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Author Topic: Open Letter to GMaxwell and Sincere Rational Core Devs  (Read 33030 times)
prezbo
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March 03, 2017, 03:54:04 PM
 #61

We finally have someone that is willing to discuss the macro-economic implications of bitcoin.  Can everyone else (except theymos) stfu and just let dialogue open?

Sure, now that this isn't in the technical forum anymore I shall unsubscribe because I have no interest in these topics.
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traincarswreck
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March 03, 2017, 03:55:28 PM
 #62



Sure, now that this isn't in the technical forum anymore I shall unsubscribe because I have no interest in these topics.
I told I proposed a communication protocol and we need re-defne core's mandate.  If you think that has not technical implications, you're lost.
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March 03, 2017, 03:57:19 PM
 #63

Can everyone else (except theymos) stfu and just let dialogue open?

if you only want to speak to theymos. send him a PM.


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prezbo
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March 03, 2017, 03:57:44 PM
 #64



Sure, now that this isn't in the technical forum anymore I shall unsubscribe because I have no interest in these topics.
I told I proposed a communication protocol and we need re-defne core's mandate.  If you think that has not technical implications, you're lost.
Not in the bitcoin forum.
traincarswreck
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March 03, 2017, 04:02:23 PM
 #65


You conclusion should be, we cannot approach "type 1" stability, if we destroy bitcoin's properties as a type 2 (ie gold) therefore it is core's mandate to guard bitcoin's type 2 properties as a digital gold.

And if they try to make bitcoin type 1 then it immediately, even by intention, destorys bitcoin's properties as a type 2 (gold)

Could you just clarify what it is you're concerned about regarding core's potential to "destroy" bitcoin's type 2 properties ? (I'm not really up to speed on the original agenda behind this thread - sorry 'bout that - I just became interested because of the monetary analytics).

Surely the only way they could 'destroy' Bitcoin's type-2 properties would be to make its supply variable and subject to liquidity demand ? (i.e. abandon the emission protocol).

anyone that knows anything about keynes/hayek or szabo/nash KNOWS you cannot centrally plan or design a type 1 money in and of itself (any more than you can stir muddy water clean).

Indeed. By that do you mean that diamonds, bundles of grain, gold bars or sea shells do not come with an inbuilt 'central bank' that monitors inflation and adjusts it's own trading rate against goods and services accordingly ?

Therefore, bitcoin - being modelled on an archetype that corresponds to the monetary properties of the items listed above - likeways cannot be coerced into a type 1 (price stability) role ?

Thank you.

For example, it is Ver and Brigade's argument that bitcoin's price and value will die off if the user experience is such that the rising fees cause them to flee.  Therefore, the argument goes, we must scale bitcoin to support a higher tp/s. This will keep the price and value going up.

Is this not an admission of inflation control?

I want to see if we are on the same page, before I speak of how core, even given their unwillingness to bend to a big block hard fork agenda, could also be inflation controlling without manipulating the supply.

See, you have admitted you have haven't thought of it from this angle.  And its IMPORTANT you let everyone know I am making sense.

(shells were great for a time, but probably inflated in various ways for various (biological/social etc.) reasons).

Pyramid block laying, would be a good standard too.  We'll understand this, when we stop supporting silly economic logic.  Why don't we understand how and why the pyramids were built?  Because it was accidentally evolution, there was no central/Keynesian planning involved.
traincarswreck
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March 03, 2017, 04:04:48 PM
 #66

There are some people here, that in the face of true discussion on the macro economic implications of bitcoin, get very agitated and worried, and they will continually make posts that derail the fact that this is relevant and significant to the technical discussion of how to properly scale bitcoin.

They will continue to disrupt and not address the very significant content.

There is something they don't like about seeing REAL arguments being advanced. I wonder what it is they don't like about scientifically founded dialogue?
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March 03, 2017, 04:06:48 PM
 #67

Can everyone else (except theymos) stfu and just let dialogue open?

if you only want to speak to theymos. send him a PM.


I've dealt with this poster, they are THE most ignorant person in the bitcoin space I have come across, they have NOTHING of value to offer this community, and they will continue to troll and troll and disrupt otherwise valuable dialogue.
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March 03, 2017, 04:09:07 PM
 #68

bitcoin's price and value will die off if the user experience is such that the rising fees cause them to flee.  Therefore, the argument goes, we must scale bitcoin to support a higher tp/s. This will keep the price and value going up.

