[XMR] Monero Speculation

[kelsey]

...
well litecoin does have a solution to the none pressing matter this is. in any case the problem tearing the bitcoin community apart has little to do with blocksize.

and this all has next to nothing to do with what joe public would think whichever way the split goes.

Well at this point we have to agree to disagree.

Those who believe that the 1MB blocksize matter in Bitcoin is a "non pressing matter" and that the problems that the Bitcoin community has are unrelated to the blocksize issue >> Litecoin.
Those who believe that the 1MB blocksize matter in Bitcoin is a "pressing matter" and that the problems that the Bitcoin community has are very much related to the blocksize issue >> Monero.

happy to agree to disagree and people should not take my points as an attack (though in txt they can come across as that). i, personally, in any coins i hold, welcome criticism. its too my advantage to learn about potential issues.

just a small point i meant the blocksize is a non pressing matter for litecoin, i think in bitcoin its a more of an urgent matter, which in itself highlights another advantage of litecoin; with bitcoin in the lead it gets a headsup on potential issues.

one could say bitcoin is becoming the sacrificial lamb for the crypto community.



 

[ArticMine]

...
one could say bitcoin is becoming the sacrificial lamb for the crypto community.

With this point I must agree.

[jehst]

It's looking more and more like bitcoin is the MySpace of digital currencies.
It's not scalable, not fungible, overly centralized, and its governance makes it very difficult to make improvements.
The right predecessor stands to inherit the community that has formed around the idea of decentralized digital currency if bitcoin fails to adapt.

No matter what coin we support, let's just hope Ripple never catches on.

[Melbustus]

...
It's not scalable,

There'll be a solution to the blocksize issue that lets bitcoin scale, one way or another. It's also worth observing that Bitcoin is currently the only crypto-currency operating at *any* sort of scale.

not fungible,

By default, that's true. Obviously there are ways for sufficiently motivated people to achieve some decent degree of privacy. I'd add that Bitcoin probably has *more* widespread market potential vs some technically-pure anon coin, due to the fact that its transparency-by-default nature makes it palatable to governments. You're naive if you think that govs would not be a lot harsher towards bitcoin if it were fully opaque, and furthermore, if you think that an aggressive stance from the world's largest nations wouldn't hinder adoption (and price).

overly centralized,

By what metric? Some degree of "centralization" is also an *inevitable* dynamic for any POW coin. The key is retaining *sufficient* decentralization, where sufficient == enough independent operators to make it nearly impossible to globally censor transactions.

and its governance makes it very difficult to make improvements.

That wasn't the case when bitcoin was small. That difficulty is probably a curse (and/or blessing) of the success of a well-decentralized crypto-coin. Note that no other coins have that "issue" because no other coins actually matter at all to the outside world.

The right predecessor stands to inherit the community that has formed around the idea of decentralized digital currency if bitcoin fails to adapt.

Well, I think monero stands to gain the support of people who realize it's one of the only alt-coins that can reasonably carve out a niche for itself (at much higher market-cap than today) which bitcoin probably won't fill in the first place.

No matter what coin we support, let's just hope Ripple never catches on.

Ripple is already catching on with banks. Which is fine. Bitcoin isn't about deep integration with existing banking systems. It's about separation of money and state.

[onemorexmr]

overly centralized,

By what metric? Some degree of "centralization" is also an *inevitable* dynamic for any POW coin. The key is retaining *sufficient* decentralization, where sufficient == enough independent operators to make it nearly impossible to globally censor transactions.

i dont think think thats true.
all that its needed are quite miners. no datacenter can compete with electric heaters in thousand of households which mine as a by-product.

[asepticskeptic]

overly centralized,

By what metric? Some degree of "centralization" is also an *inevitable* dynamic for any POW coin. The key is retaining *sufficient* decentralization, where sufficient == enough independent operators to make it nearly impossible to globally censor transactions.

i dont think think thats true.
all that its needed are quite miners. no datacenter can compete with electric heaters in thousand of households which mine as a by-product.

