Bit coin is on a down hill slope

[dinofelis]

I'm not suggesting that the Bitcoin's algorithm is racist, merely that it is horribly wasteful (roughly 14% of all BTC in existence was mined over the past year, i.e. 14% of Bitcoin's market cap was spent on network maintenance/security).  And these costs do not translate into jobs, but mind boggling amounts of burnt energy.
Bitcoin utopia:

In fact, it is a fundamental problem with money creation: the distribution of seigniorage, and of course, the flip side: the cost of inflation.

It is unavoidable when an asset becomes money.  An asset becomes money when the bulk, or all, of its price (that is, of its demand) comes from a desire to hold value, and doesn't come mainly from another desire to hold the asset (such as using or consuming it). 
The production, and the increase in value, of a monetary asset profit to certains (= seigniorage) and are hence paid for by others (inflation).  It is unavoidable.

If a normal commodity with normal usage (say, milk) becomes money, then the price of milk will increase significantly, as people will start holding milk for its value, and not to drink it or make food with it.  This will profit enormously to people with cows.  It will cause an over-investment in cows, and it will cause an under-consumption of milk. 

If an almost useless commodity, such as gold, becomes money, then there will be an over-investment in gold-mining, and people who had gold for say, ornament purposes, will become very rich as compared to people who didn't have any.  The more people dig up gold, the more they become rich, and this goes at the expense of those who have worked hard to *earn* gold, and see its value decrease because of the inflation of the gold stock.

Issuing fiat money profits of course to those issuing it (the state, the central bank, those giving assets to the central bank against fiat money...).  By increasing the fiat money stock, this seigniorage is paid for by all those who held fiat money they obtained by working for it, because of the inflation they suffer.

With crypto currencies, you have the same issues.  The idea was that during the inflationary phase, there is more or less a running-parallel with the adoption.  As such, the miners, who get the seigniorage, but, contrary to the fiat issuers who get the seigniorage for nothing, are put in competition, and as such, just "grow the network", are paid for by the inflation, but on the other hand, more adoption would also mean an offset of the inflation.

If the rate of adoption increase were equal to the inflation, then we would have a perfect system.  Clearly this isn't exactly the case currently.  Satoshi had to pick an inflation curve, and tried probably to fit it to his imagined adoption curve.  The more this is wrong, the more one will suffer from too much inflation, or the more one will get a too early price increase.

All in all, the way to handle the inflation and seigniorage issue with bitcoin is in principle not so bad.  The only difficulty is of course that the real adoption will not follow precisely the pre-programmed inflation curve (over 140 years or so), which implies strong price fluctuations.

[NotLambchop]

...
Issuing fiat money profits of course to those issuing it (the state, the central bank, those giving assets to the central bank against fiat money...).  By increasing the fiat money stock, this seigniorage is paid for by all those who held fiat money they obtained by working for it, because of the inflation they suffer...

This is the basic misunderstanding of most on this forum--believing that the state is a separate entity, rather than themselves.
The state is not a separate entity, it is the sum total of people of the state.  No more a separate entity than the pool that you aim your hashpower at.

[dinofelis]

This is the basic misunderstanding of most on this forum--believing that the state is a separate entity, rather than themselves.
The state is not a separate entity, it is the sum total of people of the state.  

Sorry to disagree, but the confusion between the nation and the state is the great lie of the modern states.

The state is an organisation which has the monopoly of violence over a nation (= people, territory, infrastructure, capital).  The workings of this organisation are similar to that of the maffia: they extort the nation, and they provide some services such as "protection".

The distinction between state and nation was much clearer in times when there was still a monarchy.  Louis XIV said it clearly "The state, that's me !".

However, after cutting off heads of state by the disgruntled nation, the state went on in a different way, by trying to make the nation think it is responsible for all the extortion of the state: they invented elections.  There's a price to pay: elections are on one hand what limits the maffia's time at the hands of the state.  Elections can alternate between different maffia families at the head of the state, which was not the worry of an hereditary monarchy.  In order to gain elections, now lies and mass manipulation is necessary which was much less the case before.  But the great thing about elections is that the nation is now "guilty" and "responsible" for all of the extortion by the state, which will avoid heads cut off of the maffia leading the state.

