The Royal Canadian Mint just announced a new alternative to BitCoin

[RodeoX]

the thing is mintchip is just not as good as Bitcoin. It lacks some of the most attractive aspects of BTC. 
But when is a movie with "2" in the title ever as good as the first?

Star Wars: The Empire Strikes Back was much better than the original Star Wars.

Your right.   and I thought of other examples since posting.

[ForceField]

If i don't see source code posted anywhere, then i don't treat a digital currency seriously.

This is a good thing for bitcoin. Canada's backing will put MintChip into many stores as a payment option. Exchange between MintChip and Bitcoin will be easier than any other fiat currency with its irrevocable electronic transactions, anyone will be able to start an exchange without having to rely on paypal or other processors. Essentially we could end up with a system like:
MintChip = checking account
Bitcoin = savings account

+1  very much what i was going to say. this is epic for BTC!

Also, +1.

MintChip itself is nothing like Bitcoin, but its existence is good for Bitcoin.

What MintChip & Bitcoin seem to have in common benefit to the users are:

1) Digital
2) Irreversible
3) Low / Non-Existent transaction fees

So looking forward to the day when PayPal declares bankruptcy b/c it is no longer necessary; Another +1.

[DeathAndTaxes]

Regarding #3 when has a monopolistic entity ever offered low/no fees?

[cunicula]

Regarding #3 when has a monopolistic entity ever offered low/no fees?

When it is run by the government as a regulated monopoly.

[DeathAndTaxes]

Regarding #3 when has a monopolistic entity ever offered low/no fees?

When it is run by the government as a regulated monopoly.

Examples?  I can't think of many govt regulated monopolies which are efficient.  Why would they want to?

[cunicula]

Regarding #3 when has a monopolistic entity ever offered low/no fees?

When it is run by the government as a regulated monopoly.

Examples?  I can't think of many govt regulated monopolies which are efficient.  Why would they want to?

The gov't regulates monopolies to prevent high fees and allow economies-of-scale.
Examples: Water, Power, Telecommunications, mail, health care (not the US, but note that US health care is more expensive and has worse outcomes on average than gov't systems in most other developed countries)



From wikipedia:

Nobel economist Milton Friedman, said that in the case of natural monopoly that "there is only a choice among three evils: private unregulated monopoly, private monopoly regulated by the state, and government operation." He said "the least of these evils is private unregulated monopoly where this is tolerable." He reasons that the other alternatives are "exceedingly difficult to reverse," and that the dynamics of the market should be allowed the opportunity to have an effect and are likely to do so (Capitalism and Freedom). In a Wincott Lecture, he said that if the commodity in question is "essential" (for example: water or electricity) and the "monopoly power is sizeable," then "either public regulation or ownership may be a lesser evil."

Milton Friedman was of course a conservative ass motherfucker.

[DeathAndTaxes]

1) The US regulated utilities tend to be more expensive than independent power producers where wholesale power is trading on open market, and don't get me started on how worthless US mail service is despite their monopoly.


2)  None of that applies to this scenario.  A monopoly isn't necessary for MintChip, or Bitcoin to (co)exist and it certainly isn't a natural monopoly.

3) From your own quote "the least of these evils is private unregulated monopoly"  and "that such action by government should not consist of forbidding competition by law"

[cunicula]

1) The US regulated utilities tend to be more expensive than independent power producers where wholesale power is trading on open market, and don't get me started on how worthless US mail service is despite their monopoly.


2)  None of that applies to this scenario.  A monopoly isn't necessary for MintChip, or Bitcoin to (co)exist and it certainly isn't a natural monopoly.

3) From your own quote "the least of these evils is private unregulated monopoly"  and "that such action by government should not consist of forbidding competition by law"

The regulated utilities are forced to offer services to everyone. Of course they are more expensive, the urban people have to subsidize the rural households. Redneck conservative are enjoying cheap power on the liberal urban dwellers' tax dollar. Makes me furious. Would rather they were denied all services based on their identity.

What does forbidding competition by law have to do with this? Who said that was a good idea? Where did you go strawman? come back!!!!

Of course, currencies are a natural monopoly. Very large network effects -> natural monopoly

[DeathAndTaxes]

There is only one issuer of MintChip.  Maybe you forget we are TALKING ABOUT MINTCHIP.  I know it may be confusing that the topic is MintChip in the fraking mint chip thread.

My point before you went off on one of your asinine derails is that ...

What MintChip & Bitcoin seem to have in common benefit to the users are:

1) Digital
2) Irreversible
3) Low / Non-Existent transaction fees

There is no proof #3 is true.  MintChip hasn't released any fee schedule and based on the fact they are a monopoly it is very unlikely that it will be true.

What does forbidding competition by law have to do with this? Who said that was a good idea? Where did you go strawman? come back!!!!

MintChip is issued by the Royal Mint of Canda.  There is a single issuer and single issuer only.  Good idea or not the reality is there is no competition.  Period.

[cunicula]

There is only one issuer of MintChip.  Maybe you forget we are TALKING ABOUT MINTCHIP.  I know it may be confusing that the topic is MintChip in the fraking mint chip thread.

My point before you went off on one of your asinine derails is that ...

What MintChip & Bitcoin seem to have in common benefit to the users are:

1) Digital
2) Irreversible
3) Low / Non-Existent transaction fees

There is no proof #3 is true.  MintChip hasn't released any fee schedule and based on the fact they are a monopoly it is very unlikely that it will be true.

What does forbidding competition by law have to do with this? Who said that was a good idea? Where did you go strawman? come back!!!!

MintChip is issued by the Royal Mint of Canda.  There is a single issuer and single issuer only.  Good idea or not the reality is there is no competition.  Period.

Isn't bitcoin a competitor?

