Bitcoin Is Not A Democracy. Then What It Is?

[deisik]

As for the insiders killing it, it is irrelevant. What is relevant is the cost to attack. Because an outsider can just buy enough stake at X cost and become an insider. As for Proof of Work, I believe it is more costly.

Of course not.  On the contrary.  if you want to do a 51% attack on consensus decisions, you need to own 51% of the market cap.  That's MUCH MUCH more of a cost (in bitcoin, it would amount to having to buy up 20 billion $ of coins, but your cornering of the market would make it still much, much more expensive).... in order to destroy the system for which you just paid 20 billion !  No miner is ever going to invest 20 billion in mining equipment, because he will not mine 50% of the stake in block rewards and fees !

Also, the cost of a 51% attack in PoW is just the cost of 51% of the mining rewards, and you don't need to be stake holder.  From the outside, you simply cannot attack a PoS system, because it is based upon much harder to fake digital signatures.
Currently, ALL of the proof of work ever delivered to bitcoin has a security level of 90 bits.  A simple 256 bit key signature has a bit security level of 128 bits, and only costs a few milliwatts of power and an old laptop (or even a mobile phone).

Cryptographically, PoW is pure BS as a protection. Any digital signature beats it with tens of orders of magnitude in "efficiency" (that is, spent resources versus security obtained).

Your arguments are compelling. I do not possess the Cryptography expertise to dismount any of the technical arguments.

I will say this:
 
51% attack in PoW does not only cost 51% of mining rewards. It is not immediate, and it costs all the energy and capital that was put onto it before any ROI.

Furthermore if you consider it is possible to hold a 51% hashpower, if we estimate like a 40% ROI for mining (and I think this is too much considering mining alone), according to current market cap it should cost total about 13.007.185.339,7 USD to achieve a 51% Hashrate. the actual loss of revenue from an attack today would be 2.410.118.399,27 USD Bringing the total to about 15.5 B. 

For a 51% PoS, the cost would be 21.678.642.232,83

This is where your reasoning ultimately fails

Basically, you roughly divide the current market cap of Bitcoin by 2 and get the cost at today's price (since this is what the market cap shows), implicitly assuming that the price will remain the same when you actually start buying 51% of all Bitcoin monetary supply. Nothing could be more false and farther from reality than that. First, not all coins are being traded, I guess, it is somewhere in the range of a few millions (maybe, 3-4 at most), and when you have bought your first million, you will have to spend like 10 times more money to buy the next million of coins (due to prices flying to the moon). Further, you chose to completely ignore my argument that you may never get there at all, no matter how much money you could have since some stake holders may not be going to sell their stakes at any price

[Cuber Krypton]

As for the insiders killing it, it is irrelevant. What is relevant is the cost to attack. Because an outsider can just buy enough stake at X cost and become an insider. As for Proof of Work, I believe it is more costly.

Of course not.  On the contrary.  if you want to do a 51% attack on consensus decisions, you need to own 51% of the market cap.  That's MUCH MUCH more of a cost (in bitcoin, it would amount to having to buy up 20 billion $ of coins, but your cornering of the market would make it still much, much more expensive).... in order to destroy the system for which you just paid 20 billion !  No miner is ever going to invest 20 billion in mining equipment, because he will not mine 50% of the stake in block rewards and fees !

Also, the cost of a 51% attack in PoW is just the cost of 51% of the mining rewards, and you don't need to be stake holder.  From the outside, you simply cannot attack a PoS system, because it is based upon much harder to fake digital signatures.
Currently, ALL of the proof of work ever delivered to bitcoin has a security level of 90 bits.  A simple 256 bit key signature has a bit security level of 128 bits, and only costs a few milliwatts of power and an old laptop (or even a mobile phone).

Cryptographically, PoW is pure BS as a protection. Any digital signature beats it with tens of orders of magnitude in "efficiency" (that is, spent resources versus security obtained).

Your arguments are compelling. I do not possess the Cryptography expertise to dismount any of the technical arguments.

I will say this:
 
51% attack in PoW does not only cost 51% of mining rewards. It is not immediate, and it costs all the energy and capital that was put onto it before any ROI.

