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Author Topic: Gold collapsing. Bitcoin UP.  (Read 1803797 times)
smooth
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October 24, 2014, 08:49:52 PM
 #14541

i think we've identified numerous potential problems in different scenarios in the last several pages that need answering.  i'm not going to repeat them yet again.

all of your potential problems depend on the creation of a sidecoin when this is not the main use case of altCHAINS

The main use case is not known yet. Creating sidecoins may not be (probably isn't) the intended use case but that's not the same thing at all. Unintended consequences happen all the time.

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brg444
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Bitcoin replaces central, not commercial, banks


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October 24, 2014, 09:04:48 PM
 #14542

The main use case is not known yet. Creating sidecoins may not be (probably isn't) the intended use case but that's not the same thing at all. Unintended consequences happen all the time.

It is not, you are right. But it is pretty clear what the intended purposes are, at least in Blockstream's team mind, and that is not sideCOINS.

Quote
By using a sidechain which carries bitcoins rather than a completely new currency, one can avoid the thorny problems of initial distribution and market vulnerability, as well as barriers to adoption for new users, who no longer need to locate a trustworthy marketplace or invest in mining hardware to obtain altcoin assets.

Sure the do put forward interesting use case of Issued Assets (native currencies) on top of a sidechain but I think it is made evident that there is not much interest creating such a currency to simply compete with Bitcoin.

Considering all the facts it seems to me sidecoins are not inherently more dangerous to Bitcoin than altcoins.

In fact, I find it more honest to consider how sidecoins could help Bitcoin's development

Quote
If, in the medium term, there were wide agreement that the new system was an improvement, it may end up seeing significantly more use than Bitcoin. As there are no changes to parent chain consensus rules, everyone can switch in their own time without any of the risks associated with consensus failure. Then, in the longer term, the success of the changes in the sidechain would provide the needed confidence to change the parent chain, if and when it is deemed necessary to do so.


"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
cypherdoc
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October 24, 2014, 09:09:51 PM
 #14543

i think we've identified numerous potential problems in different scenarios in the last several pages that need answering.  i'm not going to repeat them yet again.

all of your potential problems depend on the creation of a sidecoin when this is not the main use case of altCHAINS

no it does not. I've been talking about SC ' s alone with 1:1 scBTC
tvbcof
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October 24, 2014, 10:19:31 PM
 #14544


They have banded together [nominally under the Bitstream banner] because they believe this proposal adds considerable value to Bitcoin's infrastructure. Nothing more.
...

The makeup of this group makes them vastly more credible than Mikin 'red-list' Hearndresen and the Bitcoin Foundation circle-jerkers.  I would absolutely consider their work on Bitcoin to be the mainline branch and TBF-associated 'enhancements' to be a side-branch if/when push came to shove.  And very possibly a hostile side-branch.  Hopefully the big miners are clued in and still independent enough to see things the same way.

If Peter Todd came up with a workable generic shared ledger, especially one which employed treechain methods, I'd consider it a (very interesting) alt-ish type thing.


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October 24, 2014, 10:42:21 PM
 #14545

miners could abandon my SC that offers perfect anonymity.  and that would be for another SC that takes my SC  with perfect anonymity and adds even better functionality on top of that.  then i'd have to move my SC coins yet again!  what a hassle and potential security risk.

if the SC tech is in fact better, BTC hodlers would have to defect.  as they defect, miners would have to follow.  no?

money always seeks the place that treats it best.

If this is done (SC tech is in fact better) and no one is using Bitcoin, I can imagine there will be transaction (in new SC), how to withdraw coin from abandoned BTC chain. => New SC will accept, old bitcoin transaction even Bitcoin is dead ... because this is the only way how to create coins.
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October 24, 2014, 10:52:02 PM
 #14546


They have banded together [nominally under the Bitstream banner] because they believe this proposal adds considerable value to Bitcoin's infrastructure. Nothing more.
...

The makeup of this group makes them vastly more credible than Mikin 'red-list' Hearndresen and the Bitcoin Foundation circle-jerkers.  I would absolutely consider their work on Bitcoin to be the mainline branch and TBF-associated 'enhancements' to be a side-branch if/when push came to shove.  And very possibly a hostile side-branch.  Hopefully the big miners are clued in and still independent enough to see things the same way.

