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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?
1.  yes
2.  no

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Author Topic: Gold collapsing. Bitcoin UP.  (Read 1923305 times)
cbeast
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Let's talk governance, lipstick, and pigs.


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October 29, 2014, 05:34:33 PM
 #14821

Bitcoin Maximalism

I, for one, welcome our new ScamChain overlords.

Yes, to be sure many sidechains will be scams.  And highly regarded and trustworthy 'overlords' lending credibility to the basic idea of sidechains will be very welcome to those intending to use the mechanism for scammery.

It needs to be made very clear to users that just because something leverages the sidechains principles (or claims to) this is no reason to drop due-diligence and common sense.  Use only sidechains which can be thoroughly analyzed and have a theoretical basis in the principle that the sidechains manager can at the very worst lose value...NOT take value.


If a SC is open source and the bridge is secure, then what's the problem?

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
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October 29, 2014, 05:47:11 PM
 #14822

trendline well intact:

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October 29, 2014, 05:56:30 PM
 #14823

Bitcoin Maximalism

I, for one, welcome our new ScamChain overlords.

Yes, to be sure many sidechains will be scams.  And highly regarded and trustworthy 'overlords' lending credibility to the basic idea of sidechains will be very welcome to those intending to use the mechanism for scammery.

It needs to be made very clear to users that just because something leverages the sidechains principles (or claims to) this is no reason to drop due-diligence and common sense.  Use only sidechains which can be thoroughly analyzed and have a theoretical basis in the principle that the sidechains manager can at the very worst lose value...NOT take value.



you touched on something i'm very worried with SC's the other day:  a speculative attack.

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".  therefore a whale could pump large amts of BTC thru the peg driving up the #scBTC and eventually its price with a reasonable confidence that he won't be hurt as he could always reverse back into BTC. the problem is other BTC holders might be forced to follow for fear of the SC taking over as the mainchain and the merge mining % flipping. in other words, MM for Namecoin is about 70% that of Bitcoin currently.  assuming a SC is initially MM'd, say at 60%, if a superior SC can flip this around by making Bitcoin 60% MM'd with the SC becoming the main chain, those left behind in BTC will lose value or may lose everything.  the problem is that BTC holders may not be able to differentiate an unfolding superior SC from that of a Sidescam.

i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.
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October 29, 2014, 06:13:11 PM
 #14824

Pigs are flying, Greenspan said Gold is a safe place to store wealth.

Former Fed Chief Greenspan Worried About Future of Monetary Policy
Fed Chief From 1987 to 2006 Says Fed’s Bond-Buying Program Fell Short of its Goals
http://online.wsj.com/articles/former-fed-chief-greenspan-worried-about-future-of-monetary-policy-1414597627
(Google the title to get a link outside the pay wall)

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Mr. Greenspan said gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments.
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Enabling the maximal migration


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October 29, 2014, 06:30:40 PM
 #14825

Pigs are flying, Greenspan said Gold is a safe place to store wealth.

Former Fed Chief Greenspan Worried About Future of Monetary Policy
Fed Chief From 1987 to 2006 Says Fed’s Bond-Buying Program Fell Short of its Goals
http://online.wsj.com/articles/former-fed-chief-greenspan-worried-about-future-of-monetary-policy-1414597627
(Google the title to get a link outside the pay wall)

Quote
Mr. Greenspan said gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments.

wow.

Bro, do you even blockchain?
-E Voorhees
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October 29, 2014, 06:35:19 PM
 #14826

you touched on something i'm very worried with SC's the other day:  a speculative attack.

