Gold collapsing. Bitcoin UP.

[da2ce7]

Meanwhile, Gold collapsing,  bitcoin (also collapsing)

Oil too.

What is up? Just USD?

The USD is entering the 'red giant' phase, having exhausted its primary fuel of gold and silver backing and now being powered by the less dense energy source of hydrocarbon hegemony.  Although less productive, the economic bloat of malinvestment results in a higher apparent magnitude via the financialization process. 

That is why gold/silver/BTC (stuff you have) are collapsing, while insurance/food/medicine/education (stuff you need) costs are soaring.

While less massive bodies of fiat may ultimately wind up as harmless white dwarfs, the USD is so large it will enter a phase equivalent to carbon-burning when runaway debt-monetization overcomes the hydrostatic equilibrium provided by petrodollars.

This will result in a supernova of hyperinflation, and finally a black hole will remain where the global reserve currency once existed.

that's good 

Really good analogy! (Except I would expect to see a deflationary collapse of the red-giant, before an hyperinflationary super-nova explosion.)

[1714862693]

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[1714862693]

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[1714862693]

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[yayayo]

Meanwhile, Gold collapsing,  bitcoin (also collapsing)

Oil too.

What is up? Just USD?

The USD is entering the 'red giant' phase, having exhausted its primary fuel of gold and silver backing and now being powered by the less dense energy source of hydrocarbon hegemony.  Although less productive, the economic bloat of malinvestment results in a higher apparent magnitude via the financialization process. 

That is why gold/silver/BTC (stuff you have) are collapsing, while insurance/food/medicine/education (stuff you need) costs are soaring.

While less massive bodies of fiat may ultimately wind up as harmless white dwarfs, the USD is so large it will enter a phase equivalent to carbon-burning when runaway debt-monetization overcomes the hydrostatic equilibrium provided by petrodollars.

This will result in a supernova of hyperinflation, and finally a black hole will remain where the global reserve currency once existed.

that's good 

Really good analogy! (Except I would expect to see a deflationary collapse of the red-giant, before an hyperinflationary super-nova explosion.)

That's so good, I have to quote it again.

I hope it will not take too long before we can watch this stellar event... hopefully we won't be destroyed by it.

ya.ya.yo!

[iCEBREAKER]

(New & Improved!  Hat tip to da2ce7.)

The USD is entering the 'red giant' phase, having exhausted its primary fuel of gold and silver backing and now being powered by the less dense energy source of hydrocarbon hegemony.  Although less productive, the economic bloat of malinvestment results in a higher apparent magnitude via the financialization process.  

That is why gold/silver/BTC (stuff you have) are collapsing, while insurance/food/medicine/education (stuff you need) costs are soaring.

The red giant will eventually implode in a Kondratieff Winter deflationary holocaust:



While less massive bodies of fiat may ultimately wind up as harmless white dwarfs, the USD is so large it will enter a stage equivalent to carbon-burning when runaway debt-monetization overcomes the hydrostatic equilibrium provided by petrodollars.

This will result in a supernova of hyperinflation, and finally a black hole will remain where the global reserve currency once existed.

[HeliKopterBen]

@Cypherdoc

Your scenario is pretty far fetched.  I'm not sure a whale will be able to cause enough panic to do much damage given that side chains will be pegged at the protocol level.  A better test would be during natural panic such as the panic buying in 2011 and 2013 and subsequent crashes.  At worst, people might panic in and out of side chains during such periods  of volatility given the "risk free put" scenario, but arb bots should keep assets aligned in price for the most part.  I highly doubt that all market participants would completely abandon one chain for another.  As long as bitcoin has a block subsidy, it will not be abandoned by miners.

[cypherdoc]

@Cypherdoc

Your scenario is pretty far fetched.  I'm not sure a whale will be able to cause enough panic to do much damage given that side chains will be pegged at the protocol level.  A better test would be during natural panic such as the panic buying in 2011 and 2013 and subsequent crashes.  At worst, people might panic in and out of side chains during such periods  of volatility given the "risk free put" scenario, but arb bots should keep assets aligned in price for the most part.  I highly doubt that all market participants would completely abandon one chain for another.  As long as bitcoin has a block subsidy, it will not be abandoned by miners.

the whale could amplify the effect by buying scBTC on the open mkt exchange with fiat to assist the price rise.  remember, speculators like growth, and this would be no different than investing early in a start up currency that has the added potential of not only the MC but an added innovation that theoretically should make it better and eventually superior.

your point about the block subsidy being a differentiating factor is a good one though.  perhaps the SC could introduce a sidecoin block reward equivalent to Bitcoin at the height in the SC when it is introduced.