If Peter Todd came up with a workable generic shared ledger, especially one which employed treechain methods, I'd consider it a (very interesting) alt-ish type thing.



Blockstream:
sipa
bluematt
gmaxwell

BitPay:
jgarzik

TBF:
gavinandresen

Viacoin:
Peter Todd

Independent:?
wumpus (current lead dev)

... plus large number of 'vested-interest' coders making commits, comments and ready to pounce on BS.

I don't see any issues at present.

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October 25, 2014, 12:35:48 AM
 #14547

Maybe SideChain feature can be used for better security. Everybody can create their own sidechain (multisignature cold wallet).

a) it is hard to spend from this wallet (a lot of signatures and hashes are needed -> quantum computer resistant)
b) it can be exchanged with others sidechains in case  +51% attack and bitcoin network cannot transact

Just my ideas, I do not know if it is possible.
Melbustus
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October 25, 2014, 01:01:34 AM
 #14548

Seen this yet?

https://download.wpsoftware.net/bitcoin/alts.pdf

Quote from: 'Andrew Poelstra'
Of course, “developing your own cryptosystem” is the purview of only cranks and researchers, so it was reasonably assumed that none of these “altcoins”, as they were called, could ever be plausibly presented for public use.
Boy, were we ever wrong on that one.
...
If you are, or are planning to, develop and release an “altcoin” to the public, this document reminds you that you are playing with fire. This sort of behavior was cute on sci.crypt, a community populated mainly by cryptographic experts where there was no risk that your charlatanism would be mistaken for anything legitimate, and where there was no ability to store value in your scheme anyway.
...
The Bitcoin community differs in both those respects. Your crankery is not cute. You are not a cryptographer, and yet are releasing a homebrew cryptosystem, misrepresenting your own qualifications, and encouraging others to store value in your creation. These actions are incompetent, dishonest and reprehensibly dangerous.

lol.

That's Andrew Poelstra's "A Treatise on Altcoins". He's even harsher than many of us in this thread! He's also listed as an author on the sidechains whitepaper.

Bitcoin is the first monetary system to credibly offer perfect information to all economic participants.
But Bitcointalk & /r/bitcoin are heavily censored. bitco.in/forum, forum.bitcoin.com, and /r/btc are open.
Best info on Casascius coins: http://spotcoins.com/casascius
justusranvier
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October 25, 2014, 02:20:51 AM
 #14549

http://konradsgraf.squarespace.com/storage/Monetary%20analsyis%20of%20sidecoins%20KG%2024Oct2014.pdf
cbeast
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Let's talk governance, lipstick, and pigs.


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October 25, 2014, 02:47:54 AM
 #14550

Thanks, that is a clear explanation of Side Chains.

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
brg444
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October 25, 2014, 03:05:06 AM
 #14551


thank you.

very very helpful.

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
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October 25, 2014, 03:11:54 AM
 #14552


I guess these are more reasons to not worry about the potential for a sidechain to "takeover" Bitcoin.

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
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October 25, 2014, 03:50:18 AM
 #14553

https://vimeo.com/108437163

What terrible spokesperson these guys are.

"Bitcoin's monetary policy could change" Really !? Just cause you dropped a couple millions on Coinbase certainly does not make you an authority to speak on Bitcoin and utter such nonsense.

This video is so disappointing

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
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October 25, 2014, 04:39:10 AM
 #14554

https://vimeo.com/108437163

What terrible spokesperson these guys are.

"Bitcoin's monetary policy could change" Really !? Just cause you dropped a couple millions on Coinbase certainly does not make you an authority to speak on Bitcoin and utter such nonsense.

This video is so disappointing

Yes, he was incorrect in his statement.  A consensus doesn't change Bitcoin total coins.
https://en.bitcoin.it/wiki/Prohibited_changes

A consensus, or even a constituency, easily could change to use a different coin instead, but is not free to change bitcoin on this matter.

FREE MONEY1 Bitcoin for Silver and Gold NewLibertyDollar.com and now BITCOIN SPECIE (silver 1 ozt) shows value by QR
Bulk premiums as low as .0012 BTC "BETTER, MORE COLLECTIBLE, AND CHEAPER THAN SILVER EAGLES" 1Free of Government
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October 25, 2014, 09:53:28 AM
 #14555

I don't understand how the peg will work.