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".  therefore a whale could pump large amts of BTC thru the peg driving up the #scBTC and eventually its price with a reasonable confidence that he won't be hurt as he could always reverse back into BTC. the problem is other BTC holders might be forced to follow for fear of the SC taking over as the mainchain and the merge mining % flipping. in other words, MM for Namecoin is about 70% that of Bitcoin currently.  assuming a SC is initially MM'd, say at 60%, if a superior SC can flip this around by making Bitcoin 60% MM'd with the SC becoming the main chain, those left behind in BTC will lose value or may lose everything.  the problem is that BTC holders may not be able to differentiate an unfolding superior SC from that of a Sidescam.

i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.

i also don't think this can be arbed away.  it's reasonable to think scBTC would start off lower than BTC from being new and less secured with MM.  if the whale can force this to flip with the price of scBTC rising faster than BTC at the very least this will cause volatility.  some BTC holders and especially the speculators may be convinced the SC has a chance to take over and will follow encouraged by the risk free put.  miners may then switch to the SC too and start MM BTC instead.  yes, arb in the middle of a big picture transition can keep prices relatively equal.  but if a true transition is really happening to the SC becoming dominant, the BTC price should start to drop below that of scBTC as realization sets in that BTC is going to lose and BTC itself becomes the 60% MM'd chain with the SC as the mainchain.

so in essence, last out the door will lose.
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October 29, 2014, 06:57:45 PM
 #14827

not looking good for btc charts... LTC doesn't want to hit target and is sending BTC lower... we might get a chance to buy some really cheap BTC.

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Pay with Bitcoin, ZCash and many more
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October 29, 2014, 07:00:09 PM
 #14828

shucks, my laptop with my charting program went dead.

looks like the gold reversal DOWN is well underway.  from memory, both GDX and GDXJ, have broken below their consolidation points.  that's not good.  in retrospect, they were leading.

also, my prediction of a Dow Theory non-confirmation is looking good and is firmly on the table and in play as a major hint that we may be entering a period of severe volatility and perhaps recession as a bear cycle may be settling in.  we'll see how the next few days behave.
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October 29, 2014, 07:01:37 PM
 #14829

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".

I don't think it is risk free since a failure of the sidechain could prevent unlocking on the BTC side, or conceivably cause the locked BTC to run out.

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i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.

This seems very plausible to me.

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October 29, 2014, 07:14:50 PM
 #14830

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".

I don't think it is risk free since a failure of the sidechain could prevent unlocking on the BTC side, or conceivably cause the locked BTC to run out.

i understand.  but a chance of a bug in a well designed open sourced SC is probably no more than a bug in Bitcoin itself.  especially if an attacker waits a good amount of time to prove stability of the SC before launching the speculative attack.   given those circumstances, the 2 way peg IS a risk free put.

Quote
Quote
i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.

This seems very plausible to me.



a speculator loves to cause volatility and will love the risk free put nature of this situation.  he will take advantage of it at the expense of less sophisticated investors.
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October 29, 2014, 07:24:39 PM
 #14831

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".

I don't think it is risk free since a failure of the sidechain could prevent unlocking on the BTC side, or conceivably cause the locked BTC to run out.

i understand.  but a chance of a bug in a well designed open sourced SC is probably no more than a bug in Bitcoin itself.  especially if an attacker waits a good amount of time to prove stability of the SC before launching the speculative attack.   given those circumstances, the 2 way peg IS a risk free put.

Quote
Quote
i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.

This seems very plausible to me.



a speculator loves to cause volatility and will love the risk free put nature of this situation.  he will take advantage of it at the expense of less sophisticated investors.

- I cannot imagine how somebody can pump scBTC when exchanging them against BTC is 1:1 at the protocol level.
- I cannot imagine how keeping BTC in MixerBTC, HotWalletBTC or ExchangeBTC make them more valuable (if you do not use them for trading, fast-spending or mixing)

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October 29, 2014, 07:25:03 PM
 #14832

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".

I don't think it is risk free since a failure of the sidechain could prevent unlocking on the BTC side, or conceivably cause the locked BTC to run out.

Quote
i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.

This seems very plausible to me.



remember that my base case for consideration is a simple Bitcoin fork with no sidecoin with one sell-able "innovation" added in.  in this sense, an outright failure is not to be expected.
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October 29, 2014, 07:28:04 PM
 #14833

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".