Is this not an admission of inflation control?

no
inflation control is about adding more coins endlessly with no cap.. and LIMITING utility while producing endless coins.
bitcoin is deflationary over time so EXPANDING or limiting utility over time is deflationary control.



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Don't take any information given on this forum on face value. Please do your own due diligence & respect what is written here as both opinion & information gleaned from experience. If you wish to seek legal FACTUAL advice, then seek the guidance of a LEGAL specialist.
traincarswreck
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March 03, 2017, 04:15:14 PM
 #69

no
inflation control is about adding more coins endlessly with no cap.. and LIMITING utility while producing endless coins.
bitcoin is deflationary over time so EXPANDING or limiting utility over time is deflationary control.

Inflation speaks to the manipulation of value, not supply. You petty petty troll. You have nothing to offer this community.
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March 03, 2017, 04:26:58 PM
 #70

no
inflation control is about adding more coins endlessly with no cap.. and LIMITING utility while producing endless coins.
bitcoin is deflationary over time so EXPANDING or limiting utility over time is deflationary control.

Inflation speaks to the manipulation of value, not supply. You petty petty troll. You have nothing to offer this community.

you are not grasping the big picture of economics. you have simply got yourself reading a few articles but not spent time to sit back and let the context and content sink into your mind to understand them. you have just took the words on face value of how you perceive the words mean based on your quick to judge, slow to process personality.

VALUE (up or down, controlled or not controlled) is the RESULT of deflation/inflation. not the mechanism

I DO NOT TRADE OR ACT AS ESCROW ON THIS FORUM EVER.
Don't take any information given on this forum on face value. Please do your own due diligence & respect what is written here as both opinion & information gleaned from experience. If you wish to seek legal FACTUAL advice, then seek the guidance of a LEGAL specialist.
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March 03, 2017, 04:31:13 PM
 #71


For example, it is Ver and Brigade's argument that bitcoin's price and value will die off if the user experience is such that the rising fees cause them to flee...Is this not an admission of inflation control?

I think there are a lot of different dimensions of the problem all tangled up in each other which need ot be decoupled in order to properly prioritise them.

1. PAYMENT SYSTEMS vs STORES OF VALUE

First of all, the user experience and the monetary model are independent of each other IMO. This speaks to the difference between a payment system and a store of value.

People sitting at home watching the value of their bitcoin holdings double in a year could care less about the user experience. On the other hand someone waiting in a checkout queue at the supermarket will not go back to that same supermarket if they're made to wait 5 minutes for their credit card to clear.

This conflict is easily resolved by decoupling payment systems from the store of value that they carry. For example the Visa network lets merchants "get the trade out of the way" in an instant but the clearing time of the underlying capital may take a day or two. That doesn't mean that Visa is now suddenly a new form of money, it's just that it's a trade facilitator.

Cryptocurrency exchanges do the same thing. They perform the trades off-chain so that they are independent of the particular blockchain characteristics of the underlying asset. So, for example if you're on Poloniex, an Ether trade - which has a block time of x seconds can be cleared just as fast as a Bitcoin one which has maybe a 20 minute block time.

2. DEFLATIONARY vs INFLATIONARY MONETARY MODELS

I already posted my more detailed thought on this earlier so there isn't much to add here except to emphasize that - to me - concerns about payment fees and useability are not really part of the monetary model debate. Bitcoin's monetary model is fixed and can't be changed. It's a type 2, deflationary store of value and not designed for price stability. In fact if it was keeping prices stable it wouldn't be doing its job because you couldn't then store value against prices denominated in the prevailing national currency.

3. HARDFORKS vs NO FORKS and the ROGER VER CONCERNS

This is where I think things are more political and subjective. I just think that Roger Ver has confused bitcoin's role as a store of value with its potential to function as a payments system. Although the latter is 'handy', it definitely isn't one of bitcoin's strengths (or any blockchain' strength for that matter). An SQL server can perform far better as a payment system than bitcoin can, however I would say one thing in favour of Ver's arguments which does have a monetary dimension:

That is that the one thing that bitcoin does that no other asset has been able to do hitherto is perform the function of bearer instrument on an electronic network. That is to say you can exchange 2 attributes of the trade instead of just 1:

 • ownership
 • possesion

Gold performed this function in the age of physical markets. It was a "physical bitcoin". But prior to 2009, only ownership could be traded electronically and that was a huge obstacle to global asset trading because you needed the trusted party. That's bitcoin's strength - asset mobility. Doesn't really matter if it takes 20 minutes to confirm from that perspective because the fact that you can do it at all is so huge.

