Gold collapsing. Bitcoin UP.

Discussion in 'Economics and Policy' started by cypherdoc, Aug 28, 2015.

  1. Fatman3002

    Fatman3002
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    @Inca this is the only currency I've been told I can't buy coffee with.

    Have you people ever done one of those IQ tests?

    Which is the odd one out:

    Decentralized, trustless, highly restricted
     
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  2. Zarathustra

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    Yes, but that is just a tiny fraction of real total US government debt:

    Renowned economist Laurence Kotlikoff recently testified at the U.S. Senate about the runaway U.S. budget. How bad is it? Kotlikoff says, “I told them the real (2014) deficit was $5 trillion, not the $500 billion or $300 billion or whatever it was announced to be this year. Almost all the liabilities of the government are being kept off the books by bogus accounting. . . . The government is 58% underfinanced . . . . Social Security is 33% underfinanced . . . . So, the entire government enterprise is in worse fiscal shape than Social Security is, but they are both in terrible shape.” So, how much is America on the hook for in the future? Kotlikoff contends, “If you take all the expenditures that the government is expected to make, as projected by the Congressional Budget Office (CBO), all the spending on defense, repairing the roads, paying for the Supreme Court Justices’ salaries, Social Security, Medicare, Medicaid, welfare, everything and take all those expenditures into the future . . . and compare that to all the taxes that are projected to come in, and the difference is $210 trillion. That’s the fiscal gap. That’s our true debt.”


    http://investmentwatchblog.com/real...fake-debt-ceiling-which-is-under-20-trillion/
     
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  3. cypherdoc

    cypherdoc
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    i love these core dev guys:

    0x20000000=0010 0000 0000 0000 0000 0000 0000 0000

    29 possible in parallel soft forks simultaneously.
     
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  4. Dusty

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    Yes, softforks only so that 1MB size can be kept FOREVER
     
  5. cypherdoc

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    man, the worst thing about that video is how much Kotlikoff has aged. me too by extension. he's always been a good listen.
    --- Double Post Merged, Apr 15, 2016 ---
    yes, and core dev can be kept in power, 4EVA.
    --- Double Post Merged, Apr 15, 2016 ---
    BitClub Network already advertising support for BIP9:

    https://www.blocktrail.com/BTC/pool/bitclubnetwork
     
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  6. lunar

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    A little light weekend read. From ActingMan

    Why BlockstreamCore 'Central planning' is doomed to fail.
    ---------------------------------------------------------------------------------
    The Fatal Conceit
    Large-scale central planners fail because they believe three things that aren’t true.

    First…that they understand the current conditions (wants, desires, hopes, capabilities, resources) of the community they are planning for.

    Second…that they know what the community’s future ought to be.

    Third…that they are capable of creating the future they want.

    None of those things is more than mere illusion. Together, they constitute what Hayek described as the “fatal conceit that man is able to shape the world around him according to his wishes.”

    Central planners cannot know current conditions because that would require an infinite amount of information.
    ---------------------------------------------------------------------------------
    http://www.acting-man.com/?p=44336

    All BlockstreamCore are really achieving is retarding network growth by spending reputation. (Both Bitcoins and their own.) As Falkvinge said: The free market will win, I'm just not sure if it will be Bitcoin or Core that looses.
    As time passes this hard won commodity of 'reputation potential' is being burnt by fighting the free market. A fools errand if ever there was one.
     
    #9726 lunar, Apr 15, 2016
    Last edited: Apr 15, 2016
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  7. cypherdoc

    cypherdoc
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    @lunar

    what happened to @lunarboy?

    anyways, fitting picture follow on from your article:

    [​IMG]

    Several of the world’s most ruthless central planners and mass murderers: Backtrack, Maxwell, Todd, LukeJr, Friedenbach, & Lombrozzo.
    :D
     
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  8. Zarathustra

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    @Richy_T

    > Transactions of a free people are caused because it is a mutually beneficial arrangement.

    Yes, that's why free people don't transact with aliens. They are self-sufficient. We are not. We are completely dependent on transactions with aliens.

    > In a subsistence society,

    There is no such thing ;-) Subsistence is the characterization of the stateless community.


    > there is either a deficit of essentials (you die) or a surplus. Technology acts as a productivity multiplier and allows for more surplus. Surplus and specialization allow for activities that are not directly involved with keeping yourself alive like art, science and more technological advances. A virtuous cycle if your measure includes "quality of life for human beings" anywhere.

