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Author Topic: Gold collapsing. Bitcoin UP.  (Read 1805638 times)
brg444
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November 20, 2014, 04:52:29 PM
 #17721


the integrity of the ledger depends on the currency unit riding on it.  the greed to obtain the unit is what drives the mining incentive.  w/o the unit, the ledger dies.  which is why allowing the units an offramp to an unrelated speculative SC will kill Bitcoin.

ZB doesn't quite agree with you and made a very logical demonstration of why you are likely wrong, maybe you missed it

It seems to me that, assuming the 2wp is perfect and permanent, if everyone moves to the sidechain, the ledger remains perfectly preserved as long as the sidechain continues working. Bitcoin is no longer serving the memory function (Bitcoin the protocol/chain is dead), but the memory function is being served by another chain (and Bitcoin the ledger lives on). The store of value function has been maintained, but not by what we'd usually want to call "Bitcoin."

There are some definitional ambiguities making this difficult to pin down. The word Bitcoin is used to mean:

  • Bitcoin the protocol
    • Bitcoin the protocol maintained by the people now known as the core devs
    • Bitcoin the protocol adopted by the economic majority, or the majority of mining power
  • Bitcoin the blockchain
  • Bitcoin the ecosystem
  • Bitcoin the ledger (who owns what percentage of the ledger)

The most notable thing about this list, I think, is that the first meanings are the most commonly used, but the last meanings are what really matter from an investor's perspective. Especially Bitcoin the ledger. A sidechain takeover threatens the protocol and the blockchain, but not necessarily the ecosystem, and not the ledger insofar as the peg is ensured and the sidechain is as sound as Bitcoin.

Now whether the sidechain will be as sound as Bitcoin is up in the air. I am skeptical for now, but again in a scenario where everyone is moving to the sidechain that condition has presumably been met in a most credible fashion.

To me, spin-offs are a safer and more elegant way to add functionality to Bitcoin the ledger. Perhaps if Bitcoin the ledger was recognized as the real essence of Bitcoin, rather than the protocol used for updating that ledger, spin-offs would be recognized by everyone as the obvious choice. What do you think?

"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 20, 2014, 04:56:56 PM
 #17722

by breaking the inextricable link btwn the two, you break security and therefore break Bitcoin as Money. 

Bitcoin should continue to focus on what got us to where we are:  the Money function.  that is where the problem lies today in the world of fiat and central banks.  this is what i saw back in January of 2011, Bitcoin as a poison dart aimed at the heart of central banks.  the problem is not stocks, bonds, insurance, contracts.  those all function reasonably well.  the problems we've had with them in the past, such as in 2001 and 2008, were fiat printing enabled and backed by central banks.  w/o the ability to print at will to bail out bad actors, Bitcoin as Money seeks to clamp down and eliminate this moral hazard.  and the network of money is ripe to be disrupted.  and rightfully so.  THAT is where the money is.  the Forex is the biggest in the world as i've shown.  the gold market is huge as well.  if Bitcoin can crack those markets we will go to the Moon.  Bitcoin should stay simple and non complex.  it has evolved to that of a public good.  no one should be allowed to corrupt its primary function of money.  let alone profit off it. 

leave the source code alone.

Persistingly wrong.

How many times and how many people need to point out the fallacy in your argument for you to finally understand that sidechain DO NOT inherently, "break Bitcoin as Money"?

When are you going to address the fact that any centralized off-chain solution is considerably more dangerous to Bitcoin as Money than sidechains are?

Are you going to admit that SPVP proof is just another verification model by which the allocation of coins to other chains is potentially safer and more decentralized than current solutions that exist?

The Bitcoin money is its ledger. Sidechains are effectively the most secure way to accomodate any transactions that can not be processed on the mainchain while preserving the integrity of the ledger.

If you are honestly worried about corruption of Bitcoin as Money, centralized off-chain solutions should be the biggest of your concerns.

why should i admit that centralized offchain solutions are dangerous to Bitcoin?  based on what evidence?  Gox?  Bitcoinica?

c'mon, that would be to neglect the greater understanding that has been achieved by such unfortunate events.  it is growing up.  do you expect perfect behavior from children?  Bitcoin is inherently a p2p money and encourages us as individuals to take greater responsibility for our money.  those hard lessons have gone a long way towards strengthening Bitcoin, not endangering Bitcoin.  look at all the improved security measures that have grown out of those events.  we "need" those events to teach us how to interact with Bitcoin and further strengthen it.  SC's are an excuse to not deal with these hard problems esp when it comes to MC development.  instead of Blockstream breaking off with 40% of core devs + 3 top committers in a bid to make $millions/billions, why don't those guys work with Gavin to implement MC improvements?  or if they insist on attempting to make $millions/billions off of Bitcoin, at least step down and allow some non-conflicted core devs to take over.  or reorg as a non profit.

