Gold collapsing. Bitcoin UP.

[sickpig]

Side chains are probably unicorns . I say probably because I haven't seen the proof of concept demonstrated nor have a real world analogy. It seems like vaporware.

Time will tell I suppose.

Fwiw 2wpeg sidechains could be implemented now, without any changes to the btc protocol...

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[brg444]

Side chains are probably unicorns . I say probably because I haven't seen the proof of concept demonstrated nor have a real world analogy. It seems like vaporware.

 

They are not terribly hard to understand. Yes the math has to be vetted, the crypto validated and implemented but they are very much a reality and certainly not "vaporware".

The proof of concept is in the whitepaper.

[cbeast]

Side chains are probably unicorns . I say probably because I haven't seen the proof of concept demonstrated nor have a real world analogy. It seems like vaporware.

Time will tell I suppose.

Fwiw 2wpeg sidechains could be implemented now, without any changes to the btc protocol...

Let's see a two way peg with test bitcoins and test litecoins at an arbitrary peg. Has anyone created an atomic swap between chains without human intervention?

[cypherdoc]

Sidechain coins are Bitcoins.  All the muddled thinking about 'fixed price', 'supply/demand', etc, etc and the consequent confusion goes out the window when one conceptualizes that.  Alas, not everyone is capable of doing so and clearly not that Coinlock dude.  Of course most people are not really capable of conceptualizing Bitcoin itself for the same basic lack of mental flexibility.  Or any form of 'money' really.

no.  Bitcoins are units that only exist on the MC.

Bingo!  We have a winner!  Repeat after me as many times as necessary:  'two...way...peg.  two...way...peg."  This 'exists on MC' is precisely what separates Sidchain coins from Bitcoin alts and work-a-likes.

anything else that rides on less secure SC's are who the hell knows what.

Granted in the earlier phases there will be a discount for this which will diminish as confidence increases.  There will also be a discount for the mechanical aspects of utilizing the peg.  But these things are minor and largely inconsequential to the conceptual basis of the solution.

The peg is an illusion.

I think you're just suffering some confusion. But I'm not sure exactly what.

^ this

No. I thought coinlock phrased it very well. Which is why nullc disappeared.

[adam3us]

Thought cypherdoc might like this article by Daniel Krawisz

http://bitcoinist.net/the-two-ideologies-in-bitcoin/

I am sort of imagining it as what underlies his arguments that he doesnt like sidechains.

I think cypherdoc likely still mistaken (and Krawisz as ever makes interesting informed economic arguments).

If nothing else for those who view bitcoin as gold2.0 (and I do myself) then its in our interest actually that there not be code churn on bitcoin-core to add micro-payments, fancy contracts etc etc it's better to fix all the bugs, refactor and freeze the code.  Put the code churn onto other chains.  But having the other chains be non-bitcoin denominated detracts from bitcoin.  Hence... sidechains.

Further if extra features can go into sidechains, perhaps along the way bitcoin could do things to reduce centralisation reduce blocksize, and get rid of extraneous existing code complexity by refactoring some things off into a more featureful sidechain.

btw I read Krawisz as more saying investment utility is the predominant driver of bitcoin adoption, transactional uses secondary.

Anyway just some thoughts, not trying to reanimate the sub-thread.

Adam

[adam3us]

The peg is an illusion.

I think you're just suffering some confusion. But I'm not sure exactly what.

^ this

Uh I see I spoke too soon.  Seemingly the cypherdoc vs world sub-thread is still raging  (Wasnt reading thread for some weeks).

I think cypherdoc's skill is to be the right balance of adhominem, unexplained dismissive & occasional logic to cultivate a continuous flame war.  Otherwise called trolling I guess, easily recognisable form of entertainment for anyone who enjoyed USENET news flame wars of yore!  Flame wars are fun and all but I prefer constructive discussion.  Cypherdocs a clever fellow, I'm sure he has the smarts to hold a pure logic conversation if he chose.  Just the inner-troll is having too much fun trolling.

Anyway thats my view of whats going on.

Adam

ps and for the love of Mike trim quotes!

[cypherdoc]

Thought cypherdoc might like this article by Daniel Krawisz

http://bitcoinist.net/the-two-ideologies-in-bitcoin/

I am sort of imagining it as what underlies his arguments that he doesnt like sidechains.

