cunicula
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November 20, 2012, 12:27:44 PM |
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Bitcoin is completely compatible with liberal central bank directed credit creation. The bank just needs to have 51% of hashing power. Then it can charge demurrage and give the demurrage fees to banks to lend out.
If someone or some organization decided tomorrow to impose demurrage via a 51% attack, the response would be: 1. What is demurrage? 2. How could I calculate it even if I cared? 3. Just wait until a miner from the remaining pools mined a block with your .001 btc fee. No, common misunderstanding. If the organization has 51%, mining must be authorized by the organization or it cannot occur. but if the organization imposes certain rules (demurrage in this case), the 49% can just hard-fork by rejecting blocks identified as being mined be that organization. I'm sorry, how do you identify the organization's blocks? By the fees they charge? That would work if you imposed a mandatory fee system rather than a market-based fee. A mandatory fee is a great idea. You have to do it now, though. You can't wait for the "attack" to happen and then try to fight the government. Only idealistic libertarians will fight the government. The 99% will reject invalid libertarian blocks. 99% would mine blocks according to some rules that charge demurrage? I doubt it. Of course. They would mine coins that everyone else accepted. There is no point in having money that everyone else believes is counterfeit. I'd be a little suspicious if you wanted me to download an unregistered client. That prints special money that registered clients don't recognize as valid. We are currently printing money at about 12% per year. This is equivalent to 12% demurrage. This can be stopped of course. There is no need to accept inflation and demurrage. It is a tax on your holdings. Just create your own fork with no more block reward. I am sure everyone will welcome freedom from the inflationary tax and rapidly accept the new coin. LOL.
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cunicula
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November 21, 2012, 05:24:10 AM |
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Bitcoin is completely compatible with liberal central bank directed credit creation. The bank just needs to have 51% of hashing power. Then it can charge demurrage and give the demurrage fees to banks to lend out.
Aren't the digital coin-miners already a near-perfect mirror image of central banks? Nearly all of them currently adhere to a gold-like standard called Bitcoin. Instead of printing soft-money as fast as they can, they're all digging for a scarce common resource as fast as they can. There are a few plucky hold-outs -- let's call them the "Axis of Evil" -- who are brazenly trying to subvert the Bitcoin monetary system by making fiats that they will dig for something else instead. Fortunately, the block validity rule is not "the first central bank to be established wins", but instead "the central bank with access to the most resources wins". The "Axis of Evil" can rest easy at night.
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hashman
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November 21, 2012, 12:48:21 PM |
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Bitcoin is completely compatible with liberal central bank directed credit creation. The bank just needs to have 51% of hashing power. Then it can charge demurrage and give the demurrage fees to banks to lend out.
Aren't the digital coin-miners already a near-perfect mirror image of central banks? Nearly all of them currently adhere to a gold-like standard called Bitcoin. Instead of printing soft-money as fast as they can, they're all digging for a scarce common resource as fast as they can. There are a few plucky hold-outs -- let's call them the "Axis of Evil" -- who are brazenly trying to subvert the Bitcoin monetary system by making fiats that they will dig for something else instead. Not quite. If the miners could only get their block of currency by making a loan and waiting for the interest payments, your analogy would be better.
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J-Norm
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November 23, 2012, 05:12:51 PM |
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If you give up the idea of fractional reserve lending then a deflationary currency makes perfect sense.
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myrkul
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November 23, 2012, 07:13:36 PM |
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If you give up the idea of fractional reserve lending then a deflationary currency makes perfect sense.
Or at least, give up on the idea that FRB is a good idea.
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J-Norm
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November 23, 2012, 08:42:18 PM |
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Or at least, give up on the idea that FRB is a good idea.
Plenty of currencies manage to do just terrible without any help from the federal reserve bank. Which is neither a bank nor federal.
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MoonShadow
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November 24, 2012, 03:32:07 AM |
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Or at least, give up on the idea that FRB is a good idea.