Blockstream is just another for profit company that was established at the beginning of the year and is jockeying to modify the core protocol to its advantage so as to give them an edge over other companies or products like CP, Bitshares, Mastercoin, etc. 

What an hypocrite.

Do I understand that SCs can not benefit also from this "educational" process?

You are really trying to write-off Gox as irrelevant when nearly a year later we still hear about constantly from mainstream media. Are you suggesting this had no impact on Bitcoin's reputation?

yes it did.  but it didn't kill Bitcoin which is what is important.
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What I want you to admit is these offchain solutions are inherently more dangerous to the integrity of the Bitcoin ledger (Sound Money) than any form of sidechains.

sorry, i will never admit that.  you're talking about something totally separate from the sound money function; reputation which is an emotional response and immaterial to the math.
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we "need" those events to teach us how to interact with Bitcoin and further strengthen it. 

And that's exactly what sidechains propose.

Note that when speaking of sidechains I am also referring to federated models.

at this pt in the debate, i understand exactly what you're talking about.
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I am going to repeat this ad nauseam until you get it : Blockstream's business model is not dependent on SPVP and its core integration and neither is this proposition conferring them any advantage whatsoever considering its neutral, open source nature.

You are as stubborn as a mule...






talk about a contradiction.  you're like a chameleon:

In that sense, you are right that SPVP is crucial to their success because it is the only way they can create these ambitious extensions of Bitcoin I'm sure they have in mind.


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November 20, 2014, 04:57:04 PM
 #17723

brg444 continues to morph his argument by alternating his cheerleading of these speculative SC's btwn, "we don't need or want them, just utility chains" to "we should want to incorporate speculative assets into SC's to grow the economy and diversify.  decentralize all the things!"

but i say that the main goal of the spvp is to create speculative SC's; i have $21M in Blockstream investment that says i'm right.

You said yourself you have no idea what Blockstream business model is so my bet is you're just pulling things out of your ass once again.

I am going to repeat this ad nauseam until you get it : Blockstream's business model is not dependent on SPVP and its core integration and neither is this proposition conferring them any advantage whatsoever considering its neutral, open source nature.


"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 20, 2014, 04:57:45 PM
 #17724

I agree with you on this issue cypher but my problem is... If you don't want these side chains to exist, why is it that you are also so against alt coins that enable features that you do not wish Bitcoin to support?

Great read:
https://blog.ethereum.org/2014/11/20/bitcoin-maximalism-currency-platform-network-effects/

How would you like to see such innovation occur?


i'm against them only in the sense that i think they will die competing with Bitcoin so the sooner everyone comes to that understanding the better.  but i understand that they want to compete head to head and speculators will always try to make a buck so who am i to argue with that as long as they are competing fairly and not trying to alter Bitcoin source code to their advantage.

But many of them are not competing directly with bitcoin as sound money, they are providing other distinct features that bitcoin is unwilling to match, that you do not wish it to match, in it's quest to provide said money. How is it that all those useful features will just "die" when bitcoin is not willing or unable to provide equal features?

give me an example.

I really don't want to bring up nxt again but you asked for an example. The Nxt FreeMarket (decentralized marketplace)for example. This cannot be built on top of bitcoin. The closest is OpenBazaar but it is not built on top of bitcoin, it simply uses it. In the coming months users of the FreeMarket will also be able to buy and sell using bitcoin directly anyway. The fact that this platform is built on top of a blockchain offers some important privacy benefits that OpenBazaar will be unable to match. For instance, OpenBazaar will be require you to have a node running at all times for your shop to remain visible to other users, which I believe is a huge privacy flaw. How would such a feature just "die" because of bitcoin? It has nothing to do with money, and everything to do with a new method of secure communication using the blockchain. (FreeMarket is not core, it was built on top by a third party).
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November 20, 2014, 05:00:26 PM
 #17725


the integrity of the ledger depends on the currency unit riding on it.  the greed to obtain the unit is what drives the mining incentive.  w/o the unit, the ledger dies.  which is why allowing the units an offramp to an unrelated speculative SC will kill Bitcoin.

