Gold collapsing. Bitcoin UP.

[justusranvier]

Sure it would be great if these people did the work as charity, but its hard to demand that, especially for a project with a 6B market cap.  Can no $ flow to contributors?

Many for-profit companies contribute meaningfully to open source.  

In this case, the company will provide open source patches enabling sidechains to Bitcoin, and spend $ to create the consensus to get it actually included.  This might be the hardest part.  At that point, anyone can create their own sidechains.

I like the Conformal model.

They make money from Coinvoice, and btcd is the Bitcoin implementation they use to run their business. They eat their own dogfood, and donate the code into the community, but don't make money from other people using btcd.

I wish more companies would develop alternate implementations using this model.

also, they didn't require a fork to do their thing.

sure you are right,if possible avoiding forking is a good thing, but take into account that there
are certain type of features that require a fork.

if memory serves gavin recently proposed an hard fork to introduce a 50% a year automatic
increase of the max block size.

I don't think the problem is the fork as much as it's the financial incentive to get their fork in, and then block all other future forks that would render sidechains less necessary.

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[cypherdoc]

Sure it would be great if these people did the work as charity, but its hard to demand that, especially for a project with a 6B market cap.  Can no $ flow to contributors?

Many for-profit companies contribute meaningfully to open source.  

In this case, the company will provide open source patches enabling sidechains to Bitcoin, and spend $ to create the consensus to get it actually included.  This might be the hardest part.  At that point, anyone can create their own sidechains.

I like the Conformal model.

They make money from Coinvoice, and btcd is the Bitcoin implementation they use to run their business. They eat their own dogfood, and donate the code into the community, but don't make money from other people using btcd.

I wish more companies would develop alternate implementations using this model.

also, they didn't require a fork to do their thing.

sure you are right, if possible avoiding forking is a good thing, but take into account that there
are certain type of features that require a fork.

if memory serves gavin recently proposed an hard fork to introduce a 50% a year automatic
increase of the max block size.

edit: found gavin's proposal https://bitcoinfoundation.org/2014/10/a-scalability-roadmap/

but Gavin's proposal is dev on the main chain which is consistent with the past.

[cypherdoc]

the tenets that Satoshi did get right were the economic ones, mainly that of a fixed supply with a fair distribution.  

the market has invested accordingly based on those.  by allowing SC's to change or distort those economic assumption will cause confusion and uncertainty in the Bitcoin price.

we're seeing it right now.

I don't see how SC's can distort the original bitcoin fixed supply rules without being a total sham that no one will adopt.

If side chains allow creation of new coins/tokens not originating through the 'two way peg' then why would anyone in their right mind use them?

Edit: would appreciate an answer to this one please

Sidescams can propose any economic model they want, no different than altcoins.  unfortunately, some ppl will be lured over to them and lose BTC. 

when lots of that activity occurs over years, then i will propose a truly revolutionary idea; let's totally separate these Sidescams technically from the main chain so as to not let ppl lose their BTC!  everyone will then say, "great idea!"

[sidhujag]

Sidechains = sidejobs. Valid way of working but you never know when it will end and it will never replace the main line of work (bitcoin)

[cypherdoc]

there is a real practical drawback to Sidescams as well.

let's say one gets popular, say from faster tx times.  it becomes apparent that you should move to the SC.  now all the ppl who have cold wallets scattered round the globe have to go dig them out and make a special tx to transfer them to the SC.  this is not only a hassle but a potential anonymity risk.  after doing so, a non economic actor decides to take advantage of the fact that this merge mined chain is worth destroying.  they'll probably be successful especially if there's a transition in hashing protection going on simultaneously.

no, better any innovations get built into Core so as to not disrupt everyones long term storage plans and their investment assumptions.

[inca]

the tenets that Satoshi did get right were the economic ones, mainly that of a fixed supply with a fair distribution.  

the market has invested accordingly based on those.  by allowing SC's to change or distort those economic assumption will cause confusion and uncertainty in the Bitcoin price.

we're seeing it right now.