Furthermore if you consider it is possible to hold a 51% hashpower, if we estimate like a 40% ROI for mining (and I think this is too much considering mining alone), according to current market cap it should cost total about 13.007.185.339,7 USD to achieve a 51% Hashrate. the actual loss of revenue from an attack today would be 2.410.118.399,27 USD Bringing the total to about 15.5 B. 

For a 51% PoS, the cost would be 21.678.642.232,83

This is where your reasoning ultimately fails

Basically, you roughly divide the current market cap of Bitcoin by 2 and get the cost at today's price (since this is what the market cap shows), implicitly assuming that the price will remain the same when you actually start buying 51% of all Bitcoin monetary supply. Nothing could be more false and farther from reality than that. First, not all coins are being traded, I guess, it is somewhere in the range of a few millions (maybe, 3-4 at most), and when you have bought your first million, you will have to spend like 10 times more money to buy the next million of coins (due to prices flying to the moon). Further, you chose to completely ignore my argument that you may never get there at all, no matter how much money you could have since some stake holders may not be going to sell their stakes at any price

First of all, you mentioned a PoS attack from inside.

This would cost exactly 21.678.642.232,83. A PoS attack from the outside, would cost alot more obviously and might be arguably impossible.

For an outside POW You would need to double the existing Hashrate to acquire 51% of Market Cap.

This would cost 1.793.266,75 USD a day to run based on maintenance rate of Hashing24 or Genesis Mining. The cost to setup, let's consider Antminers S9 selling at 2500 USD on Amazon a piece. Since we would need 5.434.141.693 GH/s, this would mean approximately 388.152 Antminers S9, 970.380.000 USD.

Ignoring Logistics and setup costs this would cost around 1 Billion if we could do this in a day. With nothing to gain. Considering that existing miners already have existing infrastructure, they would also easily increase Hashrate to defend (as the market would for PoS buy-in). An attacker would have not only more cost, but a logistically difficult problem to resolve - immediate supply of Hashing Power. Furthermore, each day it took to get the necessary hashpower would arguably cost around 1M USD considering a 40% ROI.

As opposed, a 51% stake can be acquired virtually hassle free and even "anonimously" using multiple wallets during the course of time.

This considering all participants act in their best interest. Otherwise, a 51% stake always costs market cost. Whereas a 51% hashrate can possibly be bribed for 100 USD depending on the stupidity of the actors involved.

So I grant you are correct in a doomsday scenario where incurring cost to no gain happens. PoS is better security from the outside.

As for the inside all the incentives are there and the Miners can easily defend an outside attack, furthermore, they are logistically invested. It is not easy to divest resources. And their cost to defend is a lot less than that of an outside attacker. Whereas Capital, goes where its most valued pretty easily.

I am still inclined to maintain that I think Proof of Work is economically more sound than Proof of Stake.

[warrior333]

As I see it, bitcoin is more of a meritocracy since voting power for consensus is done by miners whereas end users can only voice their concerns and thoughts about the said idea. Bitcoin isn't democratic even though consensus is achieved via majority decision; the decision is just from the miners who will use x or y version of the fork to move forward.

This is a misconception, because users vote with their money. A miner gets no money if noone buys his coins, and after all, the miner is invested, he started at a loss. Whereas a User, using double-entry accounting, just changed one asset (FIAT) for another (Bitcoin).

The incentive is for miners to follow the user majority. Not the other way around.

There is no one who has bitcoins and is not interested in their existence. Bitcoin has United all people. So I am sure that nothing will happen on 1 August. Bicon intended to establish an entire online economy. This will need to constantly carry out the correction. Democracy can't be punished.

[dinofelis]

On another point, as I have been trying to argue, I think Proof of Work is economically more sound than Proof of Stake. You are effectively being backed by Energy.

This is a wrong use of the notion of "backed".  An asset cannot be backed by WASTE.  If one says that a currency is backed by gold, it means that one can OBTAIN GOLD (of value) against the currency.  One sometimes talks about 'debt-backed money', but in fact, what one wants to point out, is "promise-backed money".  A promise has value (a debt, not).  A mortgage is not debt-backed, it is real-estate-backed.  The mortgage will be honoured in value, and if not, it will be honoured with a REAL HOUSE.  There is economical value to be obtained by a backing.  However, wasted energy doesn't back anything, not more than dog poop does.

