[CLOSED] A Challenge to Timothy B Lee

[Vandroiy]

I have the feeling that the discussion on the claim on http://timothyblee.com/2011/04/19/bitcoins-collusion-problem/ is not going anywhere.

So here's something to underline arguments a little. Want to make a bet on it?

Please state clearly your failure scenario. My try on a formulation: splits of the block chain allow creating additional Bitcoins, causing a massive disturbance or inflation. This must happen before Bitcoin fails, if it does fail. If you think other failures are more likely, I accept the idea of being paid in BTC, such that if I win the bet, I gain nothing if Bitcoin failed due to other reasons. But I'm also fine with canceling the bet in case a different failure scenario happens.

I'll start with an offer: I place 1000 EUR or equivalent in USD (1458), you place 670 EUR or equivalent in USD or BTC at the rate valid when both sides agree on the bet. If Bitcoin gets massive problems due to collusion, as proposed in your post, within the next two years, you win all. Otherwise, I do. I'll leave the exact formulation for after you replied.

If you want to formulate the bet in a different or more precise manner, please go ahead. If you want to go into other failure scenarios of Bitcoin in more detail, I can adapt, but please be aware that I'm not certain about Bitcoin in general, I just claim that your proposed attack will not happen or not be successful.

If this bet happens, I will look for a well-trusted member of the community to hold my money during the bet. (Maybe someone who wants to join in, to raise the stakes? ) Fraud on my side will not be an issue that way.



Edit: exact description of the bet -- this might be necessary, now that people want to join in.

My current proposal:
Failure scenario A: If a split of the block chain is followed by a crash ending Bitcoin altogether (to be defined), we loose.

Failure Scenario B: Consider the last 10 000 blocks of the longest block chain originating from the current genesis block (ludicrous chains throwing away the difficulty not counted). Are they, at any time during the bet, dominated by blocks creating significantly more money than currently planned? If so, I/we loose.

Timeout: If two years pass, I/we win.

Bet called off: If there is a crash (to be defined) of the Bitcoin market due to a reason not linked to block chain splits, the bet is called off. (Blitzboom seems to want to take a higher risk concerning this, but he wants a symmetric bet in return. I guess we'd negotiate this.)

[1714863851]

1714863851

[N12]

I will join this bet with the same bid of 1000 EUR. We could also split a community bet for everyone who enters though. I think that would be much more fun.

Condition: Timothy Blee pays the equivalent in BTC. If he loses (Bitcoin fails* due to another reason OR does not fail in given time span), he will pay the BTC equivalent of 1000 EUR at that time. If his attack is successful within the time limit, I will pay.

*Failure is defined as decline of the exchange rate of markets with highest volume (currently Mt.Gox) to below 0.01 USD.

[BitterTea]

*Failure is defined as decline of the exchange rate of markets with highest volume (currently Mt.Gox) to below 0.01 USD.

I don't think that's a good indicator of failure. I'd recommend some metric based on bitcoindays, as proposed by ByteCoin.

[N12]

*Failure is defined as decline of the exchange rate of markets with highest volume (currently Mt.Gox) to below 0.01 USD.

I don't think that's a good indicator of failure. I'd recommend some metric based on bitcoindays, as proposed by ByteCoin.

Couldn’t that be manipulated in the case Bitcoin fails for another reason and the exchange rate drops to practically zero? He would just get a bunch of coins almost for free and reduce the bitcoindays.

[Vandroiy]

How about we define the bet content first?

I have a new proposal: If the last X blocks of the longest block chain originating from the current genesis block (ludicrous chains throwing away the difficulty not counted) are dominated by blocks creating significantly more money than currently planned, we loose. I'm editing this into the first post.

A crash of Bitcoin... hell, take any reasonable indicator. If we argue about that, the bet has become a fraudster game. It should happen on a functioning market, not on ruins. That's when the bet becomes meaningless. I'll think of a reasonable indicator, let me edit the first post for the bet winner indicator first.

[ploum]

What happens if bitcoin value drops behind 0,01€ without any collusion. I mean, it could happen: if people loose interest on it, bitcoin would be worthless.

[Vandroiy]

What happens if bitcoin value drops behind 0,01€ without any collusion. I mean, it could happen: if people loose interest on it, bitcoin would be worthless.

Sorry, I was too slow editing. See the last case in the edit in the first post: I say we call the bet off, as the result is arbitrary if bitcoin is small and weak, since in that case, many people can dictate the result by pushing the block chain one way or another.

[Vandroiy]

Quote from Timothy B. Lee on his blog:

(...) collusion will start to be an issue once the value of the Bitcoin economy grows to be a “mainstream” phenomenon, which I doubt would happen in less than a decade.

I'd say, with this, the theory's objective credibility is as low as it gets and this post will be closed unless anyone wants to make a further statement. I wish him luck with his crystal ball TV into the years 2021 and beyond.

Please use this little intermezzo to counteract the repeated quoting and linking to a post that does not deserve it. There have been multiple voices calling for this, but this is a way to objectively measure what a person believes -- and this guy believes we are fairly safe from his "collusion problem" for an entire decade. What more do people need to stop hyping that post?

If a contrary belief exists, please post an offer for a bet to quantize it. If nobody keeps this going, feel free to close this thread -- or I will do so on my next visit here.

[kiba]

Quote from Timothy B. Lee on his blog:

(...) collusion will start to be an issue once the value of the Bitcoin economy grows to be a “mainstream” phenomenon, which I doubt would happen in less than a decade.

All of which is based on lack of information about bitcoin. The Bitcoin advocate knows more than the critics about what's the problem and what's the solution. I am more worried about the government choking the bitcoin currency exchange network before we can have a viable countermeasure.

It's already clear that the infrastructure for self-sustaining cycle of trading exists as bitcoin services pay VPS providers with bitcoin earned on the marketplace.

[FreeMoney]

This seems really silly. You are sure to win imo, but you are going to end with about 800BTC instead of 1190 if you just used the money to buy coins now. Yeah, you get the cash, but that's not going to be worth anywhere near the extra 400 coins in 2 years.

[Vandroiy]

This seems really silly. You are sure to win imo, but you are going to end with about 800BTC instead of 1190 if you just used the money to buy coins now. Yeah, you get the cash, but that's not going to be worth anywhere near the extra 400 coins in 2 years.

A sure win isn't silly, if you ask me.

Bitcoin succeeding and being super-valuable isn't carved in stone, otherwise people would buy like mad now. Yes, prices are rising, but certainty isn't in there just yet.

Anyways, this is closed since the bet is not happening.