Given that background, however, there is also a "usability issue" to some extent. i.e.people to need to move bitcoin around the place and there are many cases where slow confirmation simply inhibits certain business models so I do think it's an issue, but for useability, not for store of value.

4. MY OPINION

IMHO Ver already has his hardforks - they're called altcoins. They should just leave bitcoin alone because that seems to be what the people who hold it want (those using it as a store of value rather than a payment system). Even though I sympathize with many of Ver's concerns, I don't really see much difference in an altcoin and a bitcoin hardfork that significantly changes its properties. They're both clones effectively.

Another area where he doesn't seem quite consistent is the fact that he says bitcoin should be "for everyone". The problem with that is that any scarce resource is going to be difficult to attain for most people and he's one of the people making it scarce by holding onto a huge chunk of the coin supply. He says he uses it "all the time" but doesn't acknowledged there's a huge difference between the propensity to use it when you have a surplus of it and when you don't. If I had 100,000 bitcoins (or whatever his holding is) I'd be using it "all the time" as well. On the other hand a guy with 0.2 BTC who's hoping it might help him out in his retirement might not be so worried about confirmation times.

It all comes down to WHY people want it and my first point about store of value vs payment systems. Payment systems are a redundant resource (easy to reproduce cheaply), stores of value are not.
traincarswreck
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March 03, 2017, 05:20:53 PM
 #72


For example, it is Ver and Brigade's argument that bitcoin's price and value will die off if the user experience is such that the rising fees cause them to flee...Is this not an admission of inflation control?

This conflict is easily resolved by decoupling payment systems from the store of value that they carry. For example the Visa network lets merchants "get the trade out of the way" in an instant but the clearing time of the underlying capital may take a day or two. That doesn't mean that Visa is now suddenly a new form of money, it's just that it's a trade facilitator.

 Bitcoin's monetary model is fixed and can't be changed. It's a type 2, deflationary store of value and not designed for price stability. In fact if it was keeping prices stable it wouldn't be doing its job because you couldn't then store value against prices denominated in the prevailing national currency.

This is where I think things are more political and subjective. I just think that Roger Ver has confused bitcoin's role as a store of value with its potential to function as a payments system.

Gold performed this function in the age of physical markets. It was a "physical bitcoin". But prior to 2009, only ownership could be traded electronically and that was a huge obstacle to global asset trading because you needed the trusted party. That's bitcoin's strength - asset mobility. Doesn't really matter if it takes 20 minutes to confirm from that perspective because the fact that you can do it at all is so huge.

Given that background, however, there is also a "usability issue" to some extent. i.e.people to need to move bitcoin around the place and there are many cases where slow confirmation simply inhibits certain business models so I do think it's an issue, but for useability, not for store of value.

It all comes down to WHY people want it and my first point about store of value vs payment systems. Payment systems are a redundant resource (easy to reproduce cheaply), stores of value are not.

Ok now that you have sorted you haven't answered my question.  Isn't it try that to try to target bitcoin's usability in order to keep the price up (this is the Ver premise, don't argue it, its a premise), is an admission of inflation control?  What happens when you inflation control money?

What happens when money is subject to political disturbance (hint: inflation)?

You need to address my question so that I can move on to explain how core could easily inadvertently inflate bitcoin without changing the supply. 
toknormal
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March 03, 2017, 05:29:51 PM
 #73


Ok now that you have sorted you haven't answered my question.  Isn't it try that to try to target bitcoin's usability in order to keep the price up (this is the Ver premise, don't argue it, its a premise), is an admission of inflation control?

No. Because price inflation and inflation of the monetary base are two different things. They are not trying to mess with bitcoin's inflation profile, ergo they are not attempting "inflation control".

Bitcoin's useability will have an arbitrary effect on its value. Maybe in the long term it might be good for it to have slow confirmations because people feel it's more 'safe'. Only the market can decide.

Maybe Ver think's he's making it more valuable by making it more useable but that's only one factor in the overall value proposition.

I wouldn't call it "attempting inflation control".
traincarswreck
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March 03, 2017, 05:31:39 PM
 #74


Ok now that you have sorted you haven't answered my question.  Isn't it try that to try to target bitcoin's usability in order to keep the price up (this is the Ver premise, don't argue it, its a premise), is an admission of inflation control?

