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Author Topic: Gold collapsing. Bitcoin UP.  (Read 1804589 times)
rocks
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May 18, 2015, 05:29:14 PM
 #24221

That dynamic requires that one can  (and is willing to!) short the small chain.  You can not sell what you do not have and can not borrow.

My sense is that most of the investors in the more promising altcoins like Monero are Bitcoin investors as well, who, like rpietila also are strongly weighted toward Bitcoin but have just a bit in an alt or two. I don't see how the top altcoins can have anywhere near their current market caps without simply being side investments by bitcoiners who are hedging against that possibility at the rates revealed in their market cap ratios to Bitcoin. "At the rates" is the key aspect. Why suddenly change your portfolio without a fundamental reason?

However, even if this isn't the case, what you're saying can only really hold true if most altcoin investors are single-coin investors. Because if they invest in, say, 50% Litecoin and 50% Dogecoin, why should they allow their portfolio to go to 90% LTC and 10% Doge, for example, as people rush into Litecoin for no fundamental reason? Their portfolio weighting already suggests they are happy with their bets, so why would they allow them to be changed? They should be selling LTC and buying Doge to maintain their weighting as they wanted it. Therefore the 10% "rogues" also empower their own altcoin competitors.

And in the end, even if you don't short or sell the altcoin at all, its holders are of course much weaker hands than typical BTC holders, so there should be a lot more selling on the way up. If it's a mined coin, also, the inflation rate tamps the price back down as mined coins flow into the system, just like Bitcoin in 2014. (Monero most especially because of its fast inflation rate.)

Maybe an unstated premise is that a temporary situations of an altcoin having a high "market cap" compared to Bitcoin would cause everyone to flood into that coin. I don't see that at all. Again, BTC holders tend to be Smaug-like strong hands, not price chasers. Plus, where are you going to get this sudden burst of an entire 10% of BTC holders changing their minds? If it's too slow, remember, it fails to sweep the thin markets. And even if it were somehow coordinated to deliberately spike the market cap on the thin exchanges, most of these people are going to lose horribly to slippage.

Overall I just don't see it. 10% is basically 10%. People don't switch their trust affiliations fast enough, and track records don't develop fast enough. I only see this as possibly being able to have some short-term psychological impact at the margins, in a hypothetical situation where the altcoin was already right about to take over anyway.

But if that situation ever looked plausible, it's spin-off time ♪ Grin

This is just what I've seen, but it has always come across to me that BTC investors invest in Bitcoin because they think there is a chance for Bitcoin to disrupt our existing banking system and build something better in it's place. There is speculation here, but it is speculation on useful creation and innovation happening, which is more properly described as investment.

Altcoin investment has always come across to me as pure financial speculation, simply hoping that Altcoin x will rise in price faster than Bitcoin for a given time period. I never get the sense that Altcoin investors want to disrupt the corrupt banking world and replace it with something better, just that it is a way to make a fast buck.

If this view is correct, then there is nothing long term to drive Altcoin's value up, they will just follow Bitcoin's coat tails sometime. And the better investment is to put your money where the real creation is happening, which is Bitcoin.

The price action of the last Bitcoin bubble seems to support this view. First Bitcoin shot up to $1000, and only after Bitcoin stalled did the Altcoins take over and shoot up a similar amount. They were simply following Bitcoin and offered people who missed out on Bitcoin's quick rise a 2nd chance to participate in a run up. Then as Bitcoin has slowly deflated back down, Altcoins did the same, only to a much larger extent. I'm sure Altcoin's will pop again on Bitcoin's next pop, but it is not a sustainable pop, just a speculative fever for people who missed the BTC boat.
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May 18, 2015, 05:37:32 PM
 #24222

new high on $DJI.  the non-confirmation is now wider.  can the $DJT get all the way to a new high from here?  doubtful, but hey:

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May 18, 2015, 05:57:47 PM
 #24223

Altcoin investment has always come across to me as pure financial speculation

Yeah, same with me. In dealing with altcoin people, saying that all altcoins are unadulterated shit (which I do regardless) is not popular. Here at least it is ok to confess that.

Monero is not an altcoin in that sense. It is what Bitcoin was promised to be (but is not, and likely cannot be) - private cash, and nothing more.

I will never buy bitcoins with the gains from my XMR; Bitcoin is legacy to me, as well as silver, gold, and bank accounts.

