you try to do something illegal with coins one hop away from them.  as the coins spread out through the economy though it's extremely difficult to link illegal activity with those original coins.
1793  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 10:00:13 PM

seems to me that at the very least we will see companies like Qualcomm opening their own mining pools at which all these devices will be pointed.  this would be fantastic in further decentralizing mining in terms of increasing pool choices.  especially here in the US.  and if Qualcomm opens a pool, others are sure to follow.  like Whirlpool, GE, Subzero, etc.

i think 21 is seriously going to mess with credit card companies.
1794  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 09:47:56 PM
There is a "viewkey" in Monero that allows people to track your transactions... so I wouldn't say that Monero "forces" privacy on its users. (Maybe I'm splitting hairs though).

Thanks for the correction, Chris.  What's your take on Monero and ring-signature technology, BTW?



what's this about a viewkey?
1795  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 08:39:36 PM

seems to me that at the very least we will see companies like Qualcomm opening their own mining pools at which all these devices will be pointed.  this would be fantastic in further decentralizing mining in terms of increasing pool choices.  especially here in the US.  and if Qualcomm opens a pool, others are sure to follow.  like Whirlpool, GE, Subzero, etc.
1796  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 07:35:45 PM
OK, so I'm genuinely curious to understand in what ways you think Monero as money is superior to Bitcoin as money.

To me the six properties of money are:
  • ...
  • Uniform - Each unit is valued the same - Check, Bitcoin is perfectly uniform (same/better than gold)
  • ...

sorry my english is bad, thats why i only want to talk about the properties of money since i thougth a lot about it.
i agree with all points except this one.

Gold is uniform because you can melt it down if needed and no one will ever recognize it again. with bitcoin this is not possible.
for now its uniform, but for how long, if its not fungible?

the 6th property of money is fungibility, not uniformity, since fungibility inculdes uniformity allready, but means a lot more in the end

to me, Bitcoin is fungible when you think in terms of UTXO's. 

which half of 1BTC is tainted from joining 0.5BTC taint with 0.5BTC pure from 2 UTXO's?  when you then split that 1BTC into two 0.5BTC payments, are they both uniformly tainted or is there a discrete 0.5BTC that is tainted?  how do you distinguish?

yes, an address can be tainted if identified with a drug dealer.  but that's not the same as UTXO's, which is where the real action is.
1797  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 07:30:48 PM
this is good news:

Ultimately, though, it is the community of electrical engineers and computer scientists that will judge whether embedded mining technology solves their problems. Towards that end, our team of PhDs in EE from MIT, Stanford, and CMU has built not just a chip, but a full technology stack around the chip — including reference devices, datasheets, a cloud backend, and software protocols. And we have already engaged with a wide variety of early access partners across the industry, from small startups to multibillion dollar hardware companies.

https://medium.com/@21dotco/a-bitcoin-miner-in-every-device-and-in-every-hand-e315b40f2821

“21's chip and architecture represent an important next step in securing the future of the public, synchronized global ledger that is the blockchain. We believe that massively distributed embedded mining is the bitcoin that Satoshi intended — decentralized and globally accessible. We’ve known the team since the inception of the company, and we are confident that they can achieve this goal!”
— Jim Robinson IV, Co-Founder and Managing Partner, RRE Ventures
1798  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 07:25:32 PM
this is good news:

Ultimately, though, it is the community of electrical engineers and computer scientists that will judge whether embedded mining technology solves their problems. Towards that end, our team of PhDs in EE from MIT, Stanford, and CMU has built not just a chip, but a full technology stack around the chip — including reference devices, datasheets, a cloud backend, and software protocols. And we have already engaged with a wide variety of early access partners across the industry, from small startups to multibillion dollar hardware companies.

https://medium.com/@21dotco/a-bitcoin-miner-in-every-device-and-in-every-hand-e315b40f2821
1799  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 05:37:32 PM
new high on $DJI.  the non-confirmation is now wider.  can the $DJT get all the way to a new high from here?  doubtful, but hey:

1800  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: May 18, 2015, 04:28:31 PM

good work Justus.  kudos to the others as well.

projects like this will increase pressure to keep privacy innovations coming.
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