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3541  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 04:54:21 PM
that's not necessarily true either.  with small blocks and fewer tx's, fees would increase substantially (hundreds of dollars) to hopefully compensate for diminishing block rewards.  if Bitcoin is used as a world reserve currency, then tx volumes wouldn't have to be high and could be used to settle international balance of payments btwn nations.
Those two conditions are mutually exclusive.

Few advantages an altcoin might have could overcome Bitcoin's network effect, and a three or four order of magnitude reduction in transaction fees is one of them.

well, that's not how things are evolving.

Bitcoin continues to outpace all altcoins no matter what they've promised.  and that's despite Bitcoin's 1MB limit.
3542  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 04:15:54 PM
The main chain would be more of a backbone chain being used to settle side chains and other major transactions periodically.  Bitcoin would be primarily used as a store of value and transfer of major value.  This is in line with you thoughts of bitcoin being a reserve currency.  We shall see how it plays out.
That can't work.

Mining has to be paid for via usage fees, not the block subsidy. The only way that works is if the cost is amortized over an very high transaction volume.

Again, forcing most transactions off-chain also denies the benefits of Bitcoin to most of the world's population.

that's not necessarily true either.  with small blocks and fewer tx's, fees would increase substantially (hundreds of dollars) to hopefully compensate for diminishing block rewards.  if Bitcoin is used as a world reserve currency, then tx volumes wouldn't have to be high and could be used to settle international balance of payments btwn nations.

i understand the potential role for worldwide cheap transactional volume.  i'm just saying that from a teleological standpoint, Bitcoin may not evolve that way.  you need to be aware of this.
3543  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 03:32:08 PM
https://twitter.com/cypherdoc2/status/497404702460739584
3544  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 03:17:57 PM
USD definitely making a break for it, up.  pm bugs gotta look out:

3545  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 03:00:55 PM
When historians look back they might well conclude that the 1MB limit resolution was Bitcoin's "betamax moment", the most important decision point determining its ultimate fate.

I'm in justusranvier's camp on this one. Not raising blocksize, *at least* roughly allowing for Moore's Law, seems insane, and would just drive some alt to gain significant marketshare. I think most of us in this thread realize that an alt achieving a significant portion of bitcoin's market-cap for an extended period would be a major detriment to long-run health of the entire crypto-ecosystem. It'd empirically refute the notion that bitcoin is a good store of value, giving a lot of fuel to the argument that bitcoin isn't scarce due to alts. That'd reduce investment-in/monetization-of crypto in general since none could be considered a decent parking place for capital, and that hurts everyone (which is the core point alt-boosters miss).

We need to allow bitcoin itself to fulfill its basic promises, and one of those is cheap global transactions. Part of the path to mainstream use (and the trojan-horse that widespread bitcoin ownership represents) is through demonstrating feature superiority versus fiat (sidenote: Chamath on this: https://www.youtube.com/watch?v=6AoPHNsX2x8 ). Transaction-cost is one of the most direct, most easily understandable, and most easily usable of bitcoin's "features" for new users.


Back to blocksize, I'll just drop the obligatory Satoshi quote to directly refute the notion that blocksize was always intended to remain fixed (though JR's and Peter R's orphan-cost-dynamics arguments upthread are obviously the proper args):

It can be phased in, like:

if (blocknumber > 115000)
    maxblocksize = largerlimit

It can start being in versions way ahead, so by the time it reaches that block number and goes into effect, the older versions that don't have it are already obsolete.

When we're near the cutoff block number, I can put an alert to old versions to make sure they know they have to upgrade.


Been following this thread for a while, my first post in here to say: excellent post, Melbustus, especially the bolded part. The exception being an alt of course that adds utility that btc cannot offer in principle (like high level of anonymity) but you know that yourself, as you've posted about it before.

i agree.  with enough lead time, we shouldn't get a fork.
3546  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 02:59:40 PM
nom, nom, nom, nom:

3547  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 02:53:12 PM
stocks making a run for it again.  down.
3548  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 02:47:41 PM
oil continuing the plunge:

3549  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 02:46:48 PM
this is actually good news:

http://www.lawfareblog.com/2014/08/snowden-residency-in-moscow-extended/
3550  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 02:39:26 PM
btw, i don't agree with Gavin's view on anonymity.  he seems to think that identification is no big deal in Bitcoin.  i totally disagree and believe that anonymity should be upheld and is fundamental to fungibility.
3551  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 02:08:20 PM
maybe you like Gavin more than you think...
Who said anything about liking anyone? I was talking about trust.

Why wouldn't you trust Gavin anymore than any other dev? If anything he's been pretty darn close to the best representative for Bitcoin that we could have hoped for, imo.

