Gold collapsing. Bitcoin UP.

[Mengerian]

Was it presented that way?

It seems that the spin is "let's do segregated witnesses now, it's safe, it's a soft fork! then we can maybe discuss increasing block size later, probably the flex-cap scheme"

 

[Justus Ranvier]

It seems that the spin is "let's do segregated witnesses now, it's safe, it's a soft fork! then we can maybe discuss increasing block size later, probably the flex-cap scheme"

Once there is a mechanism in place for effective fraud proofs, then there's no valid reason to have a block size limit at all.

 

[Melbustus]

https://prezi.com/lyghixkrguao/segregated-witness-and-deploying-it-for-bitcoin/

First bullet point of the last section... What exactly is meant by: "Switch to a cost-based metric"?
[doublepost=1449504433][/doublepost]

I haven't looked closely at separating signatures from the rest -- "Segregated witness" -- but you have to ask:

1. will it encourage even less validation?
2. Fully validating nodes still need to download the "witness" part, right? So the bandwidth requirements for full nodes don't change? The only thing that changes is disk space because after a few years you can forget the witness. But disk space is not an issue.
3. It seems like this "soft" fork is so huge that it is a defacto hard fork. Its one thing to create a "soft" fork for a new transaction type that you feel might be awesome in the future but it does not affect normal bitcoin transactions. Old clients can still understand 99% of what new clients are generating. Its another thing to do that with every bitcoin transaction. Old clients won't be able to understand any of the new format transactions, which is all transactions new client generate. So sure they won't fork... they just won't understand a single thing going on on the blockchain. With a soft fork this big we could "soft fork" an equivalent to BIP101 too, couldn't we? Add a "txout" to the coinbase that is not really a transaction, it contains the hash of an extension block that contains more transactions.
4. It also seemed like the soft fork was accomplished in a very complex manner... additional complexity causes bugs; better to just hard fork.

Agreed. I had the same thought re #1 and #2; I don't see how this fundamentally does anything but save disk space. But the live tx bandwidth is the far bigger cost.

I still vote for the simpler BIP101 now.

Likewise.

 

[lunar]

@cypherdoc thanks for the response.

the way i see it, all those paper claims have come as a result of debt based claims.

Agreed but doesn't this essentially equate to fractional reserve banking of claims on physical gold? I believe long term Gold will trend down to its market value as an inert pretty metal. However I'm not yet convinced there won't be some sort of short/medium term 'run on the bank' as the realisation dawns that there is no gold left in the West. At this point, what will happen? To my mind this means the various insurance companies and brokers will have to cover their shorts on gold or go bankrupt?

fundamentally gold is a shitty form of money, let alone a SOV

Money yes, SOV not so sure? Well theoretically compared to bitcoin yes, but the traditional world has yet to wake up to this sea change, and as the debt based system inflates to infinity and beyond, surely ANY port of value in currency storm?

@79b79aa8

The scheme is actually better suited to something like reddit (which is what Taringa is).

Indeed, its a shame reddit failed to follow up with Ryan Charles ideas. Datt his offshoot project looks like a great approach, but as with all networks, it's the number of users that gives the strength. A reddit wide implementation would have been an instant winner, but a brand new platform takes a while to develop.
[doublepost=1449504785][/doublepost]Gavin on segregated witness

 

[theZerg]

@ justusranvier RE attribution. I know. It sucks. AFAIK I was the first to post on reddit about the supply demand cliff a max block size creates () -- May 8. But flex cap references meni Rosenfeld's later proposal (https://bitcointalk.org/index.php?topic=1078521 on June 2. Because he has more street cred I guess. EDIT: yes I only posted as a comment on reddit, but actually this is just the first one. I posted quite a few times about the idea IIRC.

