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Author Topic: Everything that was centralized in Bitcoin happened to fail big time.  (Read 3124 times)
freequant
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August 31, 2011, 02:20:11 PM
 #1

Nice small scale simulation of what happens when you give trust and authority to a handful of people.
And this is nothing compared to real life institutions.

If there is one lesson to learn, it is that centralization of power and capital is the source of all evil.
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Lupus_Yonderboy
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August 31, 2011, 03:42:19 PM
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Actually this is what happens in a free market where there is *no* central authority and zero consequences for ripping people off. But keep trying to justify your ideology, its cute in its own way.
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August 31, 2011, 04:11:42 PM
 #3

Actually this is what happens in a free market where there is *no* central authority and zero consequences for ripping people off. But keep trying to justify your ideology, its cute in its own way.

[citation needed]
indio007
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August 31, 2011, 04:17:19 PM
 #4

Actually this is what happens in a free market where there is *no* central authority and zero consequences for ripping people off. But keep trying to justify your ideology, its cute in its own way.

That's right because reality bears that out so well..... Are you seriously high?
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August 31, 2011, 04:20:18 PM
 #5

Actually this is what happens in a free market where there is *no* central authority and zero consequences for ripping people off. But keep trying to justify your ideology, its cute in its own way.

Actually, and this is why we need a higher discussion on a more philosophical level, you are about as dead wrong as one could be. Artistic movements are by definition decentralised, and it is in our nature as humans to embrace them. Whenever some misguided attempt has been made at "centralising" art and giving it direction, it has failed miserably.

Is Bitcoin art? hmmm... In some ways, yes, I guess.
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August 31, 2011, 04:21:13 PM
 #6

Well, you gave him the reaction he wanted. Good job, gentlemen.
freequant
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August 31, 2011, 04:23:55 PM
 #7

Actually this is what happens in a free market where there is *no* central authority and zero consequences for ripping people off. But keep trying to justify your ideology, its cute in its own way.

Decentralized doesn't imply that there is no authority but that the authority is not left in the hands of a single, or a small group, of individuals.
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August 31, 2011, 05:41:56 PM
 #8

Actually this is what happens in a free market where there is *no* central authority and zero consequences for ripping people off. But keep trying to justify your ideology, its cute in its own way.

Decentralized doesn't imply that there is no authority but that the authority is not left in the hands of a single, or a small group, of individuals.

You haven't really countered anything, tons of bitcoins have been stolen already, and more will be stolen. And these people have felt no consequence besides free money.

Where is this mob authority you are speaking of?
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August 31, 2011, 06:03:47 PM
 #9

Actually this is what happens in a free market where there is *no* central authority and zero consequences for ripping people off. But keep trying to justify your ideology, its cute in its own way.

[citation needed]

Source: these forums, every day of the week. It's like a hilarious case study in how hilariously bad laissez-faire economics can fuck lots of people over easily.

Of course, you'll completely ignore everything that happens here and mumble something about Bitcoin markets 'not being free enough' or something being the actual cause, or blaming the centralization which naturally happens.
guywhogotgoxed
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August 31, 2011, 06:08:55 PM
 #10

Yes, Bitcoin ATMs and in person exchanging with cash is needed, if we truly want a decentralized currency. So why is everyone using these large exchanges and online wallets? I believe people will eventually learn not to. Time will tell, and I am eager to see what will be available by the end of this year.
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August 31, 2011, 06:10:12 PM
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Clearly, this is all the work of the Illuminati.

Bitcoin is backed by the full faith and credit of YouTube comments.
Lupus_Yonderboy
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August 31, 2011, 06:26:43 PM
 #12

[citation needed]
That's right because reality bears that out so well..... Are you seriously high?


myBitcoin1
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I could go on, there have been enough scams and ripoffs to fill an entire subforum...and not one person will pay any penalty for the $millions that have been stolen. In fact, the perpetrators of the above crimes are free to do so again and again. There is no authority, there is no justice, no way to get back what has been stolen. But of course soccer moms and grandmas are supposed to learn *nix and secure their wallets offline...because the Bitcoin client can't even reliably encrypt its single most important file. And if they instead trust an online wallet service in a free market with no oversight that rips them off, then it is their fault.

That is the reality of your decentralized free market system in action. If nothing else by the end the Bitcoin project will prove the flaws in the free market theory and why none exist in reality. The ideologues will of course blame it on anything except their failed theories.
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August 31, 2011, 06:32:03 PM
 #13

Nice small scale simulation of what happens when you give trust and authority to a handful of people.
And this is nothing compared to real life institutions.