Also, for Proof of Stake as a way to mint coins, you are dependent on utility and speculation for your currency to be worth anything. If it is just for consensus, then this last argument doesn't stand.

I think the big error in bitcoin, most crypto, including say, peercoin (the prototype PoS coin), is that they still couple consensus decision with reward (mining, minting...).  In PoW you have no choice: nobody is going to WASTE RESOURCES and prove it, without a compensation, just to help the system come to consensus.  But as PoS doesn't demand a proof of wasted economical value, and only a small computational effort, there's no need to reward it, and minting is a bad idea: minting is what renders PoS unstable ("nothing at stake" problem).

The error committed by most crypto (copied from bitcoin) is the link between coin creation, and consensus decision.  There's no link in fact and consensus decision shouldn't be rewarded with coin creation.

[Lorilikes]

Some likevfo think it is a semi-autonomous self governed peer-to-peer system of digital money.
Decentralized and "not governed" are very different things.  Good topic but you have stumped me.  I will watch this topic! 🙂

[Caelanpelley]

According to Antony Antonopoulos, Bitcoin isn't a democracy, some people call it cypherpunk or crypto-anarchy, https://youtu.be/TC3Hq76UT5g

I don't think Bitcoin is a democracy - rather it is a flat, network-based, collaborative system of super-majority consensus among five constituencies (users, developers, exchanges, merchants, miners), which makes change very difficult. It is a radical decentralization of power. Some people call the politics of this system "cypherpunk," "crypto-anarchy," and other words we don't yet have.

Is bitcoin a meritocracy?

It is holding of power by people selected according to merit. They wield the power.

Rodolfo Novak: Bitcoin is a true technical meritocracy. Cry/Kick/Scream as much as you like, but if your shitty code & ideas aren't good they wont make it

Is bitcoin a plutocracy?

It is the holding of power by the wealthy, elites.

Is bitcoin anarchy?

It is absence of government and absolute freedom of the individual, regarded as a political ideal.

I think people have decided to vote to see if btcoin should grow or not, which is also part of democracy.But in fact, bitcoin is also defined as a decentralized currency, not controlled and operated in the online world.

[deisik]

This is where your reasoning ultimately fails

Basically, you roughly divide the current market cap of Bitcoin by 2 and get the cost at today's price (since this is what the market cap shows), implicitly assuming that the price will remain the same when you actually start buying 51% of all Bitcoin monetary supply. Nothing could be more false and farther from reality than that. First, not all coins are being traded, I guess, it is somewhere in the range of a few millions (maybe, 3-4 at most), and when you have bought your first million, you will have to spend like 10 times more money to buy the next million of coins (due to prices flying to the moon). Further, you chose to completely ignore my argument that you may never get there at all, no matter how much money you could have since some stake holders may not be going to sell their stakes at any price

First of all, you mentioned a PoS attack from inside.

This would cost exactly 21.678.642.232,83. A PoS attack from the outside, would cost alot more obviously and might be arguably impossible

You simply can't claim that

Mainly, for two reasons. First, there is almost no chance that it would cost exactly that (or any other number based entirely on current market cap, i.e. price). If we talk about an "attack" originating from inside, it might in fact cost next to nothing simply because someone (e.g. a coin creator) might have premined 51% of coins at no cost at all. And once again (this is second), you can't call it an attack at all if the owner (major stake holder) voluntarily chooses to close the whole shebang. In all other cases, it won't be an insider business

[Cuber Krypton]

This is where your reasoning ultimately fails

Basically, you roughly divide the current market cap of Bitcoin by 2 and get the cost at today's price (since this is what the market cap shows), implicitly assuming that the price will remain the same when you actually start buying 51% of all Bitcoin monetary supply. Nothing could be more false and farther from reality than that. First, not all coins are being traded, I guess, it is somewhere in the range of a few millions (maybe, 3-4 at most), and when you have bought your first million, you will have to spend like 10 times more money to buy the next million of coins (due to prices flying to the moon). Further, you chose to completely ignore my argument that you may never get there at all, no matter how much money you could have since some stake holders may not be going to sell their stakes at any price

First of all, you mentioned a PoS attack from inside.

