Gold collapsing. Bitcoin UP.

[cypherdoc]

Like I said, the old thread was busier. 7000 views per day at the end. That's why they shut it down. Too much influence.
[doublepost=1449187300,1449186237][/doublepost]Look, Slush agrees with us.

"I can actually imagine that there won't be any size of the block! Miners however will be still motivated to produce "reasonably big" blocks, because bigger blocks mean slower propagation. So the motivation of every miner is to produce big enough blocks to maximize income from transaction fees, but small enough to propagate block to other p2p participants fast enough and avoid mining orphan blocks."

 

[Zangelbert Bingledack]

@awemany

Just for reference, 1Gbps up/down unlimited data prices in western Japan:

https://hikari-n.jp/sp/west/plan.php

In English that's about USD $15/mo for an apartment and $30/mo for a house. Below that are listed the initial installation and contracting fees, totaling less than $150, and they tend to waive these setup fees during sale periods anyway.

That's 500-1000x cheaper than your estimate, so makes network cost vanishingly small compared to storage.

 

[Justus Ranvier]

I managed to compress Daniel Krawisz's "Who Controls Bitcoin" article down to a single tweet:

 

[davecgh]

Just for reference, 1Gbps up/down unlimited data prices in western Japan:
...
In English that's about USD $15/mo for an apartment and $30/mo for a house...

Not that I disagree with sentiment, but isn't Japan firmly among the countries that have the cheapest and fastest internet access in the world? That being the case, it's probably not the most fair baseline for an estimate. Of course, nor is using one of the slowest and most expensive...

 

[lunar]

Jeff Garzik seems to be loving the new 21 machine

https://github.com/jgarzik/playground21/tree/master/turk


Still posting on /r/bitcoin though. :-(

 

[cypherdoc]

• “Based on our review of progress made toward putting in place a viable U.S. resolution plan, we now consider the likelihood that the U.S. government would provide extraordinary support to its banking system to be ‘uncertain’ and are removing the uplift based on government support from our ratings,” S&P said in a statement.

http://www.marketwatch.com/story/jp-morgan-goldman-sachs-among-too-big-to-fail-us-banks-downgraded-by-sp-2015-12-03

 

[AdrianX]

I managed to compress Daniel Krawisz's "Who Controls Bitcoin" article down to a single tweet:

@Justus Ranvier for us mortals what is an average accumulation rate?

Is it total BTC over number of days since first BTC transaction?

If I accumulated 10BTC over 1 year what would my % of influence be?

 

[Peter R]

10 BTC / year = 0.027 BTC / day. If 3600 BTC are produced per day, you're buying on average 0.027 / 3600 = 0.00076% of them. I would wrap my head around this as 1/0.00076% = 1 part in 130,000.

TLDR: You have 1 vote in a room of 130,000 people.

 

[Justus Ranvier]

The only problem with the simple "fraction of daily production bought" calculation is that if you added up all the positive percentages they'd be >100%, due to the negative values from people who are cashing out.

 

[Zangelbert Bingledack]

Present holders also have a lot of influence because they can sell or threaten to sell, though miners still have room for interpretation of why the price fell and whether an investor will really follow through with a threat.

In the case of fork arbitrage with futures market on exchanges it is more direct as they can sell their coins in one fork to buy future coins in the other, putting the matter very starkly before miners.

Holders can also fund assurance contracts.

 

[Justus Ranvier]

The only thing holders can do to affect the situation is compete with miners to sell their coins to the buyers, or refrain from competing with the miners. They do not contribute to miner revenue in the positive direction.

 

[Zangelbert Bingledack]

"Only" thing, yes, but that is lot bigger of an overall influence.

 

[Justus Ranvier]

Imagine a skyscraper is being built floor by floor.

The construction crew can increase the number of floors by working.

The wrecking ball, if it acts, can destroy the floors. Possibly it can do so faster than they are being built.

The wrecking ball can't cause more floors to emerge, however. It can only refrain from destroying them.

If the wrecking ball does nothing, the progress of the skyscraper depends entirely on the construction crew.

If the construction crew stops working then it doesn't matter what the wrecking ball does or does not do - no progress on the skyscraper can occur.

