fergalish
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May 31, 2011, 08:13:28 PM |
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People who invested in Apple are different because that money is being used to help produce jobs, goods, and services. Those who buy BTC are not "investing" in the creation of the Bitcoin software, they are merely investing in the Bitcoin blockchain which has no useful intrinsic value of its own, it is merely an aggregation of data that is just tallying where all the money is moving.
Hmm. What if your investment in BTC raises the price enough to attract commerce. Is that not indirectly providing jobs? Your proposal misses a big sore point. If it passes, then the value of *your* bitcoins will seriously diminish. The guy who mined already got his profit, so the loser would be *you*, and all the other people who are buying old coins now. You might not worry so much, but I expect that just about anybody who has invested in bitcoins will not cooperate with your proposal, i.e. everyone on this forum. Therefore, you'd be much better off taking your proposal elsewhere and begin a whole different project, based on bitcoin, with just the btc convertability you suggest, but appealing to a whole new audience, not to those who have already invested in btc. Another point, what about bitcoin mixers? If I send 100 bitcoins to a mixer, then eventually I get 100 bitcoins back, but they could be newer, older, or a mix of newer and older coins. There'd be no way to tell who got what. The 'penalty' to early adopters would be completely random. In the long run, I'd say you'd be simply better off starting a new block-chain, in which old bitcoinsPlus, in every transaction, are converted to new bitcoinsPlus, in proportion to the difficulty now and the difficulty when generated. Of course, then there'd be no incentive to mine now, since you get the same reward if you mine tomorrow, or next year, so I'm not entirely certain that it would take off. Perhaps it would be more popular amongst socialist idealists. As for the crux of the problem, perhaps we can hope that, eventually, older bitcoins will gradually enter the market as the early adopters spend/retire. Not unlike the gold rush of the 1800s I suppose - fortunes were made there too, and all they mined was a useless soft yellow metal.
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rebuilder
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May 31, 2011, 08:15:44 PM |
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Because when I think of providing something of value, I am thinking of the creation of goods and services, which are the true backbone of any economy, not money. When I buy BTC at 0.80 and sell them for 8.00, I feel more like a troll on a bridge. The troll isn't doing anything useful, unlike say a toll that goes to the people who built the bridge, which motivated them to build a quality bridge and which probably helps maintain the bridge.
It sounds like you don't think Bitcoin is a valuable invention. Yet it seems you're very interested in it.
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casascius (OP)
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May 31, 2011, 08:22:50 PM |
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Hmm. What if your investment in BTC raises the price enough to attract commerce. Is that not indirectly providing jobs?
What does the price of BTC have to do with jobs? Jobs are created by matching labor with market needs. If I start a useful BTC-related business and hire people to help me run it, then I have created jobs. But simply driving up the price through speculation doesn't accomplish that. Your proposal misses a big sore point. If it passes, then the value of *your* bitcoins will seriously diminish. The guy who mined already got his profit, so the loser would be *you*, and all the other people who are buying old coins now. You might not worry so much, but I expect that just about anybody who has invested in bitcoins will not cooperate with your proposal, i.e. everyone on this forum. Therefore, you'd be much better off taking your proposal elsewhere and begin a whole different project, based on bitcoin, with just the btc convertability you suggest, but appealing to a whole new audience, not to those who have already invested in btc.
I agree with you - I could be diminishing my own BTC. But the way I see it, I have already sold enough to recover well more than my initial investment, and if somehow my forum postings were to tank away my opportunity to make take more money from people, then oh well. It's not money that was ever my God-given right to take in the first place, no different than if I find your wallet and beat myself up over the chance I missed to take your money before I gave it back. Another point, what about bitcoin mixers? If I send 100 bitcoins to a mixer, then eventually I get 100 bitcoins back, but they could be newer, older, or a mix of newer and older coins. There'd be no way to tell who got what. The 'penalty' to early adopters would be completely random.