[HeliKopterBen]

the whale could amplify the effect by buying scBTC

Then it wouldn't be a risk free put.

perhaps the SC could introduce a sidecoin block reward equivalent to Bitcoin at the height in the SC when it is introduced.

The SC reward wouldn't be fungible with bitcoin like the pegged coin.  However, I could see the SC reward becoming a problem if the side chain became popular.  It would provide further incentive for miners to mine the SC vs the MC.

[cypherdoc]

the whale could amplify the effect by buying scBTC

Then it wouldn't be a risk free put.

yep, but under the right conditions could be quite effective.  like in a price ramp to offset the arb bots.

perhaps the SC could introduce a sidecoin block reward equivalent to Bitcoin at the height in the SC when it is introduced.

The SC reward wouldn't be fungible with bitcoin like the pegged coin.  However, I could see the SC reward becoming a problem if the side chain became popular.  It would provide further incentive for miners to mine the SC vs the MC.

no it wouldn't be fungible but would cause mining competition especially when the sidecoin is cheap along with the potential for significant price appreciation.

[cbeast]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

[cypherdoc]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

that is the underlying assumption in my base case.

[HeliKopterBen]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

[cbeast]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

It's A White Paper, not The White Paper. I don't agree with the notion of independently traded tokens. The idea of a SC is to decentralize mining (whatever that means) and allow it to scale using present technology.

[smooth]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

[HeliKopterBen]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

[smooth]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

My message was a bit unclear. I meant to say as a Bitcoin holder considering exchanging my coins to a side chain (and choosing between these two side chains). Granted the effect you describe could still matter if I were exchanging a small portion of my coins, although I'm not sure my decision whether to exchange would matter here to whether resources are diverted. If not then I would strictly prefer the token version.

[cbeast]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

A Side Chain may be an instance where an additional demurrage token may be desirable. The Bitcoin investment has an expiration date so people won't leave it in, but will have some incentive to use the SC.

[cypherdoc]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

if you're a small miner now on the Bitcoin MC, and a SC with all the properties of my base case (with a significant innovation such as perfect anonymity) came along (now includes a sidecoin) would you stay put or jump to the SC?

[brg444]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

if you're a small miner now on the Bitcoin MC, and a SC with all the properties of my base case (with a significant innovation such as perfect anonymity) came along (now includes a sidecoin) would you stay put or jump to the SC?

in your base case, a 1:1 peg, there is no coin issuance, no block subsidy, so no incentive to jump boat

[cypherdoc]

you know, it just occurred to me that when Austin Hill goes around to all the mining pools and mines and tries to convince them to MM all his SC's, he's introducing a market distortion.

in other words, he's attempting to get something for nothing.

[cypherdoc]

A Side Chain must be 1:1 otherwise it's a merge mined (or not merge mined) altcoin.

From the whitepaper:

However, it is possible for sidechains to produce their own tokens, or issued
assets, which carry their own semantics.

As a Bitcoin holder I fail to see why I wouldn't prefer such a sidechain to one that is relying on transaction fees for mining, other than possibly ideological reasons, which I doubt will have much practical effect. Fees plus token should be more secure than fees alone, assuming any value for the token.

The additional token may divert mining resources away from MC, causing MC to be less secure.  Of course the additional token could bring additional mining resources into the network.

if you're a small miner now on the Bitcoin MC, and a SC with all the properties of my base case (with a significant innovation such as perfect anonymity) came along (now includes a sidecoin) would you stay put or jump to the SC?

in your base case, a 1:1 peg, there is no coin issuance, no block subsidy, so no incentive to jump boat

i just changed my base case according to a helpful comment from HB.  so what?  it doesn't invalidate the rest of my arguments.

[dillpicklechips]

in your base case, a 1:1 peg, there is no coin issuance, no block subsidy, so no incentive to jump boat

Transactions will happen on the sidechain and can charge tx fees, all of which are able to be converted right back to BTC if wanted. The only incentive to jump boat would be to use a feature.