But that doesn't mean that the state is the nation.  The state is the organisation that extorts the nation, it being the violence monopolist. 
That has historically always been so, and it is not because there are elections in modern states, instead of hereditary monarchy, that that basic principle has been overthrown.

[NotLambchop]

...
The state is an organisation which has the monopoly of violence over a nation (= people, territory, infrastructure, capital).  The workings of this organisation are similar to that of the maffia: they extort the nation, and they provide some services such as "protection"...

Now I understand.  It is impossible to debate a mind like yours--you'll simply restate your delusions. Here's a quote describing your mentality far better than I ever could:

I have never seen a more sublime demonstration of the totalitarian mind, a mind which might be linked unto a system of gears where teeth have been filed off at random. Such snaggle-toothed thought machine, driven by a standard or even by a substandard libido, whirls with the jerky, noisy, gaudy pointlessness of a cuckoo clock in Hell.

The boss G-man concluded wrongly that there were no teeth on the gears in the mind of Jones. 'You're completely crazy,' he said.

Jones wasn't completely crazy. The dismaying thing about classic totalitarian mind is that any given gear, though mutilated, will have at its circumference unbroken sequences of teeth that are immaculately maintained, that are exquisitely machined.

Enjoy your worldview



Edit:  Another interesting take:

OT:
Twenty seconds of this video HAD to be about bitcointalk.org (link to the right spot):  https://www.youtube.com/watch?v=O9TEm1V4f64#t=842

[dinofelis]

...
The state is an organisation which has the monopoly of violence over a nation (= people, territory, infrastructure, capital).  The workings of this organisation are similar to that of the maffia: they extort the nation, and they provide some services such as "protection"...

Now I understand.  It is impossible to debate a mind like yours--you'll simply restate your delusions.
Enjoy your worldview

I don't see what's so deluded, extreme, or otherwise psychiatrically disformed by stating the obvious.

Since the dawn of states, an aristocracy has extorted value-producing people.  Since wealth was produced (that is, since man left the status of hunter-gatherer and started agriculture), "leaders" took part of that wealth for themselves, using their status of violent monopolist (when they were not the monopolist, there was war). That's how kings became rich.  That's how the classical upper classes (aristocracy) became rich: by extortion of those that produced, whether they were farmers or other value-producers.  With that, they did according to their whims: going to war, building palaces or pyramids, living in great wealth.  They had to manage this extortion of course, and that was traditionally done with violence, and with religion.  And of course, in order to get the gullible mass to cheer for them and support them, they had to do now and then something that, in the eyes and simple minds of the people, seemed to be good and necessary.
The formula has evolved over time, but is still the same.

I'm not against the state, as it would be as silly as being against gravity.  The appearance of organized extortion is unavoidable when there is wealth creation.  A state is unavoidable: if you destroy one, another will come in its place.  So better learn to live with it, and use it to your advantage.  Like with gravity.  A state is a dynamical essence in a society.  Maffia is unavoidable.  But that doesn't mean one has to cheer for it.

[NotLambchop]

...
That's how the classical upper classes (aristocracy) became rich: by extortion of those that produced, whether they were farmers or other value-producers.  With that, they did according to their whims: going to war, building palaces or pyramids, living in great wealth...

Lol, in that case, your employer is extorting you, taking the value you create, and living in great wealth.

I'm not against the state, as it would be as silly as being against gravity.   The appearance of organized extortion...

You are not?  Not against organized extortion?

...is unavoidable when there is wealth creation.  A state is unavoidable: if you destroy one, another will come in its place.  So better learn to live with it, and use it to your advantage...

That's mighty defeatist of you.  Work for a brighter tomorrow--Communism!

[piramida]

I don't see what's so deluded, extreme, or otherwise psychiatrically disformed by stating the obvious.

Welcome to the forums, nice to see somebody smart for a change, this section has been overrun by trolls lately so you are most probably wasting your energy in vain Good posts though.

[dinofelis]

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That's how the classical upper classes (aristocracy) became rich: by extortion of those that produced, whether they were farmers or other value-producers.  With that, they did according to their whims: going to war, building palaces or pyramids, living in great wealth...

Lol, in that case, your employer is extorting you, taking the value you create, and living in great wealth.