I think thats likely still mistaken (and Krawisz as ever makes interesting informed economic arguments).

If nothing else for those who view bitcoin as gold2.0 (and I do myself) then its in our interest actually that there not be code churn on bitcoin-core to add micro-payments, fancy contracts etc etc it's better to fix all the bugs, refactor and freeze the code.  Put the code churn onto other chains.  But having the other chains be non-bitcoin denominated detracts from bitcoin.  Hence... sidechains.

Further if extra features can go into sidechains, perhaps along the way bitcoin could do things to reduce centralisation reduce blocksize, and get rid of extraneous existing code complexity by refactoring some things off into a more featureful sidechain.

btw I read Krawisz as more saying investment utility is the predominant driver of bitcoin adoption, transactional uses secondary.

Anyway just some thoughts, not trying to reanimate the sub-thread.

Adam

If you make a  commitment to stick around and address all my concerns instead of lobbing in a comment every hundred pages or so then maybe I'll take the effort to repeat everything I've already said. 

[BldSwtTrs]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

nullc :
About the only thing negative you can say about a system which is truly backed by Bitcoin is that it doesn't create huge incomes for traders. Many people wouldn't consider that much of a negative.

Does he heard about Soros?
When two things are pegged while they don't have the same economic features, then the pegged is temporary, and that creates profit opportunities and people prompted to accelerate the failure of the peg system.

It looks like sidechains people think because two things are pegged they magically become the same thing. From 1984 to 1997 the thai bath was pegged with the US dollar, that doesn't mean that the bath was the same thing than the dollar. Sooner or later the market forces end up destroying the top down price fixation.

[brg444]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

nullc :
About the only thing negative you can say about a system which is truly backed by Bitcoin is that it doesn't create huge incomes for traders. Many people wouldn't consider that much of a negative.

Has he heard about Soros?
When two things are pegged while they don't have the same economic features, then the pegged is temporary, and that creates profit opportunities and people prompted to accelerate the failure of the peg system.

It looks like sidechains people think because two things are pegged they magically become the same thing. From 1984 to 1997 the thai bath was pegged with the US dollar, that doesn't mean that the bath was the same thing than the dollar. Sooner or later the market forces end up destroying the top down price fixation.

I don't think traditional currency peg apply. The mechanics behind these pegs are not solid and open to the failures you've illustrated.

The situation here is one where a sidechain unit has its equivalent in BTC collateral. A mathematically enforced 1:1 convertibility between both units. Each units' exchange rate value might differ but the protocol dictates that they are exchangeable 1:1 no matter their economic value. That is because for every unit on a sidechain there exist an equivalent amount of BTC locked in an "escrow" type transaction.

Theoretically (I may be wrong) but even if the perceived market value of the unit on a sidechain would come to 0 one could still return is sidecoin for its equivalent in BTC.

[molecular]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

I don't see it that way.

I see you were happy about coinlock saying this...

Now super-risky-coin collapses, I lose my Bitcoin because the information about the relative risks was hidden in the deterministic rate.

To this I would say: you already lost your Bitcoins when you swapped them for super-risky-coins. That information isn't hidden at all. When you 'move' (it's debatable wether that's a good expression to use) BTC -> scBTC you're well aware you're swapping your bitcoins for sidechain coins, aren't you?

[cypherdoc]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

nullc :
About the only thing negative you can say about a system which is truly backed by Bitcoin is that it doesn't create huge incomes for traders. Many people wouldn't consider that much of a negative.

Does he heard about Soros?
When two things are pegged while they don't have the same economic features, then the pegged is temporary, and that creates profit opportunities and people prompted to accelerate the failure of the peg system.

It looks like sidechains people think because two things are pegged they magically become the same thing. From 1984 to 1997 the thai bath was pegged with the US dollar, that doesn't mean that the bath was the same thing than the dollar. Sooner or later the market forces end up destroying the top down price fixation.

Yep, that contorted remark by nullc is painfully naive.  He totally neglects the fact that these SC assets will have a  separate exchange price in fiat that certainly can and will be pumped and manipulated to all sorts of illogical levels. SC's don't solve any of those issues

[molecular]

Sidechain coins are Bitcoins.

No. There's time (cost) and risk between the two.

[brg444]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

nullc :
About the only thing negative you can say about a system which is truly backed by Bitcoin is that it doesn't create huge incomes for traders. Many people wouldn't consider that much of a negative.