I don't see how SC's can distort the original bitcoin fixed supply rules without being a total sham that no one will adopt.

If side chains allow creation of new coins/tokens not originating through the 'two way peg' then why would anyone in their right mind use them?

Edit: would appreciate an answer to this one please

Sidescams can propose any economic model they want, no different than altcoins.  unfortunately, some ppl will be lured over to them and lose BTC.  

when lots of that activity occurs over years, then i will propose a truly revolutionary idea; let's totally separate these Sidescams technically from the main chain so as to not let ppl lose their BTC!  everyone will then say, "great idea!"

Yeah some people. Probably the same number of people who use altcoins. Any side chain is going to have the same problems as an alt. Noone will accept it anywhere - 'backed' 100% (or much much less) by bitcoin or not. At the same time bitcoin is achieving real utility as an online currency.

[sidhujag]

part of the hopium alt(shit)coins have is that they may be the bitcoin killer.. its the only driver for speculation in most of them... thus with sidechains it may make ppl realize goddammit why not just stick to my main (job).. thus its actually bullish btc not bearish.. it should keep alt market honest.

[sickpig]

sure you are right, if possible avoiding forking is a good thing, but take into account that there
are certain type of features that require a fork.

if memory serves gavin recently proposed an hard fork to introduce a 50% a year automatic
increase of the max block size.

edit: found gavin's proposal https://bitcoinfoundation.org/2014/10/a-scalability-roadmap/

but Gavin's proposal is dev on the main chain which is consistent with the past.

you're right, again

The first time I heard about SCs project was while listening to let's talk bitcoin E99
(or even an earlier nee, 77 maybe?).
 
In such episode Adam Back said the he was concerned over digital scarcity, a Bitcoin property harmed by the proliferation of altcoins.

Secondly he said that to sustain a proper level of innovation the community need to find a way to introduce changes into Bitcoin
in more secure way.

With "secure way" I think he meat having a proper test-bed, different from the test network, to check the impact of new changes.

He thinks that SCs is a solution to both problems.

I don't know if he's right or wrong, but it seems to me that he cares about Bitcoin future.

[justusranvier]

In such episode Adam Back said the he was concerned over digital scarcity, a Bitcoin property harmed by the proliferation of altcoins.

Secondly he said that to sustain a proper level of innovation the community need to find a way to introduce changes into Bitcoin
in more secure way.

With "secure way" I think he meat having a proper test-bed, different from the test network, to check the impact of new changes.

He thinks that SCs is a solution to both problems.

I don't know if he's right or wrong, but it seems to me that he cares about Bitcoin future.

That's probably what Adam Back wants.

However, this isn't just about him.

Blockstream has investors, who presumably want a return on their investment, a return that requires the continuing relevance of sidechains.

If the Bitcoin protocol adopts features that are developed in sidechains, then the need for sidechains diminishes.

What will those investors say about that? What will Blockstream do in response?

[sickpig]

I like the Conformal model.

They make money from Coinvoice, and btcd is the Bitcoin implementation they use to run their business. They eat their own dogfood, and donate the code into the community, but don't make money from other people using btcd.

I wish more companies would develop alternate implementations using this model.

also, they didn't require a fork to do their thing.

sure you are right,if possible avoiding forking is a good thing, but take into account that there
are certain type of features that require a fork.

if memory serves gavin recently proposed an hard fork to introduce a 50% a year automatic
increase of the max block size.

I don't think the problem is the fork as much as it's the financial incentive to get their fork in, and then block all other future forks that would render sidechains less necessary.

Fair.

So it seems that the real problem is the concentration of core devs into a single company, rather than the concept in itself.

I hope that community financial incentives will work to against sidechains in case this idea/implementation turns out to be bad.

[justusranvier]

So it seems that the real problem is the concentration of core devs into a single company, rather than the concept in itself.

...and the Bitcoin Core monopoly itself.

I want to see the network fully heterogenous at the implementation level.