ZB doesn't quite agree with you and made a very logical demonstration of why you are likely wrong, maybe you missed it

It seems to me that, assuming the 2wp is perfect and permanent, if everyone moves to the sidechain, the ledger remains perfectly preserved as long as the sidechain continues working. Bitcoin is no longer serving the memory function (Bitcoin the protocol/chain is dead), but the memory function is being served by another chain (and Bitcoin the ledger lives on). The store of value function has been maintained, but not by what we'd usually want to call "Bitcoin."

There are some definitional ambiguities making this difficult to pin down. The word Bitcoin is used to mean:

  • Bitcoin the protocol
    • Bitcoin the protocol maintained by the people now known as the core devs
    • Bitcoin the protocol adopted by the economic majority, or the majority of mining power
  • Bitcoin the blockchain
  • Bitcoin the ecosystem
  • Bitcoin the ledger (who owns what percentage of the ledger)

The most notable thing about this list, I think, is that the first meanings are the most commonly used, but the last meanings are what really matter from an investor's perspective. Especially Bitcoin the ledger. A sidechain takeover threatens the protocol and the blockchain, but not necessarily the ecosystem, and not the ledger insofar as the peg is ensured and the sidechain is as sound as Bitcoin.

Now whether the sidechain will be as sound as Bitcoin is up in the air. I am skeptical for now, but again in a scenario where everyone is moving to the sidechain that condition has presumably been met in a most credible fashion.

To me, spin-offs are a safer and more elegant way to add functionality to Bitcoin the ledger. Perhaps if Bitcoin the ledger was recognized as the real essence of Bitcoin, rather than the protocol used for updating that ledger, spin-offs would be recognized by everyone as the obvious choice. What do you think?

i don't miss anything.  that doesn't mean i understand everything.

sorry, but i don't agree with his assessment.  precisely b/c it leaves out an understanding that the money function will get deprecated in deference to the speculative assets riding on the SC's which distract from the mechanism which has brought us to where we are today.  the BTC price will drop if SC's are implemented, imo.
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November 20, 2014, 05:04:02 PM
 #17726

Quote

I am going to repeat this ad nauseam until you get it : Blockstream's business model is not dependent on SPVP and its core integration and neither is this proposition conferring them any advantage whatsoever considering its neutral, open source nature.

You are as stubborn as a mule...

talk about a contradiction.  you're like a chameleon:

In that sense, you are right that SPVP is crucial to their success because it is the only way they can create these ambitious extensions of Bitcoin I'm sure they have in mind.

 Cheesy

I should've expect that reply, you are much too shallow to understand intricacies in an argument.

These extensions to Bitcoin I'm referring to that require SPVP are of the open source domain. None will be proprietary to Blockstream or their client. Blockstream's goal is to build these decentralized platform to allow the open source community to create innovative services/chains on top of them.

If in the end SPVP is not integrated, which IMO would be a considerable loss to the ecosystem, then they will model their services around federated sidechains which is likely to be, anyway, the preffered choice of their clients.

"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 20, 2014, 05:04:56 PM
 #17727

I agree with you on this issue cypher but my problem is... If you don't want these side chains to exist, why is it that you are also so against alt coins that enable features that you do not wish Bitcoin to support?

Great read:
https://blog.ethereum.org/2014/11/20/bitcoin-maximalism-currency-platform-network-effects/

How would you like to see such innovation occur?


i'm against them only in the sense that i think they will die competing with Bitcoin so the sooner everyone comes to that understanding the better.  but i understand that they want to compete head to head and speculators will always try to make a buck so who am i to argue with that as long as they are competing fairly and not trying to alter Bitcoin source code to their advantage.

But many of them are not competing directly with bitcoin as sound money, they are providing other distinct features that bitcoin is unwilling to match, that you do not wish it to match, in it's quest to provide said money. How is it that all those useful features will just "die" when bitcoin is not willing or unable to provide equal features?

give me an example.