    Virtuous circle? Vicious circle! Quality of life is getting worse to the average debt slave worldwide (former homo sapiens).

    The little ones sit by their TV screens
    No thoughts to think
    No tears to cry
    All sucked dry
    Down to the very last breath
    Bartender what is wrong with me
    Why am I so out of breath
    The captain said excuse me ma'am
    This species has amused itself to death
    Amused itself to death
    Amused itself to death
    We watched the tragedy unfold
    We did as we were told
    We bought and sold
    It was the greatest show on earth
    But then it was over
    We ohhed and aahed
    We drove our racing cars
    We ate our last few jars of caviar
    And somewhere out there in the stars
    A keen-eyed look-out
    Spied a flickering light
    Our last hurrah
    And when they found our shadows
    Grouped around the TV sets
    They ran down every lead
    They repeated every test
    They checked out all the data on their lists

    And then the alien anthropologists
    Admitted they were still perplexed
    But on eliminating every other reason
    For our sad demise
    They logged the explanation left
    This species has amused itself to death
    No tears to cry no feelings left
    This species has amused itself to death


    http://www.rogerwaters.org/atdlyrics.html
     
  9. cypherdoc

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    Fucking /u/coinjaf. Deleted I see:



    b/c of your approach to not make sigs leaner and smaller, but to instead do the opposite; make them larger and more complex. and therein lies your betrayal; what you really want to do is facilitate much more complicated scripting to allow all sorts of fancy contracts that get away from the basic money function of Bitcoin. you'd just as soon change it to a WoW trading platform. and to top it all off, the result is that full nodes and miners will have to bear extra CPU and BW costs to process all this tinkering you want to do as a result of having to pass around all these complex sigs, verify, and then relay them. and even risk orphaning. and instead of charging you dumb fucks who want to take advantage of these types of larger, complex sigs for your own for profit proprietary projects, you want us to eat the costs of these things by giving you a 75% discount. fuck you.
     
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    #9729 cypherdoc, Apr 15, 2016
    Last edited: Apr 15, 2016
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  10. lunar

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    Haha I grew up, whilst impatiently waiting for Bitcoin to scale ;-)
     
  11. cypherdoc

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    i am pissed as hell. the censorship on r/Bitcoin is out of control. that response to fucking /u/coinjaf did it. i should have been banned a long time ago so that i could truly understand the level of frustration many of you have had. those core dev fucks are totally corrupted and using r/Bitcoin as a voice which they NEED to disseminate all their falsehoods. theymos and his thugs deserve to get crucified.
    --- Double Post Merged, Apr 15, 2016 ---
    no way do i support SW, LN, or SC's under these conditions.
    --- Double Post Merged, Apr 15, 2016 ---
    they're removing my comments en masse now and lying about the censorship:

     
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    #9731 cypherdoc, Apr 15, 2016
    Last edited: Apr 15, 2016
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  12. Justus Ranvier

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    @cypherdoc You might want to start using archive.is to preserve comments before they can be deleted.
    --- Double Post Merged, Apr 15, 2016 ---
    I was asked to give a more thorough explanation about how LN could lead to fractional reserve hubs.

    There are five basic step to operating a micropayment (such as the ones LN is built on):

    1. Two (or more, hypothetically) parties agree on a script where the channel funds will be stored.
    2. The parties agree on a refund transaction and all sign, but do not broadcast it.
    3. One or more individuals fund the channel by creating an output with the designated script and amount.
    4. The parties adjust the theoretical balance of of the channel by agreeing on and signing new versions of the refund transaction.
    5. Presumably someday a version of the refund transaction will actually be broadcast and mined (although depending on which LN proponent you talk to, this is apparently optional).
    LN didn't invent micropayment channels - it's basically a protocol for identifying a set of channels to revise in order to make a payment (routing), and a method for atomically (or at least safely) updating all members of the set.

    Imagine that Coinbase and Bitpay are LN hubs. The idea is that they'd probably have a channel open with each other which they can adjust, and Bitpay would have channels open with the merchants they service. A user can then open a channel with Coinbase, and as soon as this was complete they'd have the ability to perform instant, low-fee payments to any merchant which Bitpay serves.