(I will answer to the main points by Z.B. later, they seem strong, the debate is just getting interesting! Wink )

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May 18, 2015, 06:33:31 PM
 #24224

Altcoin investment has always come across to me as pure financial speculation

Yeah, same with me. In dealing with altcoin people, saying that all altcoins are unadulterated shit (which I do regardless) is not popular. Here at least it is ok to confess that.

Monero is not an altcoin in that sense. It is what Bitcoin was promised to be (but is not, and likely cannot be) - private cash, and nothing more.

I will never buy bitcoins with the gains from my XMR; Bitcoin is legacy to me, as well as silver, gold, and bank accounts.

(I will answer to the main points by Z.B. later, they seem strong, the debate is just getting interesting! Wink )

OK, so I'm genuinely curious to understand in what ways you think Monero as money is superior to Bitcoin as money.

To me the six properties of money are:
  • Portable - Easily transported - Check, Bitcoin is perfectly portable and easy to conceal (pw in head) (much better than gold)
  • Scarce - Fixed supply - Check, Bitcoin is perfectly scarce (much better than gold)
  • Divisible - Can be split into any useful amount without losing value - Check, Bitcoin is as divisible as needed (easier to do than gold)
  • Uniform - Each unit is valued the same - Check, Bitcoin is perfectly uniform (same/better than gold)
  • Durable - Will not degrade over time - Check, Bitcoin private keys are perfectly durable (better than gold)
  • Accepted - Widely used and valued by the population - Not yet, Bitcoin misses here for now (gold is better)

Bitcoin has always been interesting to me because it beats gold handily in 1) Portability, 2) Scarcity and to a lesser extent 3) Divisibility and 4) Uniformity. Bitcoin still loses in Acceptability but that is to be expected for 6 year old currency vs a 5000 year old one. This one follows the other 5.

In what manner is Monero better along these dimensions?
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May 18, 2015, 07:12:19 PM
 #24225

Monero is...what Bitcoin was promised to be (but is not, and likely cannot be) - private cash, and nothing more.

What was Bitcoin "promised to be"?  How does the Bitcoin of today not fulfil the description from the Satoshi white paper?  Bitcoin is more useful than Monero because it does not force privacy upon its users.  It gives its users the freedom to choose their privacy requirements.  Cryddit (Ray Dillinger) made a series of insightful posts beginning here arguing against all but niche adoption of strong-privacy coins.

Furthermore, even if you assume that protocol-enforced privacy is a positive (which I don't), the trade-offs made to get that privacy have real costs.  But we won't fully know what these costs are until something like Monero is trading at a much higher market cap and transaction volume. 

That being said, I like Monero because (a) it had a fair launch, and (b) it offers something unique.  I would love to see it overtake Dash (Darkcoin) and then Litecoin.  But I think best-case scenario for Monero is a few % of the bitcoin market cap.

Run Bitcoin Unlimited (www.bitcoinunlimited.info)
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May 18, 2015, 07:14:54 PM
 #24226

To me the six properties of money are:
  • Portable - Easily transported - Check, Bitcoin is perfectly portable and easy to conceal (pw in head) (much better than gold)
  • Scarce - Fixed supply - Check, Bitcoin is perfectly scarce (much better than gold)
  • Divisible - Can be split into any useful amount without losing value - Check, Bitcoin is as divisible as needed (easier to do than gold)
  • Uniform - Each unit is valued the same - Check, Bitcoin is perfectly uniform (same/better than gold)
  • Durable - Will not degrade over time - Check, Bitcoin private keys are perfectly durable (better than gold)
  • Accepted - Widely used and valued by the population - Not yet, Bitcoin misses here for now (gold is better)

Bitcoin has always been interesting to me because it beats gold handily in 1) Portability, 2) Scarcity and to a lesser extent 3) Divisibility and 4) Uniformity. Bitcoin still loses in Acceptability but that is to be expected for 6 year old currency vs a 5000 year old one. This one follows the other 5.

In what manner is Monero better along these dimensions?

All cryptocurrency (thus far) requires another property: independence of transmission (or dependency on network if you prefer)

Physical commodity money uses a much more independent/reliable transmission vector than present generation cryptocurrency. Cryptocurrency 2.0 (or do I mean 1.0?) ideally would keep the distributive and verification aspects as a part of the tx/mining network as we know it, but somehow allow the acceptance of the transaction to be determined only by the individual/s who receive it.