And no government can compete with the most altruistic, forward-thinking population who would never even commit a crime because laws don't even need to exist.

Not gonna happen.

[onemorexmr]

overly centralized,

By what metric? Some degree of "centralization" is also an *inevitable* dynamic for any POW coin. The key is retaining *sufficient* decentralization, where sufficient == enough independent operators to make it nearly impossible to globally censor transactions.

i dont think think thats true.
all that its needed are quite miners. no datacenter can compete with electric heaters in thousand of households which mine as a by-product.

Not gonna happen.

why not? quite miners are not hard to build.
they have the same running cost as an electric heater...just more expensive to buy one.

[asepticskeptic]

overly centralized,

By what metric? Some degree of "centralization" is also an *inevitable* dynamic for any POW coin. The key is retaining *sufficient* decentralization, where sufficient == enough independent operators to make it nearly impossible to globally censor transactions.

i dont think think thats true.
all that its needed are quite miners. no datacenter can compete with electric heaters in thousand of households which mine as a by-product.

Not gonna happen.

why not? quite miners are not hard to build.
they have the same running cost as an electric heater...just more expensive to buy one.

They have the same electricity cost as an electric heater.

An electric heater requires an infinitely less initial investment on an infinite timescale.

Computation tends toward efficiency, and while computational capacity increases as a result, initial investment tends toward a much higher cost.

An electric heater may only be good for ten years.

A computer will tend to be good for much less than that, due to it being a complex system. A complex system that is mostly unusable while it is producing this simple idea.

The idea of computers heating households is simple, but the idea of 1200w oil heaters is infinitely less simple, and infinitely less costly on even just a few decades time scale.

If people want heat in their households, miners or networks will have to compete with that.

The oil heater has a permanent edge. It's $50 USD for 1200w. Even in 2015 it's an easy $1500 USD just to produce 1200w in personal computational heat.

Will your extra $1450 investment ever be recovered?

Not gonna happen.

[onemorexmr]

overly centralized,

By what metric? Some degree of "centralization" is also an *inevitable* dynamic for any POW coin. The key is retaining *sufficient* decentralization, where sufficient == enough independent operators to make it nearly impossible to globally censor transactions.

i dont think think thats true.
all that its needed are quite miners. no datacenter can compete with electric heaters in thousand of households which mine as a by-product.

Not gonna happen.

why not? quite miners are not hard to build.
they have the same running cost as an electric heater...just more expensive to buy one.

They have the same electricity cost as an electric heater.

An electric heater requires an infinitely less initial investment on an infinite timescale.

Computation tends toward efficiency, and while computational capacity increases as a result, initial investment tends toward a much higher cost.

An electric heater may only be good for ten years.

A computer will tend to be good for much less than that, due to it being a complex system. A complex system that is mostly unusable while it is producing this simple idea.

The idea of computers heating households is simple, but the idea of 1200w oil heaters is infinitely less simple, and infinitely less costly on even just a few decades time scale.

If people want heat in their households, miners or networks will have to compete with that.

The oil heater has a permanent edge. It's $50 USD for 1200w. Even in 2015 it's an easy $1500 USD just to produce 1200w in personal computational heat.

Will your extra $1450 investment ever be recovered?

Not gonna happen.

you should not compare an oil heater to an electric heater. atm there are uses for electric heaters.
this doesnt change your point regarding initial investment though.

the problem is, i think ANY cryptocurrency (i dont like POS) is doomed when (long-term) there is not solution to get mining decentralized.

so instead of simply saying "not gonna happen" i try to think of ways to make it happen.

some servers are already used to heat pools there are projects to use the heat from datacenters to heat cities and so on (i only have some german links - sorry). the point is: if you are ONLY mining you cant compete with someone who mines AND needs the heat. he will always be cheaper - even if his power costs are a little higher.

