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Author Topic: Gold collapsing. Bitcoin UP.  (Read 1804583 times)
brg444
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November 11, 2014, 05:06:13 AM
 #16521

yes, that's exactly what i'm saying.  Dogecoin will bolt itself to MC as a SC b/c it has nothing to lose and everything to gain by siphoning off whatever BTC it can get whether you think its logical or not.

So your scenario essentially depends on dogecoin being a successful coin in the future. If you truly believe that then yes we will stop arguing about it right now.

I believe Bitcoin's network effect will crush it in short time, no matter if it attaches itself to a SC or not.

If your point is that Dogecoin will not be killed by sidechains then I agree. It is not a likely candidate.

But the reality is, most altcoins are NOT Dogecoin. Dogecoin is very unique in the sense that it has marketed itself stricly as a meme and built a community around this.

On the other hand, most other altcoins market themselves with utility/features/different algos. These are the ones that will be made irrelevant by sidechains.

"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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cypherdoc
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November 11, 2014, 05:10:36 AM
 #16522

the Dogecoin SC can be designed to carry scBTC as well.  that was my original condition.

So fucking what!? Both are not fungible.

There are two type of market participants :

1. Those that want to preserve the value of their investement. All they will care about is sidechains that enable 1:1 peg. Of course that is not the only condition for them to want to lock their BTC to such a chain. It needs to provide a certain utility/feature. There is no point locking your coin to a 1:1 peg of DOGEchain, that I'm sure you can agree.

2. The speculators. They want to be exposed to market fluctuation other than BTC's. These people do not care about 1:1 peg. It completely goes against what they're looking for. For this reason, these people are gonna jump straight to any altcoin.

Considering this, it makes no fucking sense to create a SC with both a 1:1 peg & an altcoin.

Either you are an utility chain or a speculative one.

Speculative ones are altcoins and NO they will not succeed selling themselves with the 2wp because in their case, all it is in reality is a decentralized exchange. A feature that can be considerably more risky than a regular centralized exchange if the user wants to cash out during a crash.

calm down and listen.

a BTC speculator is convinced by over the top Dogecoin advertising (similar to TC) that he wants exposure to Dogecoin price volatility speculation.  he doesn't want to use a centralized exchange.  he decides to transfer into the Dogecoin SC via an available 1:1 peg that gives him scBTC in a holding position on the Dogecoin SC.  he waits until the appropriate time to convert scBTC-->Dogecoin at his strike price.  now he has a position.  simple as that.  there will be plenty of ppl who might want to do this just like keystroke wants to do with TC.  you can't say it won't happen or that it is even a dumb move.  it's all a matter of opinion.

my pt is that SC's have done nothing to kill off Dogecoin and may have in fact strengthened it by facilitating the above process via the 2wp.
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November 11, 2014, 05:14:49 AM
 #16523

, most other altcoins market themselves with utility/features/different algos. These are the ones that will be made irrelevant by sidechains.

So you think competition in the cryptocoin space being made irrelevant helps free market driven innovation how again?

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November 11, 2014, 05:19:08 AM
 #16524


On the other hand, most other altcoins market themselves with utility/features/different algos. These are the ones that will be made irrelevant by sidechains.

but as we agreed very early on, anonymity and fast tx are about the only 2 features worthy of a utility chain that BTC holders will use and miners will MM and thus have a chance to kill off their progenitor altcoins.

but of the 538 altcoins out there, only a few have these features.  all the rest you can't build utility chains for them to kill them off as BTC holders won't use them either b/c they're inflationary or demurrage or some weird monetary property.  all of these altcoins WILL bolt themselves onto the MC b/c the flow of coin is essentially one way and can only benefit the altcoin:  BTC--->altcoin  thru misleading, over the top advertising, whatever.  whether you like it or not, speculators will speculate and the altcoins are gonna bolt on.
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November 11, 2014, 05:19:39 AM
 #16525

you didn't even read my original post above about this.

what Bitcoin dev is going to waste their valuable time devving a Dogecoin utility chain?  how do you even do that anyway w/o the Dogecoin itself?  the feature of Dogecoin is the coin, idiot!  that's the pt, Dogecoiners like the inflationary nature of the coin itself.  how do you build that into a utility chain?  even if you could, what Bitcoiner is going to use it, and for what utility are you talking about?  inflation?  if no Bitcoiners use it, then it can't be MM'd either.  

Well captain obvious OF COURSE they won't. Why? Well maybe because dogecoin is a stupid idea to begin with. One that will die in due time.