I really don't want to bring up nxt again but you asked for an example. The Nxt FreeMarket (decentralized marketplace)for example. This cannot be built on top of bitcoin. The closest is OpenBazaar but it is not built on top of bitcoin, it simply uses it. In the coming months users of the FreeMarket will also be able to buy and sell using bitcoin directly anyway. The fact that this platform is built on top of a blockchain offers some important privacy benefits that OpenBazaar will be unable to match. For instance, OpenBazaar will be require you to have a node running at all times for your shop to remain visible to other users, which I believe is a huge privacy flaw. How would such a feature just "die" because of bitcoin? It has nothing to do with money, and everything to do with a new method of secure communication using the blockchain.

lets be clear here.  my arguments in the past have been against altcoins but only in the sense that i think they will die by trying to compete with Bitcoin as a form of money.  the open market stuff, sure, they might survive as long as they provide a valuable service.  i doubt they survive if they depend on an altcoin.  in that sense, i would hope they would try to build their service on top of Bitcoin instead.
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November 20, 2014, 05:06:56 PM
 #17728


the integrity of the ledger depends on the currency unit riding on it.  the greed to obtain the unit is what drives the mining incentive.  w/o the unit, the ledger dies.  which is why allowing the units an offramp to an unrelated speculative SC will kill Bitcoin.

ZB doesn't quite agree with you and made a very logical demonstration of why you are likely wrong, maybe you missed it

It seems to me that, assuming the 2wp is perfect and permanent, if everyone moves to the sidechain, the ledger remains perfectly preserved as long as the sidechain continues working. Bitcoin is no longer serving the memory function (Bitcoin the protocol/chain is dead), but the memory function is being served by another chain (and Bitcoin the ledger lives on). The store of value function has been maintained, but not by what we'd usually want to call "Bitcoin."

There are some definitional ambiguities making this difficult to pin down. The word Bitcoin is used to mean:

  • Bitcoin the protocol
    • Bitcoin the protocol maintained by the people now known as the core devs
    • Bitcoin the protocol adopted by the economic majority, or the majority of mining power
  • Bitcoin the blockchain
  • Bitcoin the ecosystem
  • Bitcoin the ledger (who owns what percentage of the ledger)

The most notable thing about this list, I think, is that the first meanings are the most commonly used, but the last meanings are what really matter from an investor's perspective. Especially Bitcoin the ledger. A sidechain takeover threatens the protocol and the blockchain, but not necessarily the ecosystem, and not the ledger insofar as the peg is ensured and the sidechain is as sound as Bitcoin.

Now whether the sidechain will be as sound as Bitcoin is up in the air. I am skeptical for now, but again in a scenario where everyone is moving to the sidechain that condition has presumably been met in a most credible fashion.

To me, spin-offs are a safer and more elegant way to add functionality to Bitcoin the ledger. Perhaps if Bitcoin the ledger was recognized as the real essence of Bitcoin, rather than the protocol used for updating that ledger, spin-offs would be recognized by everyone as the obvious choice. What do you think?

i don't miss anything.  that doesn't mean i understand everything.

sorry, but i don't agree with his assessment.  precisely b/c it leaves out an understanding that the money function will get deprecated in deference to the speculative assets riding on the SC's which distract from the mechanism which has brought us to where we are today.  the BTC price will drop if SC's are implemented, imo.

A depreciation of someone's wealth on the ledger due to speculative assets is the gain of someone else. The ledger stays intact.

"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 20, 2014, 05:11:27 PM
 #17729

Quote

I am going to repeat this ad nauseam until you get it : Blockstream's business model is not dependent on SPVP and its core integration and neither is this proposition conferring them any advantage whatsoever considering its neutral, open source nature.

You are as stubborn as a mule...

talk about a contradiction.  you're like a chameleon:

In that sense, you are right that SPVP is crucial to their success because it is the only way they can create these ambitious extensions of Bitcoin I'm sure they have in mind.

 Cheesy

I should've expect that reply, you are much too shallow to understand intricacies in an argument.

These extensions to Bitcoin I'm referring to that require SPVP are of the open source domain. None will be proprietary to Blockstream or their client. Blockstream's goal is to build these decentralized platform to allow the open source community to create innovative services/chains on top of them.

If in the end SPVP is not integrated, which IMO would be a considerable loss to the ecosystem, then they will model their services around federated sidechains which is likely to be, anyway, the preffered choice of their clients.

hmmm, you sure talk like you're an insider to Blockstream.  is that you Greg?

how would you know that the spvp enabled SC's will be open source?  that's up to whoever contracts with Blockstream to build them.  the rules will be whatever they want.  i've already pointed out how you love to throw the term "open source" around to drive all the juices and get support of the devs reading this thread but the fact of the matter is that Blockstream will be paid good money to construct as many SC's, be they federated or spvp related, for any willing buyer. 

i have $21M that says i'm right.
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November 20, 2014, 05:14:03 PM
 #17730


the integrity of the ledger depends on the currency unit riding on it.  the greed to obtain the unit is what drives the mining incentive.  w/o the unit, the ledger dies.  which is why allowing the units an offramp to an unrelated speculative SC will kill Bitcoin.