pcs are getting cheaper and cheaper - atm you can buy smartphone/tablets for about 100$. it doesnt need to be much cpu-power, its enough when many people do it.

sadly that doesnt necessarily mean decentralization, but it would help

[Melbustus]

overly centralized,

By what metric? Some degree of "centralization" is also an *inevitable* dynamic for any POW coin. The key is retaining *sufficient* decentralization, where sufficient == enough independent operators to make it nearly impossible to globally censor transactions.

i dont think think thats true.
all that its needed are quite miners. no datacenter can compete with electric heaters in thousand of households which mine as a by-product.

Ok, run that thought experiment. People get clever about using the heat from miners, so their effective cost of mining is less, and therefore mining is profitable for them. So they buy more devices that mine. Difficulty rises; mining becomes less profitable, until an equilibrium is reached... It will *always* be the case that given enough time for an advance (new ASIC tech, heat-capture/re-use, etc), the cost of mining and the revenue from mining will be roughly equal.

It will therefore always come down to the lowest cost producer (ie, who has the cheapest energy). They've got the advantage. Which I think is the root of your pessimism regarding the long-term dynamics of POW:

...
the problem is, i think ANY cryptocurrency (i dont like POS) is doomed when (long-term) there is not solution to get mining decentralized.
...

I disagree with the "doom" outlook. While it's true that there will be a single or very few entities who are ultimately profitable in the narrow scope of actually finding block solutions, market forces will also cause miners to differentiate services and vertically integrate. The margin on other services (whatever they be) will very likely be higher than the gross margin on just the block solving, so there's plenty of room for a healthy-enough number of players.

A POW coin doesn't have to millions of teenagers running miners on their laptops all over the world in order to be *meaningfully* decentralized. It's probably sufficient to have a few dozen independent entities (different countries, sectors of the economy, etc) running deep mining businesses/non-profits/research-institutions/whatever (even government orgs). It simply needs to be the case that it's incredibly difficult for any single entity to coerce >50% of the hashpower. Hopefully the longrun will involve hundreds or thousands of large(ish) mining entities, but I suspect far fewer than that will still provide sufficient transaction censorship protection.

[kazuki49]

A POW coin doesn't have to millions of teenagers running miners on their laptops all over the world in order to be *meaningfully* decentralized.

But it would be cool if you could, and with Monero you can. I have come to grips this is the most resilient form of electronic cash ever devised, not only transactions are opaque to miners but you can meaningufully mine it with standard hardware, it gives the 1 cpu = 1 vote meaning again, Satoshi would be proud.

[onemorexmr]

all that its needed are quite miners. no datacenter can compete with electric heaters in thousand of households which mine as a by-product.

Ok, run that thought experiment. People get clever about using the heat from miners, so their effective cost of mining is less, and therefore mining is profitable for them. So they buy more devices that mine. Difficulty rises; mining becomes less profitable, until an equilibrium is reached... It will *always* be the case that given enough time for an advance (new ASIC tech, heat-capture/re-use, etc), the cost of mining and the revenue from mining will be roughly equal.


It will therefore always come down to the lowest cost producer (ie, who has the cheapest energy). They've got the advantage. Which I think is the root of your pessimism regarding the long-term dynamics of POW:

yes, thats the root of my pessimism.
but: why are people buying lottery tickets? they know that they will loose money (ok, most do) but its the hope for the one time win. mining has much in common with a lottery.

...
the problem is, i think ANY cryptocurrency (i dont like POS) is doomed when (long-term) there is not solution to get mining decentralized.
...

I disagree with the "doom" outlook. While it's true that there will be a single or very few entities who are ultimately profitable in the narrow scope of actually finding block solutions, market forces will also cause miners to differentiate services and vertically integrate. The margin on other services (whatever they be) will very likely be higher than the gross margin on just the block solving, so there's plenty of room for a healthy-enough number of players.

what other services are possible? call me shortsighted but mining isnt much more than putting transactions in a block and submitting them.
i can imagine (eg what eligius did for mtgox a long time ago) contracts between bigger players to guarantee that specific transactions are put in the next block (even without a fee): but why should this bring a higher reward?