Then I add traffic shaping to XT, and some guy basically takes my code and applies cosmetic changes. So how can I start getting any cred? So I complain (very nicely) and Gavin basically says "suck it or cya" but mike says ok we'll attribute you in some wierd way that applies your name to your parts of this other guy's checkin. And then one of those "cosmetic changes" (it was actually to be c++ not c99 compliant) causes that bug in XT found yesterday. I'm just like WTF??? /RANT and thx for reading

EDIT: Added the links that Justus requested
EDIT2: more links:

 

[Justus Ranvier]

AFAIK I was the first to post on reddit about the supply demand cliff a max block size creates. But flex cap references meni Rosenfeld's later proposal. Because he has more street cred I guess.

It is important for facts like that to be documented in verifiable ways.

Even if they don't post in this thread, people see things like that, and it affects the decisions that they make.

 

[catlasshrugged]

I think Jonathan gave a well-balanced and open-minded talk. He promoted BIP100 but he removed my biggest objection to it (that the voting wasn't based on a straightforward 50% majority). Well done, Jonathan.

@Peter R I haven't watched his talk yet, but I'm very curious if anything in it has caused you to rethink your positions to date on fee markets.

 

[awemany]

Greg and Adam outdid themselves at making a nice, presentable package that they can start trying to sell.

As I said on reddit: It is a nice, gift-wrapped package. Inside is a lot of /u/raisethelimit's deal-sweetener, and next to the deal sweetener is an awkward, old wooden box - the extension block proposal.

And inside the extension block proposal is the deadly 1MB poison pill.

Thinking about http://bitcoinocracy.com, what came out of the idea to have proof-of-stake voting for blocksize? Like, have a year of voting (signed special transactions) for next years' blocksize?
This is a little bit complexity, sure, but wouldn't it put the decision right where it belongs, at the stakeholders of Bitcoin? If we could get the ear of one of the devs, I feel this is really hard to argue against (except for the complexity). Thoughts?

 

[Inca]

So is this segregated witness stuff just a smoke and mirrors kludge to keep the hard limit in place before LN can be unleashed or is it real progress?

Not happy with the phrase 'give time for higher level payment systems to develop'. Bitcoin is the payment system. This was supposed to be 'scaling bitcoin' not 'introducing blockstream plc'.

Incidentally I have a Ugandan medical student with me at the moment. In Uganda the population has risen rapidly in recent years and is increasingly young and tech savvy. Very interesting talking to him about money transfer systems there. Everyone he knows uses smartphone apps linked to local carriers to transfer money (he told me mpesa is just kenya). They don't use banks at all. He didn't mention bitcoin once but I was struck by how in Africa already they have skipped landlines to go mobile and now seem to be set to skip conventional banking for mobile money app's. He showed me the app on his (iPhone 5) and it seems a centralised non-p2p system - with transfers happening within a minute to anyone in your phone book. He can 'top up' using a visa. He told me people pay their mortgages with this system - the implication being total disintermediation of the emerging banking system.

Bitcoin is being rapidly left behind as we speak. The mobile money revolution is well underway already and every month it isn't scaling and accepting new users it becomes less likely to break into areas where existing 'mobile money' systems are already being cemented into common use.

 

[cypherdoc]

energy going off the cliff:

oil:

ETF:

natgas:

 

[awemany]

@Inca:

The best part of the linked SW slide from reddit/twitter: "Give time for IBLT and weak blocks to develop".

LOL. At least they could have added: "Give time for SC/LN, IBLT and weak blocks to develop."

But apparently they know that those became somewhat naughty words in the other part of the community (not that there is something wrong with LN per se)...

 

[cypherdoc]

@cypherdoc thanks for the response.

Agreed but doesn't this essentially equate to fractional reserve banking of claims on physical gold? I believe long term Gold will trend down to its market value as an inert pretty metal. However I'm not yet convinced there won't be some sort of short/medium term 'run on the bank' as the realisation dawns that there is no gold left in the West. At this point, what will happen?

