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Author Topic: Gold collapsing. Bitcoin UP.  (Read 1803736 times)
cypherdoc
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November 18, 2014, 08:18:52 PM
 #17461

i would rather see gvts and orgs like the IMF have to buy BTC to use as reserves.  that would take us to the Moon:

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2248419

i still see SC's as a way to break Bitcoin's money function by allowing a gvt sponsored currency to siphon BTC to SC w/o having to pay for them.  we need that the price ramps to sustain mining fees and establish Bitcoin as its own global independent currency.  forget asset toys.  as it is, Wall St is the only one who needs or wants those types of toys in the first place with a minority of Americans invested in these things.  even less by foreigners.  what ppl should want and need is Sound Money.  that is what this project is all about, imo.  and the nice thing is anyone who's currently in the Bitcoin system can just sit back, relax, and wait for it to happen.  the price charts still tell me we are destined for greatness.

sorry cypher I'm slow, could you please explain to me how the bolded part is possible?  (serious question)

as i said, imo, the mere insertion of the spvp into the source code throws the whole notion of Bitcoin as Sound Money out the window b/c it allows the separation of the BTC currency unit from its ultra-secure blockchain ledger.  once that's done, all the SC's that have bolted onto Bitcoin can sit back and absorb all the BTC that might be tempted to leave the mainchain.  we also would know that there is a for-profit entity out there (Blockstream) who is in position to influence the continued development of these very SC threats to encourage this dynamic for profit generation.  is there an additional independent way for a gvt sponsored currency to encourage flight to itself?  maybe, use your imagination.  i can think of a few.
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brg444
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November 18, 2014, 08:28:54 PM
 #17462

    • they try to change Bitcoin.  change it by changing the source code which breaks the Sound Money function. [...] that is what the spvp does, it creates an offramp into all manner of these assets.
      So you're saying that a part of the real BTC is being chopped off and managed by a different source code base? The rules for the 1 million scBTC are different than for the original BTC? If so, I agree so far. What I don't understand: people will know this. scInflateBTCx2 has a public ledger and is run by miners using open source code. Why would anybody 'convert' 10 BTC to 10 scInflateBTCx2 knowing full well that scInflateBTCx2 runs a fractional reserve system and the guy with the other 10 scInflateBTCx2 will have his exchanged for 10 BTC half a microsecond later. There would be a continual run on the real BTC... it just wouldn't work, hence no BTC inflation.

    Maybe someone can be so kind to help me understand by answering some of above questions or disputing my assertions?

    Thanks!

    I can't speak for Cypherdoc, (and also don't agree with all of his criticisms) but I'll take a crack at expounding a bit on this one.

    The different rules for the 1 million scBTC may be pretty much anything. They need not be in a public ledger or have open source code, but even if they do, you ask "Why would anybody 'convert' 10 BTC to 10 scInflateBTCx2 knowing full well that scInflateBTCx2 runs a fractional reserve system and the guy with the other 10 scInflateBTCx2 will have his exchanged for 10 BTC half a microsecond later?"

    Historically the reason has been war.  This has been done many times over and over throughout history.  If you look at the creation of almost any central bank scheme, it has almost always been done to finance a war, and to pay soldiers an inflating currency because sound money is scarce at such times.

    When there is conflict, folks are very willing to "go for broke".  They have become convinced by TPTB that their life, and their way of life, and everything they care about will be lost of they don't accept the new scheme... and it is "illegal" not to do so, so they get put to death, imprisoned, called a traitor or whatever if they don't comply.

    If there is a geographical region that has a sound money system and a rule of law system, then the other geographical regimes that have only a rule of law system and have already pulled the con of paying their soldiers with inflation money have the military advantage.  Their soldiers are willing to die for funny money and medals, and your soldiers aren't, so they can afford more of them.


    So... what has all this got to do with Side Chains?  Not a lot, other than it is one mechanism that could be used to turn Bitcoin into "Military Government Inflation Coin" and require the use of that coin within a region by force of law, which of course the monetary authority could then inflate as needed and generate more as needed, diluting the bitcoin in the chain.


    The mechanism itself isn't the evil, it is just the tool.  It can be used for good or "necessary" evils.