We should be just as concerned about all the mining being done with Bitcoin Core as we are concerned about too much hashing being controlled by ghash.io.

Get btcd, libbitcoin, and a couple more independent implementations in there too.

[cypherdoc]

sure you are right, if possible avoiding forking is a good thing, but take into account that there
are certain type of features that require a fork.

if memory serves gavin recently proposed an hard fork to introduce a 50% a year automatic
increase of the max block size.

edit: found gavin's proposal https://bitcoinfoundation.org/2014/10/a-scalability-roadmap/

but Gavin's proposal is dev on the main chain which is consistent with the past.

you're right, again

The first time I heard about SCs project was while listening to let's talk bitcoin E99
(or even an earlier nee, 77 maybe?).
 
In such episode Adam Back said the he was concerned over digital scarcity, a Bitcoin property harmed by the proliferation of altcoins.

Secondly he said that to sustain a proper level of innovation the community need to find a way to introduce changes into Bitcoin
in more secure way.

With "secure way" I think he meat having a proper test-bed, different from the test network, to check the impact of new changes.

He thinks that SCs is a solution to both problems.

I don't know if he's right or wrong, but it seems to me that he cares about Bitcoin future.

SC's can't ever be an independent testbed separate from Bitcoin itself.  they will be linked by the code, security, and economic assumptions of their relative values and any market evaluation will make an assessment of the entire ecosystem; Bitcoin+SC's in aggregate.

nothing will be learned from looking at a SC in isolation b/c of this economic linkage.

[lebing]

Cypher, I respect your opinion but am at a loss on this one with where you are. The sidechains, while this will surely be a major change to bitcoin is absolutely necessary to ensure the role of bitcoin as the leader in the space. It also ensures that the fixed supply we seek with an e-currency is actually a possibility. At the moment, "cheap" alts are taking a decent amount of funding that would otherwise be going into bitcoin. What exactly is the issue if some of the bitcoins are lost? Better in that situation than an alt coin simply evaporates. In both situations wealth evaporates, but only in sidechain scenario does wealth increase (of bitcoin holders) irregardless of an evaporation.

In regards to coding with a profit model, I think Greg said it best:

http://www.reddit.com/r/Bitcoin/comments/2k070h/enabling_blockchain_innovations_with_pegged/clh5wbv

[thezerg]

the tenets that Satoshi did get right were the economic ones, mainly that of a fixed supply with a fair distribution.  

the market has invested accordingly based on those.  by allowing SC's to change or distort those economic assumption will cause confusion and uncertainty in the Bitcoin price.

we're seeing it right now.

I don't see how SC's can distort the original bitcoin fixed supply rules without being a total sham that no one will adopt.

If side chains allow creation of new coins/tokens not originating through the 'two way peg' then why would anyone in their right mind use them?

Nobody would use that sidechain if those new coins/tokens were not backed in some other manner.

Edit: would appreciate an answer to this one please

Sidescams can propose any economic model they want, no different than altcoins.  unfortunately, some ppl will be lured over to them and lose BTC. 

when lots of that activity occurs over years, then i will propose a truly revolutionary idea; let's totally separate these Sidescams technically from the main chain so as to not let ppl lose their BTC!  everyone will then say, "great idea!"

Just like everything else in this world from used cars to altcoins you can get scammed.  One "sidescam" does not mean sidechains are a bad idea.

The classic example of a valuable sidechain is one that allows native support for other securities, bonds, backed commodities, including atomic anonymous decentralized exchange.  This can be done more efficiently than overlay coins.

You could imagine geographically isolated sidechains that take alleviate the scalability issues with Bitcoin.

You could imagine a chain that orders potential transactions on an average of a 5 second window, potentially in a pseudo-centralized manner.  For example, the entity that found the prior block gets to order potential transactions until the next block is found.  This could solve the zero-confirmation problem.

You could imagine something supporting decentralized data storage, or any other collective enterprise from DACs to web forums.  Demurrage pays your monthly membership fees (which pay the developers of the system), but you can buy and sell data storage out of this account so if you offer enough storage into the system your monthly fees are paid and you even make money.