ZB doesn't quite agree with you and made a very logical demonstration of why you are likely wrong, maybe you missed it

It seems to me that, assuming the 2wp is perfect and permanent, if everyone moves to the sidechain, the ledger remains perfectly preserved as long as the sidechain continues working. Bitcoin is no longer serving the memory function (Bitcoin the protocol/chain is dead), but the memory function is being served by another chain (and Bitcoin the ledger lives on). The store of value function has been maintained, but not by what we'd usually want to call "Bitcoin."

There are some definitional ambiguities making this difficult to pin down. The word Bitcoin is used to mean:

  • Bitcoin the protocol
    • Bitcoin the protocol maintained by the people now known as the core devs
    • Bitcoin the protocol adopted by the economic majority, or the majority of mining power
  • Bitcoin the blockchain
  • Bitcoin the ecosystem
  • Bitcoin the ledger (who owns what percentage of the ledger)

The most notable thing about this list, I think, is that the first meanings are the most commonly used, but the last meanings are what really matter from an investor's perspective. Especially Bitcoin the ledger. A sidechain takeover threatens the protocol and the blockchain, but not necessarily the ecosystem, and not the ledger insofar as the peg is ensured and the sidechain is as sound as Bitcoin.

Now whether the sidechain will be as sound as Bitcoin is up in the air. I am skeptical for now, but again in a scenario where everyone is moving to the sidechain that condition has presumably been met in a most credible fashion.

To me, spin-offs are a safer and more elegant way to add functionality to Bitcoin the ledger. Perhaps if Bitcoin the ledger was recognized as the real essence of Bitcoin, rather than the protocol used for updating that ledger, spin-offs would be recognized by everyone as the obvious choice. What do you think?

i don't miss anything.  that doesn't mean i understand everything.

sorry, but i don't agree with his assessment.  precisely b/c it leaves out an understanding that the money function will get deprecated in deference to the speculative assets riding on the SC's which distract from the mechanism which has brought us to where we are today.  the BTC price will drop if SC's are implemented, imo.

A depreciation of someone's wealth on the ledger due to speculative assets is the gain of someone else. The ledger stays intact.

SC's carrying speculative asset will be different and separate ledgers to Bitcoin.  attaching these less secure ledgers to Bitcoin will devalue the entire system.  remember that the Bitcoin miners will probably only be able to MM a couple of the thousands of speculative SC's that will be bolted onto Bitcoin.
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November 20, 2014, 05:18:21 PM
 #17731

I agree with you on this issue cypher but my problem is... If you don't want these side chains to exist, why is it that you are also so against alt coins that enable features that you do not wish Bitcoin to support?

Great read:
https://blog.ethereum.org/2014/11/20/bitcoin-maximalism-currency-platform-network-effects/

How would you like to see such innovation occur?


i'm against them only in the sense that i think they will die competing with Bitcoin so the sooner everyone comes to that understanding the better.  but i understand that they want to compete head to head and speculators will always try to make a buck so who am i to argue with that as long as they are competing fairly and not trying to alter Bitcoin source code to their advantage.

But many of them are not competing directly with bitcoin as sound money, they are providing other distinct features that bitcoin is unwilling to match, that you do not wish it to match, in it's quest to provide said money. How is it that all those useful features will just "die" when bitcoin is not willing or unable to provide equal features?

give me an example.

I really don't want to bring up nxt again but you asked for an example. The Nxt FreeMarket (decentralized marketplace)for example. This cannot be built on top of bitcoin. The closest is OpenBazaar but it is not built on top of bitcoin, it simply uses it. In the coming months users of the FreeMarket will also be able to buy and sell using bitcoin directly anyway. The fact that this platform is built on top of a blockchain offers some important privacy benefits that OpenBazaar will be unable to match. For instance, OpenBazaar will be require you to have a node running at all times for your shop to remain visible to other users, which I believe is a huge privacy flaw. How would such a feature just "die" because of bitcoin? It has nothing to do with money, and everything to do with a new method of secure communication using the blockchain.

lets be clear here.  my arguments in the past have been against altcoins but only in the sense that i think they will die by trying to compete with Bitcoin as a form of money.  the open market stuff, sure, they might survive as long as they provide a valuable service.  i doubt they survive if they depend on an altcoin.  in that sense, i would hope they would try to build their service on top of Bitcoin instead.