    Interesting insight but one that totally ignores the fact that sidechain do not introduce OR do they enable inflation. The process you describe could equally be exercised through any altcoin. [/list]

    "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
    Adrian-x
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    November 18, 2014, 08:48:29 PM
     #17463

      • they try to change Bitcoin.  change it by changing the source code which breaks the Sound Money function. [...] that is what the spvp does, it creates an offramp into all manner of these assets.
        So you're saying that a part of the real BTC is being chopped off and managed by a different source code base? The rules for the 1 million scBTC are different than for the original BTC? If so, I agree so far. What I don't understand: people will know this. scInflateBTCx2 has a public ledger and is run by miners using open source code. Why would anybody 'convert' 10 BTC to 10 scInflateBTCx2 knowing full well that scInflateBTCx2 runs a fractional reserve system and the guy with the other 10 scInflateBTCx2 will have his exchanged for 10 BTC half a microsecond later. There would be a continual run on the real BTC... it just wouldn't work, hence no BTC inflation.

      Maybe someone can be so kind to help me understand by answering some of above questions or disputing my assertions?

      Thanks!

      I can't speak for Cypherdoc, (and also don't agree with all of his criticisms) but I'll take a crack at expounding a bit on this one.

      The different rules for the 1 million scBTC may be pretty much anything. They need not be in a public ledger or have open source code, but even if they do, you ask "Why would anybody 'convert' 10 BTC to 10 scInflateBTCx2 knowing full well that scInflateBTCx2 runs a fractional reserve system and the guy with the other 10 scInflateBTCx2 will have his exchanged for 10 BTC half a microsecond later?"

      Historically the reason has been war.  This has been done many times over and over throughout history.  If you look at the creation of almost any central bank scheme, it has almost always been done to finance a war, and to pay soldiers an inflating currency because sound money is scarce at such times.

      When there is conflict, folks are very willing to "go for broke".  They have become convinced by TPTB that their life, and their way of life, and everything they care about will be lost of they don't accept the new scheme... and it is "illegal" not to do so, so they get put to death, imprisoned, called a traitor or whatever if they don't comply.

      If there is a geographical region that has a sound money system and a rule of law system, then the other geographical regimes that have only a rule of law system and have already pulled the con of paying their soldiers with inflation money have the military advantage.  Their soldiers are willing to die for funny money and medals, and your soldiers aren't, so they can afford more of them.


      So... what has all this got to do with Side Chains?  Not a lot, other than it is one mechanism that could be used to turn Bitcoin into "Military Government Inflation Coin" and require the use of that coin within a region by force of law, which of course the monetary authority could then inflate as needed and generate more as needed, diluting the bitcoin in the chain.


      The mechanism itself isn't the evil, it is just the tool.  It can be used for good or "necessary" evils.

      Interesting insight but one that totally ignores the fact that sidechain do not introduce OR do they enable inflation. The process you describe could equally be exercised through any altcoin. [/list]

      but would you buy in if you had Bitcoin? just to make it more interesting, it will be like a war bond, you buy in an instantly get a 5% above market teh government will deflate after the war, you will get back more BTC at a higher rate, but you will lose if you withdraw while its inflating, so just hold.

      Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
      brg444
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      November 18, 2014, 08:52:19 PM
       #17464

        • they try to change Bitcoin.  change it by changing the source code which breaks the Sound Money function. [...] that is what the spvp does, it creates an offramp into all manner of these assets.
          So you're saying that a part of the real BTC is being chopped off and managed by a different source code base? The rules for the 1 million scBTC are different than for the original BTC? If so, I agree so far. What I don't understand: people will know this. scInflateBTCx2 has a public ledger and is run by miners using open source code. Why would anybody 'convert' 10 BTC to 10 scInflateBTCx2 knowing full well that scInflateBTCx2 runs a fractional reserve system and the guy with the other 10 scInflateBTCx2 will have his exchanged for 10 BTC half a microsecond later. There would be a continual run on the real BTC... it just wouldn't work, hence no BTC inflation.

        Maybe someone can be so kind to help me understand by answering some of above questions or disputing my assertions?

        Thanks!

        I can't speak for Cypherdoc, (and also don't agree with all of his criticisms) but I'll take a crack at expounding a bit on this one.

