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Question: Will you support Gavin's new block size limit hard fork of 8MB by January 1, 2016 then doubling every 2 years?
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Author Topic: Gold collapsing. Bitcoin UP.  (Read 2010638 times)
World
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October 25, 2014, 06:07:36 PM
 #14541

I think development on sidechains is a good thing and will open a new ideas and jobs.
http://techcrunch.com/2014/10/25/bitcoin-2-0-sidechains-and-zerocash-and-ethereum-oh-my/

Supporting people with beautiful creative ideas. Bitcoin is because of the developers,exchanges,merchants,miners,investors,users,machines and blockchain technologies work together.
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October 25, 2014, 06:26:11 PM
 #14542

I'm beginning to doubt Maxwell (nullc) has a grasp on the economics of money as a ledger, and he seemed like the best of the sidechain team on the economic aspects. This seems like a basic error:

http://www.reddit.com/r/Bitcoin/comments/2k7xwj/aantonop_sidechains_could_unleash_even_more/cliw3mi

What if sidechains, or a large part of their motivation, comes from not understanding the idea of spin-offs? Peter R has in places proposed spin-offs as a way to bootstrap an altcoin launch, but the relevance here is they serve many or perhaps even all the functions of sidechains, but without need to mess with Bitcoin.

I get a general sense from the sidechain crew that they don't understand Bitcoin as ledger, that the ledger is what matters, and that the protocol is secondary. To them, as coders, it must seem like the ledger and protocol are inextricably linked, but if you take Money as Memory seriously, the ledger is something outside the protocol and is merely updated by it. Understanding spin-offs requires fully internalizing this insight, and that is what I see no evidence of from the sidechain team.

Interesting idea.

Question : who mines the spin-offs? Can the same concept of merge-mining be applied ?

"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, 06:49:37 PM
 #14543

Question : who mines the spin-offs? Can the same concept of merge-mining be applied ?

Spon-offs can be mined in any manner including merge-mining.
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October 25, 2014, 07:21:25 PM
 #14544

I'm beginning to doubt Maxwell (nullc) has a grasp on the economics of money as a ledger, and he seemed like the best of the sidechain team on the economic aspects. This seems like a basic error:

http://www.reddit.com/r/Bitcoin/comments/2k7xwj/aantonop_sidechains_could_unleash_even_more/cliw3mi

What if sidechains, or a large part of their motivation, comes from not understanding the idea of spin-offs? Peter R has in places proposed spin-offs as a way to bootstrap an altcoin launch, but the relevance here is they serve many or perhaps even all the functions of sidechains, but without need to mess with Bitcoin.

I get a general sense from the sidechain crew that they don't understand Bitcoin as ledger, that the ledger is what matters, and that the protocol is secondary. To them, as coders, it must seem like the ledger and protocol are inextricably linked, but if you take Money as Memory seriously, the ledger is something outside the protocol and is merely updated by it. Understanding spin-offs requires fully internalizing this insight, and that is what I see no evidence of from the sidechain team.

Interesting idea.

Question : who mines the spin-offs? Can the same concept of merge-mining be applied ?

Who think it's worthy to mine it. As far as I know peter r idea it's a way to bootstrap an alt-coin with a bitcoin-blockchain-based initial coin distribution, nothing more than this. As far as I remember peter even proposed to clone ethereum with this method. In the case of ethereum clone it's impossible to merge mine i think.

Bitcoin is a participatory system which ought to respect the right of self determinism of all of its users - Gregory Maxwell.
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October 25, 2014, 07:32:16 PM
 #14545

http://letstalkbitcoin.com/blockchain-2-0-let-a-thousand-chains-blossom/

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Hill’s view is:

    We are a “blockchain 2.0” company.  Although I personally care for the success of Bitcoin, it is important to distinguish between bitcoin the asset and the blockchain as a programmable distributed trust infrastructure.  And we are interested in blockchain 2.0 and blockchain 2.0 using Bitcoin as a neutral transactional currency we believe is a great, offers great promise but I want to build a blockchain that could support a nation-state putting its national currency and phasing out paper dollars.

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October 25, 2014, 07:33:36 PM
 #14546

I'm beginning to doubt Maxwell (nullc) has a grasp on the economics of money as a ledger, and he seemed like the best of the sidechain team on the economic aspects. This seems like a basic error:

http://www.reddit.com/r/Bitcoin/comments/2k7xwj/aantonop_sidechains_could_unleash_even_more/cliw3mi

What if sidechains, or a large part of their motivation, comes from not understanding the idea of spin-offs? Peter R has in places proposed spin-offs as a way to bootstrap an altcoin launch, but the relevance here is they serve many or perhaps even all the functions of sidechains, but without need to mess with Bitcoin.

I get a general sense from the sidechain crew that they don't understand Bitcoin as ledger, that the ledger is what matters, and that the protocol is secondary. To them, as coders, it must seem like the ledger and protocol are inextricably linked, but if you take Money as Memory seriously, the ledger is something outside the protocol and is merely updated by it. Understanding spin-offs requires fully internalizing this insight, and that is what I see no evidence of from the sidechain team.

