Gold collapsing. Bitcoin UP.

[justusranvier]

Fair enough about Gavin's recent words, but broadcasting transactions can be done covertly in a variety of ways because they are tiny.  I wish to have it be the case that actually operating the infrastructure (you remember 'peer 2 peer', right?) is similarly defensible.

There is a real problem here -  P2P networks are almost always designed with built-in tragedy of the commons problem because everybody is supposed to do everything for free, instead of designing a market that allows price discovery.

I'm optimistic about BitPay's new project in that regard. If somebody manages to build a P2P network that pays the people who provide infrastructure at a price based on supply and demand, then nobody will ever need to worry about too much demand consuming more resources than the infrastructure providers are willing to donate.

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[Odalv]

if most of the transactions occur on OT then the danger is even greater for miners considering unlike SCs they do not get to mine and profit from OT, correct?

not really, just think of an exchange, they have many more transactions than the Bitcoin blockchain can process, they have there own servers and internal accounting system (it could there own PoS coin or somthing like the NASDAQ) all OT does is ensure that your balance locked and released when cretin criteria are met with a N of M script your bitcoin can be moved.

in this application it is similar or indistinguishable from a decentralized exchange using SC.

An alternate currency for example - with OT would be a for profit company - say for example a micro transaction currency, what OT would provide is a trust free way to secure your BTC, there internal servers or blockchain ledger would manage the system - risk, demand and competition would keep scales appropriate, and there dev team could trim the block chain as needed. if there micro payment coin was in high demand there would be an exchange rate floated either on the market or set by the company.    

but the above example with a SC would run at the prototypical level, and be totally decentralized the design of the coin would most likely be merged mined to incentivise mining, over time it will generate more revenue for miners than Bitcoin, the result is there is a motivation to mine and secure the SC's as they grow, the Bitcoin chain can be MM but if it gets to a point where it docent generate enough revenue because the revenue is generated on the SC, it will leave bitcoin vulnerable to exploration or attack.

this is the trade off with SC, the trade off with OT is market competition, you have to earn you way to the top, you cant boot strap you way up by getting something for nothing (mining) and risking Bitcoins incentive sachem.  

and regarding inflation on a SC. yes indeed there could be, but if there is then it becomes much like any other altcoin and this inflation does not affect the BTC ledger.

to be taken in context with the previous discussion, if the SC is more valuable it is a reason not to transfer back.

so yes basically you just confirmed my two arguments.

1. OT is very much more centralized than SC
2. The danger of the majority of txs being handled off blockchain and removing the incentives for miners to mine any network is far greater than them potentially choosing to prefer mining a particular SC other than Bitcoin.

Here is an example where I will use your argument against you.

Consider two solutions : a fast transactions sidechain and a fast transaction OT coin.

Using the first solution, the sidechain, miners are incentivized to mine both chains, the mainchain and the sidechain. In my own, more pragmatic world, they benefit from both as both work in synergy and the potential for the sidechain to take over the main one along with its mining power is slim to none.

But just to entertain your scenario let us assume it does happen and an exodus to this new chain happen. Miners are still providing the security for a new mainchain and are incentivized to do so.

Now using the second solution, the fast transactions OT coin. It could indeed be a cool solution for awhile but since we have to consider both extremes, then we should also assume that by some strech of the imagination users would somehow have no use for the BTC mainchain and want to use only the OT fast transactions coin.

The problem with that scenario is that miners are left with no txs at all to mine. All the transactions are essentially occuring off-chain. Remember this is a scenario you have yourself championed and argued that once the block reward for BTC decreases or disappear then miners would be left with no incentive to secure the chain and would abandon it but this time, without any chain to turn to.

Don't you think that's a bit problematic. Do you see why SC is the better option?