A POW coin doesn't have to millions of teenagers running miners on their laptops all over the world in order to be *meaningfully* decentralized. It's probably sufficient to have a few dozen independent entities (different countries, sectors of the economy, etc) running deep mining businesses/non-profits/research-institutions/whatever (even government orgs). It simply needs to be the case that it's incredibly difficult for any single entity to coerce >50% of the hashpower. Hopefully the longrun will involve hundreds or thousands of large(ish) mining entities, but I suspect far fewer than that will still provide sufficient transaction censorship protection.

well we are in an agreement that we dont talk about teenagers
if only a few dozens indepent entities mine i fear they will be controlled. eg i smell blacklists. its just way to easy for govs to threat them (thats also one of the reaons i like monero: its hard to control sth you cant see)

[smooth]

It will therefore always come down to the lowest cost producer

Yes but it is unclear who the lowest cost producer is actually going to be. It could be massive specialized farms in Sweden or Mongolia or wherever, or it could be kids running a miner on a laptop that would otherwise be unused, or botnets stealing electricity from whoever is least effective in protecting their equipment, or people heating water, or something else. It is a mistake to assume that any of these will necessarily be the lowest cost, because we don't know.

(ie, who has the cheapest energy)

This is not necessarily the lowest cost. That is only the case if non-variable costs are zero (or equal, but as you point out on the question of specialization, they almost certainly won't be), which in general is not the case. Also being able to use the waste heat productively is part of (net) energy cost, and it isn't clear who will end up being able to do that most efficiently.

[asepticskeptic]

overly centralized,

By what metric? Some degree of "centralization" is also an *inevitable* dynamic for any POW coin. The key is retaining *sufficient* decentralization, where sufficient == enough independent operators to make it nearly impossible to globally censor transactions.

i dont think think thats true.
all that its needed are quite miners. no datacenter can compete with electric heaters in thousand of households which mine as a by-product.

Not gonna happen.

why not? quite miners are not hard to build.
they have the same running cost as an electric heater...just more expensive to buy one.

They have the same electricity cost as an electric heater.

An electric heater requires an infinitely less initial investment on an infinite timescale.

Computation tends toward efficiency, and while computational capacity increases as a result, initial investment tends toward a much higher cost.

An electric heater may only be good for ten years.

A computer will tend to be good for much less than that, due to it being a complex system. A complex system that is mostly unusable while it is producing this simple idea.

The idea of computers heating households is simple, but the idea of 1200w oil heaters is infinitely less simple, and infinitely less costly on even just a few decades time scale.

If people want heat in their households, miners or networks will have to compete with that.

The oil heater has a permanent edge. It's $50 USD for 1200w. Even in 2015 it's an easy $1500 USD just to produce 1200w in personal computational heat.

Will your extra $1450 investment ever be recovered?

Not gonna happen.

you should not compare an oil heater to an electric heater. atm there are uses for electric heaters.
this doesnt change your point regarding initial investment though.

the problem is, i think ANY cryptocurrency (i dont like POS) is doomed when (long-term) there is not solution to get mining decentralized.

so instead of simply saying "not gonna happen" i try to think of ways to make it happen.

some servers are already used to heat pools there are projects to use the heat from datacenters to heat cities and so on (i only have some german links - sorry). the point is: if you are ONLY mining you cant compete with someone who mines AND needs the heat. he will always be cheaper - even if his power costs are a little higher.

pcs are getting cheaper and cheaper - atm you can buy smartphone/tablets for about 100$. it doesnt need to be much cpu-power, its enough when many people do it.

sadly that doesnt necessarily mean decentralization, but it would help

sigh.

really? You go through the trouble of arguing with me and fail to even make the connection that an oil heater is not $50 USD, but much more. Not to mention the cost of oil on top of that.