If there is one lesson to learn, it is that centralization of power and capital is the source of all evil.

What was centralized, though?  The only things that I can see that were put in the control of a few people were put there by the free market.  Are you arguing that somehow the free market needs to be prevented from making such bad decisions?
hugolp
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August 31, 2011, 06:55:31 PM
 #14

myBitcoin1
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I could go on, there have been enough scams and ripoffs to fill an entire subforum...and not one person will pay any penalty for the $millions that have been stolen. In fact, the perpetrators of the above crimes are free to do so again and again. There is no authority, there is no justice, no way to get back what has been stolen. But of course soccer moms and grandmas are supposed to learn *nix and secure their wallets offline...because the Bitcoin client can't even reliably encrypt its single most important file. And if they instead trust an online wallet service in a free market with no oversight that rips them off, then it is their fault.

That is the reality of your decentralized free market system in action. If nothing else by the end the Bitcoin project will prove the flaws in the free market theory and why none exist in reality. The ideologues will of course blame it on anything except their failed theories.

Ok, Im going to bite and tread you like an adult:

On justice:

So you mean that if a private legal and enforcing system the USA (or whatever) government would not have a problem with that and would try to mantain its monopolly? You really meant to say that the fact that there is no private justice is not because the government imposes a monopolly on justice?

On scams:

The BP fiasco where the company polluted the ocean and hurt the health of many many people happened under a government regulated system. The government has stopped any system of market based control and has decided to control anything related to the environment by itself with regulations. Those regulations allowed BP to avoid big compensations to the damnified and will be able to keep operating as they have been in the future. How is this justice?
Lupus_Yonderboy
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August 31, 2011, 07:22:28 PM
 #15

myBitcoin1
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I could go on, there have been enough scams and ripoffs to fill an entire subforum...and not one person will pay any penalty for the $millions that have been stolen. In fact, the perpetrators of the above crimes are free to do so again and again. There is no authority, there is no justice, no way to get back what has been stolen. But of course soccer moms and grandmas are supposed to learn *nix and secure their wallets offline...because the Bitcoin client can't even reliably encrypt its single most important file. And if they instead trust an online wallet service in a free market with no oversight that rips them off, then it is their fault.

That is the reality of your decentralized free market system in action. If nothing else by the end the Bitcoin project will prove the flaws in the free market theory and why none exist in reality. The ideologues will of course blame it on anything except their failed theories.

Ok, Im going to bite and tread you like an adult:

On justice:

So you mean that if a private legal and enforcing system the USA (or whatever) government would not have a problem with that and would try to mantain its monopolly? You really meant to say that the fact that there is no private justice is not because the government imposes a monopolly on justice?

On scams:

The BP fiasco where the company polluted the ocean and hurt the health of many many people happened under a government regulated system. The government has stopped any system of market based control and has decided to control anything related to the environment by itself with regulations. Those regulations allowed BP to avoid big compensations to the damnified and will be able to keep operating as they have been in the future. How is this justice?

On justice:

I simply mean to say that in an unregulated environment such as we have here, there is no justice available, private or otherwise. Given the nature of bitcoin, I doubt there ever can be. This does have a bit of a chilling effect on adoption by people who are risk adverse. It will ultimately be one the reasons that widespread adoption fails.

On BP:

The BP fiasco happened because many of the regulators were/are too close to the ones they are supposed to be monitoring. It came out afterward that BP filled out many of its own inspection reports, including the ones on the failed blowout preventer. The oil industry is one of the ones more rife with corruption in the world and it was that corruption along with their not following the regulations that resulted in the massive amount of damage that happened. The laws limiting the damages were put there by politicians that were paid lots of money to do so after Exxon-Valdez. It is not justice, though why you pulled that specific example out in this thread is confusing.


In a regulated environment if Dwolla, or Paypal, or another similar company shuts down, their customers have legal recourse that they can pursue in an attempt to get some or all of their money back. In fact any of the brokers and forex exchanges are required to have enough money on hand to cover all of their customer accounts at any time. If Tradehill, or MtG or any of the other Bitcoin exchanges/businesses shut down, their customers have *no* way to attempt to get anything back, as the users of Mybitcoin are painfully finding out. That is one of the differences between having a regulated and unregulated market.
d'aniel
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August 31, 2011, 07:36:35 PM
 #16

I simply mean to say that in an unregulated environment such as we have here, there is no justice available, private or otherwise. Given the nature of bitcoin, I doubt there ever can be.
There is with cash, and it's more anonymous than Bitcoin.