This would cost exactly 21.678.642.232,83. A PoS attack from the outside, would cost alot more obviously and might be arguably impossible

You simply can't claim that

Mainly, for two reasons. First, there is almost no chance that it would cost exactly that (or any other number based entirely on current market cap). If we talk about an "attack" originating from inside, it might in fact cost next to nothing simply because someone (e.g. a coin creator) might have premined 51% of coins at no cost at all. And once again (this is second), you can't call it an attack at all if the owner (major stake holder) voluntarily chooses to close the whole shebang. In all other cases, it won't be an insider business

Please. If your coins are worth 21B and you throw them away, no matter how you got them, it costs you 21B. Even if you got them for free it costs you 21B.

The cost has nothing to do with the effect on your Net Worth pre and post coins. It doesn't mean you are poorer. It just means you could be richer.

[deisik]

This is where your reasoning ultimately fails

Basically, you roughly divide the current market cap of Bitcoin by 2 and get the cost at today's price (since this is what the market cap shows), implicitly assuming that the price will remain the same when you actually start buying 51% of all Bitcoin monetary supply. Nothing could be more false and farther from reality than that. First, not all coins are being traded, I guess, it is somewhere in the range of a few millions (maybe, 3-4 at most), and when you have bought your first million, you will have to spend like 10 times more money to buy the next million of coins (due to prices flying to the moon). Further, you chose to completely ignore my argument that you may never get there at all, no matter how much money you could have since some stake holders may not be going to sell their stakes at any price

First of all, you mentioned a PoS attack from inside.

This would cost exactly 21.678.642.232,83. A PoS attack from the outside, would cost alot more obviously and might be arguably impossible

You simply can't claim that

Mainly, for two reasons. First, there is almost no chance that it would cost exactly that (or any other number based entirely on current market cap). If we talk about an "attack" originating from inside, it might in fact cost next to nothing simply because someone (e.g. a coin creator) might have premined 51% of coins at no cost at all. And once again (this is second), you can't call it an attack at all if the owner (major stake holder) voluntarily chooses to close the whole shebang. In all other cases, it won't be an insider business

Please. If your coins are worth 21B and you throw them away, no matter how you got them, it costs you 21B. Even if you got them for free it costs you 21B

Heck, what are you talking about?

I guess you should go find out what the term cost actually means. As per dictionary, the cost is "the amount of money that is needed in order to buy, do, or make it". In this case specifically, cost means how much you paid to be able to close the whole business. If you are the creator and premined 51% of all coins, that would likely cost you only electricity consumed and time spent on developing the coin. Honestly, you are now shamelessly twisting your position so that it could somehow look even remotely plausible while in fact it is completely untenable

[dinofelis]

Cryptographically, PoW is pure BS as a protection. Any digital signature beats it with tens of orders of magnitude in "efficiency" (that is, spent resources versus security obtained).

Who's 'Efficient' Digital signature am I supposed to be trusting ?

Your own !  Or another stakeholder's signature (of which you can, of course, check the validity because it is related to his address).   If a lot of stake holders have signed off successively the validity of all the previous blocks (like miners sign off the validity of previous blocks buy mining on top of it), you can say that all these stake holders have come to consensus that THIS is the list of transactions that are valid, according to the consensus protocol - in exactly the same way that you can say that miners having built blocks on top of one another with PoW, have come to consensus that THAT is the list of transactions that are valid, according to the consensus protocol.

The big difference with mining is that you, as a stake holder, with YOUR full node, are also going to be taking part in the consensus decision if you want to, and you are not at the mercy of miners over which you have nothing to say.  So contrary to the PoW system where full nodes have no consensus decision power (and are hence useless in the decentralization), but can only copy the chain that miners make for them, ALL full nodes with some stake participate in the consensus decision protocol, which makes PoS a much more decentralized system than PoW, because there are no "economies of scale" to be had (apart the few resources to run a full node).  The decentralisation in PoS is exactly equal to the decentralization of ownership of the coins themselves in PoS (and the willingness to participate).

