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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 1863887 times)
iCEBREAKER
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Crypto is the separation of Power and State.


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October 30, 2014, 01:29:33 AM
 #14901

(New & Improved!  Hat tip to da2ce7.)

The USD is entering the 'red giant' phase, having exhausted its primary fuel of gold and silver backing and now being powered by the less dense energy source of hydrocarbon hegemony.  Although less productive, the economic bloat of malinvestment results in a higher apparent magnitude via the financialization process.  

That is why gold/silver/BTC (stuff you have) are collapsing, while insurance/food/medicine/education (stuff you need) costs are soaring.

The red giant will eventually implode in a Kondratieff Winter deflationary holocaust:



While less massive bodies of fiat may ultimately wind up as harmless white dwarfs, the USD is so large it will enter a stage equivalent to carbon-burning when runaway debt-monetization overcomes the hydrostatic equilibrium provided by petrodollars.

This will result in a supernova of hyperinflation, and finally a black hole will remain where the global reserve currency once existed.


Warning Dash is a planned instamine, it wasn't an accident


The difference between bad and well-developed digital cash will determine whether we have a dictatorship or a real democracy.  David Chaum 1996
Fungibility provides privacy as a side effect.  Adam Back 2014
"Monero" : { Private - Auditable - 100% Fungible - Flexible Blocksize - Wild & Free® - Intro - Core GUI - Podcats - Roadmap - Dice - Blackjack - Github - Android }


Bitcoin is intentionally designed to be ungovernable and governance-free.  luke-jr 2016
Blocks must necessarily be full for the Bitcoin network to be able to pay for its own security.  davout 2015
Blocksize is an intentionally limited resource, like the 21e6 BTC limit.  Changing it degrades the surrounding economics, creating negative incentives.  Jeff Garzik 2013


"I believed @Dashpay instamine was a bug & not a feature but then read: https://bitcointalk.org/index.php?topic=421615.msg13017231#msg13017231
I'm not against people making money, but can't support questionable origins."
https://twitter.com/Tone_LLT/status/717822927908024320


The raison d'être of bitcoin is trustlessness. - Eric Lombrozo 2015
It is an Engineering Requirement that Bitcoin be “Above the Law”  Paul Sztorc 2015
Resiliency, not efficiency, is the paramount goal of decentralized, non-state sanctioned currency -Jon Matonis 2015

Bitcoin is intentionally designed to be ungovernable and governance-free.  luke-jr 2016

Technology tends to move in the direction of making surveillance easier, and the ability of computers to track us doubles every eighteen months. - Phil Zimmerman 2013

The only way to make software secure, reliable, and fast is to make it small. Fight Features. - Andy Tanenbaum 2004

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HeliKopterBen
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October 30, 2014, 01:57:44 AM
 #14902

@Cypherdoc

Your scenario is pretty far fetched.  I'm not sure a whale will be able to cause enough panic to do much damage given that side chains will be pegged at the protocol level.  A better test would be during natural panic such as the panic buying in 2011 and 2013 and subsequent crashes.  At worst, people might panic in and out of side chains during such periods  of volatility given the "risk free put" scenario, but arb bots should keep assets aligned in price for the most part.  I highly doubt that all market participants would completely abandon one chain for another.  As long as bitcoin has a block subsidy, it will not be abandoned by miners.

Counterfeit:  made in imitation of something else with intent to deceive:  merriam-webster
cypherdoc
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October 30, 2014, 02:24:50 AM
 #14903

@Cypherdoc

Your scenario is pretty far fetched.  I'm not sure a whale will be able to cause enough panic to do much damage given that side chains will be pegged at the protocol level.  A better test would be during natural panic such as the panic buying in 2011 and 2013 and subsequent crashes.  At worst, people might panic in and out of side chains during such periods  of volatility given the "risk free put" scenario, but arb bots should keep assets aligned in price for the most part.  I highly doubt that all market participants would completely abandon one chain for another.  As long as bitcoin has a block subsidy, it will not be abandoned by miners.

the whale could amplify the effect by buying scBTC on the open mkt exchange with fiat to assist the price rise.  remember, speculators like growth, and this would be no different than investing early in a start up currency that has the added potential of not only the MC but an added innovation that theoretically should make it better and eventually superior.

your point about the block subsidy being a differentiating factor is a good one though.  perhaps the SC could introduce a sidecoin block reward equivalent to Bitcoin at the height in the SC when it is introduced.
HeliKopterBen
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October 30, 2014, 02:52:59 AM
 #14904


the whale could amplify the effect by buying scBTC

Then it wouldn't be a risk free put.

Quote
perhaps the SC could introduce a sidecoin block reward equivalent to Bitcoin at the height in the SC when it is introduced.

The SC reward wouldn't be fungible with bitcoin like the pegged coin.  However, I could see the SC reward becoming a problem if the side chain became popular.  It would provide further incentive for miners to mine the SC vs the MC.