Even "CPU coins" can end up with color lists. Crypto mining is ultimately controlled by those with the greatest access to or influence over physical resources. Hence the present cartels.

Vires in numeris
justusranvier
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May 18, 2015, 07:16:57 PM
 #24227


good work Justus.  kudos to the others as well.

projects like this will increase pressure to keep privacy innovations coming.
Thanks.

This project will be more effective the more that wallet developers know that people read the reviews, so you can help out by widely sharing the link.

Also, we'll shortly begin a recruitment drive for volunteers to help produce the next batch of ratings.
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May 18, 2015, 07:20:30 PM
 #24228

OK, so I'm genuinely curious to understand in what ways you think Monero as money is superior to Bitcoin as money.

To me the six properties of money are:
  • Portable - Easily transported - Check, Bitcoin is perfectly portable and easy to conceal (pw in head) (much better than gold)
  • Scarce - Fixed supply - Check, Bitcoin is perfectly scarce (much better than gold)
  • Divisible - Can be split into any useful amount without losing value - Check, Bitcoin is as divisible as needed (easier to do than gold)
  • Uniform - Each unit is valued the same - Check, Bitcoin is perfectly uniform (same/better than gold)
  • Durable - Will not degrade over time - Check, Bitcoin private keys are perfectly durable (better than gold)
  • Accepted - Widely used and valued by the population - Not yet, Bitcoin misses here for now (gold is better)

Bitcoin has always been interesting to me because it beats gold handily in 1) Portability, 2) Scarcity and to a lesser extent 3) Divisibility and 4) Uniformity. Bitcoin still loses in Acceptability but that is to be expected for 6 year old currency vs a 5000 year old one. This one follows the other 5.

In what manner is Monero better along these dimensions?

Monero is better than Bitcoin in Privacy and Uniformity (fungibility), but worse in the degree to which it is Accepted (liquidity). It matches Bitcoin in the other properties you've enumerated.

By the way, Monero's privacy is by default, but privacy is not mandatory. There will be a viewkey that can be shared (not yet fully implemented), allowing others to verify one's receipts and expenditures.
rocks
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May 18, 2015, 07:24:37 PM
 #24229

Monero is...what Bitcoin was promised to be (but is not, and likely cannot be) - private cash, and nothing more.

What was Bitcoin "promised to be"?  How does the Bitcoin of today not fulfil the description from the Satoshi white paper?  Bitcoin is more useful than Monero because it does not force privacy upon its users.  It gives its users the freedom to choose their privacy requirements.  Cryddit (Ray Dillinger) made a series of insightful posts beginning here arguing against all but niche adoption of strong-privacy coins.

Furthermore, even if you assume that protocol-enforced privacy is a positive (which I don't), the trade-offs made to get that privacy have real costs.  But we won't fully know what these costs are until something like Monero is trading at a much higher market cap and transaction volume.  

That being said, I like Monero because (a) it had a fair launch, and (b) it offers something unique.  I would love to see it overtake Dash (Darkcoin) and then Litecoin.  But I think best-case scenario for Monero is a few % of the bitcoin market cap.

That is why I've always preferred to frame the discussion around specific properties/attributes.

Privacy has not usually been considered a core requirement for money. That is not to say it shouldn't be an attribute, it is possible that privacy was not included before simply because it was assumed in all cases in the pre-Snowden era.

Privacy is not an innate property of Gold, rather privacy was gained in how gold was used in some cases (i.e. direct physical transfer) and lost in other cases (i.e. bank notes). What this shows is that privacy is easily layered on top of a base system. In gold's case that was direct transfer, in Bitcoin's case there are already mechanism posts to this thread that enable shared secrets and private transfers, there are also others such as zerocoin sub-chains.

The point being that privacy is not an innate property of money, it is something that derives through how it is used. If that is the only advantage of Monero, then I believe at this time that Bitcoin already beats Monero in acceptance, and is the same in everything else, in which case I'll continue to bet on Bitcoin since it is superior in the basic properties of money

Edit:
Monero is better than Bitcoin in Privacy and Uniformity (fungibility), but worse in the degree to which it is Accepted (liquidity). It matches Bitcoin in the other properties you've enumerated.