Plenty of currencies manage to do just terrible without any help from the federal reserve bank. Which is neither a bank nor federal. All of them are centrally managed fractional reserve benking schemes, though. No contrary example persists since the Europeans strongarmed the Swiss into dropping their gold standard.
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"The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank...sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world."
- Carroll Quigley, CFR member, mentor to Bill Clinton, from 'Tragedy And Hope'
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myrkul
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November 24, 2012, 09:25:51 AM |
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Or at least, give up on the idea that FRB is a good idea.
Plenty of currencies manage to do just terrible without any help from the federal reserve bank. Which is neither a bank nor federal. All of them are centrally managed fractional reserve benking schemes, though. No contrary example persists since the Europeans strongarmed the Swiss into dropping their gold standard. Well put, but I meant "fractional reserve banking", anyway....
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sdp
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December 03, 2012, 09:47:44 PM |
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A person's bitcoins are only as secure as the computer system where said coins are stored. Given the number of stolen coins from individuals and services. It seems that a bank might be where people start looking to store their bitcoins for them. They will charge some storage fee and usage fee to use their terminals to make transactions. It will have to be both physically secure like a bank of today and Internet style secure at the same time. Such a business would seem really expensive to run though. Shawn
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Coinsbank: Left money in their costodial wallet for my signature. Then they kept the money.
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molecular
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December 03, 2012, 09:53:48 PM |
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A person's bitcoins are only as secure as the computer system where said coins are stored. Given the number of stolen coins from individuals and services. It seems that a bank might be where people start looking to store their bitcoins for them. They will charge some storage fee and usage fee to use their terminals to make transactions. It will have to be both physically secure like a bank of today and Internet style secure at the same time. Such a business would seem really expensive to run though. Shawn I think hardware wallets are a better solution for securing coins against theft (as an example here the thread about slush and sticks one: https://bitcointalk.org/index.php?topic=122438.msg1317706#msg1317706) and easy to use and also easy to secure against loss. No need to trust a bank.
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PGP key molecular F9B70769 fingerprint 9CDD C0D3 20F8 279F 6BE0 3F39 FC49 2362 F9B7 0769
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mentalove
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December 05, 2012, 01:07:37 AM |
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So how can Bitcoin have a future if it is a deflationary currency with a set in stone number of coins?
The idea that currencies have to be inflationary in nature to succeed is false. Inflation robs purchasing power from savers and transfers the wealth to those given the power to create money. A tool i consider to be unjust and immoral. The world has used gold as money for thousands of years because its purchasing power cannot be inflated away by governments and banks. Gold is mined at roughly the same pace as the increase in world population. Bitcoin does one better, after the cap is reached, holders on bitcoins would see an increase in purchasing power due to their increasing scarcity. my 2 bitcents
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myrkul
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December 05, 2012, 01:31:23 AM |
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The world has used gold as money for thousands of years because its purchasing power cannot be inflated away by governments and banks. Well, not easily, anyway, and when they do, it's easy to spot, or has some significant risks, or both.
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odolvlobo
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December 05, 2012, 04:50:15 AM |
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The world has used gold as money for thousands of years because its purchasing power cannot be inflated away by governments and banks. Gold is mined at roughly the same pace as the increase in world population.
Well, you are forgetting 17th century southern Europe when Spain imported so much plundered gold from the New World that it caused widespread inflation.
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Join an anti-signature campaign: Click ignore on the members of signature campaigns. PGP Fingerprint: 6B6BC26599EC24EF7E29A405EAF050539D0B2925 Signing address: 13GAVJo8YaAuenj6keiEykwxWUZ7jMoSLt
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myrkul
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December 05, 2012, 04:55:52 AM |
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The world has used gold as money for thousands of years because its purchasing power cannot be inflated away by governments and banks. Gold is mined at roughly the same pace as the increase in world population.
