Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

[billyjoeallen]

do we really want Bitcoin to compete with Visa or is there another, possibly more valuable, use case for Bitcoin? What about digital gold? That sounds like an area where Bitcoin could thoroughly outcompete other players in its current state, with little to no change necessary. Why are we targeting to replace payment processors when we could somehow attract the incomparable value that resides in precious metal markets, offshore saving accounts and general safe havens? That sounds like a much more interesting moonshot if you ask me.

Gold has utility value. Even so, it has become a financial backwater. A "barbarous relic".   At least gold can be used for jewelry, dental fillings, electrical connections, etc.  It's been a poor store of value this century.

Bitcoin doesn't even have those advantages. Without the blockchain, Bitcoin is just another crypto and those are in infinite supply. How can a cryptographic token be a store of value without any utility value?  No micropayments? No remittances? no irreversable consumer payments?

The thing about Swiss bank accounts was that they were bank accounts, only secret.  There are several cryptocoins that are better at anonymity: Monero, Dash, etc.

The thing about gold is that it is not in alpha or beta, but has a five thousand year history.  After Gox, Silk Road and all the other thefts and scams, you really think Bitcoin can be seen as a safe haven?  With no utility value?? Are you fucking insane? 

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[DieJohnny]

Sure, easy: Satoshi makes no distinction between miners and nodes.

How is this an error?  The network is composed of nodes.  Some nodes mine, some don't.  (I could also be pedantic and say all nodes mine but some have zero hash power.)  I don't see how this is an error.

This is absolutely an error because it ignores significant game theoric scenarios such as the one we are experiencing now which is that not all miners validate themselves their transactions causing the SPV mining fiasco we've recently experienced.

Let's agree to disagree then.  I don't consider Satoshi's omission of a predication of SPV mining an "error in the white paper."

This is a perfect example of Bitcoin evolving in a way Satoshi did not think of.

I wasn't suggesting that Satoshi foresaw precisely how Bitcoin would evolve.  I was just questioning your/(Danny's) claim that the white paper got "many details wrong."  I'm not aware of a single detail the white paper "got wrong."

I agree that the fact Satoshi does not separate and account for node vs miner right now appears to be significant. Satoshi failing to account for the difference IS an error if not doing so jeopardize the whole model. So time will tell if he got this wrong.

[DieJohnny]

#1 smoking gun problem with Bitcoin, not enough distinct miners make up 75% of hashing power. It is making me want to no longer be a HODLER as I think about it.

[Fatman3001]

I agree that the fact Satoshi does not separate and account for node vs miner right now appears to be significant. Satoshi failing to account for the difference IS an error if not doing so jeopardize the whole model. So time will tell if he got this wrong.

It's not on Satoshi anymore. If it goes belly up it's our fault.

[Peter R]

Sure, easy: Satoshi makes no distinction between miners and nodes.

How is this an error?  The network is composed of nodes.  Some nodes mine, some don't.  (I could also be pedantic and say all nodes mine but some have zero hash power.)  I don't see how this is an error.

This is absolutely an error because it ignores significant game theoric scenarios such as the one we are experiencing now which is that not all miners validate themselves their transactions causing the SPV mining fiasco we've recently experienced.

Let's agree to disagree then.  I don't consider Satoshi's omission of a predication of SPV mining an "error in the white paper."

This is a perfect example of Bitcoin evolving in a way Satoshi did not think of.

I wasn't suggesting that Satoshi foresaw precisely how Bitcoin would evolve.  I was just questioning your/(Danny's) claim that the white paper got "many details wrong."  I'm not aware of a single detail the white paper "got wrong."

I agree that the fact Satoshi does not separate and account for node vs miner right now appears to be significant. Satoshi failing to account for the difference IS an error if not doing so jeopardize the whole model. So time will tell if he got this wrong.

Great point!  I'll agree to your definition: we don't know yet whether his omission to differentiate mining from non-mining nodes was an error.  If the difference between them harms the incentive structure enough that Bitcoin fails to provide (a) double-spend protection, and (b) censorship resistance, then and only then would I agree that it was an error in the design as described by the white paper.  

[sAt0sHiFanClub]

Who wants brg444 coins?

 

Did Fatman sell his account to Lambchop or something?

Why?? Do you think that pointing you out as a fool should be a monopolized industry as well 

[brg444]

We should absolutely avoid the danger of instilling into Bitcoin users some kind of belief that they have a right to free transactions. Nothing in life is free and the costs of security & decentralization cannot forever be externalized to nodes & miners.

In that sense it is perfectly reasonable to suggest we should strive to keep block size limit as close as possible to actual network demand. Flex cap proposals are interesting in this aspect.