Thinking about it, it seems to me Maxwell is suggesting this creates two competing markets while sidechains are complementary markets at worst, if not integrated.

Quote
It's simply incorrect to state that it's not an altcoin; it's a seperate orthorgonal ledger that immediately doubles the supply of cryptocurrency and creates a base of people with commercial interests directly opposed to Bitcoin; who stand to profit by driving the adoption of their alternative in parallel to Bitcoin.

It does seem to me like his comment about supply is wrong but the rest remains true. People that start trading on the spin-off and accumulate more spinoffcoins then they had Bitcoins have competing interests with Bitcoin holders.

The difference with sidechains, from what I understand, is that accrued adoption through usage of 1:1 pegged sidechains features creates additional value for 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, 07:39:13 PM
 #14547

I think it is best to understand side chains as a Bitcoin feature that facilitates Bitcoin being used as backing for altcoins. This creates demand for Bitcoins to be held in the form of backing.

So, put simply: Bitcoin adds feature -> Bitcoin demand increases. That is the hope of side chain advocates at least, but the reality will be decided by the market, not by advocates. A new feature may increase demand, but only if people choose to use it.

From that perspective it is understandable that spin-offs would not be supported by side chain supporters, since spin-offs don't need the feature they are promoting.

I do agree that spin-offs are non-dilutive. So side chain supporters should really stop using that argument. It is incorrect.
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October 25, 2014, 07:42:03 PM
 #14548

Who think it's worthy to mine it. As far as I know peter r idea it's a way to bootstrap an alt-coin with a bitcoin-blockchain-based initial coin distribution, nothing more than this. As far as I remember peter even proposed to clone ethereum with this method. In the case of ethereum clone it's impossible to merge mine i think.

True, it seems merge mining, in that case, would require significant change to BTC.

While the idea of bootstrapping an altcoin with bitcoin's distribution is interesting, I don't see how this solves the security issue.

"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, 08:05:01 PM
 #14549

I think it is best to understand side chains as a Bitcoin feature that facilitates Bitcoin being used as backing for altcoins. This creates demand for Bitcoins to be held in the form of backing.

So, put simply: Bitcoin adds feature -> Bitcoin demand increases. That is the hope of side chain advocates at least, but the reality will be decided by the market, not by advocates. A new feature may increase demand, but only if people choose to use it.

From that perspective it is understandable that spin-offs would not be supported by side chain supporters, since spin-offs don't need the feature they are promoting.

I do agree that spin-offs are non-dilutive. So side chain supporters should really stop using that argument. It is incorrect.


Of course.

I'm not sure exactly how spin-offs compete with sidechains.

Would it not be possible to create spin-off coins through a sidechain?

This coin could benefit from spin-offs' idea of Bitcoin-blockchain distribution and also from sidechains' convenient, integrated, merge-mining.

The mining and security part is where I could be wrong though since these are technical issues I am not always comfortable with.

Another thing is a normal sidechain concept requires the user to effectively "lock" their BTC to the sidechain. For the idea I have in mind, the user should only need to claim their stake based on a particular snapshot of BTC blockchain i.e. his BTCs are not locked to the sidechain but are only used to claim his stake.

"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, 08:09:58 PM
 #14550

I think it is best to understand side chains as a Bitcoin feature that facilitates Bitcoin being used as backing for altcoins. This creates demand for Bitcoins to be held in the form of backing.

So, put simply: Bitcoin adds feature -> Bitcoin demand increases. That is the hope of side chain advocates at least, but the reality will be decided by the market, not by advocates. A new feature may increase demand, but only if people choose to use it.

From that perspective it is understandable that spin-offs would not be supported by side chain supporters, since spin-offs don't need the feature they are promoting.

I do agree that spin-offs are non-dilutive. So side chain supporters should really stop using that argument. It is incorrect.


Of course.

I'm not sure exactly how spin-offs compete with sidechains.

Would it not be possible to create spin-off coins through a sidechain?

This coin could benefit from spin-offs' idea of Bitcoin-blockchain distribution and also from sidechains' convenient, integrated, merge-mining.

The mining and security part is where I could be wrong though since these are technical issues I am not always comfortable with.

Another thing is a normal sidechain concept requires the user to effectively "lock" their BTC to the sidechain. For the idea I have in mind, the user should only need to claim their stake based on a particular snapshot of BTC blockchain i.e. his BTCs are not locked to the sidechain but are only used to claim his stake.

+1

spin-of doubles units (bitcoins  + altCoins)
SC do not create new units.
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October 25, 2014, 08:19:01 PM
 #14551

Would it not be possible to create spin-off coins through a sidechain?

Technically I suppose, but such a coin couldn't be backed by bitcoin or offer the 1:1 conversion feature.

Quote
This coin could benefit from spin-offs' idea of Bitcoin-blockchain distribution and also from sidechains' convenient, integrated, merge-mining.