        The different rules for the 1 million scBTC may be pretty much anything. They need not be in a public ledger or have open source code, but even if they do, you ask "Why would anybody 'convert' 10 BTC to 10 scInflateBTCx2 knowing full well that scInflateBTCx2 runs a fractional reserve system and the guy with the other 10 scInflateBTCx2 will have his exchanged for 10 BTC half a microsecond later?"

        Historically the reason has been war.  This has been done many times over and over throughout history.  If you look at the creation of almost any central bank scheme, it has almost always been done to finance a war, and to pay soldiers an inflating currency because sound money is scarce at such times.

        When there is conflict, folks are very willing to "go for broke".  They have become convinced by TPTB that their life, and their way of life, and everything they care about will be lost of they don't accept the new scheme... and it is "illegal" not to do so, so they get put to death, imprisoned, called a traitor or whatever if they don't comply.

        If there is a geographical region that has a sound money system and a rule of law system, then the other geographical regimes that have only a rule of law system and have already pulled the con of paying their soldiers with inflation money have the military advantage.  Their soldiers are willing to die for funny money and medals, and your soldiers aren't, so they can afford more of them.


        So... what has all this got to do with Side Chains?  Not a lot, other than it is one mechanism that could be used to turn Bitcoin into "Military Government Inflation Coin" and require the use of that coin within a region by force of law, which of course the monetary authority could then inflate as needed and generate more as needed, diluting the bitcoin in the chain.


        The mechanism itself isn't the evil, it is just the tool.  It can be used for good or "necessary" evils.

        Interesting insight but one that totally ignores the fact that sidechain do not introduce OR do they enable inflation. The process you describe could equally be exercised through any altcoin. [/list]

        but would you buy in if you had Bitcoin? just to make it more interesting, it will be like a war bond, you buy in an instantly get a 5% above market teh government will deflate after the war, you will get back more BTC at a higher rate, but you will lose if you withdraw while its inflating, so just hold.

        lol

        BTW you cannot withdraw to the mainchain more BTC than you had invested so you are essentially stuck in that inflated chain if ever you decide to preserve this illusional inflated value.

        You also fail to ignore the fact that this scheme is very much possible today using existing technology : altcoins and/or federated 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
        chriswilmer
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        November 18, 2014, 09:09:08 PM
         #17465

        why do ppl, including myself, always say that Bitcoin is going to have a binary outcome?

        it's b/c they understand that Bitcoin is about Money.  Sound fixed supply Money.  you know, the Money that has the chance to consume the Forex and gold markets.  in that sense, it has the chance to consume the entire fiat world; yes including stocks, bonds, insurance, just by being used as money alone.  it doesn't have to incorporate all those speculative assets directly within its protocol using SC's.  

        As much as a despise of what Gates said (in my words: "the blockchain tech is great, but as a money it's not so good"), you have to admit that the features 'decentralized', 'trustless', 'possibly anonymous' and 'uncensorable' are ones that would also be damn good features for stock exchange / dividend payments / all kinds of derivative gambling, ownership management, etc.

        If you want Bitcoin (the money) to conquer these areas and serve them as a liquid interchange money, wouldn't it be brilliant to have a technical solution that would allow some asset ledger (say the land ownership ledger) to interchange value with the money ledger (Bitcoin) and make atomic swaps across the chains possible?


        Doesn't colored coins already let you do this? I feel like like people are overcomplicating the problem of using the Bitcoin blockchain for asset transfer.
        brg444
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        November 18, 2014, 09:20:20 PM
         #17466

        why do ppl, including myself, always say that Bitcoin is going to have a binary outcome?

        it's b/c they understand that Bitcoin is about Money.  Sound fixed supply Money.  you know, the Money that has the chance to consume the Forex and gold markets.  in that sense, it has the chance to consume the entire fiat world; yes including stocks, bonds, insurance, just by being used as money alone.  it doesn't have to incorporate all those speculative assets directly within its protocol using SC's.  

        As much as a despise of what Gates said (in my words: "the blockchain tech is great, but as a money it's not so good"), you have to admit that the features 'decentralized', 'trustless', 'possibly anonymous' and 'uncensorable' are ones that would also be damn good features for stock exchange / dividend payments / all kinds of derivative gambling, ownership management, etc.