By the way, Monero's privacy is by default, but privacy is not mandatory. There will be a viewkey that can be shared (not yet fully implemented), allowing others to verify one's receipts and expenditures.

As stated above, I don't believe privacy is an innate property of money, that comes from how it is used.

It is not clear how uniformity/fungibility is any different from Bitcoin.
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May 18, 2015, 07:25:32 PM
 #24230

this is good news:

Ultimately, though, it is the community of electrical engineers and computer scientists that will judge whether embedded mining technology solves their problems. Towards that end, our team of PhDs in EE from MIT, Stanford, and CMU has built not just a chip, but a full technology stack around the chip — including reference devices, datasheets, a cloud backend, and software protocols. And we have already engaged with a wide variety of early access partners across the industry, from small startups to multibillion dollar hardware companies.

https://medium.com/@21dotco/a-bitcoin-miner-in-every-device-and-in-every-hand-e315b40f2821
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hello world


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May 18, 2015, 07:27:14 PM
 #24231

OK, so I'm genuinely curious to understand in what ways you think Monero as money is superior to Bitcoin as money.

To me the six properties of money are:
  • ...
  • Uniform - Each unit is valued the same - Check, Bitcoin is perfectly uniform (same/better than gold)
  • ...

sorry my english is bad, thats why i only want to talk about the properties of money since i thougth a lot about it.
i agree with all points except this one.

Gold is uniform because you can melt it down if needed and no one will ever recognize it again. with bitcoin this is not possible.
for now its uniform, but for how long, if its not fungible?

the 6th property of money is fungibility, not uniformity, since fungibility inculdes uniformity allready, but means a lot more in the end

XMR Monero
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May 18, 2015, 07:30:48 PM
 #24232

this is good news:

Ultimately, though, it is the community of electrical engineers and computer scientists that will judge whether embedded mining technology solves their problems. Towards that end, our team of PhDs in EE from MIT, Stanford, and CMU has built not just a chip, but a full technology stack around the chip — including reference devices, datasheets, a cloud backend, and software protocols. And we have already engaged with a wide variety of early access partners across the industry, from small startups to multibillion dollar hardware companies.

https://medium.com/@21dotco/a-bitcoin-miner-in-every-device-and-in-every-hand-e315b40f2821

“21's chip and architecture represent an important next step in securing the future of the public, synchronized global ledger that is the blockchain. We believe that massively distributed embedded mining is the bitcoin that Satoshi intended — decentralized and globally accessible. We’ve known the team since the inception of the company, and we are confident that they can achieve this goal!”
— Jim Robinson IV, Co-Founder and Managing Partner, RRE Ventures
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May 18, 2015, 07:31:41 PM
 #24233


Nice find!

I was surprised to see a quote from this individual:




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May 18, 2015, 07:35:45 PM
 #24234

OK, so I'm genuinely curious to understand in what ways you think Monero as money is superior to Bitcoin as money.

To me the six properties of money are:
  • ...
  • Uniform - Each unit is valued the same - Check, Bitcoin is perfectly uniform (same/better than gold)
  • ...

sorry my english is bad, thats why i only want to talk about the properties of money since i thougth a lot about it.
i agree with all points except this one.

Gold is uniform because you can melt it down if needed and no one will ever recognize it again. with bitcoin this is not possible.
for now its uniform, but for how long, if its not fungible?

the 6th property of money is fungibility, not uniformity, since fungibility inculdes uniformity allready, but means a lot more in the end

to me, Bitcoin is fungible when you think in terms of UTXO's. 

which half of 1BTC is tainted from joining 0.5BTC taint with 0.5BTC pure from 2 UTXO's?  when you then split that 1BTC into two 0.5BTC payments, are they both uniformly tainted or is there a discrete 0.5BTC that is tainted?  how do you distinguish?

yes, an address can be tainted if identified with a drug dealer.  but that's not the same as UTXO's, which is where the real action is.
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May 18, 2015, 07:39:53 PM
 #24235

OK, so I'm genuinely curious to understand in what ways you think Monero as money is superior to Bitcoin as money.

To me the six properties of money are:
  • ...
  • Uniform - Each unit is valued the same - Check, Bitcoin is perfectly uniform (same/better than gold)
  • ...

sorry my english is bad, thats why i only want to talk about the properties of money since i thougth a lot about it.
i agree with all points except this one.