    The first thing to note is that both opening and closing a micropayment channel has a minimum cost of one on-chain transaction fee. Keep this in mind when ever anyone talks about intentionally pushing transaction fees to levels which will give people an incentive to use LN. The cost of opening and closing channels has a significant impact on the LN operation.

    Bob is our example user, and he's going to buy his very first bitcoin. He downloads a LN client onto his phone. Then he goes to coinbase.com, registers for an account, links his bank account/debit card, and purchases 1 bitcoin. When this purchase is complete, he withdraws his bitcoin to his LN client. His client cooperates with Coinbase to create a micropayment channel, which Coinbase funds (Bob can't fund it himself since he doesn't own any bitcoins yet).

    The available balance on this channel is the amount which Bob receives in the first version of the refund transaction, which is 1 btc - 1 on-chain transaction fee.

    Unless Coinbase contributes some its own working capital to this channel, then as soon as Bob opens it it will be immediately "full" in terms of his ability to receive funds - he can't receive any payments on this channel since the refund transaction already sends the entire balance back to him. Coinbase may contribute some of their own working capital to the channel to enable bidirectional payments. This is a risk for them, since that portion of their working capital is hot rather than being safely secured in cold storage. One way or another, Bob will end up compensating them for this risk in addition to the time value of money, most likely via the fees he pays for using the channel.

    Let's assume that Coinbase contributes 1 bitcoin of their own when they open the channel. In that case the first version of the refund transaction will send (1 btc - 1 on-chain tx fee) to Bob, and 1 btc to Coinbase. This means Bob can spend almost 1 bitcoin using the channel and can receive 1 bitcoin using the channel.

    Life is pretty good for Bob as long as his usage of this channel (sending vs receiving) remains in balance +/- 1 btc. If at any point the channel fills up in a particular direction, the only way to keep sending or receiving (depending on the direction in which it filled up) is to open a new channel. This will cost 1 on-chain transaction fee.

    This creates a terrible user experience for LN. Imagine being the support representative tasked with explaining to customers why they can't receive money from their grandchildren any more without paying a relatively-large fee because their channel is full. In fact, once a channel is full it become uneconomical to send any more transactions in that direction whose value is less than the cost of an on-chain transaction.

    There is a solution for this - LN wallets just need the ability to add and remove new inputs to a refund transaction. So going back to the first example, as soon as Bob purchases his first bitcoin, his friend Alice immediately wants to send him another 2 btc. Since this is more than the available liquidity it's not possible to do this while adhering strictly to the micropayment channel protocol, but Coinbase has decided that they don't like dealing with awkward support calls so they've altered the protocol slightly for their customers.

    Rather than opening a new channel, whenever somebody tries to send Bob bitcoins when his existing channel is full Coinbase selects an input from their own wallet and adds it to the refund transaction. Bob's wallet accepts this either because he's using a Coinbase-branded LN wallet rather than a generic one, or else because even the generic LN wallets have been convinced to add this capability.

    There's nothing wrong with this necessarily, however since that new input isn't part of the Bob-Coinbase micropayment channel, Bob has no way to confirm the input has only been added to his refund transaction. Coinbase could have overcommitted that input to 10, 100, or 1000 other refund transactions - nobody knows until somebody decides to close a channel. As long as Coinbase is confindent that most of the channels won't attempt to close at the same time, they don't have to worry about it too much. Whenever the first channel which includes an overcommitted input closes, they just update the other channels with a new input.

    Coinbase doesn't actually do this, of course. When they rolled out their "liquidity protection" feature they explicitly promised to never overcommit inputs, and since they are regulated, law-abiding businesses we just have to look at the track record of financial regulations and their outcomes to know we have nothing to worry about.

    Also they bribed a bunch of "Bitcoin journalists" to label anyone who points out the potential for, and strong incentives to create, undetectable fractional reserves as a "conspiracy theorist."

    There's another way that Bob's wallet can apparently make his life easier while reducing his security. Remember that step 3 of the micropayment channel creation process requires an on-chain transaction. There's nothing about step 4 that inherently requires that transaction to confirm in the blockchain prior to adjusting the refund transaction. After all, until it's broadcast the refund transaction is a purely private contract between Coinbase and Bob.