You could imagine "inverting" the bitcoin database so the UTXO set is what is mined, and the blockchain is the history of UTXOs.  This and other features could make a blockchain that is much lighter-weight for non-miners.  The advantage here is that hardware wallets could be made smaller, for less money and more functionality put on the wallet vs the POS.

I think that services that use microtransactions haven't appeared yet because it is a totally new concept, because it is inconvenient with bitcoin, and because they are accused of being blockchain spam.  But, I think we will start seeing them on the bitcoin ledger because altcoins are failing and because the SEC may start looking at appcoins (or at least pre-sales of them) as a security.  Then the blockchain will truly go exponential and you guys will get to experience the fruits of your labor to marginalize these technologies.

[cypherdoc]

Cypher, I respect your opinion but am at a loss on this one with where you are. The sidechains, while this will surely be a major change to bitcoin is absolutely necessary to ensure the role of bitcoin as the leader in the space. It also ensures that the fixed supply we seek with an e-currency is actually a possibility. At the moment, "cheap" alts are taking a decent amount of funding that would otherwise be going into bitcoin. What exactly is the issue if some of the bitcoins are lost? Better in that situation than an alt coin simply evaporates. In both situations wealth evaporates, but only in sidechain scenario does wealth increase (of bitcoin holders) irregardless of an evaporation.

In regards to coding with a profit model, I think Greg said it best:

http://www.reddit.com/r/Bitcoin/comments/2k070h/enabling_blockchain_innovations_with_pegged/clh5wbv

it already is the leader.  and i'm not fan of altscams as you should know.  they are taking much needed capital away from Bitcoin but this seems to be resolving itself slowly.  nothing wrong with patience is there?

i keep saying this but i don't think the market will like a constant loss of BTC over time from Sidescams.  we already have a perception of not having enough coins from mainstream economists.  just heard one say this last weekend at Hasher's United.

it could cause a paradox in price action; down.

[cypherdoc]

where is the AMA?  wasn't it supposed to start 12 min ago?

[sickpig]

So it seems that the real problem is the concentration of core devs into a single company, rather than the concept in itself.

...and the Bitcoin Core monopoly itself.

I want to see the network fully heterogenous at the implementation level.

We should be just as concerned about all the mining being done with Bitcoin Core as we are concerned about too much hashing being controlled by ghash.io.

Get btcd, libbitcoin, and a couple more independent implementations in there too.

We're in violent agreement then.

I myself am in the process of setting up a full node, I wanted to try the latest improvements recently committed in the bitcoin core master branch. Maybe it's time to give btcd a try and if I'm quick I could set up an obelisk server too.

Though I think this is ortogonal to sidechains concept as long as every full node incarnation could implement such feature.

[thezerg]

In such episode Adam Back said the he was concerned over digital scarcity, a Bitcoin property harmed by the proliferation of altcoins.

Secondly he said that to sustain a proper level of innovation the community need to find a way to introduce changes into Bitcoin
in more secure way.

With "secure way" I think he meat having a proper test-bed, different from the test network, to check the impact of new changes.

He thinks that SCs is a solution to both problems.

I don't know if he's right or wrong, but it seems to me that he cares about Bitcoin future.

That's probably what Adam Back wants.

However, this isn't just about him.

Blockstream has investors, who presumably want a return on their investment, a return that requires the continuing relevance of sidechains.

If the Bitcoin protocol adopts features that are developed in sidechains, then the need for sidechains diminishes.

What will those investors say about that? What will Blockstream do in response?

If you really believe in the potential of digital currencies to take over practically every economic transaction, you'd realize that the Bitcoin protocol CAN'T adopt every feature developed in sidechains because some will be conflicting (fast vs slow block times for example).

I'm glad that a significant portion of the dev community is coalescing behind sidechains and honestly I think that part of why they need a company is because of the impossibility of this community to arrive at consensus as individuals.  