Gold is uniform because you can melt it down if needed and no one will ever recognize it again. with bitcoin this is not possible.
for now its uniform, but for how long, if its not fungible?

the 6th property of money is fungibility, not uniformity, since fungibility inculdes uniformity allready, but means a lot more in the end

Well I've always seen it as fungibility derives from uniformity, if something is perfectly uniform, then it will be fungible as well.

The worry being expressed here is that colored coins will force bitcoin to lose fungibility, but the thing to remember is the bitcoin network will not discriminate and continue to process white/black coins with no regard for whatever government rules are imposed on people. In that manner Bitcoin will always remain perfectly fungible in it's natural state. Fungibility might only be lost in how it is used, but people can ignore gov rules and use it however they want.
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May 18, 2015, 08:02:56 PM
 #24236

It is not clear how uniformity/fungibility is any different from Bitcoin.

Most likely if an entity (company, government, individual, ect) decided to censor bitcoin transactions based on tx history, then that entity would not accept a currency like XMR at all because tx history cannot be completely known.  In this sense, XMR could be LESS FUNGIBLE than bitcoin, or at least less accepted as fungibility may be the wrong term to use in that case.

Counterfeit:  made in imitation of something else with intent to deceive:  merriam-webster
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May 18, 2015, 08:12:44 PM
 #24237

It is not clear how uniformity/fungibility is any different from Bitcoin.

Most likely if an entity (company, government, individual, ect) decided to censor bitcoin transactions based on tx history, then that entity would not accept a currency like XMR at all because tx history cannot be completely known.  In this sense, XMR could be LESS FUNGIBLE than bitcoin, or at least less accepted as fungibility may be the wrong term to use in that case.

In that case you still can't differentiate units, which is the premise of fungibility. It would simply be outlawed.

Privacy matters, use Monero - A true untraceable cryptocurrency
Why Monero matters? http://weuse.cash/2016/03/05/bitcoiners-hedge-your-position/
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May 18, 2015, 08:24:14 PM
 #24238

It is not clear how uniformity/fungibility is any different from Bitcoin.

Most likely if an entity (company, government, individual, ect) decided to censor bitcoin transactions based on tx history, then that entity would not accept a currency like XMR at all because tx history cannot be completely known.  In this sense, XMR could be LESS FUNGIBLE than bitcoin, or at least less accepted as fungibility may be the wrong term to use in that case.

In that case you still can't differentiate units, which is the premise of fungibility. It would simply be outlawed.

As I said, fungibility may be the wrong term, but the outcome would be similar to non-fungibility (actually worse) because the currency would be banned completely. 

Counterfeit:  made in imitation of something else with intent to deceive:  merriam-webster
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May 18, 2015, 08:33:43 PM
 #24239

Monero is...what Bitcoin was promised to be (but is not, and likely cannot be) - private cash, and nothing more.

What was Bitcoin "promised to be"?  How does the Bitcoin of today not fulfil the description from the Satoshi white paper?  Bitcoin is more useful than Monero because it does not force privacy upon its users.  It gives its users the freedom to choose their privacy requirements.  Cryddit (Ray Dillinger) made a series of insightful posts beginning here arguing against all but niche adoption of strong-privacy coins.

Furthermore, even if you assume that protocol-enforced privacy is a positive (which I don't), the trade-offs made to get that privacy have real costs.  But we won't fully know what these costs are until something like Monero is trading at a much higher market cap and transaction volume. 

That being said, I like Monero because (a) it had a fair launch, and (b) it offers something unique.  I would love to see it overtake Dash (Darkcoin) and then Litecoin.  But I think best-case scenario for Monero is a few % of the bitcoin market cap.

There is a "viewkey" in Monero that allows people to track your transactions... so I wouldn't say that Monero "forces" privacy on its users. (Maybe I'm splitting hairs though).
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May 18, 2015, 08:39:36 PM
 #24240


seems to me that at the very least we will see companies like Qualcomm opening their own mining pools at which all these devices will be pointed.  this would be fantastic in further decentralizing mining in terms of increasing pool choices.  especially here in the US.  and if Qualcomm opens a pool, others are sure to follow.  like Whirlpool, GE, Subzero, etc.
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