Anyways. I don't disagree with what you are saying. We don't know much about it at all right now, but that cuts both ways. It is too soon to say anything negative or positive.

[DeathAndTaxes]

Isn't bitcoin a competitor?

Honestly not really.   Fiat to fiat centralized currency has very little to do with Bitcoin.

It is like saying Paypal will drop their fees 90% because Bitcoin exists.  By your logic Paypal with their near monopoly position should have very low fees right?

[evoorhees]

There were two features of Bitcoin which first made me so wild about it:

1) Decentralized - no party could prevent a transaction or freeze an account in any way.

2) New currency - was an entirely new currency, without perpetual debasement, not just a way to transfer USD, etc.

Without these two features, Bitcoin would be nothing. I think any "competitor" to Bitcoin without these two features will be feeble and irrelevant.

With that said, MintChip is somewhat exciting, and I hope it's successful as it will dovetail nicely with Bitcoin. Perhaps it will be one more bridge to Bitcoin that the peons can trample across as the global fiats fall apart.

[cunicula]

Isn't bitcoin a competitor?

Honestly not really.  It is like saying Paypal will drop their fees 90% because Bitcoin exists.  By your logic Paypal with their near monopoly position should have very low fees right?

No. Paypal is a natural monopoly. Network effects. It is not due to gov't sanction. Only paypal can exist, dwolla is illegal. No. It is a natural monopoly.

[cunicula]

There were two features of Bitcoin which first made me so wild about it:

1) Decentralized - no party could prevent a transaction or freeze an account in any way.

2) New currency - was an entirely new currency, without perpetual debasement, not just a way to transfer USD, etc.

Without these two features, Bitcoin would be nothing. I think any "competitor" to Bitcoin without these two features will be feeble and irrelevant.

With that said, MintChip is somewhat exciting, and I hope it's successful as it will dovetail nicely with Bitcoin. Perhaps it will be one more bridge to Bitcoin that the peons can trample across as the global fiats fall apart.

Yes, but you are a libertarian asshat. Most regular people just want an easy way to send money with low fees.

[DeathAndTaxes]

Yes, but you are a libertarian asshat. Most regular people just want an easy way to send money with low fees.

Which is why Paypal already existed and it has low fees.   So problem solved? er wait.

There are only two outcomes with a centralized issuer:
Network remains small and utility is low.
Network becomes large and monopolistic, prices continually increase as the monopoly entity exploits this fact.

[cunicula]

Yes, but you are a libertarian asshat. Most regular people just want an easy way to send money with low fees.

Which is why Paypal already existed and it has low fees.   So problem solved? er wait.

There are only two outcomes with a centralized issuer:
Network remains small and utility is low.
Network becomes large and monopolistic, prices continually increase as the monopoly entity exploits this fact.

This is run by the government... thus the discussion of regulated monopoly. It wouldn't be good gov't policy to have high fees like paypal. The gov't can just tax people if they want money. Why would they choose to get revenue in an inefficient way?

[DeathAndTaxes]

This is run by the government... thus the discussion of regulated monopoly. It wouldn't be good gov't policy to have high fees like paypal. The gov't can just tax people if they want money. Why would they choose to get revenue in an inefficient way?

Most services provided by the govt ARE inefficient.  They have no profit motive, no need for lower costs.   Like any govt agency it will become fat, bloated, and inefficient.  

[cunicula]

This is run by the government... thus the discussion of regulated monopoly. It wouldn't be good gov't policy to have high fees like paypal. The gov't can just tax people if they want money. Why would they choose to get revenue in an inefficient way?

Most services provided by the govt ARE inefficient.  They have no profit motive, no need for lower costs.   Like any govt agency it will become fat, bloated, and inefficient.  

That's likely true, but it would need to be pretty fucking inefficient to need paypal like fees to support itself. I don't see that level of inefficiency as likely. Bitcoin itself is already extremely fat, bloated, and inefficient by design.

[phillipsjk]

This is no threat to bitcoin. I have been told on IRC that I am straying into speculation territory, so take this with a grain of salt.

2.6 In addition, any individuals, teams, Organizations or Large Organizations with the intention of reverse engineering the SDK, the MintChips and/or the Remote MintChips are expressly excluded from Competition. The Sponsor and the Administrator reserve the right to exclude such individuals, teams, Organizations or Large Organizations at their sole discretion and at any time, whether the risk of reverse engineering is real or perceived.

- http://mintchipchallenge.com/rules

Not only do they not publish a protocol specification or source code: they prohibit third parties form doing the same. That (IMO) can mean only one thing: Security relies on "Copy Protection" Built into the SD card. In this case, CPRM with device revocation.

If CPRM has not been cracked already, it is probably because nobody actually uses it. This initiative will make cracking profitable. If it is true they are trying to use "copy protection" to prevent double-spending, this project has failed before it has even started by trying to fight the law of entropy. Maybe that is why they keep introducing draconian copyright legislation: the future of fiat relies on it.

The person on IRC informs me that the SD standard supports things other than block devices. These may be real "smart cards" in a micro-SD form-factor.

[DeathAndTaxes]

That's likely true, but it would need to be pretty fucking inefficient to need paypal like fees to support itself.

You obviously have never been to the DMV.

Still it likely will have lower fees that Paypal.  Paypal is just abusing its monopoly posistion.  If anything MintChip is theoretically more of a competitor to Paypal than Bitcoin.  If MintChip is successful and has lower fees than Paypal then Paypal may need to lower fees.

It all depends on how much fraud MintChip has to ammortize.  Given those chips WILL be broken I wonder how much the first widespread organized attack will cost them.  Every dubious "secret of a chip" system in the past has been broken I doubt this will be any different.

Note: I ignored your usually Bitcoin bashing.  Just not worth responding to.