Those transactions aren't free for the user even if the miners eat the cost. They STILL have to suffer exchange rate risk while using bitcoin. If they have to pay a fee higher than nominal WHILE BITCOIN IS STILL IN ALPHA, for the vast majority of people, that just isn't worth it. 

Miners have to subsidize transaction costs to bootstrap usage or this baby will die in its crib. That's why you're getting the goddamn block reward. I am the customer. I am the user who buys your fucking coins. What am I getting for my money if I have to take this monster risk and have to pay a fee anyway?  VISA gives me cash back for chrissakes. They are your competition. If you can't beat them, you won't earn their customers.

Don't you small block fuckers know how business works?

 

This post is full of misguided assumptions.

It should come as a rational observation considering the shortcomings you have pointed out that there exist absolutely no incentive to purchase bitcoins to make purchases. No amount of scaling is going to incentivize mainstream consumers to go through such hoops for a low-cost/free transactions as most of the time they don't pay for the transaction anyway, merchants eat them. You are correct that there is absolutely no way for Bitcoin to compete with VISA as a consumer payment processor and again, no amount of blocksize scale is going to change this.

The reasonable thing to ask then is do we really want Bitcoin to compete with Visa or is there another, possibly more valuable, use case for Bitcoin? What about digital gold? That sounds like an area where Bitcoin could thoroughly outcompete other players in its current state, with little to no change necessary. Why are we targeting to replace payment processors when we could somehow attract the incomparable value that resides in precious metal markets, offshore saving accounts and general safe havens? That sounds like a much more interesting moonshot if you ask me.

As is yours. Making the assumption that bitcoin was never intended to be a transaction system is probably the biggest assumption of them all.

Why would I want to use Bitcoin for transactions? 1) I don't have to go to the bank to get a cashiers check or a deal with questions to withdraw cash for my son's college car. 2) As a business owner I loathed paying fees to credit card companies, so I help other businesses as much as possible by using cash, I use bitcoin when they support it because I know the business will take in more money.  

Bitcoin has ALWAYS been a system for transactions, that has never changed, suggesting otherwise is ignoring history and inventing a new future for Bitcoin.

Frankly, I am not really caring where this blocksize debate lands, but being dishonest about Bitcoin and its history with transactions is absurd.

Were do I mention that Bitcoin is not intended for transactions?

There are plenty of legitimate use cases for transactions on the Bitcoin blockchain. The purchase of your son's college car might be a good one. Surely you wouldn't mind paying some extra fees to secure this purchase without having to rely on any third party?

As for your hardships as a business owner I am sorry to hear this but rest assured necessary technology will evolve using Bitcoin as a settlement layer and should be able to accomodate you transactions needs in a more efficient, faster and private way than you could ever hope for on the Bitcoin blockchain.

Suggesting that Bitcoin is better at processing large value transactions should not be interpreted as an assumption that Bitcoin "was never intended to be a transaction system".

[brg444]

do we really want Bitcoin to compete with Visa or is there another, possibly more valuable, use case for Bitcoin? What about digital gold? That sounds like an area where Bitcoin could thoroughly outcompete other players in its current state, with little to no change necessary. Why are we targeting to replace payment processors when we could somehow attract the incomparable value that resides in precious metal markets, offshore saving accounts and general safe havens? That sounds like a much more interesting moonshot if you ask me.

Gold has utility value. Even so, it has become a financial backwater. A "barbarous relic".   At least gold can be used for jewelry, dental fillings, electrical connections, etc.  It's been a poor store of value this century.

Bitcoin doesn't even have those advantages. Without the blockchain, Bitcoin is just another crypto and those are in infinite supply. How can a cryptographic token be a store of value without any utility value?  No micropayments? No remittances? no irreversable consumer payments?

The thing about Swiss bank accounts was that they were bank accounts, only secret.  There are several cryptocoins that are better at anonymity: Monero, Dash, etc.

The thing about gold is that it is not in alpha or beta, but has a five thousand year history.  After Gox, Silk Road and all the other thefts and scams, you really think Bitcoin can be seen as a safe haven?  With no utility value?? Are you fucking insane? 

 

Still don't get it do you.

Discussing gold's "utility" value is absolutely a non-starter. Such a thing was scarcely considered in its history of human adoption as a store-of-wealth.

How can you pretend Bitcoin has no utility value? Censorship resistant deflationary store of wealth is not good enough for you?

You sound like a troll bringing up Gox & Silk Road against Bitcoin. Whatever happened to the people who lost any Bitcoin from these event is entirely up to them. It was their responsibility to properly secure their wealth and by all accounts, against all principles of Bitcoin, they didn't. Too bad for them but fortunately some people are smarter.