Are you just responding to respond? I hate to say it's obvious that I'm referring to an electric oil heater, but well it's obvious.

I even wrote wfw : They have the same electricity cost as an electric heater.

And then when I go on to use electric and oil heater interchangeably you latch onto that.

Fine I'll spell it out for you: http://www.homedepot.com/p/Cuori-1500-Watt-Electric-Oil-Filled-Radiant-Portable-Heater-Grey-HD904-A7Q/205210318

This product competes better for heat than any cryptocurrency ever will:

https://i.imgur.com/vYlIjSc.jpg

And I promise you I'm not leading you on or trolling you.

There will never be any way that any cryptocurrency can compete with the above. It's just much better at providing heat on every level than any cryptocurrency.

Advertising a gain in heat as a discount to producing cryptocurrency is conflate them unnecessarily.

It's like advertising a sale on breathable air, only we're not in space.

As pc's get cheaper and cheaper, the cost of a computational cycle will increase! People will come to consider the .0000001 second it takes to load their app faster infinitely more valuable that the .0000001 more cryptocurrency they can produce.

Computational cycles are much more valuable than any cryptocurrency, especially when its 'lottery value' deprecates.

There will always be better uses of computational cycles, and as such, mining will always be centralized.

[smooth]

It's a reasonable discussion of mining and mining is certainly relevant to Monero Speculation, but let's try to keep it reasonably on topic (meaning mining in general is okay, especially Monero mining, but when we get to this type of electric heater or that one, that's a bit far off) or take it elsewhere. They're offering a good deal on the cost of starting new threads today: Free!

[ArticMine]

...
It's not scalable,

There'll be a solution to the blocksize issue that lets bitcoin scale, one way or another. It's also worth observing that Bitcoin is currently the only crypto-currency operating at *any* sort of scale.
...

I am not so sure. It is not that simple to come up with an adaptive blocksize limit, that also allows for a fee market to develop in the absence of a block reward. I am not convinced it is even possible. The Cryptonote adaptive blocksize limit formula works in Monero only because there is a tail emission. Take away the tail emission, as in for example Bytecoin, and the blocksize can grow to infinity with no penalty once the emission runs out. This prevents a fee market from developing, and could cause the difficulty and security to plummet. It is this kind of issue that gives credence to those in the Bitcoin community that oppose growing the blocksize.

In any case I will believe a scaling solution in Bitcoin only when I see it, not before.

[owm123]

Is there any particular reason why xmr on polo goes up today so fast? Something has happen, such as, new version of bitmonero, or some good news regarding monero?

[dEBRUYNE]

Is there any particular reason why xmr on polo goes up today so fast? Something has happen, such as, new version of bitmonero, or some good news regarding monero?

Nothing of the bolded part happened, but markets don't always go up on news only. We went up several times without any news, could just be a new influx of users. Some bitcoiners getting more privacy aware, you name it.

[TrueCryptonaire]

Monero needs now to go up if it is worth to continue the project.
The price is so low that it basically still indicates the project is going to fail.
The factor that brings Monero to rising trend is the supply and demand.
The supply is getting tighter and tighter all the time. If it is not possible to get any meaningful rise nowdays, it will probably not do it at all.
50 % of coins are mined and stored somewhere and the additional 50 % are to be mined in the future (again ignoring the tail emission).
The fact that Monero is still so low is actually quite bad thing: it means there are not enough competition to buy the coins from the markets and that's why the price is low. When 9 million bitcoins were mined, the price used to be higher than the current Monero price. Even if Monero costs 10 usd each, it means the daily emission costs only 126 000 usd/day. It is not a big amount of money is it?

[whap]

I can live with 0,50 $ XMR for at least one more year, assuming BTC holds it's price level. Should BTC rise, XMR will follow anyway.