Yep you're right, but the idea isn't to punish early adopters, it is to remove the collective leverage they have over the wealth of future participants. Besides, the reward is already pretty random as it is. I could sell 100 BTC on June 10th, and I have no clue whether I will get $1 or $50 per coin. So I'm not really shaking anyone's fate far from their expectations to begin with. In the long run, I'd say you'd be simply better off starting a new block-chain, in which old bitcoinsPlus, in every transaction, are converted to new bitcoinsPlus, in proportion to the difficulty now and the difficulty when generated.
That's essentially what I have proposed - while maintaining full compatibility with BTC so as to make it attractive to those who are currently stuck with a relatively buggy and very non-intuitive client. I am essentially proposing riding the coattails and exploiting the fact that development on the client is at a snail's pace and is lacking numerous important features.
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Companies claiming they got hacked and lost your coins sounds like fraud so perfect it could be called fashionable. I never believe them. If I ever experience the misfortune of a real intrusion, I declare I have been honest about the way I have managed the keys in Casascius Coins. I maintain no ability to recover or reproduce the keys, not even under limitless duress or total intrusion. Remember that trusting strangers with your coins without any recourse is, as a matter of principle, not a best practice. Don't keep coins online. Use paper or hardware wallets instead.
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casascius (OP)
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May 31, 2011, 08:24:03 PM |
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It sounds like you don't think Bitcoin is a valuable invention. Yet it seems you're very interested in it.
In your Bitcoin folder, there are numerous files. The ones with an extension of .cpp, .h, and such, are where the true gold is, the part that has really caught my interest. The ones with an extension of .dat are where my criticism is pointed.
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Companies claiming they got hacked and lost your coins sounds like fraud so perfect it could be called fashionable. I never believe them. If I ever experience the misfortune of a real intrusion, I declare I have been honest about the way I have managed the keys in Casascius Coins. I maintain no ability to recover or reproduce the keys, not even under limitless duress or total intrusion. Remember that trusting strangers with your coins without any recourse is, as a matter of principle, not a best practice. Don't keep coins online. Use paper or hardware wallets instead.
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rebuilder
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May 31, 2011, 08:25:27 PM |
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I'm running out of things to say here. I think the issue of distribution will sort itself out. The exchange rate is fluctuating wildly. Bitcoin has been, is, and will continue to be a risky investment. Sooner or later some of the bigger hoarders will start to chicken out and sell their Bitcoin. They may cause the exchange rates to drop a lot, or maybe they'll be sly about it and sell over time. Either way, the coins get redistributed.
If some of them do not sell and instead hold on to their coins, even at, say, USD10/BTC, or USD 100/BTC, they're taking big risks. No-one knows the outcome. No-one knows how the exchange rates would recover from a crash back to pre-dollar-parity days. It's entirely possible for a panic to decimate the exchange rates. Anyone with a few hundred thousand BTC has to have balls of steel not to think about unloading significant amounts of those sooner or later, unless they're already loaded, of course.
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Selling out to advertisers shows you respect neither yourself nor the rest of us. --------------------------------------------------------------- Too many low-quality posts? Mods not keeping things clean enough? Self-moderated threads let you keep signature spammers and trolls out!
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nazgulnarsil
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May 31, 2011, 08:26:19 PM |
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I think a little perspective is in order...first, if someone does have 20% of all bitcoins, the notional value of those coins is around $10 million. However, were they to sell all those coins on any short time scale, they wouldn't get anywhere near that amount and they would crash the market. But, let's assume they could bleed out $5 million over the span of 3 months (but I think that's still far above what the market could support today). That's peanuts compared with the wealthiest people on this planet and I'd bet that the contribution these bitcoin pioneers have made is far greater than the vast majority of those extremely wealthy individuals (and yes, even for those that did little more than buy or mine bitcoin...because, after all, without them, there would be no "us"). If the price of bitcoin continues to appreciate, these early adopters will have increasing pressure and incentive to either lock in those gains or to invest it in some capacity (quite likely in businesses involving bitcoins). Continuing to hold such a large hoard will make less and less sense as time passes.