At the risk of repeating myself, "a cryptographic token" gains value by attracting trust in its sound economic nature as digital gold. Why is it this trust can not be replicated in just any other altcoins you ask? Because: "Trust is a very organic process which takes an enormous amount of time". Bitcoin has 5 years of history for that trust to build on.

[billyjoeallen]

#1 smoking gun problem with Bitcoin, not enough distinct miners make up 75% of hashing power. It is making me want to no longer be a HODLER as I think about it.

I'm thinking the same thing. I can't decide if these cripplecoiners are really that stupid or just plain evil. My inner conspiracy nut suspects that they are just waiting for us hodlers to dump and then they will suddenly see the light about block size and scalability. 

[brg444]

Who wants brg444 coins?

 

Did Fatman sell his account to Lambchop or something?

Why?? Do you think that pointing you out as a fool should be a monopolized industry as well 

"Speak of the devil...."

[brg444]

#1 smoking gun problem with Bitcoin, not enough distinct miners make up 75% of hashing power. It is making me want to no longer be a HODLER as I think about it.

I'm thinking the same thing. I can't decide if these cripplecoiners are really that stupid or just plain evil. My inner conspiracy nut suspects that they are just waiting for us hodlers to dump and then they will suddenly see the light about block size and scalability. 

You do realize bigger blocks encourage mining centralization don't you?

[billyjoeallen]

Discussing gold's "utility" value is absolutely a non-starter. Such a thing was scarcely considered in its history of human adoption as a store-of-wealth.

That's because no other metal was as recognizable, divisible, rare, etc.  Cryptocoins are all more or less equally fungible, recognizable, divisible, portable and rare.

How can you pretend Bitcoin has no utility value? Censorship resistant deflationary store of wealth is not good enough for you?

ALL cryptocoins are censorship resistant and some are more so and also more deflationary. 


[quote
At the risk of repeating myself, "a cryptographic token" gains value by attracting trust in its sound economic nature as digital gold. Why is it this trust can not be replicated in just any other altcoins you ask? Because: "Trust is a very organic process which takes an enormous amount of time". Bitcoin has 5 years of history for that trust to build on.
[/quote]

At the risk of pointing out the obvious: 5<5000             
also, there are no limits on gold transactions/second.   A throttled network capacity makes Bitcoin digital fool's gold.

At the risk of repeating myself also: Network effects didn't save MySpace.  I'm starting to think all those talking heads on the idiot box who said Bitcoin was too new, experimental and would be replaced by a better crypto  maybe had it right.

[ChartBuddy]

Coin
Explanation

[brg444]

Discussing gold's "utility" value is absolutely a non-starter. Such a thing was scarcely considered in its history of human adoption as a store-of-wealth.

That's because no other metal was as recognizable, divisible, rare, etc.  Cryptocoins are all more or less equally fungible, recognizable, divisible, portable and rare.

That's absolutely not true. For starters, no other coins can rival Bitcoin security which is what basically guarantees its fungibility property. At this point in time, any POW coin that suggests to be a threat by Bitcoin could be trivially attacked by the network of Bitcoin miners.

ALL cryptocoins are censorship resistant and some are more so and also more deflationary.

 

See response above. Bitcoin has an history and infrastructure that cannot be easily replicated.

At the risk of pointing out the obvious: 5<5000              
also, there are no limits on gold transactions/second.   A throttled network capacity makes Bitcoin digital fool's gold.

At the risk of repeating myself also: Network effects didn't save MySpace.  I'm starting to think all those talking heads on the idiot box who said Bitcoin was too new, experimental and would be replaced by a better crypto  maybe had it right.

Yes. Obvious is obvious. In crypto 5 might as well be 5000 when referring to the competition.

Your point about gold's transaction throughput is laughable. The limits on gold transaction and its very real cost is considerable given its physical nature. Even 7 tps accross the world is better than the transportability of gold.

Comparing Bitcoin's network effect to MySpace where there is essentially no cost to the users for switching networks confirms you as just another simple noob. Did you buy this account? You can't have possibly registered in 2011 and utter such idiocy.

[billyjoeallen]

You do realize bigger blocks encourage mining centralization don't you?

We've discussed this ad nauseum. GPU mining caused centralization. Pools caused centralization. ASICS caused centralization.  Capitalism causes centralization because capital increases productivity and there are fewer people with capital than without. The only way around that is to leave the free market and that causes an even worse form of power centralization.
 
Growth causes centralization. I think you know this, but unlike you I think a certain degree of centralization is preferable to no growth.  

[brg444]

You do realize bigger blocks encourage mining centralization don't you?

