Bitcoin trades the inequity of dynastic power for the inequity of early adoption

[Coincrazy]

Gold has been the go-to (You might even say "standard") medium of exchange for most of human history. It's only recently that it was decoupled from currency, and look where that's lead us.

Off topic, but you might dig this, myrkul:

A history of the precious metals, from the earliest times to the present (1902)

Del Mar spent 20 years working on this book. It originally came out 1880's. Well worth the hang time.

A great collateral benefit from this thread

Thanks for referring to this book

[revans]

There is no basis for thinking bitcoins will take wealth away from the rich, that is absurd and there's no need to start a thread about it. If anything, bitcoin will help the very rich avoid taxes, it won't help the average guy with a monthly wage and matching lifestyle who the government can easily check on.

OP: What you really meant to say in the title is that bitcoin replaces one type of plutocrat with another; 'dynastic' is an inappropriate word to use here. I appreciate that you are practising new words, but if you aren't crystal clear on the definition it is best to use a more common expression or word which you are better familiar with- in this case you could have said something like 'established power.'

You've misunderstood

The dynastic power is the existing setup, with crime families like the Bush's, Rockfeller's and  Rothschild's. Each has wielded great power for generations, thus they can be correctly described as dynasties.

I have, I see. But it's still unclear to me how bitcoin could target influential families.

That scenario would require the collapse of state fiat and Bitcoin becoming the alternative. This is hypothetical of course, but it is what a lot of Bitcoin users hope for.

[revans]

It is interesting to note that as that distributive inequality has turned into a lucrative windfall that attitudes have hardened to what is a fundamental problem.

Maybe we're just getting tired of all the repetitive whining threads that crop up every time someone new feels jealous of the people who got in before them.

Again, you guys really need to grow beyond this ridiculous idea that everyone who has a different view is riven with jealousy. If you missed my post I own a significant number of Bitcoins, and am gradually gifting them to good causes. I want no part in a grubby get rich quick scheme;

[myrkul]

It is interesting to note that as that distributive inequality has turned into a lucrative windfall that attitudes have hardened to what is a fundamental problem.

Maybe we're just getting tired of all the repetitive whining threads that crop up every time someone new feels jealous of the people who got in before them.

Again, you guys really need to grow beyond this ridiculous idea that everyone who has a different view is riven with jealousy. If you missed my post I own a significant number of Bitcoins, and am gradually gifting them to good causes. I want no part in a grubby get rich quick scheme;

This isn't a get rich quick scheme. It's a new currency. The digital equivalent of gold. And you're whining because the people who took the big risks back when it was a big risk have seen gains from that. And hey, if you're interested in distributing the coins evenly, there's an empty wallet in my signature. I promise any coins deposited will go to further the bitcoin economy. Specifically, I'll buy things with them.

[Severian]

A great collateral benefit from this thread

Thanks for referring to this book

Few things make me happier than people finding Del Mar.

From the author's intro:

So long as this state of affairs continues, so long as Individuals in
place of Government retain control of the Monetary Measure, there
can be no real Religion, there can be no real Liberty, there can be no
real National Life. The bases of Religion are Love and Fraternity.
There can be no Fraternity whilst an Unjust Measure is permitted to
introduce discontent and strife into all the transactions of social life.
The basis of Liberty is Justice. There can be no Justice whilst an
Unjust Measure continues to nullify the lessons of wisdom and ex-
perience. The basis of National Life is Political Equality. There
can be no Equality so long as an Unjust Measure continues to rob
the many for the benefit of the few. The control of Weights and
Measures, including Money and the materials of which its symbols are
made, is a prerogative and a necessary prerogative of National Life.
It has been so held by all the Courts of Judicature, by all the ex-
ponents of Law, from Plato to Paulus, from Paulus to Grimaudet,
from Grimaudet to the Mixt Money case, and from the latter to the
decisions of the Supreme Court of the United States.

[revans]

It is interesting to note that as that distributive inequality has turned into a lucrative windfall that attitudes have hardened to what is a fundamental problem.

Maybe we're just getting tired of all the repetitive whining threads that crop up every time someone new feels jealous of the people who got in before them.

This gave me a big grin!

Well put revans!
Trust me myrkul, most early adopters called it jealous whining the first time around!

Here's a hint: if you're here, you're an early adopter.

And if the fact that taking a risk first gets you a bigger reward than taking that risk after it's been proven safe is a "fundamental problem," then I'm afraid it's a fundamental problem with reality, not with Bitcoin.

What risk was there with mining Bitcoins when difficulty was 1?

[revans]

It is interesting to note that as that distributive inequality has turned into a lucrative windfall that attitudes have hardened to what is a fundamental problem.

Maybe we're just getting tired of all the repetitive whining threads that crop up every time someone new feels jealous of the people who got in before them.