But this is why I believe your statement, "the blockchain may only be applicable to bitcoin as money" is incorrect. We are already seeing very useful applications of the blockchain outside of money (which aren't possible with bitcoins current parameters, 10min-1hr blocktime being a big one) and I cannot see these slowing down or going away.
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November 20, 2014, 05:19:55 PM
 #17732

sorry, i will never admit that.  you're talking about something totally separate from the sound money function; reputation which is an emotional response and immaterial to the math.

How is it any different?

Is the "sound money function" not the aspect by which the value assigned to the unit cannot be inflated by a deterministic increase in the supply?

You propose that exchanges or any off-scheme schemes running on a fractional reserve is not a direct threat to Bitcoin's sound money function but only a "reputation" problem?

Is it not true that offchain solutions are inherently more likely to run on a fractional reserve than a sidechain where the scarcity is enforced on the protocol level (mathematically) ?

If you answer no to that question then I cannot debate with you as you are clearly not being honest.

"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 20, 2014, 05:20:29 PM
 #17733

the integrity of the ledger depends on the currency unit riding on it.  the greed to obtain the unit is what drives the mining incentive.  w/o the unit, the ledger dies.  which is why allowing the units an offramp to an unrelated speculative SC will kill Bitcoin.

I am wary of sidechains because of the mining incentive issue. Moving transactions off-chain leaves miners underfunded in the far future, or else results in very high tx fees, leaving Bitcoin more open to competition from a more inflationary coin that pays miners through block rewards more and tx fees less.

However, on that note I have to admit there is little substantive difference between sufficiently high tx fees and slightly breaking the 21M coin limit (no halving, or slower halving), since you can't actually benefit from your Bitcoin wealth unless you spend it eventually, at which time if you incur a big tx fee as a tax it is no different to you than an inflation tax. OK, maybe certain people will gain/lose more from high tx fees vs. inflation. Nevertheless, one way or another the miners have to get paid, and if Bitcoin is severely under-mined due to SC then one of those two things will eventually happen, or else Bitcoin (the platform) will die. But I think Bitcoin the platform will only be allowed to die if everyone is confident that Bitcoin the ledger will live on in an even more secure form as a sidechain, spin-off, or something else. So I'm not so worried about sidechains from that angle, since in such a case the investors lose nothing. And if such confidence can never be gained in the first place, sidechains will never reach such a threat level.

If you are currently a holder of 1% of "the ledger currently being updated by Bitcoin," and at the end of the day your private keys still control 1% of what is now the ledger of civilization, you haven't lost any purchasing power, provided whatever protocol is updating that ledger now is at least as secure as Bitcoin. So I see no danger from perfect sidechains (sidechains where the 2wp is permanent and the sidechain never fails and can somehow live on its own if Bitcoin-the-platform dies) although a very successful one could force Bitcoin to choose between high tx fees and some continuing inflation, but I see a possible threat from imperfect sidechains (2wp is broken and/or mining incentives get messed with) though it seems somewhat self-limiting in that most investors would be tentative about moving their wealth until the peg is proven to be as strong as Bitcoin itself.

In some sense if you're worried about the economic majority just being dumb and moving to a doomed sidechain because of naivety, why not also worry about the economic majority supporting some really bad change to Bitcoin that kills it? The nature of Bitcoin is, in part, that we trust the economic majority to have a certain level of sanity.

In summary, investors shouldn't be wedded to the protocol per se, but of course to the ledger and their percentage stake in it. If there is a better protocol for updating that ledger, and it can be proven to my satisfaction that it is superior (an extremely high bar), then I say bring it on, since it just means the ledger and all investment stakes in it become even more secure (ex hypothesi; again, if there is any doubt of this then I for one won't be excited about it, but I think - for the same reason - most others won't either).
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November 20, 2014, 05:24:09 PM
 #17734

But this is why I believe your statement, "the blockchain may only be applicable to bitcoin as money" is incorrect. We are already seeing very useful applications of the blockchain outside of money (which aren't possible with bitcoins current parameters) and I cannot see these slowing down or going away.

i don't know.  looks like NXT is fading fast:

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November 20, 2014, 05:25:03 PM
 #17735

When they say "you can't separate" the two, that's absolutely not in reference to sidechains or other similar schemes.