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The BP fiasco happened because many of the regulators were/are too close to the ones they are supposed to be monitoring. It came out afterward that BP filled out many of its own inspection reports, including the ones on the failed blowout preventer. The oil industry is one of the ones more rife with corruption in the world and it was that corruption along with their not following the regulations that resulted in the massive amount of damage that happened. The laws limiting the damages were put there by politicians that were paid lots of money to do so after Exxon-Valdez. It is not justice, though why you pulled that specific example out in this thread is confusing.
I think it's probably wise to expect this kind of thing from the system we have.  It's just the nature of the incentives, and you can see it play out this way in all different industries - the financial industry being the most glaring.
hugolp
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August 31, 2011, 07:55:00 PM
 #17

On justice:

I simply mean to say that in an unregulated environment such as we have here, there is no justice available, private or otherwise. Given the nature of bitcoin, I doubt there ever can be. This does have a bit of a chilling effect on adoption by people who are risk adverse. It will ultimately be one the reasons that widespread adoption fails.

But what you are saying is not true. Even if you operate in bitcoins you are protected by the legal system of the country you live on. With the MyBitcoin fiasco someone in the forum has explained that he reported to the FBI, but nothing has happened. Well, thats the kind of protection you get from the government monopoly. I dont understand how you can defend that system.

I believe that under a competitive justice system you would get much better service, but as anything in social science there is uncertainty about it. But what we can be sure is that the system you defend is not working.

Quote
On BP:

The BP fiasco happened because many of the regulators were/are too close to the ones they are supposed to be monitoring. It came out afterward that BP filled out many of its own inspection reports, including the ones on the failed blowout preventer. The oil industry is one of the ones more rife with corruption in the world and it was that corruption along with their not following the regulations that resulted in the massive amount of damage that happened. The laws limiting the damages were put there by politicians that were paid lots of money to do so after Exxon-Valdez.

Yes, but this is exactly how regulations and the regulatory system works. Having regulations does not mean having some angels coming from the sky to take care of us faliable humans. It means having limited and corruptable humans with monopolly power. And the net results of regulations are always benefiting big companies and hurting the little guy, exactly like the BP case.

Quote
It is not justice, though why you pulled that specific example out in this thread is confusing.


In a regulated environment if Dwolla, or Paypal, or another similar company shuts down, their customers have legal recourse that they can pursue in an attempt to get some or all of their money back.

No. In a regulated environment the big players of the industry get to pass regulations that allow them to cheat the consumers. Thats how regulations work. The rest are just excuses.

Quote
In fact any of the brokers and forex exchanges are required to have enough money on hand to cover all of their customer accounts at any time. If Tradehill, or MtG or any of the other Bitcoin exchanges/businesses shut down, their customers have *no* way to attempt to get anything back, as the users of Mybitcoin are painfully finding out. That is one of the differences between having a regulated and unregulated market.

Well, since you mention MyBitcoin, a Bitcoin bank, let me mention that we are in a depression were there has been record of bank failures under a regulated environment. According to your way of thinking it should not be happening. But its happening.

Regulations dont work how you think they work.
Lupus_Yonderboy
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August 31, 2011, 08:29:15 PM
 #18

But what you are saying is not true. Even if you operate in bitcoins you are protected by the legal system of the country you live on. With the MyBitcoin fiasco someone in the forum has explained that he reported to the FBI, but nothing has happened. Well, thats the kind of protection you get from the government monopoly. I dont understand how you can defend that system.

I believe that under a competitive justice system you would get much better service, but as anything in social science there is uncertainty about it. But what we can be sure is that the system you defend is not working.

No you are most certainly not protected. Because bitcoins are not regulated by any governments. You get as much protection as if somebody stole your ISK, or WOW gold. Less actually, since you have no central authority to go to. If governments recognized bitcoin as being an actual currency, or as having value, things would chang. Bitcoins would also be taxed, but part of the taxing bit means you get the protection. Right now you pay no taxes, why should they expend their resources in helping you? A private justice system could not operate for free, either.