Again, you guys really need to grow beyond this ridiculous idea that everyone who has a different view is riven with jealousy. If you missed my post I own a significant number of Bitcoins, and am gradually gifting them to good causes. I want no part in a grubby get rich quick scheme;

This isn't a get rich quick scheme. It's a new currency. The digital equivalent of gold. And you're whining because the people who took the big risks back when it was a big risk have seen gains from that. And hey, if you're interested in distributing the coins evenly, there's an empty wallet in my signature. I promise any coins deposited will go to further the bitcoin economy. Specifically, I'll buy things with them.

You're not a good cause, merely a lost one.

Again I ask. What 'big risk' was undertaken by those mining Bitcoins at the lowest difficulty?

[Severian]

What risk was there with mining Bitcoins when difficulty was 1?

I dunno. Maybe the two years of time and effort that Satoshi put into writing and testing Bitcoin before opening the network to the world in 2009?

He was the only miner at the time.

[myrkul]

What risk was there with mining Bitcoins when difficulty was 1?

The problem with proof-of-work is that in order to make the ledger impeachable, people need to throw real-world value into a hole.

Most notably, that the time and electricity would be wasted if Bitcoin failed.

[revans]

What risk was there with mining Bitcoins when difficulty was 1?

The problem with proof-of-work is that in order to make the ledger impeachable, people need to throw real-world value into a hole.

Most notably, that the time and electricity would be wasted if Bitcoin failed.

Right, so in the beginnings we're talking absolutely negligible.People throw CPU cycles at all kinds of activities more computationally intense than early coin miners and they do not consider themselves to be taking a 'risk'.

[Coincrazy]

So, one of the main arguments I encounter when discussing Bitcoin with its promulgators is that it can potentially free the financial system from the cabal of plutocrats that currently run the show, and who have lavished enormous  wealth on themselves and their cronies. This argument seems to entirely dismiss the actions of the shady cabal who mined huge numbers of Bitcoins when doing so was trivial (and prior to any public availability), and to a lesser extent the early adopters.

When central bankers throw money like confetti at themselves and their friends whilst most others must struggle to earn small amounts of it this is deemed a moral evil. Yet when the progenitors of Bitcoin and their acolytes do much the same; capture the low hanging fruit and leave everyone else fighting over increasingly complex computational scraps this is hailed as a brave new world of financial freedom.

Should Bitcoin ever achieve the kind of ubiquity its most ardent fans hope for, these people will wield more financial power than any of the Banksters they decry. They will also control such a large amount of the monetary base that they too could end up becoming plutocrats

Far from being a revolution, the future as envisaged by Bitcoin fanboys will be little more than a changing of the cast of villains.

Revans I agree partially

Yes. This benefits early adopters . But the makers would not have expected such price swings so if the real libertarians fout against tyranny, those  real libertarians must be feeling sad ...IMHO

However there is a beautiful way to increase equality and reduce crony capitalism..... Develop the next crypto / cyber / virtual currency ...evangelize and make that next one grow....there is place of more than one crypto / virtual currency just as there have been multiple fiats at an time in history

More currencies will make a much larger market and make adoption much more easier and the price much more stable

If currency is a medium of exchange and NOT just a medium of hoarding, why not a second or a third or a fourth .....n th medium ?

There is more than one model car , or one type of vehicle on roads

Any thoughts

At this point I'd take my chances with a new bunch plutocrats over the old ones - even though I know the majority of Bitcoin EAs will hail from the richest parts of the planet, not to mention being young and male - just like me.

However there is a danger of this revolution being like many revolutions before it and not really changing much in the end. This is why I'm generally in favour of progressive change, rather than disruption - it normally leads to better outcomes in the long term.

I've had plenty of wacky thoughts about some of the things I would like to see in an alternative crypto-currency. For example thinking about how might we counter the deflationary aspect (which does serve a purpose for EAs) by either incentivising redistribution in some way beyond selling out for FIAT? I'd like to see a coin that doesn't ultimately favour those with large amount of FIAT to buy up coins and I don't believe the mining mechanisms does that adequately.

Out of all the alternative crypto currencies so far I like PPCoin the most because it is trying to be innovative in a number of ways. I believe we will need a number of crypto-currencies, with a number of different design characteristics to satisfy our needs.

Better the devil you know.

You mean only one devil ? Then that will lead to concentration of devilishness :-)

Have multiple devils ...well make it an open market as they say !!!

The more I am here, the more I think that the social media craze would soon be eclipsed by the fin craze ....just imagine you can really earn by being online ...than just text and message being online ....



Ps ; I understand the venture capitalists are already investing in the next partial crypto partial centrally controlled exchange cum currency cum many things !

[Severian]

Right, so in the beginnings we're talking absolutely negligible

Which publicly funded job do you hold?