We can't even agree to raise the block size limit -- a limitation that, if unchanged will either dramatically limit Bitcoin's applicability, or will cause such high txn fees that a worldwide Bitcoin will be limited to high value transactions.  Either case opens up all kinds of avenues for traditional finances, fiat currencies, etc.  And the only downside is that the home user MAY not be able to run a full node.  

Well let me break it to you, if Bitcoin is so unsuccessful as to not require greater block size then hobbyists will be gone -- the radical, money revolution that Bitcoin promises will be unfulfilled and these people will be on the the next new thing.  And if Bitcoin is wildly, globally, successful with today's block size a single transaction will be so expensive individuals will own zero coins and so be uninterested in running a full node.

I mean come on... If I was a tinfoil hat wearing type, I'd really begin to suspect some of you guys.

[cypherdoc]

the tenets that Satoshi did get right were the economic ones, mainly that of a fixed supply with a fair distribution.  

the market has invested accordingly based on those.  by allowing SC's to change or distort those economic assumption will cause confusion and uncertainty in the Bitcoin price.

we're seeing it right now.

I don't see how SC's can distort the original bitcoin fixed supply rules without being a total sham that no one will adopt.

If side chains allow creation of new coins/tokens not originating through the 'two way peg' then why would anyone in their right mind use them?

Nobody would use that sidechain if those new coins/tokens were not backed in some other manner.

Edit: would appreciate an answer to this one please

Sidescams can propose any economic model they want, no different than altcoins.  unfortunately, some ppl will be lured over to them and lose BTC. 

when lots of that activity occurs over years, then i will propose a truly revolutionary idea; let's totally separate these Sidescams technically from the main chain so as to not let ppl lose their BTC!  everyone will then say, "great idea!"

Just like everything else in this world from used cars to altcoins you can get scammed.  One "sidescam" does not mean sidechains are a bad idea.

The classic example of a valuable sidechain is one that allows native support for other securities, bonds, backed commodities, including atomic anonymous decentralized exchange.  This can be done more efficiently than overlay coins.

You could imagine geographically isolated sidechains that take alleviate the scalability issues with Bitcoin.

You could imagine a chain that orders potential transactions on an average of a 5 second window, potentially in a pseudo-centralized manner.  For example, the entity that found the prior block gets to order potential transactions until the next block is found.  This could solve the zero-confirmation problem.

You could imagine something supporting decentralized data storage, or any other collective enterprise from DACs to web forums.  Demurrage pays your monthly membership fees (which pay the developers of the system), but you can buy and sell data storage out of this account so if you offer enough storage into the system your monthly fees are paid and you even make money.

You could imagine "inverting" the bitcoin database so the UTXO set is what is mined, and the blockchain is the history of UTXOs.  This and other features could make a blockchain that is much lighter-weight for non-miners.  The advantage here is that hardware wallets could be made smaller, for less money and more functionality put on the wallet vs the POS.

I think that services that use microtransactions haven't appeared yet because it is a totally new concept, because it is inconvenient with bitcoin, and because they are accused of being blockchain spam.  But, I think we will start seeing them on the bitcoin ledger because altcoins are failing and because the SEC may start looking at appcoins (or at least pre-sales of them) as a security.  Then the blockchain will truly go exponential and you guys will get to experience the fruits of your labor to marginalize these technologies.

Maybe the real Tragedy of the Commons is 'devs gotta dev'.

We have this great open source project so why not tinker with it?  I've always said that "the geeks fail to understand that which they hath created". Bitcoin has so much potential to change the world simply as it is: a new form of money. Why so much emphasis on other asset uses I'll never understand.

[justusranvier]

Though I think this is ortogonal to sidechains concept as long as every full node incarnation could implement such feature.

I wouldn't care so much about Blockstream if it wasn't composed of so many of the people who can effectively veto changes to the Bitcoin protocol, and who suddenly have a financial incentive to block protocol changes that are good for the network but bad for their revenue.

If the network was implementation-heterogeneous, then it wouldn't be such a potential problem.