Money yes, SOV not so sure? Well theoretically compared to bitcoin yes, but the traditional world has yet to wake up to this sea change, and as the debt based system inflates to infinity and beyond, surely ANY port of value in currency storm?

i'll present my optimistic scenario. i agree, the West has minimal gold left. where i differ from you is that i believe we (the banks) realize this and are beginning to think a transition to Bitcoin is what will save us. which is why we see the intense interest in private blockchains now with a full transition to the Bitcoin blockchain later; only after some losses. fundamentally, i still believe the US will be the tallest pigmie left standing and will sustain it's lead worldwide. i know that's debatable but we still have the greatest freedoms of most countries around and somehow, someway, i think we are going to get thru this but not w/o significant pain. IOW, if the US can move to Bitcoin quickly enough, we will short circuit the Armageddon by driving the price of gold back downwards towards $250 and killing all the speculative claims on phyz (killing the longs). the US will may have to give up the USD as the reserve currency but it will be a smaller price to pay than having to print up enough USD to fulfill all the paper gold claims which can otherwise never be fulfilled with phyz (b/c they can't).

 

[awemany]

@cypherdoc: There surely must be some people thinking along these lines. That Bitcoin might be helpful in transitioning away from dangerously bloated/failing fiat systems.

That wouldn't explain why the banks are interested in private blockchains, though?

 

[cypherdoc]

@ justusranvier RE attribution. I know. It sucks. AFAIK I was the first to post on reddit about the supply demand cliff a max block size creates. But flex cap references meni Rosenfeld's later proposal. Because he has more street cred I guess.

Then I add traffic shaping to XT, and some guy basically takes my code and applies cosmetic changes. So how can I start getting any cred? So I complain (very nicely) and Gavin basically says "suck it or cya" but mike says ok we'll attribute you in some wierd way that applies your name to your parts of this other guy's checkin. And then one of those "cosmetic changes" (it was actually to be c++ not c99 compliant) causes that bug in XT found yesterday. I'm just like WTF??? /RANT and thx for reading

i still think you should be leaving any personal code out of BU for now. KISS. until it gets accepted and running. this isn't the last time you'll hear about that bug.

 

[Melbustus]

I think a key point re gold is the disconnect from actual use in the economy. Gold used to actually be exchanged in commerce, physically, but with the Nixon shock, the last strand of connection to the real transactional economy was severed. Thus, gold as a store of value to me is no different than anything else that's hard to clone and in limited supply. There are plenty of things like that, and they don't carry trillions in premium over their industrial use value.

So why does gold carry a premium? I think it's effectively just "monetary inertia" due to gold's historical (centuries long) role in human commerce. But that role is gone now. In my opinion, if the market is rational longrun, the price of gold will coast down toward its industrial use value with some *small* premium since gold would be directly useful again in some weird semi-apocolypse scenario where robust trade still exists, but electronic commerce doesn't. ....that scenario is really all goldbugs have to hang on to.

If there's some truth to the above, then it should be obvious that it's important for a store-of-value to maintain a direct-utility connection with the economy. This is why it's important that bitcoin be viable for large scale transactional *use*; it's probably a pre-condition of store-of-value monetization.

 

[cypherdoc]

@awemany

private blockchains are a necessary transition to create the maximum # of losers investing in cryptocurrency over time. remember that i think <1% of us will make it to the finish line with all the rest losing incredible amounts of money along the way. like loser Halsey Minor. what we're seeing is the first generation of investment failures by banks entering the Bitcoin ecosystem.
[doublepost=1449509345][/doublepost]

If there's some truth to the above, then it should be obvious that it's important for a store-of-value to maintain a direct-utility connection with the economy. This is why it's important that bitcoin be viable for large scale transactional *use*; it's probably a pre-condition of store-of-value monetization.

esp in light of the fact that Bitcoin has absolutely no ornamental or industrial value. it's pure digital money. thus, it has to function not only as a SOV but as a payment network which we have never seen before. which is probably why all the miniblockists can't shed their blinders about Bitcoin solely serving as a settlement layer with small blocks while totally not understanding that Bitcoin is nowhere near distributed enough worldwide to ordinary users who really will provide the liquidity and monetary velocity that will maximally decentralize Bitcoin and make it as secure as can be vs gvts. which is why i always talk about the little African kid who has never even heard of Bitcoin and will continue to crawl down 3' wide holes 100 yds deep to pull up a few grains of worthless metal. when he covets Bitcoin instead, we've made it.