Well, you are forgetting 17th century southern Europe when Spain imported so much plundered gold from the New World that it caused widespread inflation. And the gold rush of 1849, which caused an inflationary blip, too. But these things tend to settle out a hell of a lot faster when there's no printing press going full-speed.
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Richy_T
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1RichyTrEwPYjZSeAYxeiFBNnKC9UjC5k
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December 06, 2012, 02:57:30 PM |
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The world has used gold as money for thousands of years because its purchasing power cannot be inflated away by governments and banks. Gold is mined at roughly the same pace as the increase in world population.
Well, you are forgetting 17th century southern Europe when Spain imported so much plundered gold from the New World that it caused widespread inflation. And the gold rush of 1849, which caused an inflationary blip, too. But these things tend to settle out a hell of a lot faster when there's no printing press going full-speed. It's also self-correcting somewhat. Once the price of gold falls in such a scenario, the incentive to mine/conquer more drops greatly
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1RichyTrEwPYjZSeAYxeiFBNnKC9UjC5k
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Adrian-x
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December 06, 2012, 08:04:00 PM |
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And the gold rush of 1849, which caused an inflationary blip, too. But these things tend to settle out a hell of a lot faster when there's no printing press going full-speed.
It's also self-correcting somewhat. Once the price of gold falls in such a scenario, the incentive to mine/conquer more drops greatlyCorrection, - the incentive to mine more increases (motivation for innovation), but one's ability to mine more is diminished by the decrease in value (without innovation). Ones will to mine the same amount for a lower return is diminished, hence in the absence of innovation, mining more gold is diminished and the self-correcting equilibrium is restored.
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Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
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Richy_T
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1RichyTrEwPYjZSeAYxeiFBNnKC9UjC5k
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December 06, 2012, 08:51:04 PM |
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And the gold rush of 1849, which caused an inflationary blip, too. But these things tend to settle out a hell of a lot faster when there's no printing press going full-speed.
It's also self-correcting somewhat. Once the price of gold falls in such a scenario, the incentive to mine/conquer more drops greatlyCorrection, - the incentive to mine more increases (motivation for innovation), but one's ability to mine more is diminished by the decrease in value (without innovation). Ones will to mine the same amount for a lower return is diminished, hence in the absence of innovation, mining more gold is diminished and the self-correcting equilibrium is restored. You put the cart before the horse. The motivation for innovation is to reduce costs. It tends to create an increase in production which in turn suppresses prices (in a properly competitive system).
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1RichyTrEwPYjZSeAYxeiFBNnKC9UjC5k
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Adrian-x
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December 06, 2012, 10:12:49 PM |
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@Richy_T I think it cuts both ways, if you have good profit (or a monopoly) you are not motivated to innovate, if you have a drive for more you are motivated to innovate, or if you have a treat of less you are motivated to innovate.
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Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
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firefop
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December 08, 2012, 12:33:47 PM |
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The world has used gold as money for thousands of years because its purchasing power cannot be inflated away by governments and banks. Gold is mined at roughly the same pace as the increase in world population.
Well, you are forgetting 17th century southern Europe when Spain imported so much plundered gold from the New World that it caused widespread inflation. This raises an interesting questions: Is bitcoin (or something like it) the final nail in coffin of nationalism? Once everyone's using the same money... doesn't that largely remove the need for government beyond the local level?
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MoonShadow
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December 08, 2012, 01:04:34 PM |
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The world has used gold as money for thousands of years because its purchasing power cannot be inflated away by governments and banks. Gold is mined at roughly the same pace as the increase in world population.
Well, you are forgetting 17th century southern Europe when Spain imported so much plundered gold from the New World that it caused widespread inflation. This raises an interesting questions: Is bitcoin (or something like it) the final nail in coffin of nationalism? Once everyone's using the same money... doesn't that largely remove the need for government beyond the local level? By itself, no.
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"The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank...sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world."
- Carroll Quigley, CFR member, mentor to Bill Clinton, from 'Tragedy And Hope'
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