I don't think it is risk free since a failure of the sidechain could prevent unlocking on the BTC side, or conceivably cause the locked BTC to run out.

i understand.  but a chance of a bug in a well designed open sourced SC is probably no more than a bug in Bitcoin itself.  especially if an attacker waits a good amount of time to prove stability of the SC before launching the speculative attack.   given those circumstances, the 2 way peg IS a risk free put.

Quote
Quote
i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.

This seems very plausible to me.



a speculator loves to cause volatility and will love the risk free put nature of this situation.  he will take advantage of it at the expense of less sophisticated investors.

- I cannot imagine how somebody can pump scBTC when exchanging them against BTC is 1:1 at the protocol level.

why not?  we're talking about a whale pumping in a "large" #BTC thru the peg for scBTC.  whether he is doing it b/c he truly believes the SC has merit or is doing it as a pump and dump, observers will never know.
Quote
- I cannot imagine how keeping BTC in MixerBTC, HotWalletBTC or ExchangeBTC make in more valuable (if you do not use them for trading, fast-spending or mixing)



take my base case scenario and add in perfect anonymity as the innovation.  if this SC actually works, the paper itself said that BTC holders could make a transition to the SC to take advantage of the innovation.

the question is, do we all want to be making transitions to a new chain everytime an innovation comes along?
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October 29, 2014, 07:28:45 PM
 #14834

you touched on something i'm very worried with SC's the other day:  a speculative attack.

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".  therefore a whale could pump large amts of BTC thru the peg driving up the #scBTC and eventually its price with a reasonable confidence that he won't be hurt as he could always reverse back into BTC. the problem is other BTC holders might be forced to follow for fear of the SC taking over as the mainchain and the merge mining % flipping. in other words, MM for Namecoin is about 70% that of Bitcoin currently.  assuming a SC is initially MM'd, say at 60%, if a superior SC can flip this around by making Bitcoin 60% MM'd with the SC becoming the main chain, those left behind in BTC will lose value or may lose everything.  the problem is that BTC holders may not be able to differentiate an unfolding superior SC from that of a Sidescam.

i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.

i also don't think this can be arbed away.  it's reasonable to think scBTC would start off lower than BTC from being new and less secured with MM.  if the whale can force this to flip with the price of scBTC rising faster than BTC at the very least this will cause volatility.  some BTC holders and especially the speculators may be convinced the SC has a chance to take over and will follow encouraged by the risk free put.  miners may then switch to the SC too and start MM BTC instead.  yes, arb in the middle of a big picture transition can keep prices relatively equal.  but if a true transition is really happening to the SC becoming dominant, the BTC price should start to drop below that of scBTC as realization sets in that BTC is going to lose and BTC itself becomes the 60% MM'd chain with the SC as the mainchain.

so in essence, last out the door will lose.

Just a note about this scenario.

I don't believe miners switching over to the SC and MM BTC makes the SC the mainchain. Only a full exile of the nodes can do that.

"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 29, 2014, 07:31:32 PM
 #14835

you touched on something i'm very worried with SC's the other day:  a speculative attack.

assuming a SC failure is a long tail unlikely event as from a bug, the 2 way peg and scBTC is acting like a "risk free put".  therefore a whale could pump large amts of BTC thru the peg driving up the #scBTC and eventually its price with a reasonable confidence that he won't be hurt as he could always reverse back into BTC. the problem is other BTC holders might be forced to follow for fear of the SC taking over as the mainchain and the merge mining % flipping. in other words, MM for Namecoin is about 70% that of Bitcoin currently.  assuming a SC is initially MM'd, say at 60%, if a superior SC can flip this around by making Bitcoin 60% MM'd with the SC becoming the main chain, those left behind in BTC will lose value or may lose everything.  the problem is that BTC holders may not be able to differentiate an unfolding superior SC from that of a Sidescam.