"What Bitcoiner is going to use it"  Cheesy Cheesy Cheesy Are you out of your mind? THAT'S WHAT I'VE BEEN SAYING ALL ALONG.

Yes it is possible to create a dogecoin chain. NO! it creates no utility at all. Just a shitty coin bootstrapped on top of a sidechain.

So you went from saying no one would use it, to suggesting it would attach itself to the MC and siphon BTC  Huh Huh

You are right. Sidechains will not kill Dogecoin. It will exist as long as there are people stupid enough to participate in that coin. What sidechains will do is make irrelevant any coin that advertises itself with "utility" features (fast tx, different algo, anonymity)

Dude 100% of the top 7 coins after btc either have no features or are projects that reject btc-style pow mining entirely. Side chains are irrelevant to them. By market cap that is probably 99% of alts and 99.99% of crypto.

Stop wasting your time talking about alts. Btc devs too
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November 11, 2014, 05:20:40 AM
 #16526

, most other altcoins market themselves with utility/features/different algos. These are the ones that will be made irrelevant by sidechains.

So you think competition in the cryptocoin space being made irrelevant helps free market driven innovation how again?


 Huh

Maybe because innovators will not be distracted by having bother bootstrapping a currency on top of their innovation and will actually focus on the innovation while leveraging the BTC currency.

Did you not think of that? Do you not see how it rids us of crypto-scammer that care more about getting rich with their crypto than actually driving innovation and developing better technology?

"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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November 11, 2014, 05:31:39 AM
 #16527

, most other altcoins market themselves with utility/features/different algos. These are the ones that will be made irrelevant by sidechains.

So you think competition in the cryptocoin space being made irrelevant helps free market driven innovation how again?


 Huh

Maybe because innovators will not be distracted by having bother bootstrapping a currency on top of their innovation and will actually focus on the innovation while leveraging the BTC currency.

Did you not think of that? Do you not see how it rids us of crypto-scammer that care more about getting rich with their crypto than actually driving innovation and developing better technology?

but devs wanna make money just like everyone else.  the altcoin is what monetizes their innovation. they don't get paid anything, per se, innovating on Bitcoin.
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November 11, 2014, 05:42:28 AM
 #16528

, most other altcoins market themselves with utility/features/different algos. These are the ones that will be made irrelevant by sidechains.

So you think competition in the cryptocoin space being made irrelevant helps free market driven innovation how again?


 Huh

Maybe because innovators will not be distracted by having bother bootstrapping a currency on top of their innovation and will actually focus on the innovation while leveraging the BTC currency.

Did you not think of that? Do you not see how it rids us of crypto-scammer that care more about getting rich with their crypto than actually driving innovation and developing better technology?

but devs wanna make money just like everyone else.  the altcoin is what monetizes their innovation. they don't get paid anything, per se, innovating on Bitcoin.

So why exactly are you surprised then that devs were willing to join Blockstream? Isn't that exactly the point? Fund innovation

I'm sorry but "monetizing" an innovation by creating a scammy coin on top of it is the least ethical way to go about it. I hope you will agree with that. This is Andrew's main argument in his paper against altcoin :

Quote
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. If somehow you are doing this through honest cluelessness, I dream that you’ll read this article and realize the error of your ways.

"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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November 11, 2014, 05:44:33 AM
 #16529

Dude 100% of the top 7 coins after btc either have no features or are projects that reject btc-style pow mining entirely. Side chains are irrelevant to them. By market cap that is probably 99% of alts and 99.99% of crypto.

Stop wasting your time talking about alts. Btc devs too

whatever, I was never the one to claim that sidechains were created to kill alts, cypherdoc made this insinuation, going so far as to say that because they effectively don't (kill alts) then they have no reason to exist.

this is where I disagree.

"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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November 11, 2014, 05:49:22 AM
 #16530

calm down and listen.

a BTC speculator is convinced by over the top Dogecoin advertising (similar to TC) that he wants exposure to Dogecoin price volatility speculation.  he doesn't want to use a centralized exchange.  he decides to transfer into the Dogecoin SC via an available 1:1 peg that gives him scBTC in a holding position on the Dogecoin SC.  he waits until the appropriate time to convert scBTC-->Dogecoin at his strike price.  now he has a position.  simple as that.  there will be plenty of ppl who might want to do this just like keystroke wants to do with TC.  you can't say it won't happen or that it is even a dumb move.  it's all a matter of opinion.

my pt is that SC's have done nothing to kill off Dogecoin and may have in fact strengthened it by facilitating the above process via the 2wp.

fair enough, I can see your point.

my problem with you argument is that you suggest because they will not "kill", per say, these kind of altcoins, then sidechains lose their purpose. I don't see how you come to that conclusion.