this. over time as bitcoin climbs in value it makes little sense to sit on large hordes when cashing out a portion can catapult you into a higher living standard (not working). We'll see medium hordes get dumped on the market at various psychologically significant price levels (I'm assuming a short term price ceiling of $10 due to this actually). http://www.forexfreeway.net/trading-online/forex-trading-the-importance-of-round-numbers
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markm
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May 31, 2011, 08:30:47 PM |
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Mixers need a float to work with, the big oldsters could send their coins through mixers constantly, or even run mixers of their own keeping newer coins and dumping old ones on other people.
Its stupid.
-MarkM-
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Ulysses
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June 01, 2011, 12:07:49 AM |
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1) OP have 25000 BTC. 2) OP wants to destroy some part of BTC mined. 3) OP won't destroy his BTC. 4) The less total BTC we have, the more they are valuable. Conclusion? ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif)
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casascius (OP)
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June 01, 2011, 01:32:22 AM |
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1) OP have 25000 BTC. 2) OP wants to destroy some part of BTC mined. 3) OP won't destroy his BTC. 4) The less total BTC we have, the more they are valuable. Conclusion? ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) 1) OP have 25000 BTC. 2) OP wants to create a second block chain, but to offer a way to transfer BTC from one block chain to the other (which involves creating a transaction that looks like a "destroy" to the original client) 3) OP won't convert his BTC, and also expects that nobody would convert BTC mined with an easy difficulty because it would yield so little. Only recently mined BTC during high difficulty would make sense to transfer because the yield is directly related to the difficulty. 4) The BCP will become more valued than the BTC because there aren't millions of easily-acquired BCP out there waiting to pop the market.
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Companies claiming they got hacked and lost your coins sounds like fraud so perfect it could be called fashionable. I never believe them. If I ever experience the misfortune of a real intrusion, I declare I have been honest about the way I have managed the keys in Casascius Coins. I maintain no ability to recover or reproduce the keys, not even under limitless duress or total intrusion. Remember that trusting strangers with your coins without any recourse is, as a matter of principle, not a best practice. Don't keep coins online. Use paper or hardware wallets instead.
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rezin777
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June 01, 2011, 01:46:40 AM |
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4) The BCP will become more valued than the BTC because there aren't millions of easily-acquired BCP out there waiting to pop the market.
Since we are speculating. It's more likely that people will ignore "Plus" because it was never bootstrapped, and probably wouldn't have bootstrapped at all because of the massive amount of inflation that would have had to occur to make the early Bitcoins worth less, and is only attempting to ride on the coattails of Bitcoin while pretending that bootstrapping a new currency is not worth anything. But you should really make it anyway.
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Bimmerhead
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June 01, 2011, 03:32:53 AM |
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What I'd like to know, casascius, is where you get the authority to determine what is fair? And where do you get the authority to determine what is valuable work and what is parasitism? And what makes you think you know the exact rate at which old btc should be converted to your BCP? Anyway, why should later adopters be rewarded either? Maybe some central authority should simply distribute all btc equally over the planet.
You say you've done well outside of bitcoin, presumably in your software business. You haven't indicated that you feel you've been over-compensated in that realm, but how do you know you haven't? Just because you've provided a 'valuable service'? But maybe that 'valuable service' could have been obtained more cheaply from somewhere else or someone else. Have you therefore stolen some portion of what you have, even though it was given to you voluntarily?
You feel bitcoin approximates a pyramid scheme. But at the end of the bitcoin pyramid scheme everyone will still have their bitcoin. The problem is you have greater faith in the USD than in BTC. You think that a few years down the road the USD will be worth more in BTC terms than it is now, and that it will be that way by design. I'm afraid that most people here believe that BTC>USD in a few years, and if it isn't, it won't be because Satoshi designed it that way.
