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Author Topic: BTC Concept & Mining = waste + rich founders. [Proposal: use charity]  (Read 1039 times)
kite
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June 14, 2011, 11:51:38 AM
 #1

I'm a skeptic but please don't ban me for my opinion.

The bitcoin strategy is brilliant for the founders. Creating a decentralized currency is still an interesting endeavor though.

  • Why not back the original value of the currency on something that actually helps people?
  • Why back it on a process that is completely pointless and does nothing but waste electricity & computing power?
  • Why back it on something that will make the founders and early adopters rich when they offload on a bunch of bag holders?
  • Why not back it on something that would engage regular people to take part in it?

I hesitate to use the word "scam" because, either way, it exists now. How long will it last? Who knows. It has novelty, but it has absolutely no appeal to normal people. No one in their right mind would rely on it until it's as safe as an FDIC-backed bank account. Furthermore, I have to imagine the only serious markets propping up actual value are the drug/sex markets. If those should ever disappear or suffer a major 'blow,' then what the heck will prop up the value? Nothing. Who will want to buy into it then?


Seeding Proposal

An alternative currency's mining effort (or "seeded value") should be based on some type of real-world value. The first idea that comes to mind is creating a claim code system linked to major mainstream charities and/or with Kiva.org. It would require an authority to dish out the currency, but only in the beginning.

The process might be something like:

  • Come up with a better "New Currency" standard, artificial scarcity/limit, more secure, still decentralized, etc.
  • Create "New Currency Authority" that donates to mainstream charities with a proof of receipt system that can be verified at the actual charitable org's site, kind of like UPS and their tracking codes (yes, I realize most charities DO NOT implement this; but we're talking ideas that could be created/pushed along in the future)

So then:

  • Random Person wants some New Currency
  • Random Person goes to New Currency Authority and buys some by effectively donating to charity and uses a "salt" tracking phrase if they wish
  • New Currency Authority processes Random Person's money.
  • The Authority donates it to "The Red Cross" (or wherever) and receives a next-gen verification code.
  • The Authority gives Person the bought units in currency (minus a percent of withheld units as a fee, undoubtedly) + the charity's verification code.

The Person now has:

  • at least contributed to something of value
  • the ability to ensure that value by entering the verification code on the charity's web site. The verification stamp would pull up the amount given, date/time, and a "salt" word/phrase that was designated by the user (which would protect against the Authority handing out the same verification code for the same amounts in the same time window)
  • greater stability because the Authority only makes New Currency for themselves when there's increasing buyers and liquidity
  • their decentralized New Currency

+

a system for randomly dispersing certain amounts among everyone who chooses to freely enter that lottery

+

wallets that use more protective security like GPG and have a friendly interface; if a currency stays relegated to the fringe, it'll never have real stability


There's very little waste with the above scenario.

And, hey, at least you know that each coin in the system was the result of some original real-world good -- even if the whole thing someday crashes and burns.

Thoughts?
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June 14, 2011, 12:17:27 PM
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Until you can prove that these suggestions are technically feasible without compromising the security of the blockchain, they remain nothing but pie in the sky ideas. Additionally your "central authority bootstrapping" is ludicrous if you wish for bitcoin to ever be taken seriously as a decentralised currency.
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June 14, 2011, 12:32:04 PM
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If current concept is not attractive to "normal" people, who the hell is speculating on The Mount right now? Vampires?  Tongue
Stephen Gornick
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June 14, 2011, 01:23:03 PM
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Why not back the original value of the currency on something that actually helps people?

Right now hashing is done 6 trillion times a second but only 1 of those hashes over the next ten minutes is actually kept.

You aren't the first to wish there was an alternative that didn't require the 5,999,999,999,999 hashes each second that got tossed or to wish that the fair amount of energy that was consumed to create those hashes wouldn't need to be expended.

Unfortunately, not a single person has proposed a workable alternate method for enabling a decentralized currency.  The proof of work method done through hashing today stands alone in solving the problem.

Would you happen to know another method that has somehow been overlooked thus far?

[edited]

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June 14, 2011, 02:12:44 PM
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"Furthermore, I have to imagine the only serious markets propping up actual value are the drug/sex markets. If those should ever disappear or suffer a major 'blow,' then what the heck will prop up the value? Nothing. Who will want to buy into it then?"

I don't think you are thinking this through. History repeats itself. The economies of DOZENS of countries in the 20th century totally collapsed to the point where it was more economical to burn paper money in stoves than use firewood.

Hungary 1946:
http://upload.wikimedia.org/wikipedia/commons/0/0e/Inflaci%C3%B3_utan_1946.jpg

Germany 1923: Bank notes became so worthless they were used as wallpaper. (and not in a joking way)
http://upload.wikimedia.org/wikipedia/commons/f/ff/Bundesarchiv_Bild_102-00104%2C_Inflation%2C_Tapezieren_mit_Geldscheinen.jpg

Gold vs Deutchmark During Germanys Hyperinflation:
http://upload.wikimedia.org/wikipedia/commons/9/93/German_Hyperinflation.jpg

 I am in no way advocating such activity, but at least do some research before you ignore/downplay the ENORMOUS markets of "drugs" and "sex".

Examples: Las Vegas, the CIA trading cocaine for arms to the contras
http://en.wikipedia.org/wiki/CIA_and_Contras_cocaine_trafficking_in_the_US

I understand the ideas you have, and appreciate them. You should create your own system of currency and if it is better than bitcoins I will invest in it.

-Ansel

October: This is one of the peculiarly dangerous months to speculate in stocks in. The others are July, January, September, April, November, May, March, June, December, August and February.
 - Samuel Langhorne Clemens, Master Riverboat Captain
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June 14, 2011, 07:40:53 PM
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If current concept is not attractive to "normal" people, who the hell is speculating on The Mount right now? Vampires?  Tongue

Yes?
kite
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June 15, 2011, 10:40:40 AM
 #7

Thanks for all the replies!

My point was about keeping a decentralized model but making the seeded, first-time issuing of the currency given to those who provide proofs of charitable donations, in addition to issuing to everyone with an element of lottery/randomness over time. I don't see why it would be any less secure than it is with Bitcoin and all the exchanges that are needed for people who want to buy in.
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June 16, 2011, 12:18:35 AM
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If current concept is not attractive to "normal" people, who the hell is speculating on The Mount right now? Vampires?  Tongue

Yes?

Oh, that explains so much.
Perof
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June 16, 2011, 02:33:28 AM
 #9

Well I like your ideas, but you forget that this is community existing at all is a big step towards the currency you are imagining. I suggest you play along for a bit and see where this project goes. If the ship starts to sink PM me and I'll jump on your new currency, for profit, like the early responders did on this one  Cheesy

Sounds like you want a way to distribute the physical representation of currency through the internet with a means for verifying transactions using reliable third party intermediaries? If you think banks are gonna give up their rackets for charity work and cyber-currency you're dreaming harder than the people who dreamt this place up. Credit unions, maybe, but the idea I think here would be to get something set up so that you can actually walk up to a friend of yours and transmit him a bitcoin (w/e) in exchange for his old stuff, buying a pizza for you, the clothes off his back ect. Then when currency X is widely accepted and traded by people stores might start to ease into the idea and paperless transactions would eventually over take payment in cash and via previous credit scams. As it should.
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