I'm sure that OT is SC (it looks to me as Federated 2-way-peg)

[Odalv]

Now, I'm getting paranoid. :-)

SC's architecture:

<bitcoin>
   <us-govSC>
       <govscBTC />
       <govscUSD />

       <exchangeSC>
          <mergerSC />
       </exchange>

   </gowSC>
   
   <china-govSC />
   
   <!-- wild-wild-west  -->
   <exchangeSC>
         <mergerSC />
   </exchange>

</bitcoin>

govSC is asymetric 2wp => GOV can veto if you can go in/out
all govSC are secured by GOV mining HW (cetralized servers)

[cypherdoc]

Now, I'm getting paranoid. :-)

SC's architecture:

<bitcoin>
   <us-govSC>
       <govscBTC />
       <govscUSD />

       <exchangeSC>
          <mergerSC />
       </exchange>

   </gowSC>
  
   <china-govSC />
  
   <!-- wild-wild-west  -->
   <exchangeSC>
         <mergerSC />
   </exchange>

</bitcoin>

govSC is asymetric 2wp => GOV can veto if you can go in/out
all govSC are secured by GOV mining HW (cetralized servers)

What a shitfest.  This is precisely the problem we have today with altcoins multiplied by a thousand.

[Odalv]

What a shitfest.  This is precisely the problem we have today with altcoins multiplied by a thousand.

lol, do not worry. You will able to use ALL NEW services without transferring cold-wallet back and forth.

SC is pattern how to secure keep your bitcoins in escrow on MC. While you are able to safe(b/c you own pKeys) use exchangeBTC in mergerSC for trading.

bitcoin {
  exchange {
      merger
  }
}

exchangeBTC is not new ALTcoin it is your new privateKey what can unlock BTC on MC (or parent chain).

[sickpig]

another Adam Back's contribute to the SC debate

https://twitter.com/adam3us/status/529599284065615872
https://bitcointalk.org/index.php?topic=831527.msg9433219#msg9433219

[NewLiberty]

Now, I'm getting paranoid. :-)

SC's architecture:

<bitcoin>
   <us-govSC>
       <govscBTC />
       <govscUSD />

       <exchangeSC>
          <mergerSC />
       </exchange>

   </gowSC>
  
   <china-govSC />
  
   <!-- wild-wild-west  -->
   <exchangeSC>
         <mergerSC />
   </exchange>

</bitcoin>

govSC is asymetric 2wp => GOV can veto if you can go in/out
all govSC are secured by GOV mining HW (cetralized servers)

What a shitfest.  This is precisely the problem we have today with altcoins multiplied by a thousand.

Think of it, govSC may use compromised cryptographic primitives giving them a back door on all the money.
Then they essentially own key escrow on all the coins and can also automatically tax them as needed.  Seize criminal assets etc.
That pretty much solves all the government's problems.

[Odalv]

Think of it, govSC may use compromised cryptographic primitives giving them a back door on all the money.
Then they essentially own key escrow on all the coins and can also automatically tax them as needed.  Seize criminal assets etc.
That pretty much solves all the government's problems.

I agree with you. I'll not keep my BTC in govSC. But I would rather trade on gov secured exchange than on MtGox.
If SC are implemented in Bitcoin then Bitcoin is my first choice.

[cypherdoc]

scenario:  SC + sidecoin + innovation faster tx times + MM + scBTC

is it possible for scBTC to take advantage of the innovation faster tx times or is that impossible b/c the SC MM is specific to sidecoin?

[cypherdoc]

Think of it, govSC may use compromised cryptographic primitives giving them a back door on all the money.
Then they essentially own key escrow on all the coins and can also automatically tax them as needed.  Seize criminal assets etc.
That pretty much solves all the government's problems.

I agree with you. I'll not keep my BTC in govSC. But I would rather trade on gov secured exchange than on MtGox.
If SC are implemented in Bitcoin then Bitcoin is my first choice.

what's your answer again to the argument that all these billions of SC's are stealing tx fees away from Bitcoin miners?

[Odalv]

scenario:  SC + sidecoin + innovation + MM + scBTC

is it possible for scBTC to take advantage of the innovation or is that impossible b/c the SC MM is specific to sidecoin?

I do not understand how creating more units (sidecoin) can be advantage.
I think SC + innovation + scBTC is better chain.  And if it is better than MC then innovation will be implemented into MC.