Of course, everyone is free to disagree with some of his decision making but that doesn't equate to a betrayal of trust.   
3552  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 01:45:03 PM
I've known about this since 2008,  but everytime I read this it never fails to make me angry as hell:

If the Federal Reserve and the bankers who control it believe that they can continue to devalue the savings of Americans and continue to destroy the US economy, they will have to face the realization that their trillion dollar printing presses will eventually plunder the world economy.

http://www.sott.net/article/250592-Audit-of-the-Federal-Reserve-Reveals-16-Trillion-in-Secret-Bailouts
3553  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 05:42:16 AM
that's fine, but just don't f*ck it up.  Grin
Note that Gavin has said in the past that he wants to see multiple implementations of the protocol, yet somehow the other core developers managed to fend off every attempt by other teams to do exactly this.

Finally somebody showed up that was good enough that they couldn't stop by stonewalling them, so now they just ignore them and hope everybody else does too.

i'm very much for btcd and Bitcoinj.  the resiliency gained from those implementations strengthens Bitcoin.

i also think that projects like Open Transactions will be good for the system.  at least they don't blow wind. can't wait for them to get something up and running.

maybe you like Gavin more than you think...
3554  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 05:13:24 AM
i would say that if it ain't broke, don't fix it.
"640k ought to be enough for anyone"

For the non-technical: what is "not broken" is as good as this idea for slowing down a train...  FFS! We can do better, surely?




to which i could respond:

"The Geeks Fail to Understand That Which They Hath Created"?
3555  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 05:03:38 AM
maybe i'm just more optimistic than you.
Probably true.

I'd rather err on the side of too many precautions than too few precautions in this area.

that's fine, but just don't f*ck it up.  Grin
3556  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 04:58:15 AM
most of those ppl honestly believe that keeping blocks at 1MB is the right thing to do

Of course. That does not preclude their believe being incited from people will less pure motives. That's a pretty standard political movement infiltration/disruption tactic.

i must admit, i don't like what i'm seeing on Coinbase's behalf regarding KYC/AML.  they're being too intrusive.  we'll have to see how this evolves as i'm sure they are under severe pressure to conform which could change for the better with time.

What I'm most worried about is fractional reserves once the majority of the coins are herded into off-chain processors.

why would ppl leave significant amounts of coins at the processors anymore than they do now just b/c they're forced off chain by high fees from a 1MB block?  spending amounts maybe, but not savings.  the only indisputable principle here is to never leave your privkeys to someone else.
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Consider this scenario:

The IRS devotes a lot of resources to auditing anyone who withdraws their coins. If you withdraw coins and move them, they assume it's a taxable event with the burden of proof on you to show otherwise. Coinbase/Circle are more than happy to tip them off.

Most people don't want to deal with the hassle, so they leave their coins in their online "wallets" that handle their tax reporting automatically (how convienient!)

Bitlicences make it unprofitable to operate a Bitcoin company, except for banks which are except. Coinbase and Circle get bought out by JPM and Goldman Sachs.

You'll never see your coins again, just like Germany will never see their gold again.

the IRS doesn't have those kind of resources.  audit rates are minimal and have been going down.  even so, just leave small spending amounts on offchain processors.
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you do know that Gavin agrees with you when it comes to increasing tx rates?  i seriously doubt he could be manipulated given his political leanings and actions heretofore.  i'm just glad he's being paid by the BF while being alongside Matonis, who i think has his head on straight.

I know Gavin agrees and I generally agree with what Matonis does.

Nevertheless, they are in positions of influence and vulnerable to coercion and so I'll never be able to trust them. I'd love for the situation to be such that they don't have any power that anyone would coerce them to misuse, so that I could trust them.

Note that Bitlicenses may have legal implications for both of them.

i would say that if it ain't broke, don't fix it.
"640k ought to be enough for anyone"

maybe i'm just more optimistic than you.  every open source project has a leader.  maybe not one with so much at stake as Bitcoin.  as i said in a post earlier today on the Nash Equilibrium; i think corruption won't want to take the risk of being exposed to the sunlight of the Bitcoin system as there would be too much at stake for them to risk it.  if billionaires like Branson and Ka-shing ever got wind of something like that, we might actually see some gubmint apparatchiks go to jail.
3557  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 04:25:23 AM
When historians look back they might well conclude that the 1MB limit resolution was Bitcoin's "betamax moment", the most important decision point deciding its ultimate fate.

coinmarketcap.com is interesting because it gives a market assessment of Bitcoin's future prospects.

Right now the total cryptocurrency market cap is $8,197,074,397 and Bitcoin's is $7,678,842,953 or 93.68%
(higher if MSC and XCP and other BTC-based alts are included).