There are plenty of pegged (1:1) use cases for Sidechains that can benefit Bitcoin. I would argue the primary "raison d'être" of sidechains is to enable these 1:1 utility chains.

"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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November 11, 2014, 05:52:31 AM
 #16531

, most other altcoins market themselves with utility/features/different algos. These are the ones that will be made irrelevant by sidechains.

So you think competition in the cryptocoin space being made irrelevant helps free market driven innovation how again?


 Huh

Maybe because innovators will not be distracted by having bother bootstrapping a currency on top of their innovation and will actually focus on the innovation while leveraging the BTC currency.

Did you not think of that? Do you not see how it rids us of crypto-scammer that care more about getting rich with their crypto than actually driving innovation and developing better technology?

And maybe it won't.

The real scam Alts are ones without multisig all others have utility even if it teaches one how to avoid a scam. And my favorite, and I have a large portfolio of worthless Alta, (not premined scams or clones) is all those developers and supporters have all traded for or adopted Bitcoin the safe assets.

Realistically I'm looking for innovation in mining algorithms, distribution schemes, and new incentive mechanisms.
I may be lacking in imagination,  Roll Eyes but I'm seeing a very sterile world of complicated financial assets not a fertile bed for developing new or innovative alternate technology.

I've come up with a few new SC scams so no I don't see them diminishing, rather becoming more sophisticated  Wink.
The barrier to entry being moral.

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November 11, 2014, 05:53:20 AM
 #16532

So why exactly are you surprised then that devs were willing to join Blockstream? Isn't that exactly the point? Fund innovation

I'm sorry but "monetizing" an innovation by creating a scammy coin on top of it is the least ethical way to go about it. I hope you will agree with that. This is Andrew's main argument in his paper against altcoin :

Quote
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. If somehow you are doing this through honest cluelessness, I dream that you’ll read this article and realize the error of your ways.

i understand it in principle but i don't agree the way they're going about it.  as painful as it would be for me to see it, i would expect them to step down from their core dev positions b/c otherwise it sends the wrong message to the market place; that being that a bunch of insiders (core devs) MAY abuse their position in the future to block out any innovations to Bitcoin to protect Blockstream profits.

so you understand my argument about why the vast majority of altcoins will bolt on to Bitcoin MC utilizing the 2wp and how it might be a bigger threat than it already is to Bitcoin in the long run?
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November 11, 2014, 06:01:39 AM
 #16533

calm down and listen.

a BTC speculator is convinced by over the top Dogecoin advertising (similar to TC) that he wants exposure to Dogecoin price volatility speculation.  he doesn't want to use a centralized exchange.  he decides to transfer into the Dogecoin SC via an available 1:1 peg that gives him scBTC in a holding position on the Dogecoin SC.  he waits until the appropriate time to convert scBTC-->Dogecoin at his strike price.  now he has a position.  simple as that.  there will be plenty of ppl who might want to do this just like keystroke wants to do with TC.  you can't say it won't happen or that it is even a dumb move.  it's all a matter of opinion.

my pt is that SC's have done nothing to kill off Dogecoin and may have in fact strengthened it by facilitating the above process via the 2wp.

fair enough, I can see your point.

my problem with you argument is that you suggest because they will not "kill", per say, these kind of altcoins, then sidechains lose their purpose. I don't see how you come to that conclusion.

There are plenty of pegged (1:1) use cases for Sidechains that can benefit Bitcoin. I would argue the primary "raison d'être" of sidechains is to enable these 1:1 utility chains.


wow, after 200 pgs we have an agreement.

i would love to see SC's fulfill their primary goal; that of innovating Bitcoin esp for fast tx and anonymity.  i just fear the unknown secondary effects, one being the perverse strengthening of altcoins via the bolt on.

how do you propose to assess the efficacy/success of these utility chains over time?
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November 11, 2014, 06:06:35 AM
 #16534

so you understand my argument about why the vast majority of altcoins will bolt on to Bitcoin MC utilizing the 2wp and how it might be a bigger threat than it already is to Bitcoin in the long run?

I do agree they will create their own sidechain.

Do I feel it is a threat to Bitcoin in the long run? Absolutely not. My opinion is the network effect is too important and sidechain or not they will all die their slow death.