i see a very high likelihood of this attack that at the very least will cause volatility in the entire ecosystem. and that would be bad for the BTC and the scBTC price.

i also don't think this can be arbed away.  it's reasonable to think scBTC would start off lower than BTC from being new and less secured with MM.  if the whale can force this to flip with the price of scBTC rising faster than BTC at the very least this will cause volatility.  some BTC holders and especially the speculators may be convinced the SC has a chance to take over and will follow encouraged by the risk free put.  miners may then switch to the SC too and start MM BTC instead.  yes, arb in the middle of a big picture transition can keep prices relatively equal.  but if a true transition is really happening to the SC becoming dominant, the BTC price should start to drop below that of scBTC as realization sets in that BTC is going to lose and BTC itself becomes the 60% MM'd chain with the SC as the mainchain.

so in essence, last out the door will lose.

Just a note about this scenario.

I don't believe miners switching over to the SC and MM BTC makes the SC the mainchain. Only a full exile of the nodes can do that.

this is the follow on from me beating around the bush the other day, btw.

if BTC holders and miners can be seduced to switch to the SC, full nodes might be expected to as well. 
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October 29, 2014, 07:32:28 PM
 #14836

BTW, for those who haven't seen it yet, this new Coinbase feature is FANTASTIC : http://blog.coinbase.com/post/101266587127/introducing-multisig-vault-you-can-now-control-your


Terrific innovation and demonstration that technology can enable better consumer protection than mere regulations

"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 29, 2014, 07:35:44 PM
 #14837

- I cannot imagine how somebody can pump scBTC when exchanging them against BTC is 1:1 at the protocol level.

One example was specifically described: A nominally 1:1 side chain with a cap on the amount of BTC that can be moved to the side chain. Now imagine that the developer secretly grabs 90% of the cap before pumping the sidechain. The developer has a put that makes this a largely risk free (with my caveat about security risks).

I imagine that once speculators and scammers get to work on coming up with their own variations there will be more such methods developed. Scammers are innovative when it comes to methods of scamming if nothing else.
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October 29, 2014, 07:38:54 PM
 #14838

this is the follow on from me beating around the bush the other day, btw.

if BTC holders and miners can be seduced to switch to the SC, full nodes might be expected to as well. 

I guess this is a possible scenario but I find it highly unlikely and a fail to see exactly how the whale profits from such attack? Can you explain further? The way I see it, yes the last out the door may lose but the first in do not gain anything other than securing is stake on the new chain?

I also think the growth of BTC's market cap will eventually mitigate such an attack as what you are suggesting assumes the "attacker" a considerable % stake of the BTC market

"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 29, 2014, 07:39:08 PM
 #14839

if BTC holders and miners can be seduced to switch to the SC, full nodes might be expected to as well. 

That is called an upgrade. The same thing happens today if you convince miners, nodes, and users to adopt a new version of the software. It has nothing to do with sidechains, except perhaps providing a more gradual method to migrate.
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October 29, 2014, 07:40:56 PM
 #14840

- I cannot imagine how somebody can pump scBTC when exchanging them against BTC is 1:1 at the protocol level.

One example was specifically described: A nominally 1:1 side chain with a cap on the amount of BTC that can be moved to the side chain. Now imagine that the developer secretly grabs 90% of the cap before pumping the sidechain. The developer has a put that makes this a largely risk free (with my caveat about security risks).

I imagine that once speculators and scammers get to work on coming up with their own variations there will be more such methods developed. Scammers are innovative when it comes to methods of scamming if nothing else.

it's pretty clear that Sidescams are going to blossom.  all they have to do is cause volatility to the Bitcoin ecosystem to have a negative effect. 

but, i have just described to you a SC situation that starts out with good intent and how a whale could exploit that situation with a speculative attack all b/c he has the economic equivalent of a risk free put with the 2 way peg.

everyone knows the consequences of the Greenspan Put, do they not?
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