No, of course not.  My employer and I AGREED mutually on a deal.  He didn't put a gun against my head forcing me to produce value for him.  I had a choice.  When you have a choice (not "an offer you cannot refuse"), there's by definition no extortion.  At most, a scam.

I'm not against the state, as it would be as silly as being against gravity.   The appearance of organized extortion...

You are not?  Not against organized extortion?

As it is unavoidable, better be on the extortion side, no ? 

...is unavoidable when there is wealth creation.  A state is unavoidable: if you destroy one, another will come in its place.  So better learn to live with it, and use it to your advantage...

That's mighty defeatist of you.  Work for a brighter tomorrow--Communism!

Communism is the top of extortion. 

[JimboToronto]

I don't see what's so deluded, extreme, or otherwise psychiatrically disformed by stating the obvious.

Don't take Trollchop seriously. She's just a pathetic little troll with an axe to grind.

She's also not very bright so there's no sense trying to reason with her.

You're best to just put her on ignore, as most here have.

[NotLambchop]

^
>My employer and I AGREED mutually on a deal.  He didn't put a gun against my head forcing me to produce value for him.

Who put a gun to your head last?   What God-forsaken foregny you hail from, brah?

[NotLambchop]

[more senile dementia]

This old chestnut again?

I'll say the same as I did 6 months ago or a month ago.

We'll probably reach our old ATH by mid summer, and hit anywhere from $7000 to $12,000 before crashing down to $2000-$2500, possibly before year's end.

We should be above $10,000 for good by this time next year.

Unless something comes along to break Bitcoin before then.

[dinofelis]

Who put a gun to your head last?   What God-forsaken foregny you hail from, brah?

Whenever you do not comply in giving about half or 2/3 of what you produce to the state, that's what happens in the end: they put a gun against your head, or force you violently to comply in any case.  They call it tax evasion.  You get "protection" and "public services" you didn't necessarily ask for in return.  What other kind of organization comes and takes a good chunk of the value you produce in an offer you can't refuse, and offers you "protection" and goods and services you didn't ask for in return ?

[cryptogeeknext]

... Like with gravity.  A state is a dynamical essence in a society ...

Great analogy!
Something tells me that we talked about it some years ago... Maybe just a coincidence

As it is unavoidable, better be on the extortion side, no ?

The Infinity will make sure that we will all play on each side eventually.

But there is a way out.

With the fuel as pure and clean as Bitcoin the Star of Humanity has a good chance to go Supernova.
That's when people move to live among the stars with all the good stuff that we will have produced up to that point and there is no amount of government that can hold us back. That's where we are headed, resistance is futile.

[NotLambchop]

Who put a gun to your head last?   What God-forsaken foregny you hail from, brah?

Whenever you do not comply in giving about half or 2/3 of what you produce to the state, that's what happens in the end: they put a gun against your head, or force you violently to comply in any case.  They call it tax evasion.  You get "protection" and "public services" you didn't necessarily ask for in return.  What other kind of organization comes and takes a good chunk of the value you produce in an offer you can't refuse, and offers you "protection" and goods and services you didn't ask for in return ?

So no one has put a gun to your head, you're simply afraid that someone will.  Now we're finally getting somewhere, let's take this a step at a time.
Do you personally know someone who was shot for failing to pay taxes?
My previous question still stands: What God-forsaken foregny you hail from?

[Elliander]

If so it's a HORRIBLE idea because it creates unnecessary cost barriers to getting into Bitcoin mining.

Correct. Mining-less systems regardless of their initial distribution of money have an asymptote that leads towards centralization essentially turning any such system into a private enterprise.

I don't really understand how a mining-less system can function either. I mean, sure, right now most of the income from Bitcoin mining is from newly minted coins, but as the number of coins minted decreases the usability as a currency should be increasing which will lead to a gradual shift towards income from transaction fees. In fact, Satoshi probably predicted the move towards mining hardware at ever increasing speeds so that by the time people stop making money from the minting their machines are able to process enough transactions to actually allow the transaction fees to go even lower and work even faster at equivalent ROI to the minting of today.