POW is Objective. POS is not.

I wouldn't know what that means.  In what way is the block a PoW miner adds, is objective, and the block a PoS decider adds, would be subjective ?

POW accumulates over time. POS does not. ( I can fake POS history using old spent keys )

PoS accumulates too: the amount of stake that has "signed off" past blocks is accumulating.  You can of course NOT fake PoS with "old spent keys" if the PoS mechanism is defined correctly: only CURRENT stake holders are eligible to be drawn as the "next staker", with probability equal to their stake (or their stake times the coin age since last staking which is better).  In the same way that in PoW, you're supposed to accept the chain with most PoW in it, you're supposed to accept the PoS chain with most accumulated stake in it, which resolves the consensus problem.  Blocks can orphan in the same way they can with PoW, because of network delays.

You are maybe alluding to the "nothing at stake" problem, but that problem goes away if there is no staking reward.  Multiple staking on different branches has an incentive if you want to win minted coins (if ever the branch you didn't multi-stake on, wins in the end, you would have lost a potential minting gain).  But if there's no reward, your ONLY incentive is to keep the system honest, so that your stake doesn't become worthless in the market.  The bigger your stake, the more probable you will be the next staker, and the more you are willing to keep the system honest.  But even if you are dishonest (that is, you orphan other blocks to "reverse transactions" and you are lucky, and are a randomly selected staker at that moment), or you apply different rules in the block), like with PoW, if the NEXT staker (which you can't be with the same stake in any case) wants to be honest, he won't stake on top of YOUR block (in the same way that another miner won't mine on top of an invalid block) because that other staker doesn't want to lose the value of his stake either in the market.   As a staker, you have no incentive to stake on top of a bad block, because there's nothing to win for you in doing so, you can only make the chain dishonest, and have the market of your coins crash.  Why would you ?

[Cuber Krypton]

This is where your reasoning ultimately fails

Basically, you roughly divide the current market cap of Bitcoin by 2 and get the cost at today's price (since this is what the market cap shows), implicitly assuming that the price will remain the same when you actually start buying 51% of all Bitcoin monetary supply. Nothing could be more false and farther from reality than that. First, not all coins are being traded, I guess, it is somewhere in the range of a few millions (maybe, 3-4 at most), and when you have bought your first million, you will have to spend like 10 times more money to buy the next million of coins (due to prices flying to the moon). Further, you chose to completely ignore my argument that you may never get there at all, no matter how much money you could have since some stake holders may not be going to sell their stakes at any price

First of all, you mentioned a PoS attack from inside.

This would cost exactly 21.678.642.232,83. A PoS attack from the outside, would cost alot more obviously and might be arguably impossible

You simply can't claim that

Mainly, for two reasons. First, there is almost no chance that it would cost exactly that (or any other number based entirely on current market cap). If we talk about an "attack" originating from inside, it might in fact cost next to nothing simply because someone (e.g. a coin creator) might have premined 51% of coins at no cost at all. And once again (this is second), you can't call it an attack at all if the owner (major stake holder) voluntarily chooses to close the whole shebang. In all other cases, it won't be an insider business

Please. If your coins are worth 21B and you throw them away, no matter how you got them, it costs you 21B. Even if you got them for free it costs you 21B

Heck, what are you talking about?

I guess you should go find out what the term cost actually means. As per dictionary, the cost is "the amount of money that is needed in order to buy, do, or make it". In this case specifically, cost means how much you paid to be able to close the whole business. If you are the creator and premined 51% of all coins, that would likely cost you only electricity consumed and time spent on developing the coin. Honestly, you are now shamelessly twisting your position so that it could somehow look even remotely plausible while in fact it is completely untenable

Not really. It is simple economic logic. If you build something for 0 that is worth 21B, your earned 21B at no cost. If you then destroy it, you destroyed 21B of your value. Therefore it cost 21B.