The real danger here isn't that some early adopters will profit (in USD terms). The danger here is that even after a 70 year experiment with the Soviet Union, even after a 40 year side-by-side comparison between East Germany and West Germany, even after the fantastic demonstration of the power of the free market in China over the last 2 decades we still have people who think they know better than everybody else. People who feel they can plan things for the rest of us so it turns out more 'fair', 'equitable', sunshine & rainbows. That type of thinking, given free reign, always ends in utter disaster and usually a great many deaths. That type of thinking is the very antithesis of the bitcoin project.
You may have good intentions, but there is a reason that is the pavement on the road to hell.
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unk
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June 01, 2011, 04:39:30 AM |
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casascius isn't claiming any kind of authority, nor is he proposing any kind of centralisation. i wish people criticising him would read more carefully and think more sensitively about subjects they expound on, rather than staying in the realm of idealised theory and apparently assuming that anyone who proposes something new must be a communist.
he's made what's at heart the same point many others have made: the seigniorage of bitcoin is arbitrary, is probably not priced into the value of coins in the current block chain because of informational asymmetries, ultimately serves no productive function, and has contributed to what is likely a functional pyramid scheme from the public's perspective. this is not a crazy or extreme point; it's consistent with almost all economic literature on productive rather than unproductive investment.
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BitterTea
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June 01, 2011, 05:25:56 AM |
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casascius isn't claiming any kind of authority, nor is he proposing any kind of centralisation. i wish people criticising him would read more carefully and think more sensitively about subjects they expound on, rather than staying in the realm of idealised theory and apparently assuming that anyone who proposes something new must be a communist.
he's made what's at heart the same point many others have made: the seigniorage of bitcoin is arbitrary, is probably not priced into the value of coins in the current block chain because of informational asymmetries, ultimately serves no productive function, and has contributed to what is likely a functional pyramid scheme from the public's perspective. this is not a crazy or extreme point; it's consistent with almost all economic literature on productive rather than unproductive investment.
I have no problem with others creating alternate block chains with whatever rules they want. It is my opinion that competition is always good and I applaud anyone that expends the effort to do so. Even if I didn't want there to be alternate chains, there's nothing I or anyone else could do about it. However, to claim that early adopters did nothing to deserve their easily mined bitcoins is fucking preposterous. If they had not invested time and resources into the bitcoin community, you would not be here now in order to complain. So go and create your own chain, or use your considerable amount of unearned exploited wealth to pay someone to do it for you. Put your money where your mouth is, so to speak. The constant complaining about the unfairness of the rules of the main chain just makes it sound like you're bitter that you didn't get in earlier and you want to punish the early adopters for taking a risk. Come back when you have something of substance, I'm sure you will be more warmly welcomed.
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John Tobey
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June 01, 2011, 11:34:26 AM |
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1) OP have 25000 BTC. 2) OP wants to destroy some part of BTC mined. 3) OP won't destroy his BTC. 4) The less total BTC we have, the more they are valuable. Conclusion? ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) Let's see if I can recast this in Ayn Rand terms... 1) OP can afford a Ferrari. 2) OP wants a Lear jet (go OP!) 3) OP is insightful, daring, and innovative (my hero!) 4) The cloud of seigniorage threatens the market value of OP's portfolio. 5) OP wants to create and profit from something of greater value than all the world's BTC. Does that look better? Getting back to the "antidote" that this post is about, I really don't see the need to support BTC destruction as a way to create BCP. It is complicated and probably controversial, as it seems to attack BTC in an unfriendly, not to say unfair way. A little patience with minting the new currency would, in my opinion, pay off better in the long run. A BTC<->BC2 exchange would be very straightforward to set up (technically, not to say legally) and would be the way to distribute the new currency to non-miners. I also no longer feel the need to "poll" miners prior to working on a genesis block as I outlined in another thread. The initial difficulty should be on the order of 10,000 to 100,000 (or 2-20% of BTC difficulty at the time). And the project (and supporting software) should be widely advertised among Bitcoiners, so anyone who might be interested can make a conscious decision whether to join at the outset. Apart from that, we do not have to regulate the generation speed of the first blocks. In a few years' time, assuming ASIC mining or quantum mining overtakes GPU mining, there may arise a perception that yet another startup currency would hold more value than BC2. And that would be fine.