 

[lunar]

Well if you are both right and the big western banks have seen this coming - essentially sold all the gold to China, India and Russia then shorted the hell out of it, this is effectively the biggest bait and switch humanity has ever seen.

A flaw in this thinking; perhaps? If Western banks can see this, then so can Eastern governments. What happens if BRICS goes for a gold backed currency in retaliation?

Anyway I understand where your coming from now and see the risks. I don't hold gold but was considering hedging options if/when we see another BTC bubble?

 

[cypherdoc]

@lunarboy

i didn't say they planned it all out.

remember what i said about experience yesterday? i started buying pm's in 2005 @550 in a big way b/c at the time it made perfect sense to me given the debt buildups and speculation we saw back then. in 2008 we promptly saw the whole thing blow up followed by enormous moral hazard to save the system. it's no coincidence that Bitcoin came along in 2009. in Jan 2011 i finally figured it out enough to do a massive pivot and dive into the Bitcoin rabbit hole. yes, i sold all my silver and all but 2 sleeves of gold and started shorting the hell of of pms and their stocks. in contrast, most financial speculators including banks have only begun to figure this out maybe only as far back as a couple of years ago. there's no clear demarcation line for this increasing awareness. but it clearly is gaining momentum and any rational investor needs to wake up and start hedging at the very least. this is why you hear Barry Silbert saying the other day that all these private BC bank ppl are accumulating BTC in the background.

tl;dr it's just the path of least resistance and a logical extension of what we see happening today from what started in 2008-9 with the release of the WP. could be wrong.
[doublepost=1449511907][/doublepost]oh geezuz. that deflationary smell is getting pungent:

[doublepost=1449512670,1449511506][/doublepost]@lunarboy

the above also illustrates why bigger blocks are so important to the West. by facilitating more tx's and fees they will help promote commerce (user growth) in places like the US, where most of it already occurs. but having so much mining centralized in China is a problem (even tho the entire system is still safely decentralized ala Sam Cole's description). bigger blocks will allow the evolution of Western based mining centers via leveraging our bandwidth advantage. this will massively decentralize mining away from China, which would be a healthy thing esp in light of the childish comments coming from Wang Chun and that macbook-air dude on BCT (same guy?). also, having so much mining and the exchanges subject to control by their communist gvt is clearly a risk. Bitcoin can't be held hostage by that nor by their tech limitations (the result of an authoritarian model).

 

[Mengerian]

Thinking about @Zangelbert Bingledack 's analysis of how free markets tend to favour stability, eschewing risk and change until the need becomes unbearable. Looks like the landscape is shaking out to remove the 'stable' option. Core developers seem to be pushing Segregated Witness, which seems like a fairly fundamental change in how the system works, with unclear impacts on most market participants (wallets, etc.). BIP101 is implemented and has testing behind it, but leads to a hard fork, and is associated with XT which is seen as less well established. Market participants have quite a conundrum, what will they do? Coinbase? Bitstamp? Chinese miners?

By the way, I think Segregated Witness is a good concept. It just seems unnecessary to rush it through with a convoluted soft fork, and it doesn't really do anything to help scaling for full nodes.

@Justus Ranvier I'm wondering about the relationship between Fraud Proofs and UTXO commitments. Do Fraud Proofs render UTXO commitments unnecessary, or are they orthogonal concepts?

 

[cypherdoc]

SPV mining is the shit anyways. we shouldn't be facilitating that sort of behavior by maintaining small blocks.

bond bulls are saying bullshit to Yellen's threat to raise interest rates. that's deflationary: