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Author Topic: John Nash created bitcoin  (Read 20236 times)
Dorky
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April 13, 2017, 09:30:01 AM
 #201

Again would need to do the maths to be sure, but im fairly convinced the whole design rely on tieing up two opposite for them to work together as a greater whole with a certain global order even if it's composed of two opposite forces.

The two sides are the market/trading/speculation, and the other side, the predictible nature supposed to emerge from it, from the Mining, to keep the chain coherent and secure the transactions.

The two opposing sides are just distractions.

The shadow elites neither understand Taoism nor are practicing Taoist wisdom.

Because they do not practice what they understand/preach, thus they are as good as not practicing any wisdom.

Besides, the shadow elites worship the money god.

Money, no matter how perfect we try to make it to be, will never be perfect.

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April 13, 2017, 09:36:05 AM
 #202


How will you suffer an investment valuation loss if I am correct?

What have I stated which could cause you to make a decision which could potentially cause any loss for you  Huh

What I mean is if you're wrong, then I will suffer investment loss if I listen to you.


What you have stated about transaction fee that gets too high that it locks us out of the blockchain.
What you may not realize is that if that will be the case, then many still holding bitcoin (but is not $billionaire) by that time will have useless bitcoin because they can't spend them as they will never get confirmed.
If that will be so, then why not shift away to the alts soon?
Your comment about that transaction fee gives the wrong impression.

My comment about transaction fee is correct.

But I told you that you don't need to sell BTC until you see the transaction fees rising too much. The fees won't rise overnight. It will be a slow process over the coming years.

Yes you will end up buying an altcoin eventually some years from (or cashing out to some fiat or other asset). You will have no choice.
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April 13, 2017, 09:38:18 AM
 #203

 

I'm sorry about that.  I used to like bitcoin, and I used to believe that it could have been good money.  It turns out it isn't.  But it is a great gambler's token, and it is a great reserve currency for unregulated sleazy big business (but not for the normal user, only for the big sleazy guys).  This is why I don't like it.  I think Satoshi created a monster, and that, together with a lot of technical clumsiness of the design, makes my have some doubts about him being Nash. But I'm not emotionally invested into this.  In other words, when I see the work, I think it cannot be the work of a genius, or at most of a genius in a bad day. Simply because the result doesn't look very well constructed, not because it has something to do with my "world view".  Bitcoin turned out to be clunky and quite ugly.  If you think that a genius created something clunky and quite ugly, be my guest.  I'm just pointing out that for a math genius, things don't add up, and I haven't seen any explanation of why it doesn't add up.  Your "you are wrong" are not arguments, but just expressions of your un-argumented opinion.

I can write a letter to Pythagoras, saying "you are wrong, but you are suffering from cognitive dissonance".  That doesn't disprove Pythagoras' theorem.

If the elements I bring up WERE truly well-thought over, I'm sure that one could explain them clearly to me, or refer to Satoshi explaining them which would even be better.  I haven't looked through all of the documentation, but I have never seen (so maybe I missed it) a convincing analysis countering the indications of clumsy design I mention here *especially on the math and crypto side* which is where we could expect a guy like Nash to be top-level.
The clumsiness and the monster that you describe as a great reserve currency for unregulated sleazy big business (but not for the normal user....is EXACTLY what Nash describes:
Quote
In a large state like one of the "great democracies" it is reasonable to say that the people should be able, in principle, to decide on the form of a money (like a "public utility") that they should be served by, even though most of the actual volume of the use of the money would be out of the hands of the great majority of the people.

Quote
And then the “integration” or “coordination” of those into a global currency would become just a technical problem. (Here I am thinking of a politically neutral form of a technological utility rather than of a money which might, for example, be used to exert pressures in a conflict situation comparable to “the cold war”.)

Quote
Here I think of the possibility that a good sort of international currency might EVOLVE before the time when an official establishment might occur.

Quote
if it were too easy to set up a form of “global money” that the version achieved might have characteristics of inferiority which would make it, compar-atively, more like a relatively inferior national currency

You simply do not understand the role of money in this world, and are a perfect example of why Satoshi never explained what bitcoin truly was.

We are mixing different things here.  Satoshi clearly stated that he intended to have VISA-like transaction volumes on-chain with bitcoin, but that bitcoin would become a semi-centralized served thing.

I already cited that:

http://satoshi.nakamotoinstitute.org/emails/cryptography/2/

Quote
The bandwidth might not be as prohibitive as you think. A typical transaction
would be about 400 bytes (ECC is nicely compact). Each transaction has to be
broadcast twice, so lets say 1KB per transaction. Visa processed 37 billion
transactions in FY2008, or an average of 100 million transactions per day.
That many transactions would take 100GB of bandwidth, or the size of 12 DVD or
2 HD quality movies, or about $18 worth of bandwidth at current prices.
If the network were to get that big, it would take several years, and by then,
sending 2 HD movies over the Internet would probably not seem like a big deal.

From this, I clearly read that the original aim, as announced by Satoshi, was to have VISA like transaction amounts on chain.  100 GB of extra block chain a day didn't seem to scare him in 2008.

The way I understand what Nash is saying in what you put in bold, is not so much that most people should use another KIND of money, but rather that they would use *the same money* but not determine most VOLUME.

In other words, people pay in dollars - the same dollars - as a few rich entities, but the dollar flow between the few rich entities is much, much bigger than the dollar flow between most people.  He's talking about VOLUME, not about KIND.

I read from Satoshi also that he realized that his system would only be viable in the long term in the hands of an oligarchy of miners.

(from the same e-mail):

Quote
Long before the network gets anywhere near as large as that, it would be safe
for users to use Simplified Payment Verification (section Cool to check for
double spending, which only requires having the chain of block headers, or
about 12KB per day. Only people trying to create new coins would need to run
network nodes.
At first, most users would run network nodes, but as the
network grows beyond a certain point, it would be left more and more to
specialists with server farms of specialized hardware
. A server farm would
only need to have one node on the network and the rest of the LAN connects with
that one node.

So much for the P2P nature of bitcoin, which was only intended as a bootstrap with useful idiots.  He clearly didn't care about a long-term P2P network, and the importance of decentralized nodes: he wanted a few big miner nodes, to which people would connect directly, without them even having the ability to download the block chain.  The block chain was just the ledger that a few oligarchs would share amongst them, hopefully keeping one another in check, to serve as the new centralized VISA backbone to which all users would connect.

However, the way bitcoin is evolving, and was actually designed with the 1 MB limit (and other practical limits), is that on chain transactions will be limited to a few big actors and will not reach large scale, but on the other hand, that most people will be able to download a chain with which they cannot do anything apart from contemplating how big guys are filling it with their expensive transactions.

Bitcoin is "rich sleasy business" OWN private money, NOT to be used by normal people, contrary to what Satoshi initially announced.   Bitcoin IS downloadable by anybody, but not usable ; Satoshi announced bitcoin to be usable by anybody, but not downloadable except for a few miner oligarchs.

And why did it become a rich sleazy business money and not a VISA administered by a few miners ?  Because Satoshi put himself a 1MB limit on the block chain.  If he understood the game structure of bitcoin, he would have known that this limit would become immutable because it was needed to generate fees (which he needed for reasons of his diminishing coin creation scheme in the longer term) but then it couldn't turn into a VISA kind of money and he would deny what he had been proposing from the start  - and if he didn't understand the consequences of him introducing a "temporary" 1 MB limit, then he couldn't foresee that it was going to become a rich-business-only crypto either.
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April 13, 2017, 09:45:07 AM
 #204



In regards to John Nash creating Bitcoin I think I could just as well say someone else created it. I don’t think we will ever know for sure.
Absolutely true and intelligent point!  Although on other hand, how many people do you know spent the last 20 years explaining how an international e-currency with a stable supply and asymptotically stabilizing inflation rate would cause a currency war that would eventually end the monopoly on central banks and government ability to issue money?

This is another reason why bitcoin is not corresponding to Nash's ideal money.  Bitcoin has a diminishing DEBASEMENT, and a huge DEFLATION (that is, value appreciation). 

For Nash, it was extremely important that this international currency had zero or low and fixed, inflation, that is VALUE DEPRECIATION.  He accused gold of not being ideal, exactly because it was too much of a collectible, and couldn't adapt supply to keep its value constant.  Bitcoin is based upon sound money doctrine, which is not what Nash considers ideal money, because it doesn't have a stable value, and can't because you cannot have inelastic supply, variable demand, and constant price.  Bitcoin has perfectly inelastic supply (it is programmed in advance), even a diminishing growth rate of his supply.  So this must be a value-appreciating asset, which cannot serve as ideal money with constant value AT ALL.

If it was meant to be a reserve ASSET (not money), then Satoshi has been lying through his teeth, and it doesn't correspond to what Nash called ideal money.
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April 13, 2017, 09:47:24 AM
 #205

My comment about transaction fee is correct.

But I told you that you don't need to sell BTC until you see the transaction fees rising too much. The fees won't rise overnight. It will be a slow process over the coming years.

Yes you will end up buying an altcoin eventually some years from (or cashing out to some fiat or other asset). You will have no choice.

Are you aware there can be 2 scenario playing out?

Scenario A: Fee rises along with bitcoin price within a fixed percentage. So if the percentage is 0.1% and bitcoin price is at $100,000, then the fee will be $100. And if bitcoin price is at $1,000,000, then the fee will be $1,000.

Scenario B: Fee rises regardless of bitcoin price. So if fee is fixed at $1,000 minimum, it will remain at $1,000 (minimum) regardless of whether bitcoin price is at $100,000 or $1,000,000 (or even at $10,000, effectively meaning to say the fee is 10% of transaction value).

Which scenario do you mean will play out? Or is there a scenario C, if so, how will it play out?

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April 13, 2017, 09:47:53 AM
 #206

Hello everyone, it's my first post here.

About the creation of bitcoin, I don't know who created bitcoin (I know who created Tor). But that talk about bitcoin will be just for billionaires, its a valid point, but I doubt it will happen the way you put it.

When I see new coins specialised in anonymity it kind of makes me laugh. There is no anonymity online, there never will be !

The only way for you to be (more) anonymous is to make it more difficult to track you.

That being said, do you really think billionaires will stick to bitcoin and not have a portfolio of at least tens of coins ?

I see the future using only crypto, its obvious for various reasons, whether is litecoin, eth, dash, or even googlecoin or applecoin, or all at the same time. Since blockchain, money will become 100% private and will have to compete with each other, in the market, like any other asset !

This is just the beginning of classic liberalism dream (the opposite of new liberalism), the one planned by former nobel prizes like Friedrich Hayek, Milton Friedman, and others from Chicago and Austrian School of economics. It will be fulfilled

https://youtu.be/QON_CobFPM0
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April 13, 2017, 09:51:52 AM
 #207

I've first heard about John Nash is when I've watched the movie a beautiful mind. Of course the movie is not enough to tell whole of John Nash story but I think he has a paranoid schizophrenia, where he think that something or someone is real.

I don't know if John Nash created Bitcoin but I think he's field is more on game theory and partial differential equations.

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iamnotback
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April 13, 2017, 09:59:31 AM
 #208

Quote from: iamnotback
Besides the shadow elite are apt to love the altcoin I will launch, because they will see it as yet another speculation that falls under Bitcoin's umbrella.

Why would they love a currency that is designed to be truly decentralized? Please be more specific on that.

Because they don't think anything can be. They will view it as another speculation or if necessary something they can capture when needed.

I assume you meant "decentralized". But that leaves us with a dilemma:

a) They think it because they are very smart and proved the impossibility of decentralized currencies before releasing Bitcoin. Though that would mean that your design would turn out as impossible as well. Either because it's impossible as such or because it will finally get captured by them.

b) They didn't prove it and just think (or hope) it. In that case they would be very dumb (and thus cannot be called an "elite") since they must have been aware of the risk that someone would eventually come and fix Bitcoin's flaw of becoming centralized.

@iamnotback: Do you have any thoughts on how to solve that dilemma?

From my deep study of the range of plausible designs for a blockchain consensus system (and I studied much deeper than in than what is contained in that linked thread), I conclude that it is impossible to have a fungible token on a blockchain in which the consensus doesn't become centralized iff the presumption is that the users of the system gain the most value from the system due to its monetary function.

However, I was able to outsmart the global elite, because I realized that if the users of the system gained more value from the system for its non-monetary function and iff that value can't be financed (i.e. its value can be leeched off by control of fungible money), and if I provided a way for the users to provide the Byzantine fault DETECTION as a check-and-balance against the power of the whales and if I provided this in a way that is not democracy and is a crab bucket mentality Nash equilibrium, then I would have defeated the problems with the concept of fungible money.

The elite simply weren't aware of these concepts, because I invented them. Nash didn't know this.

And that is what I intend to launch with BitNet.
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April 13, 2017, 10:00:31 AM
 #209

Again would need to do the maths to be sure, but im fairly convinced the whole design rely on tieing up two opposite for them to work together as a greater whole with a certain global order even if it's composed of two opposite forces.

The two sides are the market/trading/speculation, and the other side, the predictible nature supposed to emerge from it, from the Mining, to keep the chain coherent and secure the transactions.

The two opposing sides are just distractions.

The shadow elites neither understand Taoism nor are practicing Taoist wisdom.

Because they do not practice what they understand/preach, thus they are as good as not practicing any wisdom.

Besides, the shadow elites worship the money god.

Money, no matter how perfect we try to make it to be, will never be perfect.

Depend on what you call "elite" Cheesy

Originally elite is the same root than "elected" and are supposed to emerge as responsible to handle certain things for the other people better than what they would do themselves. Shadow elite in itself is bit an oxymoron.

But if you are talking about money worshiping,  if you study occidental philodophy, it's really classic. It's even the stuff in the first star war trilogy with the federation of trade against jedi council . Well just to say it's very classic abc of philosophy since the beginning and plato wrote many about this.

It's not really about elite, but psychology of the mass and pyramidal nature of society. With gauss curve etc you know very small fraction of person really study math or philosophy or care about law , justice, truth, good & all.

It's really a central question in occidental philosophy since the beginning.

And the idea is always the same that money worshiping or greed, materialism , doesnt lead to wisedom, or idealism. Actually materialism is the enmy of rationality and moral for plato. But majority of people are materialistic, and plato was very aware of this.

And it's just where you get Nash theories with proba and game theory who are made to model this "low end of the pyramid" psychology, and model it as a coherent whole with higher purpose even by taking in account all the economic game theory that animate trader and speculators.

And im not sure the whole demarch would be so coherent coming from plain dumb money worshiping greedy person. Those people just run mining hardware and play on bitrex. They dont design whole system like this in the shadow.
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April 13, 2017, 10:21:06 AM
 #210

I've first heard about John Nash is when I've watched the movie a beautiful mind. Of course the movie is not enough to tell whole of John Nash story but I think he has a paranoid schizophrenia, where he think that something or someone is real.

I don't know if John Nash created Bitcoin but I think he's field is more on game theory and partial differential equations.

Bitcoin is basically two part, one of them is game theory, the other is decentralized transactional database.

Game theory is all about reward vs risk. Bitcoin pow is exactly this. Into maintaining a constant with the risk/reward thing for miner. The risk is the difficulty ( 1/rateof(good nonce)), and reward is the block reward associated with taking the risk associated with finding the good nonce.

The whole mining for reward thing totally fit within game theories.

The other aspect is speculative value, which is something Nash also studied.

Not saying it's Nash who made it, but the model could fit.
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April 13, 2017, 10:24:10 AM
 #211

I've first heard about John Nash is when I've watched the movie a beautiful mind.

The movie contained many lies and misrepresentations of the facts. Read the biography book instead.
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April 13, 2017, 10:52:31 AM
 #212

Satoshi clearly stated that he intended to have VISA-like transaction volumes on-chain with bitcoin, but that bitcoin would become a semi-centralized served thing.

He lied by not mentioning that isn't his intended use case. He was just responding to a question about if Bitcoin could scale from a bandwidth consideration alone. You can find other cases where he lied by not pointing out how impractical something would be, such as how he claimed some nodes would still be willing to process a transaction for free:

When that runs out, the system can support transaction fees if
needed.  It's based on open market competition, and there will
probably always be nodes willing to process transactions for free.

Duplicity is exactly what you'd expect from secret agents working for the global elite.

I read from Satoshi also that he realized that his system would only be viable in the long term in the hands of an oligarchy of miners.

So why can't you add 2+2?

He knows it will become centralized yet some how he thinks hobbyist nodes will still process for free. Satoshi was a liar.

Btw, John Nash was a prankster and deviant.

I was listening to him in an interview and he said he isn't concerned about helping the poor, because he said they are adjusted to their poverty.

So much for the P2P nature of bitcoin, which was only intended as a bootstrap with useful idiots.  He clearly didn't care about a long-term P2P network, and the importance of decentralized nodes:

Now you are starting to understand.

So why can't you add 2+2?

The block chain was just the ledger that a few oligarchs would share amongst them, hopefully keeping one another in check, to serve as the new centralized VISA backbone to which all users would connect.

However, the way bitcoin is evolving, and was actually designed with the 1 MB limit (and other practical limits), is that on chain transactions will be limited to a few big actors and will not reach large scale, but on the other hand, that most people will be able to download a chain with which they cannot do anything apart from contemplating how big guys are filling it with their expensive transactions.

Bitcoin is "rich sleasy business" OWN private money, NOT to be used by normal people, contrary to what Satoshi initially announced.   Bitcoin IS downloadable by anybody, but not usable ; Satoshi announced bitcoin to be usable by anybody, but not downloadable except for a few miner oligarchs.

And why did it become a rich sleazy business money and not a VISA administered by a few miners ?  Because Satoshi put himself a 1MB limit on the block chain.  If he understood the game structure of bitcoin, he would have known that this limit would become immutable because it was needed to generate fees (which he needed for reasons of his diminishing coin creation scheme in the longer term) but then it couldn't turn into a VISA kind of money and he would deny what he had been proposing from the start  - and if he didn't understand the consequences of him introducing a "temporary" 1 MB limit, then he couldn't foresee that it was going to become a rich-business-only crypto either.

Yup. So why can't you admit the evil genius of Satoshi?


Btw, I think it was necessary to murder John Nash before the blockchain scaling debate reached its boiling point. Because by now even people such as yourself are starting to realize something smells funny.
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April 13, 2017, 10:57:35 AM
 #213

Hello everyone, it's my first post here.

...

That being said, do you really think billionaires will stick to bitcoin and not have a portfolio of at least tens of coins ?

Welcome aboard. You have a lot of reading to do. You would be well advised to read my entire archive.
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April 13, 2017, 11:11:59 AM
 #214



In regards to John Nash creating Bitcoin I think I could just as well say someone else created it. I don’t think we will ever know for sure.
Absolutely true and intelligent point!  Although on other hand, how many people do you know spent the last 20 years explaining how an international e-currency with a stable supply and asymptotically stabilizing inflation rate would cause a currency war that would eventually end the monopoly on central banks and government ability to issue money?

This is another reason why bitcoin is not corresponding to Nash's ideal money.  Bitcoin has a diminishing DEBASEMENT, and a huge DEFLATION (that is, value appreciation).  

For Nash, it was extremely important that this international currency had zero or low and fixed, inflation, that is VALUE DEPRECIATION.  He accused gold of not being ideal, exactly because it was too much of a collectible, and couldn't adapt supply to keep its value constant.  Bitcoin is based upon sound money doctrine, which is not what Nash considers ideal money, because it doesn't have a stable value, and can't because you cannot have inelastic supply, variable demand, and constant price.  Bitcoin has perfectly inelastic supply (it is programmed in advance), even a diminishing growth rate of his supply.  So this must be a value-appreciating asset, which cannot serve as ideal money with constant value AT ALL.

If it was meant to be a reserve ASSET (not money), then Satoshi has been lying through his teeth, and it doesn't correspond to what Nash called ideal money.

You are mistaken. By the time Bitcoin reaches its intended use case phase after the global monetary reset 2024ish, Bitcoin's debasement will be winding down.

Also you are causing confusion with your incorrect use of the term deflation. Deflation is an economy-wide phenomenon so would only apply if Bitcoin was the unit-of-account widely employed in the economy. Although it is true that in a few more years, Bitcoin will be causing massive global deflation.

Also Nash specifically wrote that debasement was compatible with his ideal money, as long as the schedule of debasement was non-manipulable (which is the case for Bitcoin).

Eventually the speculative value of Bitcoin will become nil as it becomes the home of $billionaires-only (which btw is mathematically why all the speculative value in the economy will leech off into BTC), then the miners will not longer be able to do these manipulations of the speculative exchange price as they are currently doing with for example Litecoin.
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April 13, 2017, 11:23:09 AM
 #215

There will be digital currencies and they will be regulated like 666, and you won't be able to transact on chain in Bitcoin which won't be regulated.

Satoshi designed it this way and even @dinofelis admits he did, but somehow @dinofelis can't see that such a design forces the masses off chain into the totalitarianism of 666 regulated currencies.


Satoshi designed it that way BY ERROR (or by cheating and lying).  I simply don't think that bitcoin is going to fly so high.  It will find its niche, namely an unregulated reserve currency for big sleazy business, and as a highly speculative toy for gamblers/traders, and that's it.  Bitcoin, nor any other block chain type crypto, will be "the future of money" for most people, simply because it is too clunky, authorities won't let it happen, and in the end, people are material beings.

So, yes, I agree with you that the design of bitcoin is such that it will remain immutable, and that most of the current characteristics of bitcoin are understandable by game-theoretical arguments.

Where I don't agree with you is to think that bitcoin will become world-important - it will remain in a niche.  Like all crypto.  People will never pay their groceries with crypto.  Forget that.  Fiat systems will remain in place as long as humanity is still in command and states exist.

Where I sort of don't agree with you, but I don't care much, is that I have good reasons to think that bitcoin's design has too many clunky crypto design features to be the product of a mind like Nash.  But it could be ; but as, moreover, Bitcoin's monetary philosophy is ALSO not in agreement with Nash ideal money, I tend to reject the hypothesis that Satoshi was Nash.  I tend to think it was a guy with some bright ideas, and some limited crypto and math understanding, and some limited economic understanding, that made bitcoin in his basement.  But I could be wrong.   The "design features" that I find clunky in bitcoin, don't break it, but they are simply clunky.  There's nothing "brilliant" about them.

Where I don't agree with you is that bitcoin is designed by the "global elite" because apart from a gambler's token, it is not going to go anywhere that can interest the "global elite".  The sleazy business it is profiting is not the global elite, but second-hand maffioso.  And if it were, against all odds, designed by the global elite, it is a failure in any case.  Don't stare yourself blind on the "market cap" of bitcoin: that's nothing else but one big huge speculative bubble, driven by greater-fool games.  The economic value of bitcoin (the value creation it allows over its competition: fiat, in economic activity) is most probably 100 times smaller, and dominated by dark web markets, its main economic utility for the moment.  Bitcoin's economic value must at most be a few hundreds of millions of $$ worth ; that is, the value creation it helped create which wouldn't have been possible with fiat because of legal or other obstacles.  The 20 billions are nothing else but greater fool speculators waiting for still greater fools.  If they don't find greater fools after 10 years or 15 years, that bubble will collapse.  But there are still a lot of greater fools to be taken, so as long as the black tulips rise in price, you will find speculators flowing in.  But that is not economic value.  

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April 13, 2017, 11:35:02 AM
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However, I was able to outsmart the global elite, because I realized that if the users of the system gained more value from the system for its non-monetary function and iff that value can't be financed (i.e. its value can be leeched off by control of fungible money), and if I provided a way for the users to provide the Byzantine fault DETECTION as a check-and-balance against the power of the whales and if I provided this in a way that is not democracy and is a crab bucket mentality Nash equilibrium, then I would have defeated the problems with the concept of fungible money.

The elite simply weren't aware of these concepts, because I invented them. Nash didn't know this.

And that is what I intend to launch with BitNet.

Im quite in line with this idea Smiley

In fact my initial idea in seeing blockchain only as distributed ledger lead me to think the whole interest of pow is very limited in this context, and the same result could be achieved in way that are much simpler and less expansive risk, like "fault checking " even if the real pb is not exactly fault checking, but selecting one between two valid version , but even this could be achieved without pow. And the base cost / risk to operate distributed database is not that high.

Maybe there is something im missing.

But it could look as the whole pow thing was just inserted to put some game theory in it, and give it more speculative value or for purely economic reason  ( in the sense market economy) than to really be the most efficient way to keep à decentralized ledger consistent.

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April 13, 2017, 11:39:07 AM
 #217

You are mistaken. By the time Bitcoin reaches its intended use case phase after the global monetary reset 2024ish, Bitcoin's debasement will be winding down.

I don't believe in that "monetary reset".  There will be financial crises, as there always have been.  No big deal.  Crypto won't help.

Quote
Also you are causing confusion with your incorrect use of the term deflation. Deflation is an economy-wide phenomenon so would only apply if Bitcoin was the unit-of-account widely employed in the economy. Although it is true that in a few more years, Bitcoin will be causing massive global deflation.

I use deflation simply in terms of "monetary unit acquires value".  

From wiki:
Quote
In economics, deflation is a decrease in the general price level of goods and services.[1] Deflation occurs when the inflation rate falls below 0% (a negative inflation rate). Inflation reduces the real value of money over time; conversely, deflation increases the real value of money – the currency of a national or regional economy. This allows one to buy more goods and services than before with the same amount of money.

When a monetary unit acquires value, there is deflation of that monetary unit.

Quote
Also Nash specifically wrote that debasement was compatible with his ideal money, as long as the schedule of debasement was non-manipulable (which is the case for Bitcoin).

You can't have it both ways.  You can't require the ideal money unit to keep a stable value (with respect to a large basket) and have its debasement *numerically* specified in advance.  What you can do, is to have strict target rules for debasement to act to reach an inflation target.  In as much as these rules are immutable, they are non-manipulable.

This is why Nash thought of the Euro as close to an asymptotic ideal money:
Quote
John Nash mentioned in his lecture that Euro might become an ideal money in the future, because Euro is used in a large range of places and has a good stability. It is the currency used by the Institutions of the European Union and is the official currency of the eurozone which consists of 18 of the 28 member states of the European Union. In general, Euro has a macroeconomic stability, people in Europe owning large amounts of euros are "served by high stability and low inflation." Moreover, in March 2014, Euro was commented as "an island of stability" by the head of the European Central Bank.

(from the wiki on ideal money).

So, the "schedule of debasement" as a non-manipulable rule to reach the inflation target, yes.  A pre-programmed, blind, debasement scheme: obviously not, because otherwise, the introduced inelasticity cannot guarantee price stability or price inflation stability, which is the defining characteristic of ideal money.  

It is why gold is not a possible ideal money:
Quote
The gold does not reach the standard of ideal money, despite its merits. The main problem is because the silver and gold do not have a constant value all the time. "To the undiscerning minds of the mass of men a pound sterling of gold, a silver five-franc piece, or a paper dollar, represents always a definite unit. It has not escaped attention, however, that a given amount of money buys much less at one time than another."

exactly because one cannot apply a debasement (or destruction) to keep its value constant.

This is the other reason why I don't think it was Nash that created bitcoin: the economic model of ideal money of his hand, would never go for a collectible with DIMINISHING emission.  At best, Nash would have built in an emission curve that would follow predicted adoption (which is essentially impossible in advance): few emission in the beginning, and issuing MORE AND MORE bitcoins as time advances, so as to keep the price of bitcoin constant with growing adoption.

In fact, there would have been a way to do so: instead of increasing difficulty to have constant (and 4-year stepwise decreasing) emission rate, have constant difficulty, compensated by Moore's law.  As such, the price of a bitcoin would more or less remain constant, and equal the cost of the work spent on making them.  You would accept bitcoins against value if it would cost you more to make them, and you would make bitcoins if it would cost you less making them than buying them.

PoW at constant work cost, was a way to implement something much closer to ideal money, than bitcoin's sound money doctrine.

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April 13, 2017, 11:39:55 AM
 #218

There will be digital currencies and they will be regulated like 666, and you won't be able to transact on chain in Bitcoin which won't be regulated.

Satoshi designed it this way and even @dinofelis admits he did, but somehow @dinofelis can't see that such a design forces the masses off chain into the totalitarianism of 666 regulated currencies.

Satoshi designed it that way BY ERROR (or by cheating and lying to make me think he blundered because I am naive as a 12 year old girl).

ftfy

You will eventually realize I am correct. Hopefully realize it before it is too late for you to escape the 666 totalitarianism coming.

I simply don't think that bitcoin is going to fly so high.  It will find its niche, namely an unregulated reserve currency for big sleazy business, and as a highly speculative toy for gamblers/traders, and that's it.

All the $billionaires and $trillionaires will be doing their settlement in BTC.

It will be $500,000 per BTC.

That is obvious.

You don't seem to understand money very well. And I am not going to write a treatise here. It isn't my responsibility to fix your ignorance about money. I say this forcefully because it behooves you to do some learning so you stop spouting off incorrect judgments.

Bitcoin, nor any other block chain type crypto, will be "the future of money" for most people, simply because it is too clunky, authorities won't let it happen, and in the end, people are material beings.

It isn't intended to be used by the masses. It is intended to be used by the $billionaires and they have the most wealth.

So, yes, I agree with you that the design of bitcoin is such that it will remain immutable, and that most of the current characteristics of bitcoin are understandable by game-theoretical arguments.

Where I don't agree with you is to think that bitcoin will become world-important - it will remain in a niche.

Because you don't understand money and what time it is. You don't even understand that your own EU is collapsing into abject totalitarianism.

You are far too smug and overconfident. A well fattened cow ready for the slaughter.

You have a high IQ but you aren't motivated to use it. Because you are too comfortable. The cows don't try to escape, because they have plenty of grass to eat and fields to roam. Yet they do get slaughtered one day.

Like all crypto.  People will never pay their groceries with crypto.  Forget that.  Fiat systems will remain in place as long as humanity is still in command and states exist.

Correct. But entirely irrelevant to what we are discussing. That you don't realize it is irrelevant is indicative of why you are blind to the reality of what is going on.

Where I sort of don't agree with you, but I don't care much,

You don't care much because you are smug and comfortable. Lots of grass to eat.

is that I have good reasons to think that bitcoin's design has too many clunky crypto design features to be the product of a mind like Nash.

You've been refuted upthread but you continue to repeat your errors instead of studying what I taught you and contemplating more deeply on the permutations of what I taught you.

But it could be ; but as, moreover, Bitcoin's monetary philosophy is ALSO not in agreement with Nash ideal money,

I refuted that a few moments earlier upthread. You have so many errors.

Where I don't agree with you is that bitcoin is designed by the "global elite" because apart from a gambler's token, it is not going to go anywhere that can interest the "global elite".

You have entirely ignored everything. Amazing. It is like you have selective reading comprehension. You are clearly in a massive state of cognitive dissonance.

The sleazy business it is profiting is not the global elite, but second-hand maffioso.

Look over the forest, not just at the bark on the trees.

And if it were, against all odds, designed by the global elite, it is a failure in any case.  Don't stare yourself blind on the "market cap" of bitcoin: that's nothing else but one big huge speculative bubble, driven by greater-fool games.

No man. Most BTC is hodling. MAJOR MISTAKE IN ANALYSIS!!

You are way off. Only a very small % of BTC supply is traded on exchanges. The same coins traded over and over again.

The economic value of bitcoin (the value creation it allows over its competition: fiat, in economic activity) is most probably 100 times smaller,

OMG you are really blind.
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April 13, 2017, 11:40:03 AM
 #219


Where I don't agree with you is that bitcoin is designed by the "global elite" because apart from a gambler's token, it is not going to go anywhere that can interest the "global elite".  The sleazy business it is profiting is not the global elite, but second-hand maffioso.  And if it were, against all odds, designed by the global elite, it is a failure in any case.  Don't stare yourself blind on the "market cap" of bitcoin: that's nothing else but one big huge speculative bubble, driven by greater-fool games.  The economic value of bitcoin (the value creation it allows over its competition: fiat, in economic activity) is most probably 100 times smaller, and dominated by dark web markets, its main economic utility for the moment.  Bitcoin's economic value must at most be a few hundreds of millions of $$ worth ; that is, the value creation it helped create which wouldn't have been possible with fiat because of legal or other obstacles.  The 20 billions are nothing else but greater fool speculators waiting for still greater fools.  If they don't find greater fools after 10 years or 15 years, that bubble will collapse.  But there are still a lot of greater fools to be taken, so as long as the black tulips rise in price, you will find speculators flowing in.  But that is not economic value.  



Well if you see this only through the prism of economy this is right.

But if you think more generally in term of propagating "stananist agenda", law of the jungle, irrationnal risk taking for greed, etc, it can still have interest in that view.

And on a bigger perspective it's easy to see how that could benefit "elite" in the sense illuminati/satanists .
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April 13, 2017, 12:08:15 PM
 #220

But to be sure, would need to do the maths lol need to find someone good with proba and algebra and market economy to put the equation together to see if some prectible behavior is supposed to emerge through some factor who is made to be kept constant in the equation, even if it's seemingly random and clumpsy.

I think one is reading too much in what isn't there.  This is how people invent religions, by seeing purpose when there wasn't any.  In my idea, the whole concept was rather simple: Satoshi wanted a non-centralized token transmission system, and needed to solve a few technical, and a few economical problems.  There were already several elements lying on the table and he put them together (which is the merit he really has).

1) He needed to get rid of the "central bank".  The block chain concept, where instead of tokens to be materialized, TRANSACTIONS were the fundamental element, was a great insight.  In as much as it is impossible to prove that transmitted digital tokens aren't double-spent, if everyone has a list of past transactions, that solves the double spending problem.  So the idea was to get all participants to get the full list of all transactions at a point.

2) he then realized that he needed to solve a consensus problem, because of the finite propagation delays on the network: what if some participants received valid transaction A, and other participants received valid transaction B, and A and B are spending the same tokens ?  How to come to a consensus ?

=> he needed a kind of decision game so that at any moment, only one decider was going to decide upon the consensus, that is, the full list of accepted past valid transactions.  As he didn't want (at first) a central authority, he needed a LOTTERY BETWEEN PARTICIPANTS.  However, in order to avoid a sybil attack, he proposed to do the lottery with Proof Of CPU work.  --> a lottery every 10 minutes.

3) he needed also to create coins, and he realized that creating coins was going to give seigniorage which was going to undermine the belief system in the money.  So he (though he had) a brilliant insight:

"the CPU work spent in winning the lottery to determine consensus, is going to be rewarded with new coins ; that looks fair, because 1) a priori everyone gets the belief that they could have won the coins and 2) people doing something useful get rewarded".

That's more or less it.  I don't think Satoshi's insight went beyond that, but that was already quite something.

The rest consisted in:

1) working out the details
2) thinking about the consequences of choices made when working out the details.

One of the things Satoshi was religious about, visibly, was the fact that there should only be a finite amount of coins in circulation.  He must have been influenced by the Austrian school and gold bugs.  In fact, if he could have put them into circulation right away, most probably he would have preferred that, but as he now needed to emit them by people finding consensus, he HAD A SERIOUS PROBLEM: how to reward people in the future when all coins are emitted ?

In order to obtain a finite amount of coins at the end of the universe, he needed to diminish rewards ---> simple solution of block reward halvings.  In order to reward them in the long term, he needed transaction fees. 

In order to limit the coin emission, he needed the lottery to take place only once every 10 minutes, and because he didn't want to rely on real time (in the end, he did!) he invented the scheme of increasing difficulty.

The logical consequence of this was that the economic cost of the PoW at the 10 minute reward was going to rise to be about equal to the market value of the emitted coins.  This would lead to totally crazy amounts of PoW, the rise of specialized hardware, and the killing of the original idea of just "a lottery between participants to decide who was going to decide upon consensus next with Sybil mitigation".

Satoshi's idea of having most payments done with bitcoin led him to understand that the block chain as he designed it, would have to grow at 100 GB a day.

However, as is often the case with inventions, when one sees the consequences that were orthogonal to the original design ideas, the right way is to discard the invention because it fails in implementing what one had in mind ; but most often, one perseveres in modifying the initial design goals so that the invention in which one has a lot of emotional and intellectual investment, ends up suiting the goals.  I think bitcoin has been created exactly that way: when Satoshi realized (partially) that his invention wasn't exactly what he set out to do, but not being able to think of anything better at the moment, he considered that it should go ahead and modified his initial ideas so that they suited the thing he invented.

This is why bitcoin is the clunky thing we see it is, and not the thing Satoshi set out to design, but failed to do so: a digital peer-to-peer trustless, decentralized money and payment system for all to use.

One can of course always think that this clunky thing is what he intended to make, but this is like explaining why God, in his perfection, allows man to make war and allows him to suffer unfairness.  Simply because there wasn't any god, there wasn't any masterplan, but things just happened, and they weren't designed this way or another way.

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