Gold collapsing. Bitcoin UP.

[79b79aa8]

Haven't seen anyone talking about taxes...

With the inception of bitcoin cash on Aug 1 hodlers we're gifted a new balance. My guess, in the USA, is that these should be treated as a gift with Aug 1 as the gift date and a 0 cost basis. If this is the appropriate treatment it may have something to do with whales not dumping. Any whales that dump would have to lock in short term capital gains. If they sold 5000 BCC at 200 they would have a million dollar tax liability. Since it's short term gains, if you had no other income, money chimp gains calculator states at an effective rate of 37% so 370k. That's a huge tax burden and may have caused many to hold for longer term... I wonder.

i doubt the short term capital gains tax concern is having a big effect . . . american traders dumping Bitcoin Cash are likely turning it into BTC on offshore exchanges. if they want to then take profits in USD, they can sell coins acquired over a year ago (assuming most whales did not get the bulk of their holdings in the last year).

 

[79b79aa8]

It's paranoid witch-hunting BashCo, the reason I know is because he went off on me in a reddit PM for participating here.

In the end, some people will make money, others will lose it. The one thing you can do to increase the chances of being in the first group (and I don't mean by collecting a salary), is to be well informed. And that requires openness to ideas and dissent.

Yet some people are focused on winning arguments on the internet, at the cost of staying well informed.

Or perhaps the intent is to deceive others less informed. That's another way to try to make money. Fortunately Bitcoin is demonstrating to investors it can survive such ploys. I can't resist posting an image of

The Exodus Block

 

[adamstgbit]

The Core Project mouthpiece has spoken

So, it's 1MB4EVA for Legacy Bitcoin and the NYA signatories will have three options:
1) Forge yet another fork with SegWit plus 2MB
2) Support Bitcoin Cash
3) Come to BS-Core's heel (this time muzzled and on a short leash).

I can hardly believe there unwillingness to compromise... When i heard about bitcoin cash i though it was simply a tool, some leverage at the negotiating table, and they weren't asking for much, just a 2MB incress sooner rather then later ( an incress is not optional long term ). surely core would weigh the risks and agree to push 2mb sooner rather than later.... but no!

Before activating segwit the narrative was "the fees are high, let us activate segwit to lower them!" and now that is active blockstream warns users that they have to take for granted a great increase in fees:

https://medium.com/@rusty_lightning/dear-bitcoin-im-sorry-fees-will-rise-b002b1449054

I can't understand how people still fall for them.

and now core is laying some ground work for poeple to simply accept that fees will continue to rise.

there's no question they want to deploy their things in such a way as to force users to use offchain payments, but offchain payments aren't Completely offchain, the channels will settle on the blockchain, these settlement TX coming from LN will have million dollar value and be very large in terms of Kb, so these TX will pay a huge fee and not really care, 500$ fee on a 10million dollar settlement is totally reasonable. this will make simple payments on the blockchain unreasonably expensive, and soon on-chain TX will soon be Exclusively for LN settlement TX.

I don't think the small blockers truly understand what they are saying when they say "settlement layer".

with Core's roadmap, bitcoin has already lost a HUGE amount of market share to alts. now with bitcoin cash in the mix of available alternatives, i dont see this trend reversing, but rather intensifying!

 

[79b79aa8]

it appears that blockstream investors (some of whom are known to have acquired large quantities of BTC at auction) estimate that they can get the greatest ROI not directly by BTC price increase, but by putting their coin to work, hosting payment hubs over the Lightning Network.

this requires SW (or a malleability fix), but why does it necessitate small blocks? such a business model certainly should not count on BTC users with consumer equipment for transaction relay.

 

[Bloomie]

Seeing Voorhees and Greg slap each other around is a delight. By declaring war on Seg2X, coreblockers are going to lead Bitcoin Cash to victory or at least a firm 30 percent market share. They are failing at this and are starting to become furious. This was evident from Luke's body language during the interview in Japan and all the twitching he started doing when a hard fork was mentioned.