Quote from: Sidechains white paper
In this paper, we argue that it is possible to simultaneously achieve these seemingly contradictory goals. The core observation is that
“Bitcoin” the blockchain is conceptually independent from “bitcoin” the asset

I totally believe that BlockStream's business as it standards will depend on that fact.

There is a risk of destroying Bitcoin as we know it if BlockStream's goal is achieved.

Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
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November 20, 2014, 05:25:35 PM
 #17736

But this is why I believe your statement, "the blockchain may only be applicable to bitcoin as money" is incorrect. We are already seeing very useful applications of the blockchain outside of money (which aren't possible with bitcoins current parameters) and I cannot see these slowing down or going away.

i don't know.  looks like NXT is fading fast:



The bitcoin chart looks exactly the same... There are 100+ devs working in a slack.com project on some absolutely mind blowing tech for the supernet project. Extremely active with 10,000+ messages per day. Anybody who takes a bit of time to look into that would understand something big is in the works and the fruits of that labour will be seen when it is ready. In the meantime, there is absolutely no pumping going on since they will prefer the technology speaks for itself when it is ready. Best part is all of the tech is completely currency agnostic. At the very least read this whitepaper to understand that some breakthrough anonymity tech for currency and communication has been already successfully developed, and it will be usable directly with Bitcoin! https://www.copy.com/s/x4mYj7Cy9tNtwwXg/crossing_the_last_mile_-_telepathy_2014-11-04.pdf. This will have implications on not only currency trading, but accessing and communicating with anonymous html pages, decentralized web applications and many other unforseen consquences. All because of a blockchain and cryptography. Not money related.
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November 20, 2014, 05:27:54 PM
 #17737


the integrity of the ledger depends on the currency unit riding on it.  the greed to obtain the unit is what drives the mining incentive.  w/o the unit, the ledger dies.  which is why allowing the units an offramp to an unrelated speculative SC will kill Bitcoin.

ZB doesn't quite agree with you and made a very logical demonstration of why you are likely wrong, maybe you missed it

It seems to me that, assuming the 2wp is perfect and permanent, if everyone moves to the sidechain, the ledger remains perfectly preserved as long as the sidechain continues working. Bitcoin is no longer serving the memory function (Bitcoin the protocol/chain is dead), but the memory function is being served by another chain (and Bitcoin the ledger lives on). The store of value function has been maintained, but not by what we'd usually want to call "Bitcoin."

There are some definitional ambiguities making this difficult to pin down. The word Bitcoin is used to mean:

  • Bitcoin the protocol
    • Bitcoin the protocol maintained by the people now known as the core devs
    • Bitcoin the protocol adopted by the economic majority, or the majority of mining power
  • Bitcoin the blockchain
  • Bitcoin the ecosystem
  • Bitcoin the ledger (who owns what percentage of the ledger)

The most notable thing about this list, I think, is that the first meanings are the most commonly used, but the last meanings are what really matter from an investor's perspective. Especially Bitcoin the ledger. A sidechain takeover threatens the protocol and the blockchain, but not necessarily the ecosystem, and not the ledger insofar as the peg is ensured and the sidechain is as sound as Bitcoin.

Now whether the sidechain will be as sound as Bitcoin is up in the air. I am skeptical for now, but again in a scenario where everyone is moving to the sidechain that condition has presumably been met in a most credible fashion.

To me, spin-offs are a safer and more elegant way to add functionality to Bitcoin the ledger. Perhaps if Bitcoin the ledger was recognized as the real essence of Bitcoin, rather than the protocol used for updating that ledger, spin-offs would be recognized by everyone as the obvious choice. What do you think?

i don't miss anything.  that doesn't mean i understand everything.

sorry, but i don't agree with his assessment.  precisely b/c it leaves out an understanding that the money function will get deprecated in deference to the speculative assets riding on the SC's which distract from the mechanism which has brought us to where we are today.  the BTC price will drop if SC's are implemented, imo.

A depreciation of someone's wealth on the ledger due to speculative assets is the gain of someone else. The ledger stays intact.

SC's carrying speculative asset will be different and separate ledgers to Bitcoin.  attaching these less secure ledgers to Bitcoin will devalue the entire system.  remember that the Bitcoin miners will probably only be able to MM a couple of the thousands of speculative SC's that will be bolted onto Bitcoin.

Absolutely wrong once again. Remember that Bitcoin miners will NOT mine speculative SCs as they can only command marginal use in the market and therefore not obtain the necessary adoption for miners to validate them with their work.

Can you even provide an example of these speculative SCs ?