In a mining-less system the income is exclusively from minted coins without any strategy for the shift towards transaction fee income. There is even this interesting concept called "Proof of Burn" which although presents an interesting low energy cost approach to distributing new coins has not even considered the role hardware has to take in maintaining the network. In either Stake or Burn the focus gets shifted away from the hardware that holds everything together. Even in the better stake proposals that allows people to be rewarded from mining alone, the fact that people are rewarded just by holding coins would seriously disrupt the expansion of the network which would be required for it to become the world reserve currency for all transactions everywhere.

In the worst case scenario, based on fluctuating price, energy, and hardware the rewards for holds could become higher than mines which could in turn result in a rapid shut down of mining hardware to the point that the network ceases to function fully or at all. Sure, the existing mines won't shut down right away, but as people stop investing in new mines and stop buying more energy efficient hardware as energy prices go up the old hardware could be gradually decommissioned without replacement. That would be a consequence of the BETTER proposal where you are allowed to earn from mining independently of holding. In the other scenario where you have to hold and mine it would guarantee that only the wealthiest control Bitcoin, but more importantly would cut the network expansion rate in half which would seriously compromise required network growth.

The emphasis needs to remain with proof of work because that is the only model that will allow the network to expand as it must while providing the required buffer to keep everything working in the event of price declines as will occasionally happen.

[interlagos]

...
The emphasis needs to remain with proof of work because that is the only model that will allow the network to expand as it must while providing the required buffer to keep everything working in the event of price declines as will occasionally happen.

Yes, apart from a method of initial distribution which acts like a faucet, mining is a way to keep the system as neutral as an algorithm can be.

[dinofelis]

So no one has put a gun to your head, you're simply afraid that someone will.  Now we're finally getting somewhere, let's take this a step at a time.

You mean that if you're convicted for tax evasion, you can still stay at home and enjoy life, and nobody's going to use violence on you, like trying to put handcuffs, or put you in jail or something ?  And if you try to defend yourself against people with uniforms coming to use violence on you with a weapon, you're not going to get any guns against you ?  Nothing physical will happen to you if you refuse to pay your taxes ?  You will simply be denied access to state services you're not paying and that's it ?  Nothing physical will happen to you and you will happily go your way ?

[NotLambchop]

^
No.  You have failed to answer my previous question, and I unjustly attributed it to evasiveness.  In my haste, I overlooked the possibility of you being differently enabled & suffering from poor reading comprehension.  Along with your delusions of persecution.
Apologies.
I've highlighted the important bits this time, in hopes that it may somehow help:

...
So no one has put a gun to your head, you're simply afraid that someone will.  Now we're finally getting somewhere, let's take this a step at a time.
Do you personally know someone who was shot for failing to pay taxes?
My previous question still stands: What God-forsaken foregny you hail from?

You're trying to answer two questions, so that we could continue our conversation.
Good luck!

[Wary]

[some trolling]

As others already said, NotLambChop is one of major forum's trolls. Most people have him on ignore. By the same reason they are not happy when somebody is quoting him.

If a normal commodity with normal usage (say, milk) becomes money, then the price of milk will increase significantly, as people will start holding milk for its value, and not to drink it or make food with it.  This will profit enormously to people with cows.  It will cause an over-investment in cows, and it will cause an under-consumption of milk.

"Over-investment" and "under-consumption" wording assume that there is some "proper" level of consumption and investment. But there isn't. If milk becomes money, their utility will grow. If, say british scientists would discover that milk, added to petrol, would double mileage per gallon, milk consumption will grow, along with investment into milk production. But we won't call it over-production and over-consumption. If milk, apart from drinking, can be used for something else, it's utility will grow and it is normal, rather than "over".

[picolo]

So no one has put a gun to your head, you're simply afraid that someone will.  Now we're finally getting somewhere, let's take this a step at a time.

You mean that if you're convicted for tax evasion, you can still stay at home and enjoy life, and nobody's going to use violence on you, like trying to put handcuffs, or put you in jail or something ?  And if you try to defend yourself against people with uniforms coming to use violence on you with a weapon, you're not going to get any guns against you ?  Nothing physical will happen to you if you refuse to pay your taxes ?  You will simply be denied access to state services you're not paying and that's it ?  Nothing physical will happen to you and you will happily go your way ?

You are right in the sense that you will be subject to violence if you don't obey but you can organize your life to be less subject to this violence.