        If you want Bitcoin (the money) to conquer these areas and serve them as a liquid interchange money, wouldn't it be brilliant to have a technical solution that would allow some asset ledger (say the land ownership ledger) to interchange value with the money ledger (Bitcoin) and make atomic swaps across the chains possible?


        Doesn't colored coins already let you do this? I feel like like people are overcomplicating the problem of using the Bitcoin blockchain for asset transfer.

        They do, but they introduce another layer of trust that is considerably less decentralized.


        "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 18, 2014, 09:26:41 PM
         #17467

        Quote
        but would you buy in if you had Bitcoin? just to make it more interesting, it will be like a war bond, you buy in an instantly get a 5% above market teh government will deflate after the war, you will get back more BTC at a higher rate, but you will lose if you withdraw while its inflating, so just hold.

        lol

        BTW you cannot withdraw to the mainchain more BTC than you had invested so you are essentially stuck in that inflated chain if ever you decide to preserve this illusional inflated value.

        You also fail to ignore the fact that this scheme is very much possible today using existing technology : altcoins and/or federated sidechains
        in you lack of understanding you overlooked interest being paid on the bond in inflation coin, as the source for withdrawing more than you put in, there is also the irony you missed and that is the fact that throughout history the war time inflation is never paid back, only this time its different, it is guaranteed by the SideChain not governments Roll Eyes.  

        I didn't ignore it, I asked you if you would consider it if you had Bitcoin? (you just make it more complicated by saying alts aren't the only option, you could do it with Bitcoin and federated sidechains.)

        the question is now more complicated thanks to your input, would you consider inflation coin in war time if it was made the law, using either alts or federated sidechains, or would you prefer to hold your Bitcoin?

        Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
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        November 18, 2014, 09:29:37 PM
         #17468

        why do ppl, including myself, always say that Bitcoin is going to have a binary outcome?

        it's b/c they understand that Bitcoin is about Money.  Sound fixed supply Money.  you know, the Money that has the chance to consume the Forex and gold markets.  in that sense, it has the chance to consume the entire fiat world; yes including stocks, bonds, insurance, just by being used as money alone.  it doesn't have to incorporate all those speculative assets directly within its protocol using SC's.  

        As much as a despise of what Gates said (in my words: "the blockchain tech is great, but as a money it's not so good"), you have to admit that the features 'decentralized', 'trustless', 'possibly anonymous' and 'uncensorable' are ones that would also be damn good features for stock exchange / dividend payments / all kinds of derivative gambling, ownership management, etc.

        If you want Bitcoin (the money) to conquer these areas and serve them as a liquid interchange money, wouldn't it be brilliant to have a technical solution that would allow some asset ledger (say the land ownership ledger) to interchange value with the money ledger (Bitcoin) and make atomic swaps across the chains possible?


        Doesn't colored coins already let you do this? I feel like like people are overcomplicating the problem of using the Bitcoin blockchain for asset transfer.

        I couldn't agree more its not like the whole of civilization is corrupted to the core, lets just change the money first and see it that works.

        Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
        chriswilmer
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        November 18, 2014, 09:33:01 PM
         #17469

        why do ppl, including myself, always say that Bitcoin is going to have a binary outcome?

        it's b/c they understand that Bitcoin is about Money.  Sound fixed supply Money.  you know, the Money that has the chance to consume the Forex and gold markets.  in that sense, it has the chance to consume the entire fiat world; yes including stocks, bonds, insurance, just by being used as money alone.  it doesn't have to incorporate all those speculative assets directly within its protocol using SC's.  

        As much as a despise of what Gates said (in my words: "the blockchain tech is great, but as a money it's not so good"), you have to admit that the features 'decentralized', 'trustless', 'possibly anonymous' and 'uncensorable' are ones that would also be damn good features for stock exchange / dividend payments / all kinds of derivative gambling, ownership management, etc.

        If you want Bitcoin (the money) to conquer these areas and serve them as a liquid interchange money, wouldn't it be brilliant to have a technical solution that would allow some asset ledger (say the land ownership ledger) to interchange value with the money ledger (Bitcoin) and make atomic swaps across the chains possible?


        Doesn't colored coins already let you do this? I feel like like people are overcomplicating the problem of using the Bitcoin blockchain for asset transfer.