My best guess is we will look at the last 2 years as having been the only opportunity for altcoins to flourish and speculators to profit from them. This window, IMO, is closing soon. Uncertainty has allowed them to stay around so far, but my feeling is the next bubble will see Bitcoin detach itself from them and solidify its position as the inarguable one and only ledger. When we get there, altcoins market cap will shrink to next to nothing.

"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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November 11, 2014, 06:09:37 AM
 #16535

wow, after 200 pgs we have an agreement.

i would love to see SC's fulfill their primary goal; that of innovating Bitcoin esp for fast tx and anonymity.  i just fear the unknown secondary effects, one being the perverse strengthening of altcoins via the bolt on.

how do you propose to assess the efficacy/success of these utility chains over time?

the same way we have with Bitcoin and other entities in the ecosystem : due diligence, code review, community leaders support.

you might not like it but my hunch is some of the most interesting ones will be Blockstream-sponsored  Tongue

"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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November 11, 2014, 06:11:49 AM
 #16536

Blockstream is really a thorny problem.  i try to reconcile it over and over but i can't.  it's so painful b/c of all the talented long term core devs and commiters participating.  i know that while i might be the only one objecting now, we as a community will hear this objection loud and clear later by traditional financial competitors.

the Fed analogy is pretty darn close as an illustration:  if 40% of Fed governors + key management personnel announced tomorrow that they were going to form Fedstream a for-profit corporation to capitalize on their soon to be implemented new negative interest rate scheme here in the US, i suggest we all would scream bloody murder and demand that they all step down out of conflict of interest.
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November 11, 2014, 06:18:46 AM
 #16537

Blockstream is really a thorny problem.  i try to reconcile it over and over but i can't.  it's so painful b/c of all the talented long term core devs and commiters participating.  i know that while i might be the only one objecting now, we as a community will hear this objection loud and clear later by traditional financial competitors.

the Fed analogy is pretty darn close as an illustration:  if 40% of Fed governors + key management personnel announced tomorrow that they were going to form Fedstream a for-profit corporation to capitalize on their soon to be implemented new negative interest rate scheme here in the US, i suggest we all would scream bloody murder and demand that they all step down out of conflict of interest.

and you know what?  they probably would. in fact, i know they would.
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November 11, 2014, 06:34:25 AM
 #16538

Blockstream is really a thorny problem.  i try to reconcile it over and over but i can't.  it's so painful b/c of all the talented long term core devs and commiters participating.  i know that while i might be the only one objecting now, we as a community will hear this objection loud and clear later by traditional financial competitors.

the Fed analogy is pretty darn close as an illustration:  if 40% of Fed governors + key management personnel announced tomorrow that they were going to form Fedstream a for-profit corporation to capitalize on their soon to be implemented new negative interest rate scheme here in the US, i suggest we all would scream bloody murder and demand that they all step down out of conflict of interest.
Fedstream works in the "old system" where people run it and requires trust along the whole process. Conflict of interest is a very big concern. Bitcoin on the other hand is not a financial system built by trusted networks of people but on code. It's a protocol designed in such a way we don't have to trust people but rather the protocol. And because it is open-source we can always see how it is working.  

I wouldn't worry too much about Blockstream. They seem like a bunch of good guys AND the entire community gets to monitor all their work. It will all be out in the open.


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November 11, 2014, 06:38:24 AM
 #16539

Blockstream is really a thorny problem.  i try to reconcile it over and over but i can't.  it's so painful b/c of all the talented long term core devs and commiters participating.  i know that while i might be the only one objecting now, we as a community will hear this objection loud and clear later by traditional financial competitors.

the Fed analogy is pretty darn close as an illustration:  if 40% of Fed governors + key management personnel announced tomorrow that they were going to form Fedstream a for-profit corporation to capitalize on their soon to be implemented new negative interest rate scheme here in the US, i suggest we all would scream bloody murder and demand that they all step down out of conflict of interest.
Fedstream works in the "old system" where people run it and requires trust along the whole process. Conflict of interest is a very big concern. Bitcoin on the other hand is not a financial system built by trusted networks of people but on code. It's a protocol designed in such a way we don't have to trust people but rather the protocol. And because it is open-source we can always see how it is working.  

I wouldn't worry too much about Blockstream. They seem like a bunch of good guys AND the entire community gets to monitor all their work. It will all be out in the open.




but they're re-writing the protocol (rules) to add the SPVproof which will facilitate their profit model at the expense of altcoins (if you believe brg444) and Bitcoin 2.0's.
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November 11, 2014, 08:19:46 AM
 #16540

In this scheme, there will be only BTC buying with the fiat at exchanges.  No BTC is sold to the market.  Only scBTC is sold to the market but people believe the notion of the peg so they pay the same for them as they would for BTC (because after all they can be redeemed for BTC with only a 100 block delay in spend-ability).