Quote
Yes, but this is exactly how regulations and the regulatory system works. Having regulations does not mean having some angels coming from the sky to take care of us faliable humans. It means having limited and corruptable humans with monopolly power. And the net results of regulations are always benefiting big companies and hurting the little guy, exactly like the BP case.

You fail to realize that it is the big companies that continually push for *less* regulation. BP, Exxon, etc are always trying to either undermine or repeal any environmental regulations possible. The sad part is that they have conned a whole subset of people into believing that less regulation is better.

Quote
No. In a regulated environment the big players of the industry get to pass regulations that allow them to cheat the consumers. Thats how regulations work. The rest are just excuses.

You fail to realize that it is the big companies that continually push for *less* regulation. BP, Exxon, etc are always trying to either undermine or repeal any environmental regulations possible. Same with the banks and financial regulations. The sad part is that they have conned a whole subset of people into believing that less regulation is better.


Quote
Well, since you mention MyBitcoin, a Bitcoin bank, let me mention that we are in a depression were there has been record of bank failures under a regulated environment. According to your way of thinking it should not be happening. But its happening.

Regulations dont work how you think they work.

In the US we have a program called the FDIC, it means the Federal Deposit Insurance Corporation. If a bank fails, the FDIC steps in and makes sure that all the depositors get their money bank (up to $200,000 I think)...Not 1 person who had an account under that limit lost a single penny at any bank that has failed in the US since the FDIC was formed 70 years ago. That is regulation in action.

I think that regulations work a lot better than you think, and it saddens me that you and so many others have been brainwashed by the very people you attack into believing that less regulation is better. There is such a thing as too much regulation, of course. But no regulation is not an acceptable solution.
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August 31, 2011, 08:37:05 PM
 #19

...It's almost as if Economic situations gravitate towards centralisation since it offers easier use for everyone involved...
hugolp
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August 31, 2011, 08:42:39 PM
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No you are most certainly not protected. Because bitcoins are not regulated by any governments. You get as much protection as if somebody stole your ISK, or WOW gold. Less actually, since you have no central authority to go to. If governments recognized bitcoin as being an actual currency, or as having value, things would chang. Bitcoins would also be taxed, but part of the taxing bit means you get the protection. Right now you pay no taxes, why should they expend their resources in helping you? A private justice system could not operate for free, either.

You are wrong.

1. Even if you pay on bitcoins you are required to pay taxes. Whether its enforceable and you do it is another issue.
2. Theft is not permited, and that its independent of on what you pay taxes.

I feel you need to try harder and talk of things you know and understand.

Quote
You fail to realize that it is the big companies that continually push for *less* regulation. BP, Exxon, etc are always trying to either undermine or repeal any environmental regulations possible. The sad part is that they have conned a whole subset of people into believing that less regulation is better.

Again, you are wrong. Companies push for whatever they want, but usually it means MORE regulations. Thats the reason why in each of the last decades the regulations in the USA have increased.

Yes, despite of what the official propaganda says (and you obviously believe), if you check the data you will see that regulations have increased in each of the last decades in the USA. The deregulation myth is just that, a myth. Please dont believe me, just go and check the data.

Quote
You fail to realize that it is the big companies that continually push for *less* regulation. BP, Exxon, etc are always trying to either undermine or repeal any environmental regulations possible. Same with the banks and financial regulations. The sad part is that they have conned a whole subset of people into believing that less regulation is better.

Again, not true. As net result companies push for more regulations. The sad part is that they have educated a bunch of kids that grow into disfunctional adults into believing that regulations are for their protection.


Quote
In the US we have a program called the FDIC, it means the Federal Deposit Insurance Corporation. If a bank fails, the FDIC steps in and makes sure that all the depositors get their money bank (up to $200,000 I think)...Not 1 person who had an account under that limit lost a single penny at any bank that has failed in the US since the FDIC was formed 70 years ago. That is regulation in action.

Actually, the FDIC is the perfect example of how regulations work. The FDIC does not have the money to pay for the banks failures and that is why the taxpayers have had to rescue them, specially through the Fed. That you think that you are not paying for the banks failures just shows that propaganda works.

Quote
I think that regulations work a lot better than you think, and it saddens me that you and so many others have been brainwashed by the very people you attack into believing that less regulation is better. There is such a thing as too much regulation, of course. But no regulation is not an acceptable solution.

No, of course not. If there was no regulations, companies would have to compete and offer good services and good prices. Without regulations, how would the big companies abuse the costumers? We can not allow that.
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