 

[adamstgbit]

@79b79aa8
small blocks are required because if onchain capacity isn't maxed out, users will likely stick to oncahin payments, which will mean a (much) less profitable LN network.

without pushing everyone to use LN, LN is probably not profitable, i mean the costs of running a LN node and such probably won't be very much at all, and some B2B TX will probably choose to do this, but they won't profit from it, it will simply allow them to do high frequency TX B2B and thus save on fees. but when you add in 2million users wanting NEEDING to use you hub to TX then you start to really profit.

everyone thinks they will be able to run a node and profit, but they wont be able to, the barrier to entry for running a profit yielding LN node will probably be " you need at least 10K BTC available " if not more. forget the one time investment in hardware required to run a LN node, thats going to be nothing compared to the $$$$ your node has to be funded with.

kinda talking about this without really knowing... who knows exactly how this will all work itself out, its going to be an interesting couple of years, lol the never ending story that is bitcoin.

 

[79b79aa8]

that sums up what i can think of.
the VC investors do have that amount of coin.
i don't see why miners should follow along, even if tx fees go through the roof, this threatens to take them out of the game in the long run.

 

[satoshis_sockpuppet]

Seeing Voorhees and Greg slap each other around is a delight. By declaring war on Seg2X, coreblockers are going to lead Bitcoin Cash to victory or at least a firm 30 percent market share. They are failing at this and are starting to become furious. This was evident from Luke's body language during the interview in Japan and all the twitching he started doing when a hard fork was mentioned.

I don't believe we will have more than one dominant chain in the long term. BCC will either overtake or vanish.
If the miners and the industry stands up to the core terrorists and forks to 2 MB I see a big chance for Bitcoin cash to lose against SW2X.

In the end it's really hard to tell what is going to happen so I'll just hold my coins as always. Maybe I'll buy some BCC in the next weeks because it feels like buying cheap Bitcoins.

 

[adamstgbit]

@79b79aa8

making bitcoin a settlement layer, might make miners unprofitable somewhere down the line, but then this leads to less miners / lower difficulty and bitcoin minning is suddenly profitable again!

but if LN successfully sucks the life out of minning, the lower level network(bitcoin) becomes insecure.
imagine billions of LN TX all supported by a 10million dollar bitcoin minning operation!!

with bitcoin cash the level of security provided by miners is proportional to the amount of value being transacted on that network(more or less). but with bitcoin core, forcing everyone off chain, suddenly you can end up with a trillion dollar market being secured by million dollar minning operation.

OH but its not the minners that call the shots its NODES get to choose what rules the miners run with. well then lets just make it as easy as possible to run up an army of full nodes, so that at anytime we can fake UASF support for what ever new rules we need.

 

[albin]

BCC is the most credible "flippening" threat ever, so notice how the virtue-signalling narrative they have to try too hard to push in censor-space channels is "Bcashlol down to $0, dump everything or you're a traitor".

There is probably a small percentage of eunuchs for sure who will do it, but realistically even if people on that side think BCC is pure unadulterated shit, they also know that shitcoins can and often do pump. Combine that with the altcoin bubble and the so-called "butthurt Bitcoiner"-phenomenon, and you have the perfect storm of FOMO hodlers, clutching in fear of losing gains on yet another thing that their ideology prevented them from profiting off of, and this time at least they got the asset without having to actively go against their ideology and get it.

 

[adamstgbit]

some thoughts about reorg attack.

it is possible for an attacker to mine 20 blocks and only board cast them later in order to reorganize the blockchain such that one of the miners payments vanishes.

this is a devastating attack vector, which currently the only defence is having ALOT of hashpower. but why is such an attack even allowed? why do nodes willingly let this easily detectable attack take place?

it seems to me nodes simply need to not allow for the reorganization of there blockchain, a simple rule that says somthing like, if a block has 6 conf. its set in stone and i'm not going to replace it with another block no matter what!

why are nodes allowing for reorg?
whats the point?

when things are going well there is never a need for a reorg beyond allowing for the orphaning one of the two blocks which are found at the same time. after a block has had many confirmation ( for example 6 ) is there any Valid reason to throw away these block and go with another set of blocks?

 

[spunky]

Almost certainly, thousands of new people buying right now, have no idea of of the extra hidden risks involved, they are buying on one half of a fork that could easily not exist in a few months time. Responsible exchanges should have big red warning flags, for any new investors.