[Qoheleth]

The problem with proof-of-work is that in order to make the ledger impeachable, people need to throw real-world value into a hole.

Most notably, that the time and electricity would be wasted if Bitcoin failed.

When the difficulty was 1, the time/electricity cost was trivial. We're talking risking a taco, getting an island.

[alcibiades]

This is precisely why I'm a fan of PPC coin. First, big hardware isn't given as big of a preference in mining. Second, the mining rate levels off at a 1% increase per year, so nobody can ever own a large fixed fraction of all PPC coin for all eternity.

[Qoheleth]

This is precisely why I'm a fan of PPC coin. First, big hardware isn't given as big of a preference in mining. Second, the mining rate levels off at a 1% increase per year, so nobody can ever own a large fixed fraction of all PPC coin for all eternity.

It also doesn't have a cap, right? That's problematic for its own reasons.

[Red]

I'm quoting this post because I'm worried you missed it the first time.

You wrote your post as if you were trying to make a rhetorical point.

The problem with proof-of-work is that in order to make the ledger impeachable, people need to throw real-world value into a hole.

It turns out this is no longer true. Keeping an impeachable ledger is pretty trivial. Lots of industries do it with much less computing power. Preserving the illusion that all that computing power is important, is the primary use of that computer power now.

The unfortunate result is that a lot of people early on in the project got a lot of coins...

The problem is not that they got "a lot of coins". The problem is that they got a large percentage out of a fixed set of coins. Had they gotten a large number of coins out of an unbounded set of coins there would be no problem at all.

So then... what? If this is a troubling result of the network rules, what rules would have worked better? How do you distribute newly created BTC in a "fair" way, when an anonymous system means that Sybil shenanigans are trivial? How do you incentivize mining, except via block rewards?

I'm sincerely interested in hearing your ideas.

Most of the "steady value" models involve generating and destroying coins on an as needed basis. None have been implemented yet (as far as I know) because there isn't a ground swell of interest in creating a currency in which the early adopters don't get rich.

However, for insights you might consider learning about Local Exchange Trading Systems.
http://en.wikipedia.org/wiki/Local_exchange_trading_system

Suppose Alice grows Apples, Bob grows Beans, and Charlie makes Cheese. But none of them have any money.
Now if Bob wants an Apple, but Alice doesn't want Beans, then in a LETS system they agree on a price $1 and Alice gives Bob an Apple. The transaction is accounted for using double entry book keeping. Alice + $1, Bob - $1. With LETS it is OK to have a negative balance (within limits)
Now Alice wants $1 worth of Cheese so Charlie gives it to her. Balances now are:
Alice = 0
Charley = +1
Bob = -1
Finally Charlie wants $1 from Bob so he gives them to him. That puts all balances back at zero again.
No currency exists at the moment, because no currency is needed.
When currency is needed again, it is simply created. A flexible currency supply is indeed a magical thing!

Compare that to Bitcoin.
Say I have a Ferrari and you want to buy my Ferrari but neither of us have Bitcoins.
It should be a transaction that only involves us, it shouldn't make anyone else richer. But with bitcoin, of course, it does.
How do we know how many Bitcoins is a Ferraris worth? Early adopters get to decide. Something about that seems fishy. :-)

[myrkul]

What risk was there with mining Bitcoins when difficulty was 1?

The problem with proof-of-work is that in order to make the ledger impeachable, people need to throw real-world value into a hole.

Most notably, that the time and electricity would be wasted if Bitcoin failed.

Right, so in the beginnings we're talking absolutely negligible.People throw CPU cycles at all kinds of activities more computationally intense than early coin miners and they do not consider themselves to be taking a 'risk'.

Never said it was a big risk. Just that they took it, back when it was a risk, and as a result, they have seen gains.

I don't see a problem with that... but then, I'm a capitalist, not a communist.

[rpietila]

What risk was there with mining Bitcoins when difficulty was 1?

I knew of the opportunity. It would have required a lot of time and effort, and I had mine in better use. I figured out, I could buy them for cheap if they ever gain traction. So here I am. Only now was bitcoin big enough to be worth of my time. The really rich guys are coming soon

Point is, I am not complaining that someone wasted their time mining. If they profit off of it, good. If not, hope they had fun. I still think I am better off NOT mining even though I had the chance.

[revans]

Right, so in the beginnings we're talking absolutely negligible

Which publicly funded job do you hold?

None.

I invest in what people often term 'disruptive' startups with a meaningful underlying technology portfolio. So, yes to D-Wave, no to Facebook.

[revans]

This is precisely why I'm a fan of PPC coin. First, big hardware isn't given as big of a preference in mining. Second, the mining rate levels off at a 1% increase per year, so nobody can ever own a large fixed fraction of all PPC coin for all eternity.

Pity about the name. I just can't see something called 'PP Coin' taking off.