 

[awemany]

@awemany

Just for reference, 1Gbps up/down unlimited data prices in western Japan:

https://hikari-n.jp/sp/west/plan.php

In English that's about USD $15/mo for an apartment and $30/mo for a house. Below that are listed the initial installation and contracting fees, totaling less than $150, and they tend to waive these setup fees during sale periods anyway.

That's 500-1000x cheaper than your estimate, so makes network cost vanishingly small compared to storage.

Yes, I might be off by a bit, and maybe I under- or overestimated somewhere. But I think the important point is that a transaction would cost all full nodes in a network of a 1000 on the order of some 12 microdollars to process, total. I am just trying to do an order of magnitude calculation.

Even if you assume an error of a factor 10 in the cost calculation, that would still just amount to 0.012 cents, you're still way below Bitcoin's current transaction fees which are currently at about 0.1mBTC, so about 3ct (correct me if I am wrong).

I simply think this clearly shows how ridiculous the notion of forcing a fee market is.

This should also be the way, IMO, to confront people who say that Bitcoin is a highly inefficient network and thus should only be used for settlement.

A decentralized, replicated distributed database that does transactions in the range of 10s of microdollars isn't inefficient for what it is doing.

Even if the true cost to full nodes would be up to 1ct/txn (and that's a factor 800x away from my calculation!) we still would have a network that could easily be used for micropayments even.

We should rather figure out ways and modes of operation so that full nodes can be paid than crippling the system due to fear of success.

 

[awemany]

Oh, and lets look at today's cost for a full node, too, assuming we have the state of @Peter R.'s 'A payment system for planet earth', BIP101 implemented and maxed out:

12 microdollars all full nodes -> 12 n$/txn per full node
8GB block -> about 32 Mtxn
32 Mtxn / 600 s -> 53ktxn/s
53 ktxn/s -> 640 u$/s

640u$/s -> $55.3 full node cost per day

This is obviously not something a single middle class person would be able to afford for any significant timespan, but it is easily within reach of a smaller organisation of some dozen people (like a hacker club).
And this is, IMO, quite sufficient as a decentralization goal. I am even fine with bigger nodes in data centers.

And this is using today's hardware and excludes all technological process.

 

[Zangelbert Bingledack]

@Justus Ranvier

I can see the two types of control holders and accumulators can exert is different in perhaps important ways. I'm not sure I see all the relevant details yet though.

@awemany

Fully agree, didn't mean it to take anything from your analysis, just an FYI on the situation on the ground here in Japan. It turns out not really to affect your ballpark number anyway, because storage cost is so much more, but I wonder how it would be if people didn't even store the whole blockchain.

I of course don't like when people say flatly, "Bitcoin doesn't scale." It obviously scales to some significant degree, after which we could try some more creative add-ons, but to say it "doesn't scale" as if magnitudes meant nothing is meaningless. Nothing scales forever, but if transactions cost orders of magnitude less than a penny to process, even on-chain microtransactions seem potentially feasible.

People should be asked, "Doesn't scale how far?" A couple of orders of magnitude might not count as scaling to an engineer, but it means a tremendous amount in interim progress on the mainstream adoption front, after which other ideas will come out.

Too many people can only engage in static thinking, never taking into account how all sorts of other things change by the time we've reached the dead end they're imagining. This is the same kind of thinking that Malthusians employ exprapolating that populations will grow until extinction without anyone taking measures to mitigate anything in the meantime. Or the long string of people who predicted an early end to Moore's law over the decades.

 

[awemany]

@Zangelbert Bingledack:

People should be asked, "Doesn't scale how far?" A couple of orders of magnitude might not count as scaling to an engineer, but it means a tremendous amount in interim progress on the mainstream adoption front, after which other ideas will come out.

Well said.

 

[cypherdoc]

 

[cypherdoc]

Seriously, this is a guy who understands how to run a successful business. Now imagine Peter Todd or Maxwell running this same business. Ask yourself how would those guys do it? Are they giving people who understand the importance of goodwill and customer service? Of taking a risk by giving before receiving?

 

[albin]

@cypherdoc

Todd and Maxwell would refuse to sell you a beer and instead lecture you for upwards of an hour about how you don't actually want a beer because you don't understand what a beer is, but that you actually do want a beer, and the beer that you're going to get hasn't had its recipie thought out yet, and then they'll close the bar early in a tizzy because you had the audacity to ask them about beer in the first place.