Endgame is there are a lot of the scBTC created, reducing BTC liquidity and pumping the BTC fiat price... until it unwinds.

There is no peg.
There is no spoon.

Here is what I believe to be the flaw in your scenario :

If, as you say, people believe in the peg (which they absolutely should) then they will not buy your scBTC. In reality, the market has no incentive to purchase your scBTC over BTC if they are the same price.  

The reason for this? Well you have suggested it yourself : the "block delay in spend-ability". What makes the best money? The most cost effective and versatile exchangeable asset. BTC is more easily exchangeable with fiat (because of liquidity) and other scBTCs than scBTC is and is also more cost-effective at doing so. No matter the 1:1 fiat peg, BTC is a more desirable unit than scBTC. BTC has better fungibility and liquidity in the economy than scBTC.

Here is where you are flatly wrong.  There clearly is an incentive, the time incentive.
To change BTC to scBTC, you will have to wait for 100 blocks or so, whatever the confirmation time may be.
If you buy them at exchange, there is no wait.

This confirmation exchange value is created in both ways in the transaction.  People will pay a premium for time, localbitcoin pricing is evidence enough of this.
Maybe I'm wrong but don't the atomic swaps described in the paper remove "the time incentive"?
Am I missing something obvious?

Atomic swaps don't involve BTC, they involve scBTC and an altcoin that also exists on the sidechain along with the scBTC.

My knowledge of all this new sidechains nomenclature is a little bit rusty at the least
(I have to go through the last few hundreds pages to get proper definitions).

But from what I read from the paper the atomic swaps will involve token exchange across
chains, I've quote the relevant part of the paper here:

Quote from: sidechains white paper
Appendix C Atomic swaps
Once a sidechain is operational, it is possible for users to exchange coins atomically between chains,
without using the peg. In fact, this is possible with altcoins today, though the independent prices
make it harder to organise. This is important, because as we have seen, direct use of the peg requires
fairly large transactions (with correspondingly large fees) and long wait periods. To contrast, atomic
swaps can be done using only two transactions on each network, each of size similar to ordinary
pay-to-address transactions

You're implying that atomic swaps apply only to scBTC and altcoin that belongs to the same chain, right?

I've gone through this thread and I find this post from Adam Back and it seems to confirm
that we can exchange coins across chains and, I dare to say, even BTC and scBTC.


Since you are free to move coins between BTC and scBTC, the price will be the same. You don't sell scBTC for a lower price when you can transfer it back to BTC and sell it for the full price.

Correct.  I think its worth clarifying that the peg is algorithmic, because its seems from the thread that some people may not understand that.  You, personally, can ask the network automatically to swap unlimited quantities of BTC on the sidechain for BTC on the main bitcoin chain.

The only reason to swap with users using atomic swaps or trades is to do that faster.  No one is going to take anything other than a negligible price difference because they can click a button and move the coins between chains themselves.

Further because that 2wp backstop is there, and anyone and his dog can do arbitrage, with full confidence that they'll be able to exercise the 2wp and capitalise on the small time-preference, the will be small.  It seems just as likely that the sidechain coins sell at a small premium for the time-preference access to side-chain features.  (Time-preference means someones preference to gain access to something sooner rather than waiting eg 24hrs, and they'll sometimes be willing to pay a small fee to get it earlier, eg check advances or such things).

I dont think it realistic that we would see anyone willing to sell sidechain BTC at anything significantly below par in either direction, to do so is to burn money needlessly.  People will arbitrage it and its open to anyone to arbitrage.  So unless someone wants to burn money (and bitcoin already supports proof of burn or pay to miners if you're into burning money or donating to miners), no one will be offering to swap sidechain BTC for BTC at anything far below or above $350 (assuming current market price of $350).  eg $349.50 to $350.50 might be an example which is 15 basis points, that'd give someone a 15% return on an annual basis with steady arbitrage for a 2 day clearance time on the peg.  They can maybe get a higher return (and hence be willing to offer even lower margins) by holding a float on both sides and cancelling some trades against others as those happen faster so they get more than one arbitrage fee per exercise of the 2wp.

Obviously no one is encouraging anyone to put real money into untested or buggy sidechains.  I dont think there will be lots of sidechains and the main sidechains will be extremely well tested and coded to the same rigor as bitcoin itself.

Adam

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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