I don't see the flaw in this argument

[Krimster]

This is where your reasoning ultimately fails

Basically, you roughly divide the current market cap of Bitcoin by 2 and get the cost at today's price (since this is what the market cap shows), implicitly assuming that the price will remain the same when you actually start buying 51% of all Bitcoin monetary supply. Nothing could be more false and farther from reality than that. First, not all coins are being traded, I guess, it is somewhere in the range of a few millions (maybe, 3-4 at most), and when you have bought your first million, you will have to spend like 10 times more money to buy the next million of coins (due to prices flying to the moon). Further, you chose to completely ignore my argument that you may never get there at all, no matter how much money you could have since some stake holders may not be going to sell their stakes at any price

First of all, you mentioned a PoS attack from inside.

This would cost exactly 21.678.642.232,83. A PoS attack from the outside, would cost alot more obviously and might be arguably impossible

You simply can't claim that

Mainly, for two reasons. First, there is almost no chance that it would cost exactly that (or any other number based entirely on current market cap). If we talk about an "attack" originating from inside, it might in fact cost next to nothing simply because someone (e.g. a coin creator) might have premined 51% of coins at no cost at all. And once again (this is second), you can't call it an attack at all if the owner (major stake holder) voluntarily chooses to close the whole shebang. In all other cases, it won't be an insider business

Please. If your coins are worth 21B and you throw them away, no matter how you got them, it costs you 21B. Even if you got them for free it costs you 21B

Heck, what are you talking about?

I guess you should go find out what the term cost actually means. As per dictionary, the cost is "the amount of money that is needed in order to buy, do, or make it". In this case specifically, cost means how much you paid to be able to close the whole business. If you are the creator and premined 51% of all coins, that would likely cost you only electricity consumed and time spent on developing the coin. Honestly, you are now shamelessly twisting your position so that it could somehow look even remotely plausible while in fact it is completely untenable

Not really. It is simple economic logic. If you build something for 0 that is worth 21B, your earned 21B at no cost. If you then destroy it, you destroyed 21B of your value. Therefore it cost 21B.

I don't see the flaw in this argument

I guess you are thinking about "cost of oportunity". If you use your stake to nuke the coin rather than sell it, you are indeed paying the cost of oportunity. However, do keep in mind that there is no way in Earth that you are actually selling your stash for 51% of the market cap, for the very same reasons that you can't just buy 51% of the coins at market value. The price would drop catastrophically once you start doing it.

[Cuber Krypton]

Only if you sell your whole stack at once. Which there is no need to.

However, this is not cost of opportunity. The cost of opportunity will actually add to this cost. When you compound the return of other investments that could have catered your 21 B. This is in fact, actual cost.

[deisik]

Heck, what are you talking about?

I guess you should go find out what the term cost actually means. As per dictionary, the cost is "the amount of money that is needed in order to buy, do, or make it". In this case specifically, cost means how much you paid to be able to close the whole business. If you are the creator and premined 51% of all coins, that would likely cost you only electricity consumed and time spent on developing the coin. Honestly, you are now shamelessly twisting your position so that it could somehow look even remotely plausible while in fact it is completely untenable

Not really. It is simple economic logic. If you build something for 0 that is worth 21B, your earned 21B at no cost. If you then destroy it, you destroyed 21B of your value. Therefore it cost 21B.

I don't see the flaw in this argument

No, this is nowhere near the case

As I told you before, you are distorting the concepts and twisting the terms so that your "theory" could look somewhat plausible. If you created something for X amount of money (i.e. spent that amount of resources in monetary terms), it cost you exactly that, i.e. X amount of money. If you lose it or intentionally destroy it, your losses would amount only to the costs that you incurred while building or creating it. Your costs simply can't magically turn equal to the current market price of whatever you chose to dispose of. If what you say were even remotely true (i.e. costs would always be equal to market valuation, which is your point), no trade would be possible altogether. Really, why would anyone want to sell anything for no profit at all? In short, stop talking bullshit

[virasog]

What you're talking about is a currency system and a way confirming of the various Network activities  that has nothing to do with voting although consensus does go into the fact of which fork will be used if there's a hard fork. That's really not something that has anything to do with democracy that  I can think of, or any other modal form of government.

[Cuber Krypton]

Heck, what are you talking about?