        They do, but they introduce another layer of trust that is considerably less decentralized.



        What are you talking about? What's centralized about the colored coin protocol?
        brg444
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        November 18, 2014, 09:35:06 PM
         #17470

        Quote
        but would you buy in if you had Bitcoin? just to make it more interesting, it will be like a war bond, you buy in an instantly get a 5% above market teh government will deflate after the war, you will get back more BTC at a higher rate, but you will lose if you withdraw while its inflating, so just hold.

        lol

        BTW you cannot withdraw to the mainchain more BTC than you had invested so you are essentially stuck in that inflated chain if ever you decide to preserve this illusional inflated value.

        You also fail to ignore the fact that this scheme is very much possible today using existing technology : altcoins and/or federated sidechains
        in you lack of understanding you overlooked interest being paid on the bond in inflation coin, as the source for withdrawing more than you put in, there is also the irony you missed and that is the fact that throughout history the war time inflation is never paid back, only this time its different, it is guaranteed by the SideChain not governments Roll Eyes.  

        I didn't ignore it, I asked you if you would consider it if you had Bitcoin? (you just make it more complicated by saying alts aren't the only option, you could do it with Bitcoin and federated sidechains.)

        the question is now more complicated thanks to your input, would you consider inflation coin in war time if it was made the law, using either alts or federated sidechains, or would you prefer to hold your Bitcoin?

        What exactly do you mean by "if it was made the law".

        Also, are we not assuming this sidechain is controlled by the government or else who exactly do this war time money go to? If so why should I trust government sidechain more than traditional government. They could just as easily change the rules after the fact.

        And of course I would prefer to hold Bitcoin. I'm not the type of person who willingly fund war and consciously inflate the value of my holdings

        "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 18, 2014, 09:41:25 PM
         #17471

        why do ppl, including myself, always say that Bitcoin is going to have a binary outcome?

        it's b/c they understand that Bitcoin is about Money.  Sound fixed supply Money.  you know, the Money that has the chance to consume the Forex and gold markets.  in that sense, it has the chance to consume the entire fiat world; yes including stocks, bonds, insurance, just by being used as money alone.  it doesn't have to incorporate all those speculative assets directly within its protocol using SC's.  

        As much as a despise of what Gates said (in my words: "the blockchain tech is great, but as a money it's not so good"), you have to admit that the features 'decentralized', 'trustless', 'possibly anonymous' and 'uncensorable' are ones that would also be damn good features for stock exchange / dividend payments / all kinds of derivative gambling, ownership management, etc.

        If you want Bitcoin (the money) to conquer these areas and serve them as a liquid interchange money, wouldn't it be brilliant to have a technical solution that would allow some asset ledger (say the land ownership ledger) to interchange value with the money ledger (Bitcoin) and make atomic swaps across the chains possible?


        Doesn't colored coins already let you do this? I feel like like people are overcomplicating the problem of using the Bitcoin blockchain for asset transfer.

        They do, but they introduce another layer of trust that is considerably less decentralized.



        What are you talking about? What's centralized about the colored coin protocol?

        the colored coin protocol is too centralized Roll Eyes with Sidechaines it can be less centralized.

        see that white gap in the image below, (thats where Colourd coins would fit) Tongue this proves Sidechanes are better as they are less centralized.


        its all good if you dont know where the economic incentives for the added decentralization comes from. all you need to understand it it can be done with the same or very similar security to that of bitcoin, and miners will do it because they earn more.  Wink  

        its not all good Mr brg444 cant see the large picture.

        Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
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        November 18, 2014, 09:45:45 PM
         #17472


        What exactly do you mean by "if it was made the law".


        Legal tender like in 1934

        Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
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        November 18, 2014, 09:51:36 PM
         #17473

        it's becoming clearer to me everyday that what we are dealing with is Keynesian vs Austrian philosophy with this SC's debate.

        that might follow from the big paragraph below about how sidechains dilute bitcoins sound money function, which I cannot for the love of my life understand the reasoning of at this point (I'm trying).