I guess we should define some terms here. By "side chain" I mean the on-chain convertibility feature. This is usually described as 1:1 but doesn't need to be that, it could use some other fixed ratio or a non-fixed formula.

Merged mining can be done with or without this sort of side chain. They are independent.
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October 25, 2014, 08:21:22 PM
 #14552

spin-of doubles units (bitcoins  + altCoins)

Yes but since the units are distributed in the same ratio, it is non-dilutive.

Similarly you could redefine "Bitcoin" down to 100 Satoshi's, which has actually been proposed. This creates more units since the number of units increases from 22 million to 22 trillion (trillion = 1012), but does it is not diluted since there is no change in the distribution of ownership.

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SC do not create new units

This is only true for 1:1 side chains. Not all side chains need to be 1:1.

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October 25, 2014, 08:30:38 PM
 #14553

spin-of doubles units (bitcoins  + altCoins)

Yes but since the units are distributed in the same ratio, it is non-dilutive.

Similarly you could redefine "Bitcoin" down to 100 Satoshi's, which has actually been proposed. This creates more units since the number of units increases from 22 million to 22 trillion (trillion = 1012), but does it is not diluted since there is no change in the distribution of ownership.

Quote
SC do not create new units

This is only true for 1:1 side chains. Not all side chains need to be 1:1.


Spin-of will create 13M worthless units ... it will take ages and millions(billions) $ until you build solid market cap. (so it never happen, or bitcoin must die)

OTOH SideChain can use same functionality and will use bitcoin market cap. ... has big value from the beginning.
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October 25, 2014, 08:33:10 PM
 #14554

Would it not be possible to create spin-off coins through a sidechain?

Technically I suppose, but such a coin couldn't be backed by bitcoin or offer the 1:1 conversion feature.

Quote
This coin could benefit from spin-offs' idea of Bitcoin-blockchain distribution and also from sidechains' convenient, integrated, merge-mining.

I guess we should define some terms here. By "side chain" I mean the on-chain convertibility feature. This is usually described as 1:1 but doesn't need to be that, it could use some other fixed ratio or a non-fixed formula.

Merged mining can be done with or without this sort of side chain. They are independent.


Right, I also realise there is a fundamental error in my proposition. Sidechains issuing assets (sidecoins) are responsible for their security (through their own mining algo).

Quote
Of course, sidechains are able to support their own assets, which they would be responsible for maintaining the scarcity of

So a sidecoin type spinoff is no more secure than a regular altcoin spinoff

"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, 08:38:58 PM
 #14555

Spin-of will create 13M worthless units ... it will take ages and millions(billions) $ until you build solid market cap. (so it never happen, or bitcoin must die)

Very valid point.

I recognize the value of sharing the same ledger but this does not necessarily mean the value is shared.


"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, 08:51:06 PM
 #14556


This is only true for 1:1 side chains. Not all side chains need to be 1:1.


It works too for a sidechain  that is 1:1000 (to fund) and 1000:1(to withdraw)
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October 25, 2014, 08:52:28 PM
 #14557


This is only true for 1:1 side chains. Not all side chains need to be 1:1.


It works too for a sidechain  that is 1:1000 (to fund) and 1000:1(to withdraw)

If the ratio is higher than 1:1 then it does create new units. If it is lower than it destroys (or at least locks) units.

The number of units is irrelevant. What matters is the share of ownership.





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October 25, 2014, 08:55:15 PM
 #14558

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Of course, sidechains are able to support their own assets, which they would be responsible for maintaining the scarcity of

So a sidecoin type spinoff is no more secure than a regular altcoin spinoff

A side chain is no more secure than any other coin that uses the same method of mining (and both side chains and others can use any method of mining).

The purpose of side chains is not to increase security it is to provide a convenient mechanism for coins to serve as backing for other coins with automated exchange between them.

In fact side chains add an additional degree of insecurity (though ideally small) in that they are going to use SPV proofs for cross-chain transactions, which introduces a new vulnerability.

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October 25, 2014, 09:00:43 PM
 #14559


This is only true for 1:1 side chains. Not all side chains need to be 1:1.


It works too for a sidechain  that is 1:1000 (to fund) and 1000:1(to withdraw)

If the ratio is higher than 1:1 then it does create new units. If it is lower than it destroys (or at least locks) units.

The number of units is irrelevant. What matters is the share of ownership.

SC cannot unlock more bitcoins than was locked.  If there is SC what will create new scBTC then
a) some will end up holding scBTC but this cannot be converted to BTC
b) SC must implement some conversion ratio -> consensus of SC participants
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October 25, 2014, 09:03:04 PM
 #14560

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Of course, sidechains are able to support their own assets, which they would be responsible for maintaining the scarcity of

So a sidecoin type spinoff is no more secure than a regular altcoin spinoff

A side chain is no more secure than any other coin that uses the same method of mining (and both side chains and others can use any method of mining).

But sidechains that do not create issued assets (additional coins) certainly are more secure than altcoins

"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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