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marcus_of_augustus
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June 01, 2011, 12:03:56 PM Last edit: June 01, 2011, 12:41:51 PM by mother_of_another |
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casascius's proposition is exploiting what is, in my opinion, a weakness in bitcoin as a currency, that they are not truly fungible. (And it is related to the fact that they haven't got true anonymity either.)
His proposal is to selectively value bitcoins generated from different difficulty eras at different rates for conversion to the new system. If bitcoins were truly fungible each would be indistinguishable from the other and this process would not be possible. There would be no question about devaluing the early adopters gold because gold would just be gold, wherever and whenever it was found. After it is all melted down in a big pot there is no new gold and old gold.
As a currency, quasi-fungibility is a weakness and he is proposing an exploit, what are we going to do about it?
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BitterTea
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June 01, 2011, 12:19:53 PM |
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Fungibility does not require that the units be indistinguishable, just that they can be seen as such. Notes have serial numbers and coins have mint dates, some people discriminate based on this but they are a minority.
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kjj
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June 01, 2011, 12:21:19 PM |
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casascius's proposition is exploiting is what is, in my opinion, a weakness in bitcoin as a currency, that they are not truly fungible. (And it is related to the fact that they haven't got true anonymity either.)
His proposal is to selectively value bitcoins generated from different difficulty eras at different rates for conversion to the new system. If bitcoins were truly fungible each would be indistinguishable from the other and this process would not be possible. There would be no question about devaluing the early adopters gold because gold would just be gold, wherever and whenever it was found. After it is all melted down in a big pot there is no new gold and old gold.
As a currency, quasi-fungibility is a weakness and he is proposing an exploit, what are we going to do about it?
Ignore him. Dollar bills have dates and serial numbers on them. In theory some kook could start a movement to reject old bills.
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17Np17BSrpnHCZ2pgtiMNnhjnsWJ2TMqq8 I routinely ignore posters with paid advertising in their sigs. You should too.
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Cusipzzz
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June 01, 2011, 12:21:42 PM |
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casascius's proposition is exploiting is what is, in my opinion, a weakness in bitcoin as a currency, that they are not truly fungible. (And it is related to the fact that they haven't got true anonymity either.)
His proposal is to selectively value bitcoins generated from different difficulty eras at different rates for conversion to the new system. If bitcoins were truly fungible each would be indistinguishable from the other and this process would not be possible. There would be no question about devaluing the early adopters gold because gold would just be gold, wherever and whenever it was found. After it is all melted down in a big pot there is no new gold and old gold.
As a currency, quasi-fungibility is a weakness and he is proposing an exploit, what are we going to do about it?
Coin mixing services will be more popular if anyone other than crazy people start taking this 'treat some coins differently that others' seriously. It's not a weakness as it's a ridiculous idea.
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marcus_of_augustus
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June 01, 2011, 12:27:09 PM Last edit: June 01, 2011, 12:46:02 PM by mother_of_another |
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Gold is highly fungible, down to the atom. Bitcoin is not, neither are cash notes.
What if there is a way to make digital cash have higher fungiblilty from the outset? The "early coin devalue" attack would not have even been proposed, and others thwarted too. Higher quality money has higher fungibility.
Might be worth considering, but I agree there are bigger problems right now ... like the chaotic state of the mining network.
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BitterTea
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June 01, 2011, 01:28:00 PM |
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It's not an attack.
If someone wants to value certain coins over others, that's their choice.
Gold in raw form is not widely used as currency, and you could discriminate based on a shape instead of minting date or design.
It really doesn't even matter at all. As Cusipzzz said, if this became widespread, coin mixing services could become more widely used.
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