        heretofore, what has brought Bitcoin to where it is today is its Sound Money function.  and its been brilliant at that.  instant liquidity and transportation worldwide and p2p.  continuous growth in the economy and stellar, but volatile, increasing SOV.  gvts everywhere scrambling to figure out what this is and what role it has for their futures.  investment groups everywhere diving into a variety of Bitcoin investing schemes.  Bitcoin is the "Technology Singularity", as Daniel put it in the video above, that is the culmination of 4 decades of work by the cypherpunks.  we have achieved acceptance as a global, digital, cash money system that, imo, is in the process of replacing gold's function for the last 5000 yrs.  to me, an Austrian leaning Bitcoin proponent, that's all we should strive to be.  that's all we need to be.  my goal is to have Bitcoin have its own ticker symbol on the Forex exchange.  from there, as the only true Sound Money in the world, it can consume all fiat currency AND gold, which will take us To The Moon and way beyond as the sole globally accepted currency.  there only needs to be one money and Bitcoin can be "it".  the problem is, if it is even a problem, it will take time and some long hard fought battles.  the Keynesians don't want to help us.  they don't want to "buy in" to the system which would take the price up logarithmically.  they think a price of $376 is "too expensive".  well, to me the other view is that they just weren't paying attention back in 2009 and tough luck, that's how technology disrupts financial systems, as it has with many other industries.  i say "buy in" now and you can still join us on the way to the Moon.  we haven't even really taken off yet.

        I totally agree with the goal (moon) and the view (replace gold) and also to an extent with a possible strategy (forex). I'm absolutely convinced the world needs to go back to sound money... it will solve so many hard problems many people suffer greatly from with a single stroke. We need to try this at all cost and bitcoin is our best chance.

        the Keynesian view is that Bitcoin needs to do more to gain acceptance and grow itself.  the protocol needs to be changed to incorporate all other forms of asset options; stocks, bonds, assurance contracts, smart contracts, insurance, etc.  by allowing BTC to be transformed into speculative assets via the spvp, that is by definition inflationary.  nevermind that if Bitcoin succeeds at the Austrian Sound Money function, it will force all those assets to trade in terms of Bitcoin eventually as well.  but that would be the hard battle and there are too many fiat vested interests that don't want to see that happen.  and there are too many Bitcoiner's who are impatient and can't stand price volatility.  and there are too many devs that gotta dev and get paid (in USD's).  and there are too many of all of those who missed out.  so what do they do?  they try to change Bitcoin.  change it by changing the source code which breaks the Sound Money function.  to me, that is what the spvp does, it creates an offramp into all manner of these assets.  after all, that is exactly what the Blockstream (Keynesian's) say as well; that being that the blockchain is too restrictive, it's prevents innovation, it's too risky, it's too slow, it's not big enough, yada yada yada.  so what is wrong with using SC's to incorporate all those assets?  it breaks the Sound Money function.  Bitcoin will no longer be viewed as solely a new form of money.  it will be viewed as a "trading platform" with which you can use to move back and forth btwn assets and BTC.  it would be like a Fidelity brokerage house, you deposit your money in a cash acct and then trade all manner of assets in and out. it also destroys the time preference of what money should be.  you see, stocks, bonds, contracts, insurance, etc are long term investments.  they are to be held.  and they are not used to provide seamless, instant, liquidity type functions like Bitcoin would be if it stays in its current form as sound money.  thus, we may NEVER see those assets be converted back to BTC in the future.  or at least if we do, it won't be for a long time, and then what does that do for Bitcoins money function?  answer:  it slows it down if not outright destroys it.  if that's true, where do Bitcoin miners get the tx fees they desperately need in the future to secure the mainchain?  what do we, as current Bitcoin holders, do if we see that many ppl are using this offramp to move into all these different SC's?  how do we interpret an especially popular SC?  Zerg and others say that we should trust Blockstream devs to incorporate any popular function back into the MC. but that would be to violate one of Bitcoins core principles; trust no man.  and incorporating other assets back into MC doesn't even make any sense when you are talking about SC's that offer completely different assets as defined above.  they would have to stay as SC's and i dare say there mere existence destroys Bitcoins liquidity and money function.  

        The bolded parts is the reasoning I have problems with.

        Let me rip out those bolded parts and ask specific question or utter some hypothesis regarding them.