Does he heard about Soros?
When two things are pegged while they don't have the same economic features, then the pegged is temporary, and that creates profit opportunities and people prompted to accelerate the failure of the peg system.

It looks like sidechains people think because two things are pegged they magically become the same thing. From 1984 to 1997 the thai bath was pegged with the US dollar, that doesn't mean that the bath was the same thing than the dollar. Sooner or later the market forces end up destroying the top down price fixation.

Yep, that contorted remark by nullc is painfully naive.  He totally neglects the fact that these SC assets will have a  separate exchange price in fiat that certainly can and will be pumped and manipulated to all sorts of illogical levels. SC's don't solve any of those issues

Please, we have been going over this times and times again. The exchange rate of a properly implemented 1:1 SC asset will, in time, closely track BTC prices for many logical reasons.

[molecular]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

nullc :
About the only thing negative you can say about a system which is truly backed by Bitcoin is that it doesn't create huge incomes for traders. Many people wouldn't consider that much of a negative.

Does he heard about Soros?
When two things are pegged while they don't have the same economic features, then the pegged is temporary, and that creates profit opportunities and people prompted to accelerate the failure of the peg system.

It looks like sidechains people think because two things are pegged they magically become the same thing. From 1984 to 1997 the thai bath was pegged with the US dollar, that doesn't mean that the bath was the same thing than the dollar. Sooner or later the market forces end up destroying the top down price fixation.

Yep, that contorted remark by nullc is painfully naive.  He totally neglects the fact that these SC assets will have a  separate exchange price in fiat that certainly can and will be pumped and manipulated to all sorts of illogical levels. SC's don't solve any of those issues

Please, we have been going over this times and times again. The exchange rate of a properly implemented 1:1 SC asset will, in time, closely track BTC prices for many logical reasons.

'pumped and manipulated to all sorts of illogical levels'? Yeah, that's ridiculous. If the peg works, arbitrage would stop that kind of thing in its roots. Also: do you really thing there would be sidechainCoin <-> fiat exchange? I doubt that makes much sense since the peg plus existing bitcoin <-> fiat exchanges can easily be used, no?

[cypherdoc]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

I don't see it that way.

I see you were happy about coinlock saying this...

Now super-risky-coin collapses, I lose my Bitcoin because the information about the relative risks was hidden in the deterministic rate.

To this I would say: you already lost your Bitcoins when you swapped them for super-risky-coins. That information isn't hidden at all. When you 'move' (it's debatable wether that's a good expression to use) BTC -> scBTC you're well aware you're swapping your bitcoins for sidechain coins, aren't you?

If that's a real question, then, but of course.  SC's mechanics are easy to understand. But economically do they work and will they be good for Bitcoin? The answer, I think, is more philosophical.

I think Bitcoin is, and has always been, simply  money. It has gotten to where it has based on economic assumptions of how the blockchain works currently. SC's change all those assumptions. That is a mistake, imo.

[NewLiberty]

I don't think traditional currency peg apply. The mechanics behind these pegs are not solid and open to the failures you've illustrated.

The situation here is one where a sidechain unit has its equivalent in BTC collateral. A mathematically enforced 1:1 convertibility between both units. Each units' exchange rate value might differ but the protocol dictates that they are exchangeable 1:1 no matter their economic value. That is because for every unit on a sidechain there exist an equivalent amount of BTC locked in an "escrow" type transaction.

Theoratically, and I might be wrong, but even if the perceived market value of the unit on a sidechain would come to 0 one could still return is sidecoin for its equivalent in BTC.

If markets are efficient then market value of pure 1:1 sidechains should only ever be *higher* than BTC.  They should never have the same market value.  The time delay via SPV to use the sidechain makes it such that there should be a premium on no-delay (bought from market).

We never did find out why the SC marketing folks are using the economically discredited term "peg", for something that is so very different from a peg in any traditional sense of the word.  It is bound to confuse people.

[brg444]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

I don't see it that way.

I see you were happy about coinlock saying this...

Now super-risky-coin collapses, I lose my Bitcoin because the information about the relative risks was hidden in the deterministic rate.

To this I would say: you already lost your Bitcoins when you swapped them for super-risky-coins. That information isn't hidden at all. When you 'move' (it's debatable wether that's a good expression to use) BTC -> scBTC you're well aware you're swapping your bitcoins for sidechain coins, aren't you?