I guess you should go find out what the term cost actually means. As per dictionary, the cost is "the amount of money that is needed in order to buy, do, or make it". In this case specifically, cost means how much you paid to be able to close the whole business. If you are the creator and premined 51% of all coins, that would likely cost you only electricity consumed and time spent on developing the coin. Honestly, you are now shamelessly twisting your position so that it could somehow look even remotely plausible while in fact it is completely untenable

Not really. It is simple economic logic. If you build something for 0 that is worth 21B, your earned 21B at no cost. If you then destroy it, you destroyed 21B of your value. Therefore it cost 21B.

I don't see the flaw in this argument

No, this is nowhere near the case

As I told you before, you are distorting the concepts and twisting the terms so that your "theory" could look somewhat plausible. If you created something for X amount of money (i.e. spent that amount of resources in monetary terms), it cost you exactly that, i.e. X amount of money. If you lose it or intentionally destroy it, your losses would amount only to the costs that you incurred while building or creating it. Your costs simply can't magically turn equal to the current market price of whatever you chose to dispose of. If what you say were even remotely true (i.e. costs would always be equal to market valuation, which is your point), no trade would be possible altogether. Really, why would anyone want to sell anything for no profit at all? In short, stop talking bullshit

You are mixing Unrealized and Realized gains in the mixture.

But through your rationale, if someone gives you 100 BTC today as a present, and then you lose the Private Key, you would say you lost nothing. It didn't cost you anything. This is only true if you consider BTC doesn't have any value, present or future, unless you realize it in FIAT.

You are thinking about Equity here, not a Currency.

[oegarod]

I feel bitcoin to be democratic, because this has been decentralized from the beginning. So though it's developed by a particular person altogether now the identity is missing. So it's by the people, Secondly the people are the beneficiaries.

[deisik]

Heck, what are you talking about?

I guess you should go find out what the term cost actually means. As per dictionary, the cost is "the amount of money that is needed in order to buy, do, or make it". In this case specifically, cost means how much you paid to be able to close the whole business. If you are the creator and premined 51% of all coins, that would likely cost you only electricity consumed and time spent on developing the coin. Honestly, you are now shamelessly twisting your position so that it could somehow look even remotely plausible while in fact it is completely untenable

Not really. It is simple economic logic. If you build something for 0 that is worth 21B, your earned 21B at no cost. If you then destroy it, you destroyed 21B of your value. Therefore it cost 21B.

I don't see the flaw in this argument

No, this is nowhere near the case

As I told you before, you are distorting the concepts and twisting the terms so that your "theory" could look somewhat plausible. If you created something for X amount of money (i.e. spent that amount of resources in monetary terms), it cost you exactly that, i.e. X amount of money. If you lose it or intentionally destroy it, your losses would amount only to the costs that you incurred while building or creating it. Your costs simply can't magically turn equal to the current market price of whatever you chose to dispose of. If what you say were even remotely true (i.e. costs would always be equal to market valuation, which is your point), no trade would be possible altogether. Really, why would anyone want to sell anything for no profit at all? In short, stop talking bullshit

You are mixing Unrealized and Realized gains in the mixture.

But through your rationale, if someone gives you 100 BTC today as a present, and then you lose the Private Key, you would say you lost nothing. It didn't cost you anything. This is only true if you consider BTC doesn't have any value, present or future, unless you realize it in FIAT

Why are you so consistently trying to distort the meaning of the words?

If someone gave me 100 bitcoins and I lost them all, that would mean only that, i.e. me losing 100 bitcoins, and I would say that I lost 100 bitcoins, as simple as that. But that doesn't in the least mean that they cost me anything in monetary terms (let's assume for simplicity that I just found them to avoid unnecessary complications). Loss and cost are different things, which you seem to be deliberately trying to confuse here, again. Aside from that, costs have nothing to do with either realized or unrealized gains. Open any economic dictionary (or textbook, for that matter) finally and read for yourself. Gain (otherwise known as profit) is the difference between what you received when you sold the coins and what it cost you to obtain them. If this difference is negative it will be a loss. I'm really fascinated that you are still trying to continue this futile argument, or do you really think that having the last word in it will somehow make your point more plausible?