        (cypherdoc, please don't take this as an attack on your opinion. I don't hold any opinion myself, I'm just asking question because I want to understand your reasoning)

        • allowing BTC to be transformed into speculative assets via the spvp, that is by definition inflationary.
          How is that inflationary? What is being inflated? Surely there are still at most 21 million bitcoins. Ok, 1 million got locked on the bitcoin blockchain and the 'access rights' to them are now managed by a sidechain. Are you saying the sidechain devs could inflate the amound of scBTC (say they double it) and then we'd have 22 million bitcoins?


        We have to assume that it is not possible to convert 1 BTC to 1 scBTC, do magic to create another scBTC, convert back and then have 2 BTC. That is absurd. If the sidechain tries to do this, which is fractional reserve banking, there will be an immediate run, and someone will hold a bag of worthless scBTC. Conclusion: Such sidechain can not get off the ground.


        Quote
        • they try to change Bitcoin.  change it by changing the source code which breaks the Sound Money function. [...] that is what the spvp does, it creates an offramp into all manner of these assets.
          So you're saying that a part of the real BTC is being chopped off and managed by a different source code base? The rules for the 1 million scBTC are different than for the original BTC? If so, I agree so far. What I don't understand: people will know this. scInflateBTCx2 has a public ledger and is run by miners using open source code. Why would anybody 'convert' 10 BTC to 10 scInflateBTCx2 knowing full well that scInflateBTCx2 runs a fractional reserve system and the guy with the other 10 scInflateBTCx2 will have his exchanged for 10 BTC half a microsecond later. There would be a continual run on the real BTC... it just wouldn't work, hence no BTC inflation.


        The rules for the spvp can not be like this, it is bitcoin suicide and everybody will know. Even technically, how would it come about? Every coin fraction can be traced back to some coinbase transaction, and this would break that connection.


        Quote
        • so what is wrong with using SC's to incorporate all those assets?  it breaks the Sound Money function.
          Again: how? If the sidechain fucks up, not all of the inflated coins there will magically be convertible back to BTC, only the amount that was 'moved over from the MC' in the first place, right? So again: no harm to BTC monetary base.


        The only external function the bitcoin blockchain can serve, is to have pointers in the blockchain to other resources, in that way someone can prove that the object pointed to existed at the time of the inclusion in a block. This kind of usage (you migh call it misuse), can not be prevented, and zero bitcoin outputs were allowed to minimize the impact on the blockchain. Otherwise you can either burn coins, or move them to some address and temporarily hide the key necessary to transact. So there is no danger of desoundifying bitcoins.


        Quote

        • thus, we may NEVER see those assets be converted back to BTC in the future.
          So? It's the same with hoarding or burning BTC, no? If they never come back to the MC, if anything BTC monetary supply is deflated.


        Bitcoins disappearing from the scene sounds, on the surface, like a bad thing, in fact it does not matter. There is absolutely no limit to the amount of bitcoins that can disappear, and we still have a working system. (Lost coins appreciate the remaining coins, balanced against the risk of loss on the holder). At some point, we might need to change the protocol and invent micro-satoshis, but that change is trivial.


        Quote
        • they would have to stay as SC's and i dare say there mere existence destroys Bitcoins liquidity and money function.
          Are you saying because all those BTC are being locked in the main chain, Bitcoins liquidity is reduced and therefore its money function hampered? Isn't that like saying Satoshi is reducing Bitcoins liquidity and money function by sitting on 1.5 million BTC?


        No liquidity is lost with holding and hiding and locking and whatever. Liquidity is the ease with which you can get rid of your coins, it is up to the receiver. Many potential receivers, more liquidity. Hoarded coins can still be moved by the owner, as long as there is a willing taker. An approximation of the liquidity is the value of the coins, you could also use the wallet count, merchant count and other parameters.


        Quote
        [/list]

        Maybe someone can be so kind to help me understand by answering some of above questions or disputing my assertions?

        Thanks!
        [...]
        brg444
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        November 18, 2014, 09:52:16 PM
         #17474

        why do ppl, including myself, always say that Bitcoin is going to have a binary outcome?

        it's b/c they understand that Bitcoin is about Money.  Sound fixed supply Money.  you know, the Money that has the chance to consume the Forex and gold markets.  in that sense, it has the chance to consume the entire fiat world; yes including stocks, bonds, insurance, just by being used as money alone.  it doesn't have to incorporate all those speculative assets directly within its protocol using SC's.  