[NewLiberty]

Think of it, govSC may use compromised cryptographic primitives giving them a back door on all the money.
Then they essentially own key escrow on all the coins and can also automatically tax them as needed.  Seize criminal assets etc.
That pretty much solves all the government's problems.

I agree with you. I'll not keep my BTC in govSC. But I would rather trade on gov secured exchange than on MtGox.
If SC are implemented in Bitcoin then Bitcoin is my first choice.

Exchange security doesn't require a government though... because multikey cryptography, or things like the Counterparty DEX.  So its a false dichotomy in either gov secured exchange vs MtGox.

[NewLiberty]

scenario:  SC + sidecoin + innovation + MM + scBTC

is it possible for scBTC to take advantage of the innovation or is that impossible b/c the SC MM is specific to sidecoin?

I do not understand how creating more units (sidecoin) can be advantage.
I think SC + innovation + scBTC is better chain.  And if it is better than MC then innovation will be implemented into MC.

Except that we know from experience that this is not true.  MC ossifies or has unbreakable social contracts, so better doesn't get implemented into MC.

Instead what SC offers is that MC may 95% migrate to it and leave behind those that don't agree that the change is better.

[cbeast]

what's your answer again to the argument that all these billions of SC's are stealing tx fees away from Bitcoin miners?

Are you concerned about revenue or block size? Isn't the point of SCs to allow Bitcoin to scale by mitigating its transactions through other chains?

[Odalv]

Think of it, govSC may use compromised cryptographic primitives giving them a back door on all the money.
Then they essentially own key escrow on all the coins and can also automatically tax them as needed.  Seize criminal assets etc.
That pretty much solves all the government's problems.

I agree with you. I'll not keep my BTC in govSC. But I would rather trade on gov secured exchange than on MtGox.
If SC are implemented in Bitcoin then Bitcoin is my first choice.

what's your answer again to the argument that all these billions of SC's are stealing tx fees away from Bitcoin miners?

win:win
Smaller MC -> save resources. There are a lot thing  SC cannot do.
1. create new BTC
2. change amount of BTC in SC.

And there will be thousands SC (every company can have 1 SC for internal accounting, and 1 for public btcShares)
A lot of transactions for MC :-)

This SC transaction(IN/OUT rebalacing) will cost more. (they will be bigger)

Transaction fee per block is around 0.15 BTC now. No big deal for miners compared to 25 BTC (12.5 BTC, 6.75 BTC ... )

[NewLiberty]

Transaction fee per block is around 0.15 BTC now. No big deal for miners compared to 25 BTC (12.5 BTC, 6.75 BTC ... )

I think we all agree that NOW is not the basis of this concern.

[justusranvier]

Isn't the point of SCs to allow Bitcoin to scale by mitigating its transactions through other chains?

if that is the point, it won't work.

Sidechains only have SPV security. If the entire main chain network does not validate a particular sidechain, then the resources required to produce fraudulent SPV proofs that redeem sidechains units for locked bitcoin are fewer.

If every node in the main chain network needs to watch every sidechain, there is no scalability improvement.

If every node on the main chain network does not watch every sidechain, then the security of the sidechains is low.

[Adrian-x]

I'm sure that OT is SC (it looks to me as Federated 2-way-peg)

Different in many ways but the fundamental difference is that you don't need to change the Bitcoin protocol. And MM is not logical step in the evolution.

[Odalv]

Transaction fee per block is around 0.15 BTC now. No big deal for miners compared to 25 BTC (12.5 BTC, 6.75 BTC ... )

I think we all agree that NOW is not the basis of this concern.

I cannot imagine that there will ever exist somebody who can hold 1 copy of all world transactions. (if bitcoin is used by everyone)  and to keep bitcoin decentralized you need at least 5 copies. (100,000 copies is better :-) )

[NewLiberty]

I cannot imagine that there will ever exist somebody who can hold 1 copy of all world transactions. (if bitcoin is used by everyone)  and to keep bitcoin decentralized you need at least 5 copies. (100,000 copies is better :-) )

If this were desired, what would prevent it?