"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 20, 2014, 05:31:05 PM
 #17738

When they say "you can't separate" the two, that's absolutely not in reference to sidechains or other similar schemes.

Quote from: Sidechains white paper
In this paper, we argue that it is possible to simultaneously achieve these seemingly contradictory goals. The core observation is that
“Bitcoin” the blockchain is conceptually independent from “bitcoin” the asset

I totally believe that BlockStream's business as it standards will depend on that fact.

There is a risk of destroying Bitcoin as we know it if BlockStream's goal is achieved.

So I understand you are also against federated sidechains? Because they also create this exact seperation you are against.

"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 20, 2014, 05:36:02 PM
 #17739


the integrity of the ledger depends on the currency unit riding on it.  the greed to obtain the unit is what drives the mining incentive.  w/o the unit, the ledger dies.  which is why allowing the units an offramp to an unrelated speculative SC will kill Bitcoin.

ZB doesn't quite agree with you and made a very logical demonstration of why you are likely wrong, maybe you missed it

It seems to me that, assuming the 2wp is perfect and permanent, if everyone moves to the sidechain, the ledger remains perfectly preserved as long as the sidechain continues working. Bitcoin is no longer serving the memory function (Bitcoin the protocol/chain is dead), but the memory function is being served by another chain (and Bitcoin the ledger lives on). The store of value function has been maintained, but not by what we'd usually want to call "Bitcoin."

There are some definitional ambiguities making this difficult to pin down. The word Bitcoin is used to mean:

  • Bitcoin the protocol
    • Bitcoin the protocol maintained by the people now known as the core devs
    • Bitcoin the protocol adopted by the economic majority, or the majority of mining power
  • Bitcoin the blockchain
  • Bitcoin the ecosystem
  • Bitcoin the ledger (who owns what percentage of the ledger)

The most notable thing about this list, I think, is that the first meanings are the most commonly used, but the last meanings are what really matter from an investor's perspective. Especially Bitcoin the ledger. A sidechain takeover threatens the protocol and the blockchain, but not necessarily the ecosystem, and not the ledger insofar as the peg is ensured and the sidechain is as sound as Bitcoin.

Now whether the sidechain will be as sound as Bitcoin is up in the air. I am skeptical for now, but again in a scenario where everyone is moving to the sidechain that condition has presumably been met in a most credible fashion.

To me, spin-offs are a safer and more elegant way to add functionality to Bitcoin the ledger. Perhaps if Bitcoin the ledger was recognized as the real essence of Bitcoin, rather than the protocol used for updating that ledger, spin-offs would be recognized by everyone as the obvious choice. What do you think?

i don't miss anything.  that doesn't mean i understand everything.

sorry, but i don't agree with his assessment.  precisely b/c it leaves out an understanding that the money function will get deprecated in deference to the speculative assets riding on the SC's which distract from the mechanism which has brought us to where we are today.  the BTC price will drop if SC's are implemented, imo.

A depreciation of someone's wealth on the ledger due to speculative assets is the gain of someone else. The ledger stays intact.

SC's carrying speculative asset will be different and separate ledgers to Bitcoin.  attaching these less secure ledgers to Bitcoin will devalue the entire system.  remember that the Bitcoin miners will probably only be able to MM a couple of the thousands of speculative SC's that will be bolted onto Bitcoin.

Absolutely wrong once again. Remember that Bitcoin miners will NOT mine speculative SCs as they can only command marginal use in the market and therefore not obtain the necessary adoption for miners to validate them with their work.

Can you even provide an example of these speculative SCs ?

anything not BTC.  like stocks, bonds, insurance, contracts, etc.  you yourself say this is the goal, to decentralize and incorporate into the Bitcoin protocol all manner of these things enabled by spvp.

In that sense, you are right that SPVP is crucial to their success because it is the only way they can create these ambitious extensions of Bitcoin I'm sure they have in mind.


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November 20, 2014, 05:37:47 PM
 #17740

Maybe you remember the dusty old term 'peer-2-peer'?

I got my share of abuse for proposing that it should be deprecated as a sales pitch before it became a total joke since that is the way things are heading.


Well, then we have to get pedantic. Bitcoin was *never* peer-to-peer. A miner technically always sits in the middle, even if the hashing/nodes were perfectly uniformly distributed.


With such a definition can anything be peer to peer? There would always require some media for communication between the peers.
Some computer among the millions transmits the packet, some router...
If it doesn't require such an extreme definition, then it is more peer to peer than pretty much anything else.

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