        As much as a despise of what Gates said (in my words: "the blockchain tech is great, but as a money it's not so good"), you have to admit that the features 'decentralized', 'trustless', 'possibly anonymous' and 'uncensorable' are ones that would also be damn good features for stock exchange / dividend payments / all kinds of derivative gambling, ownership management, etc.

        If you want Bitcoin (the money) to conquer these areas and serve them as a liquid interchange money, wouldn't it be brilliant to have a technical solution that would allow some asset ledger (say the land ownership ledger) to interchange value with the money ledger (Bitcoin) and make atomic swaps across the chains possible?


        Doesn't colored coins already let you do this? I feel like like people are overcomplicating the problem of using the Bitcoin blockchain for asset transfer.

        They do, but they introduce another layer of trust that is considerably less decentralized.



        What are you talking about? What's centralized about the colored coin protocol?

        the colored coin protocol is too centralized Roll Eyes with Sidechaines it can be less centralized.

        see that white gap in the image below, (thats where Colourd coins would fit) Tongue this proves Sidechanes are better as they are less centralized.


        its all good if you dont know where the economic incentives for the added decentralization comes from. all you need to understand it it can be done with the same or very similar security to that of bitcoin, and miners will do it because they earn more.  Wink  

        its not all good Mr brg444 cant see the large picture.

        Colored Coins could be good enough for certain applications, just like Open Transactions could be.

        Others certainly command a more important level of decentralization.

        "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
        brg444
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        November 18, 2014, 09:53:38 PM
         #17475


        What exactly do you mean by "if it was made the law".


        Legal tender like in 1934

        Well fortunately Bitcoin is not physical and is valuable in part exactly because it allows one to avoid such criminal legislations.

        "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 18, 2014, 09:56:01 PM
         #17476

        Colored Coins could be good enough for certain applications, just like Open Transactions could be.

        Others certainly command a more important level of decentralization.
        This is the second time you've referred to the concept of decentralizing with reference to colored coins without explaining exactly what you're talking about, in spite of the fact that what you're saying makes no sense at all.
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        November 18, 2014, 10:00:43 PM
         #17477

        Unlike most detractors in here, Adam Back and Austin Hill's track record speak for themselves.
        You're definitely new here, or else you'd recognize that exact same argument has been run by each and every single long-con scammer and ponzi operator going back to Pirate@40 until the present day.

        Are you getting paid to discredit Blockstream?
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        November 18, 2014, 10:11:55 PM
         #17478

        Unlike most detractors in here, Adam Back and Austin Hill's track record speak for themselves.
        You're definitely new here, or else you'd recognize that exact same argument has been run by each and every single long-con scammer and ponzi operator going back to Pirate@40 until the present day.

        Are you getting paid to discredit Blockstream?

        well, another way to look at them is that they both admittedly missed the Bitcoin train in the beginning and only came around in 2013.  how visionary is that?
        brg444
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        November 18, 2014, 10:17:53 PM
         #17479

        Unlike most detractors in here, Adam Back and Austin Hill's track record speak for themselves.
        You're definitely new here, or else you'd recognize that exact same argument has been run by each and every single long-con scammer and ponzi operator going back to Pirate@40 until the present day.

        Are you getting paid to discredit Blockstream?

        The same argument were made in reference to whom? Pirate@40? What is Pirate@40's name? How does his track record compare to two very public cypherpunks who have been in the scene for longer than most everybody here


        "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
        brg444
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        November 18, 2014, 10:20:22 PM
         #17480

        Unlike most detractors in here, Adam Back and Austin Hill's track record speak for themselves.
        You're definitely new here, or else you'd recognize that exact same argument has been run by each and every single long-con scammer and ponzi operator going back to Pirate@40 until the present day.

        Are you getting paid to discredit Blockstream?

        well, another way to look at them is that they both admittedly missed the Bitcoin train in the beginning and only came around in 2013.  how visionary is that?

         Roll Eyes

        A technology that Adam Back developed is being leveraged in Bitcoin. Austin Hill has been working on zero-knowledge system since before you probably know they existed.

        You really want to debate who is the visionary here?

        I'd also like to know if you plan to respond to everyone who has thoroughly debunked your claims in the past 3-5 pages

        "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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