Let's say 10 000 BTC are locked and give access to some sidecoin, if that Sidecoin is more succesful than BTC then the Sidecoin could be sell for more than the peg on the open market. If the sidecoin fail than the sidecoin holder can exit the sidechain and retreive their old BTC.

So basically a sidecoin is an option and there is a massive incentive to leave the BTC blockchain to the sidechain and enjoy you free option, so basically this will destroy Bitcoin. What I don't understand?
An altcoin could be created through a side chain using a non-deterministic exchange rate. If BTCs are pledged to that sidechain's altcoin then they are exposed to its exchange rate and volatility. In this scenario if the sidecoin fails than the holder CANNOT retrieve the same amount of BTC he put in, only the amount the exchange rate provides him in exchange for his failed coin.
My understanding is that the exchange rate BTC <> sidecoin will not float, only the exchange rate sidecoin <> fiat will float. Is that true?

If 10 000 BTC back 10 million units of sidecoin (so the fixe exchange rate is 1 BTC = 10 000 sidecoins) and that side-currency is deemed as crap by the free market (ie. the fiat exchange rate implies a valuation 1 BTC >10 000), then people will just doesn't sell their sidecoins on the free market and moved back to the BTC blockchain and take back their BTC.

Now if the free market loves a new feature of that sidecoin and the fiat exchange rate imply a 1BTC = 1 000 sidecoins rate, then people will have made a 10x profit.

So barring an improbable technical failure of the sidechain that would prevent to get back the BTC, people will have only benefits by exchanging bitcoins to sidecoins.

It's a lethal mechanism for Bitcoin. Imagine the size of the altcoin market if people were able to sell their bitcoins to buy altcoins while being able to reclaim the exact same initial amount of bitcoin if the said altcoin end up underperforming BTC.



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October 25, 2014, 09:58:27 AM
 #14556

Can someone ask kindly Jeff to stop stalking NXT and Mr Maxwell his sidechains coding and both have a look at this:

http://t.co/eWNQq2h1Cx

??


WTF ? ? ? ?

BTC: 1K9atu5zgz7izCMAynk5adBJ8Qn2YgS6nT
inca
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October 25, 2014, 10:38:41 AM
 #14557

Can someone ask kindly Jeff to stop stalking NXT and Mr Maxwell his sidechains coding and both have a look at this:

http://t.co/eWNQq2h1Cx

??


WTF ? ? ? ?

I wonder how good the random number generation is with bitaddress.org. I cannot be alone in generating my cold storage addresses from that. Poor random number generation was always going to be the next attack vector to try and narrow down the bitcoin private key space. Only good can come from this.
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October 25, 2014, 10:49:56 AM
 #14558


not at all. The discussion in this thread have moved way beyond the limited concepts in that paper.
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October 25, 2014, 10:51:53 AM
 #14559

Good to hear this. Bitcoin is future of currency, and I give to it some trust, but I not appreciate so much volatility of this ultimate. It's because I have some gold in my investment portfolio..

I'm Gianluca95. Please, PM me here or for urgent question. Payment for Cryptomixer.io signature campaign, Sportsbet.io Signature campaign, Betking.io Signature campaign and the spam checking for the BTC2BID.com signature campaign will go ahead as always. Thank you to everyone !
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October 25, 2014, 12:15:38 PM
 #14560

About pegging.

To have pegging, there must be an authority that guarantees the peg to the main coin.

The tool is to have a reserve, so you can buy from one with the other and vice versa.

The reserve is always less than the full value of the pegged currency. Else there would be no point, from the authority's point of view. The point is to extract the inflation tax on the users of the sidecoin.

The peg is instituted for a coin that is of risk to lose all value. To inject trust in the sidechain, the authority starts the peg.

The peg is in practise not exact, it is a band with a lower and upper limit. Else there is opportunity for others to front run the pegging transactions and extract value from the authority. For the same reason, the exact limits are often not public.

Since the authority controls the volume of the sidecoins, their volume can also be increased or decreased. Decrease means taxing and destroying sidecoins, this is not helpful for the authority. Increasing the numbers can also be used. Increase is possible when the sidecoin demand increases (economy increases), and when the main coin volume increases (thus inflation tax goes to the sidecoin authorities in stead of to the main coin authorities).

Bad management, decrease of sidecoin demand due to shrinking economy, or random external shocks can destroy the peg. In that case, the sidecoin quickly looses value and stays there.

A new peg can then be instituated at a lower level.
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