We've discussed this ad nauseum. GPU mining caused centralization. Pools caused centralization. ASICS caused centralization.  Capitalism causes centralization because capital increases productivity and there are fewer people with capital than without. The only way around that is to leave the free market and that causes an even worse form of power centralization.
 
Growth causes centralization. I think you know this, but unlike you I think a certain degree of centralization is preferable to no growth.  

There is an important distinction. The existing mining centralization comes at little cost to nodes precisely because the blocksize cap is there to limit the resources required to process the blocks mined by miners.

You are perfectly correct that the hash rate centralizing is already a reality but lifting the cap or increasing the limit by too much too soon only precipitate and encourages this phenomenon at the loss of individuals running nodes.

This is important because it increases the cost to access governance of the network and consequently centralizes it into the hands of more wealthy people.

[DieJohnny]

We should absolutely avoid the danger of instilling into Bitcoin users some kind of belief that they have a right to free transactions.

 

This post is full of misguided assumptions.

It should come as a rational observation considering the shortcomings you have pointed out that there exist absolutely no incentive to purchase bitcoins to make purchases.

As is yours. Making the assumption that bitcoin was never intended to be a transaction system is probably the biggest assumption of them all.
 

Were do I mention that Bitcoin is not intended for transactions?

see above

[Fatman3001]

do we really want Bitcoin to compete with Visa or is there another, possibly more valuable, use case for Bitcoin? What about digital gold? That sounds like an area where Bitcoin could thoroughly outcompete other players in its current state, with little to no change necessary. Why are we targeting to replace payment processors when we could somehow attract the incomparable value that resides in precious metal markets, offshore saving accounts and general safe havens? That sounds like a much more interesting moonshot if you ask me.

Gold has utility value. Even so, it has become a financial backwater. A "barbarous relic".   At least gold can be used for jewelry, dental fillings, electrical connections, etc.  It's been a poor store of value this century.

Bitcoin doesn't even have those advantages. Without the blockchain, Bitcoin is just another crypto and those are in infinite supply. How can a cryptographic token be a store of value without any utility value?  No micropayments? No remittances? no irreversable consumer payments?

The thing about Swiss bank accounts was that they were bank accounts, only secret.  There are several cryptocoins that are better at anonymity: Monero, Dash, etc.

The thing about gold is that it is not in alpha or beta, but has a five thousand year history.  After Gox, Silk Road and all the other thefts and scams, you really think Bitcoin can be seen as a safe haven?  With no utility value?? Are you fucking insane? 

 

Still don't get it do you.

Discussing gold's "utility" value is absolutely a non-starter. Such a thing was scarcely considered in its history of human adoption as a store-of-wealth.

How can you pretend Bitcoin has no utility value? Censorship resistant deflationary store of wealth is not good enough for you?

You sound like a troll bringing up Gox & Silk Road against Bitcoin. Whatever happened to the people who lost any Bitcoin from these event is entirely up to them. It was their responsibility to properly secure their wealth and by all accounts, against all principles of Bitcoin, they didn't. Too bad for them but fortunately some people are smarter.

At the risk of repeating myself, "a cryptographic token" gains value by attracting trust in its sound economic nature as digital gold. Why is it this trust can not be replicated in just any other altcoins you ask? Because: "Trust is a very organic process which takes an enormous amount of time". Bitcoin has 5 years of history for that trust to build on.

In other words:

The value of Bitcoin is its utility,
The utility of Bitcoin is its ability to store wealth.

Any alarm bells ringing?

Circular argument, anyone?

[brg444]

We should absolutely avoid the danger of instilling into Bitcoin users some kind of belief that they have a right to free transactions.

 

This post is full of misguided assumptions.

It should come as a rational observation considering the shortcomings you have pointed out that there exist absolutely no incentive to purchase bitcoins to make purchases.

As is yours. Making the assumption that bitcoin was never intended to be a transaction system is probably the biggest assumption of them all.
 

Were do I mention that Bitcoin is not intended for transactions?

see above

I see. Maybe that came off wrong but that wasn't my point. The point being it makes little sense for the average consumer to have to jump through all the hoops of buying bitcoins just to make a purchase. Now don't get me wrong it might serve some niche use cases but this is simply not something you can sell to mainstream consumers, even if they can make 100000000000000 transactions for free.

[brg444]

In other words:

The value of Bitcoin is its utility,
The utility of Bitcoin is its ability to store wealth.

Any alarm bells ringing?

Circular argument, anyone?

Seems like you're twisting things a bit. Maybe I ought to clarify?

The value of Bitcoin is in being deflationary, censorship resistant form of money.

I don't see what's so hard to grasp about this