No. Because price inflation and inflation of the monetary base are two different things. They are not trying to mess with bitcoin's inflation profile, ergo they are not attempting "inflation control".

Bitcoin's useability will have an arbitrary effect on its value. Maybe in the long term it might be good for it to have slow confirmations because people feel it's more 'safe'. Only the market can decide.

Maybe Ver think's he's making it more valuable by making it more useable but that's only one factor in the overall value proposition.

I wouldn't call it "attempting inflation control".

When we speak of inflation, we are speaking of degradation of value.  Please re asses, with the proper definition. 
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March 03, 2017, 05:35:21 PM
 #75


Ok now that you have sorted you haven't answered my question.  Isn't it try that to try to target bitcoin's usability in order to keep the price up (this is the Ver premise, don't argue it, its a premise), is an admission of inflation control?

No. Because price inflation and inflation of the monetary base are two different things. They are not trying to mess with bitcoin's inflation profile, ergo they are not attempting "inflation control".

Bitcoin's useability will have an arbitrary effect on its value. Maybe in the long term it might be good for it to have slow confirmations because people feel it's more 'safe'. Only the market can decide.

Maybe Ver think's he's making it more valuable by making it more useable but that's only one factor in the overall value proposition.

I wouldn't call it "attempting inflation control".

When we speak of inflation, we are speaking of degradation of value.  Please re asses, with the proper definition. 

to add to toknormals point.

trainscarswreck is the one not defining the proper concepts
value=price
value=desire/need

are 2 different things

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March 03, 2017, 05:36:05 PM
 #76


When we speak of inflation, we are speaking of degradation of value.  Please re asses, with the proper definition.

You mean they are trying to control the price by degrading its value ?
traincarswreck
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March 03, 2017, 05:45:16 PM
 #77


You mean they are trying to control the price by degrading its value ?

In Ver's eyes he is trying to control the price/value by increasing the tp/s.  He doesn't distinguish between the two (price and value mean the same to him).

When we speak of inflation, the IMPORTANT consideration is the degradation of value, which the markets will reflect in price.
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March 03, 2017, 05:47:34 PM
 #78



to add to toknormals point.

trainscarswreck is the one not defining the proper concepts
value=price
value=desire/need

are 2 different things
I am not conflating anything. I am sorting out the problems and misunderstanding for the community.  Allow my and toknormals dialogue to unfold.  It take a bit to get on the same page.  But I already did it with Adam Back (it only took a few minutes but slack is a better medium).
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March 03, 2017, 05:57:20 PM
 #79

Core needs to change its mandate to the facilitation of the levation of ideal money. Not the idealization of bitcoin that is irresponsible.  

And we need SCIENTISTS that understand science.

I very hope you are aware that science is only a very poor projection from reality into our very limited human brain?  Even the best and stricted science = math is not even close to explain real life.

You dream of sth ideal that only exists in theory like an ideal gas. There is no ideal in real.


We are dammed to try and experiment and let nature do its work by Darwinism.


Maybe the mixture of all currencies we have incl gold IS close to the ideal. Everybody can decide how much to diversify ( in an ideal political env...).


You can not just fix things from above, you are part of huge community and are dammed to play your role as theoretical 'scientist'. I m happy we have experienced engineers in control.

Carpe diem  -  cut the down side  -  be anti-fragile
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March 03, 2017, 05:57:25 PM
 #80

trainscarswreck obsession with inflation means he is not grasping the basics.

BITCOIN IS DEFLATIONARY

non blockstreamers
as for value(desire/utility)
by increasing its value(utility) you increase value(desire) which increases its value(price)

blockstreamers
by halting its value(utility) and then forcing its value(price) up, with fee filters and coded fee wars. does not mean its value(desire) can sustainably last.

trying to artificially mess with the value(price) to hope it maintains value(desire) is not a sustainable long term. which is where boom and busts/pumps and dumps occur

bitcoin is and always will be DEFLATIONARY which is of value(desire)
having it usable spendable without headache or unknown costs, delays, etc= value(utility) which adds further value(desire). which causes the value(price) to increase sustainably without boom or bust / pump and dump

I DO NOT TRADE OR ACT AS ESCROW ON THIS FORUM EVER.
Don't take any information given on this forum on face value. Please do your own due diligence & respect what is written here as both opinion & information gleaned from experience. If you wish to seek legal FACTUAL advice, then seek the guidance of a LEGAL specialist.
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