    If his client is being as safe as possible, it will wait to allow him to use the channel until the funding transaction has confirmed. However, this is another UX problem that Coinbase has a strong incentive to avoid. In order to be as convienient as possible, his LN client could allow him to start using the channel immediately. In fact, in keeping with user interface trends the app designer might decide to never show Bob the confirmation status of the funding transaction at all (it's a low-level detail he doesn't need to worry about).

    What if the funding transaction never confirms at all? How long could Bob's wallet work for him before he notices a problem?

    The answer is - he'll never notice any problem whatsoever until he tries to close the channel.

    What if channel closure is highly discouraged by high on-chain transaction fees, and eventually becomes so uncommon that LN apps actually drop that functionality entirely? Bob could use his LN client for the rest of his life blissfully unaware that he doesn't actually own any bitcoins at all.
     
    #9732 Justus Ranvier, Apr 15, 2016
    Last edited: Apr 15, 2016
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  13. cypherdoc

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    Ok, finally got my 30d ban for trolling. Nothing happens to /u/coinjaf.
     
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  14. bluemoon

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    Beats me how BS-Core has any traction with serious bitcoiners when they are so clearly self-serving and rely so heavily on deceit and sleight of hand, manipulation, bullying, and censorship.
     
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  15. 8up

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    fixed it for you.
     
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  16. bluemoon

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    Haha, @8up, thank you!

    I guess in a sense it's the way of the world, but it's still infuriating.

    I wonder if any of the miners have serious doubts yet? @Jihan seems to have been fairly quiet for a while now. A month ago he was quoted on reddit saying the miners were told at the Hong Kong meeting that LN would let them raise on chain fees 100x.



    Do he and the other miners still believe anyone will use LN if they have to pay 100x on chain fees each time they open and close LN channels? Or that a successful LN would ultimately even need bitcoin? Or that LN will ever get off the ground? They must have a lot of trust.
     
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  17. Inca

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    I suppose it is a nice fairy tale to be sold. You carry on the status quo mining small blocks on your dodgy internet connections and we will compensate you by increasing on chain fees 100x - let us take care of the p2p transactions and scaling difficulties - you focus on security (and include our super transactions from our centralised payment hubs - nudge, nudge, wink, wink).

    This does mean of course that in the future *any* on chain transaction will also have to cost 100x the current transaction fee to be included in a tiny 1mb block if bitcoin popularity continues to trend upwards. By creating a system like this you are tacitly destroying conventional on chain transactions and use-cases in the long run if bitcoin continues to exist.

    As a long term holder this is not good news and should bitcoin bubble pre-halving as July approaches I will be probably reducing my exposure to bitcoin (cannot believe I am even saying this). My interest in bitcoin is as a scalable, frictionless, universal payment ledger for the internet with scarce monetary properties. The unholy alliance of miners and core + LN changes that irrevocably, not for technical reasons, but simply for political and individual selfish motives of those programmers working for Blockstream, who have hijacked the open source project.

    The effects are already seen on social media / online fora where bitcoin has lost a lot of its previously vocal and enthusiastic support. Active user numbers are down everywhere as people are either turned off by the hostile division in the community or simply do not like the fact that bitcoin has been sloppily captured. Seeing those previously lauded programmers who contributed to bitcoin Core in the early years demonised (including Satoshi) and the latest cohort revealed for being liars, surrounding themselves with malignant sycophants, whilst actively supporting censorship of healthy debate between the userbase and the development community is probably a massive turn-off to people who believe in bitcoin as censorship resistant!

    The longer this saga continues unresolved the more apparent it becomes to me that bitcoin is probably not going to be *the* blockchain for the internet. What is frustrating is that it probably should be.
     
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  18. tynwald

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    BTC ... appears to be turning into the MySpace of cryptocurrencies. Will Dash, ETH or ZCash be the one that takes over while BTC slowly turns into mashed-up corporate plaything.
     
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  19. bluemoon

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    I'm just hoping BScore turns out to be the new MtGox and crashes and burns before it turns bitcoin into any MySpace.
     
    #9739 bluemoon, Apr 16, 2016
    Last edited: Apr 16, 2016
  20. Justus Ranvier

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    The biggest disappointment for me has been seeing just how many apparently-honest people were willing to become malignant sycophants.

    The problem isn't that bad actors took an interest in Bitcoin - there will always be bad actors in the world and they will always be attracted to the positions where they can do the most damage - the problem is that it's so easy for them to recruit followers.
     
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