So, the cryptocurrency market is effecting pricing a >93% probability of Bitcoin dominating this new asset class - long term. An asset class of such importance that many crypto investors consider could make all fiat obsolete and perhaps even demonetize precious metals as well.

If the 1MB limit is not handled properly, in good time, and is allowed to seriously disrupt organic growth, then that percentage will fall significantly. Perhaps even causing an irrecoverable erosion in the first-mover status, opening the window for alts like NXT and XMR.

This is the stakes in play.


here's a novel thought: it may not matter either way.  i can construct reasonable game theory scenarios where Bitcoin can succeed both ways.  the economic incentives may be so strong against the existing inflationary fiat monetary system that participants will work hard to make either scenario workable.  the main incentive being an open and transparent fixed supply monetary system.
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Bitcoin can not disrupt fiat currencies unless it's a network that everyone on the planet is actually capable of transacting on.

i guess you don't think much about my Bitcoin Standard.  however, by providing an instant, almost realtime method of settling international balance of payment imbalances, Bitcoin could put the screws to overleveraging in the overlying fiat system.  perhaps the sustainability that i suggest of that system is what puts you off but i still think it's the path of least resistance for integration of existing and new technology.
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Pulling out all the FUD/propaganda stops to keep the transaction throughput rate capped is the best possible strategy the defenders of he legacy system could employ to save themselves.

i probably should say that i am neutral on the issue of block size, currently.  i understand both halves of the argument and honestly think it may not matter which way we go as the network could adapt. but even so, you can't label those who argue against what you propose as spewing FUD.  most of those ppl honestly believe that keeping blocks at 1MB is the right thing to do, and perhaps it is.  we'll see.
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If they can force most transactions off chain, into the waiting arms of Coinbase and Circle, then most of the benefits of Bitcoin will remain inaccessible to most of the world's population.

i must admit, i don't like what i'm seeing on Coinbase's behalf regarding KYC/AML.  they're being too intrusive.  we'll have to see how this evolves as i'm sure they are under severe pressure to conform which could change for the better with time.

having said that, we do need a way to bring all the unbanked online with Bitcoin.  that will require cheap tx fees.  my hope is that the market will force down fees thru increased competition.  we're beginning to see that with 0% fees via Circle.
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Given the stakes involved, I don't trust Gavin to be capable of making good decisions even if he wanted to. A single point of control is a single target for blackmail and extortion.

you do know that Gavin agrees with you when it comes to increasing tx rates?  i seriously doubt he could be manipulated given his political leanings and actions heretofore.  i'm just glad he's being paid by the BF while being alongside Matonis, who i think has his head on straight.
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they are very aware of issues like block size limits and bandwidth limitations.
What you're talking about are  symptoms of a sub-optimal network layer.

The fact that the P2P network suffers from a tragedy of the commons effect because there is no price discovery for bandwidth or storage is nothing inherent to Bitcoin - it's inherent to the current design of the reference client.

i'm not seeing it.  every day we get more positive news and year on year we are still up around 500%.  
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If people who don't want Bitcoin to succeed can stop that problem from ever being fixed in the reference client, they can point to the tragedy of the commons problem as an example of why never to raise the transaction rate, forever.

Of course, that strategy only works when a single codebase has a monolopy on the implementation of the protocol.

i would say that if it ain't broke, don't fix it.
3558  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 03:38:10 AM
but amongst the general users
General users don't matter from the perspective of the future composition of the full node network.

Businesses and mining pool operators matter.

they do matter when some of the largest holders of bitcoin come from that segment of the community.

the other thing is that there are plenty of general users who understand Bitcoin both technically and economically as well, if not better, than business and mining pool operators.  they are very aware of issues like block size limits and bandwidth limitations.  

3559  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 03:28:49 AM
but amongst the general users
General users don't matter from the perspective of the future composition of the full node network.

Businesses and mining pool operators matter.

they do matter when some of the largest holders of bitcoin come from that segment of the community.
3560  Economy / Speculation / Re: Gold collapsing. Bitcoin UP. on: August 07, 2014, 03:19:23 AM
i don't see that ever happening as long as Gavin remains lead dev.  there's no one even close to him that has the political capital, trust, or good will he has generated.
We'll see.

The reference client has already lost the technical lead to btcd, and their dev team is orders of magnitude more functional than Bitcoin Core's.

In addition, he doesn't have as much goodwill as you think. I'm not the only person who's noticed that there has been no substantial development in the reference client for about two years.

i can see that being true amongst other devs all of whom are desperately trying to make their mark or advocate for vested alternative interests.  but amongst the general users i think what i said holds.  i know it does from my perspective.
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