The general risk is fairly well established among traders, I don't see it being too bad. Especially since most traders leave coins on the exchange, that will act as a relief valve if there is a panic for the exits. Is it ironic that such a warning might suggest it is safer to keep your coins on an exchange in case of an emergency?

 

[AdrianX]

On exchange = not secure Layer 2 network. But if you can live with the risk there is a potential opportunity on the horizon. That is if Cash becomes King (become more profitable to mine due to an increase in price) than the BTC network the BTC Network will become exponentially more congested and the market won't be able to get BTC on or off exchange. I would want coins on an exchange but wouldn't want to be stuck on an exchange in such a scenario especially if those exchanges have some naked shorts.

I think the concern is with retail investors who have just got into bitcoin. Most Coinbase customers and those who can't yet access BCC will probably be good.

 

[Norway]

BCC is the most credible "flippening" threat ever, so notice how the virtue-signalling narrative they have to try too hard to push in censor-space channels is "Bcashlol down to $0, dump everything or you're a traitor".

There is probably a small percentage of eunuchs for sure who will do it, but realistically even if people on that side think BCC is pure unadulterated shit, they also know that shitcoins can and often do pump. Combine that with the altcoin bubble and the so-called "butthurt Bitcoiner"-phenomenon, and you have the perfect storm of FOMO hodlers, clutching in fear of losing gains on yet another thing that their ideology prevented them from profiting off of, and this time at least they got the asset without having to actively go against their ideology and get it.

I have actually fleeced some hardcore smallblockers that I know personally by buying their Bitcoin Cash. It's funny to see how they transform during the price negotiation. They suddenly understand that this "filthy altcoin Roger Ver Jihad Wu China bcoin" actually holds value. And when they negotiate, they understand that "worthless" is not the best way to describe Bitcoin Cash. They have to respect it to sell it. I start out by asking them if they will sell this worthless shitcoin at a price a lot cheaper than the market says. They think about it first. Then they say no. Because they have instincts preventing them from being totally fucked. And then they accept market price.

I'm still fleecing them, though
[doublepost=1502246058][/doublepost]I recommend buying directly from people you know and disagree with. Much more satisfying than buying from an anonymous person at an exchange.

 

[freetrader]

@Norway , your negotiations crack me up. But is it smart to reveal your strategy here?

---
Brilliant strategy, calling off an agreement to which you are not a party.

If anything, I've come to appreciate the new CSO

 

[Dusty]

 

[Bloomie]

Does the S2X coin have a name yet? Can't wait to hear pejorative names for it from coreblockers and creative ideas for ticker symbols from exchanges.

 

[spunky]

DARI (Difficulty Adjusted Reward Index):

(block coinbase+fees in satoshis) / (block difficulty) * (coin price in USD)

http://fork.lol/

Won't this be self levelling to a 1:1 advantage?

 

[AdrianX]

It'll tend to approach a 1:1 ratio but miners don't convert everything they save some earnings.

The block size debate exists because off chain scaling degrades long term profits and network growth. Supporting the cartel to limit transaction capacity benefits short term profit at the expense of long term viability.

So the chain with the long term profit horizon will be discount in the short term. It may even run negative for a short while.

Long term mining is more committed to profit growth while short term mining is more committed to profit now.

The flippering is when both long and short term profitability converge on the same chain. Could be the 2X or the BCC chain but not the BS/Core chain with the existing developers roadmap. It's designed to move fee paying transactions onto a banking transaction layer undermining miners profit and neywork security threatening the long term viability of the network.

It's this perverted result of incentives that the Core developers have capitalized on. It's what drove Mike Hearn to rage quit bitcoin calling it a failed experiment.

Possibly 40% of hash power is committed to long term success. However miners all have different short term goals.
[doublepost=1502292327,1502291167][/doublepost]Long term investors and miners have the same goal long term returns, growth and security. Because it's hard to visualize future profit without quantifying it there is uncertainty in the present. This is why BCC came into existence and why it started with futures trading

 

[79b79aa8]

^ total lucidity.
----------------------------------

on a different note, @Peter R, i kept thinking, even though a miner with alpha% of the hashrate always expects (in a technical sense) to find his next block in 10 min./ (1-alpha), irrespective of how much computing he has already put into it, is there sense to saying that the probability of him finding the next block is just alpha?