[Cuber Krypton]

Heck, what are you talking about?

I guess you should go find out what the term cost actually means. As per dictionary, the cost is "the amount of money that is needed in order to buy, do, or make it". In this case specifically, cost means how much you paid to be able to close the whole business. If you are the creator and premined 51% of all coins, that would likely cost you only electricity consumed and time spent on developing the coin. Honestly, you are now shamelessly twisting your position so that it could somehow look even remotely plausible while in fact it is completely untenable

Not really. It is simple economic logic. If you build something for 0 that is worth 21B, your earned 21B at no cost. If you then destroy it, you destroyed 21B of your value. Therefore it cost 21B.

I don't see the flaw in this argument

No, this is nowhere near the case

As I told you before, you are distorting the concepts and twisting the terms so that your "theory" could look somewhat plausible. If you created something for X amount of money (i.e. spent that amount of resources in monetary terms), it cost you exactly that, i.e. X amount of money. If you lose it or intentionally destroy it, your losses would amount only to the costs that you incurred while building or creating it. Your costs simply can't magically turn equal to the current market price of whatever you chose to dispose of. If what you say were even remotely true (i.e. costs would always be equal to market valuation, which is your point), no trade would be possible altogether. Really, why would anyone want to sell anything for no profit at all? In short, stop talking bullshit

You are mixing Unrealized and Realized gains in the mixture.

But through your rationale, if someone gives you 100 BTC today as a present, and then you lose the Private Key, you would say you lost nothing. It didn't cost you anything. This is only true if you consider BTC doesn't have any value, present or future, unless you realize it in FIAT

Why are you so consistently trying to distort the meaning of the words?

If someone gave me 100 bitcoins and I lost them, that would mean exactly that, i.e. losing 100 bitcoins, and I would say that I lost 100 bitcoins, as simple as that. But that doesn't in the least mean but they cost me anything in monetary terms (let's assume for simplicity that I just found them to avoid unnecessary complications). Loss and cost are different things, which you seem to be deliberately trying to confuse here, again. Aside from that, costs have nothing to do with either realized or unrealized gains. Open any economic dictionary (or textbook, for that matter) finally and read for yourself. Gain (otherwise known as profit) is the difference between what you received when you sold the coins and what it cost you to obtain them. If this difference is negative it will be a loss. I'm really fascinated that you are still trying to continue this futile argument, or do you really think that having the last word in it will somehow make your point more plausible?

You can keep the last word. Seems pretty straightforward to me where the incentives lie. It can cost 0 Dollars to lose 21 B. So it costs nothing. Seems legit.

[deisik]

Why are you so consistently trying to distort the meaning of the words?

If someone gave me 100 bitcoins and I lost them, that would mean exactly that, i.e. losing 100 bitcoins, and I would say that I lost 100 bitcoins, as simple as that. But that doesn't in the least mean but they cost me anything in monetary terms (let's assume for simplicity that I just found them to avoid unnecessary complications). Loss and cost are different things, which you seem to be deliberately trying to confuse here, again. Aside from that, costs have nothing to do with either realized or unrealized gains. Open any economic dictionary (or textbook, for that matter) finally and read for yourself. Gain (otherwise known as profit) is the difference between what you received when you sold the coins and what it cost you to obtain them. If this difference is negative it will be a loss. I'm really fascinated that you are still trying to continue this futile argument, or do you really think that having the last word in it will somehow make your point more plausible?

You can keep the last word. Seems pretty straightforward to me where the incentives lie. It can cost 0 Dollars to lose 21 B. So it costs nothing. Seems legit.

Indeed, it could cost nothing

If you didn't spend anything to obtain 21 billion dollars' worth of coins, your costs would be effectively equal to 0, so it is perfectly legit. Imagine that someone has sent you 50% plus 1 coin to your wallet, and now you can either destroy the coin or sell the coins. Destroying the coin would mean that you lose a certain amount of some other currency which you could receive if you chose to sell your stash for that currency. But your costs associated with the acquisition of this stash will be the same in either of these cases (read you could destroy the coin in question without spending anything). I guess that should help somehow at last