If that's a real question, then, but of course.  SC's mechanics are easy to understand. But economically do they work and will they be good for Bitcoin? The answer, I think, is more philosophical.

I think Bitcoin is, and has always been, simply  money. It has gotten to where it has based on economic assumptions of how the blockchain works currently. SC's change all those assumptions. That is a mistake, imo.

SC's would change some assumptions but most certainly not all.

It is also debatable whether those changes will hinder the Bitcoin blockchain or help it thrive.

[cypherdoc]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

nullc :
About the only thing negative you can say about a system which is truly backed by Bitcoin is that it doesn't create huge incomes for traders. Many people wouldn't consider that much of a negative.

Does he heard about Soros?
When two things are pegged while they don't have the same economic features, then the pegged is temporary, and that creates profit opportunities and people prompted to accelerate the failure of the peg system.

It looks like sidechains people think because two things are pegged they magically become the same thing. From 1984 to 1997 the thai bath was pegged with the US dollar, that doesn't mean that the bath was the same thing than the dollar. Sooner or later the market forces end up destroying the top down price fixation.

Yep, that contorted remark by nullc is painfully naive.  He totally neglects the fact that these SC assets will have a  separate exchange price in fiat that certainly can and will be pumped and manipulated to all sorts of illogical levels. SC's don't solve any of those issues

Please, we have been going over this times and times again. The exchange rate of a properly implemented 1:1 SC asset will, in time, closely track BTC prices for many logical reasons.

'pumped and manipulated to all sorts of illogical levels'? Yeah, that's ridiculous. If the peg works, arbitrage would stop that kind of thing in its roots. Also: do you really thing there would be sidechainCoin <-> fiat exchange? I doubt that makes much sense since the peg plus existing bitcoin <-> fiat exchanges can easily be used, no?

Yes, there should be markets that arise. Have you read Konrad Grafs paper? 

[molecular]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

I don't see it that way.

I see you were happy about coinlock saying this...

Now super-risky-coin collapses, I lose my Bitcoin because the information about the relative risks was hidden in the deterministic rate.

To this I would say: you already lost your Bitcoins when you swapped them for super-risky-coins. That information isn't hidden at all. When you 'move' (it's debatable wether that's a good expression to use) BTC -> scBTC you're well aware you're swapping your bitcoins for sidechain coins, aren't you?

If that's a real question, then, but of course.  SC's mechanics are easy to understand. But economically do they work and will they be good for Bitcoin? The answer, I think, is more philosophical.

I think Bitcoin is, and has always been, simply  money. It has gotten to where it has based on economic assumptions of how the blockchain works currently. SC's change all those assumptions. That is a mistake, imo.

If people can be lured into thinking their scBTC are BTC (even just 'monetarily'), then yes, that's a danger. The same kind of danger as thinking mtgoxBTC are BTC.

going back to ccc now. side-note: the 'hacker crowd' seems much more open to Bitcoin than a year ago.

[cypherdoc]

for those who miss their daily SC's hit, go here for an excellent discussion btwn this guy Coinlock and nullc over on Reddit.  Coinlock gives some very clear and cogent arguments against the peg and shuts nullc down real quick:

http://www.reddit.com/r/Bitcoin/comments/2qpdnc/gregory_maxwell_how_i_went_from_bitcoin_skeptic/cn8dne9

I don't see it that way.

I see you were happy about coinlock saying this...

Now super-risky-coin collapses, I lose my Bitcoin because the information about the relative risks was hidden in the deterministic rate.

To this I would say: you already lost your Bitcoins when you swapped them for super-risky-coins. That information isn't hidden at all. When you 'move' (it's debatable wether that's a good expression to use) BTC -> scBTC you're well aware you're swapping your bitcoins for sidechain coins, aren't you?

If that's a real question, then, but of course.  SC's mechanics are easy to understand. But economically do they work and will they be good for Bitcoin? The answer, I think, is more philosophical.

I think Bitcoin is, and has always been, simply  money. It has gotten to where it has based on economic assumptions of how the blockchain works currently. SC's change all those assumptions. That is a mistake, imo.

SC's would change some assumptions and most certainly not all.

It is also debatable whether those changes will hinder the Bitcoin blockchain or help it thrive.

Those are very logical statements with which I agree. Clearly I have my opinions though.