Counterfeit:  made in imitation of something else with intent to deceive:  merriam-webster
cypherdoc
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October 30, 2014, 02:56:17 AM
 #14905


the whale could amplify the effect by buying scBTC

Then it wouldn't be a risk free put.


yep, but under the right conditions could be quite effective.  like in a price ramp to offset the arb bots.

Quote
Quote
perhaps the SC could introduce a sidecoin block reward equivalent to Bitcoin at the height in the SC when it is introduced.

The SC reward wouldn't be fungible with bitcoin like the pegged coin.  However, I could see the SC reward becoming a problem if the side chain became popular.  It would provide further incentive for miners to mine the SC vs the MC.

no it wouldn't be fungible but would cause mining competition especially when the sidecoin is cheap along with the potential for significant price appreciation.
cbeast
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Let's talk governance, lipstick, and pigs.


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October 30, 2014, 02:58:22 AM
 #14906

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
cypherdoc
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October 30, 2014, 02:59:29 AM
 #14907

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

that is the underlying assumption in my base case.
HeliKopterBen
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October 30, 2014, 03:02:41 AM
 #14908

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

Counterfeit:  made in imitation of something else with intent to deceive:  merriam-webster
cbeast
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Let's talk governance, lipstick, and pigs.


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October 30, 2014, 03:07:31 AM
 #14909

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.
It's A White Paper, not The White Paper. I don't agree with the notion of independently traded tokens. The idea of a SC is to decentralize mining (whatever that means) and allow it to scale using present technology.

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
smooth
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October 30, 2014, 03:07:54 AM
 #14910

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.



HeliKopterBen
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October 30, 2014, 03:19:48 AM
 #14911

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

Counterfeit:  made in imitation of something else with intent to deceive:  merriam-webster
smooth
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October 30, 2014, 03:29:39 AM
 #14912

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

My message was a bit unclear. I meant to say as a Bitcoin holder considering exchanging my coins to a side chain (and choosing between these two side chains). Granted the effect you describe could still matter if I were exchanging a small portion of my coins, although I'm not sure my decision whether to exchange would matter here to whether resources are diverted. If not then I would strictly prefer the token version.



cbeast
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Let's talk governance, lipstick, and pigs.


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October 30, 2014, 03:32:27 AM
 #14913

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.
A Side Chain may be an instance where an additional demurrage token may be desirable. The Bitcoin investment has an expiration date so people won't leave it in, but will have some incentive to use the SC.

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
cypherdoc
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October 30, 2014, 03:33:07 AM
 #14914

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

if you're a small miner now on the Bitcoin MC, and a SC with all the properties of my base case (with a significant innovation such as perfect anonymity) came along (now includes a sidecoin) would you stay put or jump to the SC?
brg444
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October 30, 2014, 03:37:41 AM
 #14915

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

if you're a small miner now on the Bitcoin MC, and a SC with all the properties of my base case (with a significant innovation such as perfect anonymity) came along (now includes a sidecoin) would you stay put or jump to the SC?

in your base case, a 1:1 peg, there is no coin issuance, no block subsidy, so no incentive to jump boat

"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 30, 2014, 03:39:20 AM
 #14916

you know, it just occurred to me that when Austin Hill goes around to all the mining pools and mines and tries to convince them to MM all his SC's, he's introducing a market distortion.

in other words, he's attempting to get something for nothing.
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October 30, 2014, 03:41:08 AM
 #14917

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

Quote
However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

if you're a small miner now on the Bitcoin MC, and a SC with all the properties of my base case (with a significant innovation such as perfect anonymity) came along (now includes a sidecoin) would you stay put or jump to the SC?

in your base case, a 1:1 peg, there is no coin issuance, no block subsidy, so no incentive to jump boat

i just changed my base case according to a helpful comment from HB.  so what?  it doesn't invalidate the rest of my arguments.
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October 30, 2014, 03:44:06 AM
 #14918

in your base case, a 1:1 peg, there is no coin issuance, no block subsidy, so no incentive to jump boat
Transactions will happen on the sidechain and can charge tx fees, all of which are able to be converted right back to BTC if wanted. The only incentive to jump boat would be to use a feature.
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October 30, 2014, 03:46:06 AM
 #14919

in your base case, a 1:1 peg, there is no coin issuance, no block subsidy, so no incentive to jump boat
Transactions will happen on the sidechain and can charge tx fees, all of which are able to be converted right back to BTC if wanted. The only incentive to jump boat would be to use a feature.

go back and read my comments from today about this.  there seems to be several reasons for a BTC holder to jump to scBTC immediately once a whale starts pumping thru the peg and the price starts rising. 

don't forget other speculators who just want to use their fiat on an exchange to buy (pile on) a rising asset (scBTC) with significant growth potential.
brg444
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October 30, 2014, 03:47:02 AM
 #14920

i just changed my base case according to a helpful comment from HB.  so what?  it doesn't invalidate the rest of my arguments.

oh nothing, just pointing you moving goal post again. i'm impressed how your imagination can strech to such length to try and poke hole into sidechains.

it reminds of reading logs of the forum thread where satoshi first posted the paper.

"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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