Gold collapsing. Bitcoin UP.

[lunar]

https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2015-July/009815.html

Mike Hearn getting back into the fray. His words sounds so sane amongst a cacophony of ego and hidden agenda it's no wonder he gets a hard time.

Edit ... sorry old response missed the 2015 date. still good though.

.................................... quoted response....................

If Bitcoin needs to support a large scale, it already failed.

It hasn't even been tried.

The desperately sad thing about all of this is that there's going to be a fork, and yet I think most of us agree on most things. But we don't agree on this.

Bitcoin can support a large scale and it must, for all sorts of reasons.
Amongst others:

1. Currencies have network effects. A currency that has few users is simply not competitive with currencies that have many. There's no such thing as a settlement currency for high value transactions only, as evidenced by the ever-dropping importance of gold.

2. A decentralised currency that the vast majority can't use doesn't change the amount of centralisation in the world. Most people will still end up using banks, with all the normal problems. You cannot solve a problem by creating a theoretically pure solution that's out of reach of ordinary people: just ask academic cryptographers!

3. Growth is a part of the social contract. It always has been.

The best quote Gregory can find to suggest Satoshi wanted small blocks is a one sentence hypothetical example about what *might* happen if Bitcoin users became "tyrannical" as a result of non-financial transactions being stuffed in the block chain. That position makes sense because his scaling arguments assuming payment-network-sized traffic and throwing DNS systems or whatever into the mix could invalidate those arguments, in the absence of merged mining. But Satoshi did invent merged mining, and so there's no need for Bitcoin users to get "tyrannical": his original
arguments still hold.

4. All the plans for some kind of ultra-throttled Bitcoin network used for infrequent transactions neglect to ask where the infrastructure for that will come from. The network of exchanges, payment processors and startups that are paying people to build infrastructure are all based on the assumption that the market will grow significantly. It's a gamble at best because Bitcoin's success is not guaranteed, but if the block chain cannot grow it's a gamble that is guaranteed to be lost.

So why should anyone go through the massive hassle of setting up exchanges, without the lure of large future profits?

5. Bitcoin needs users, lots of them, for its political survival. There are many people out there who would like to see digital cash disappear, or be regulated out of existence. They will argue for that in front of governments and courts .... some already are. And if they're going to lose those arguments, the political and economic damage of getting rid of Bitcoin must be large enough to make people think twice. That means it needs supporters, it needs innovative services, it needs companies, and it needs legal users making legal payments: as many of them as possible.

If Bitcoin is a tiny, obscure currency used by drug dealers and a handful of crypto-at-any-cost geeks, the cost of simply banning it outright will seem trivial and the hammer will drop. There won't be a large scale payment network OR a high-value settlement network. And then the world is really screwed, because nobody will get a second chance for a very long time.

 

[albin]

@lunar

As of a few days ago, Maxwell is officially on the paranoid schizophrenic crazy train of conspiracy theory concerning Mike Hearn:

[doublepost=1465304209,1465303237][/doublepost]Also as of posting right now, this thread is very obviously being brigaded by /r/bitcoin:

https://www.reddit.com/r/btc/comments/4mucpv/big_blocks_thin_blocks_whateverit_all_comes_down/

Seriously, the huge 24-hour posting bout, and all this paranoia... did homeboy pick up a cocaine habit?

 

[Bagatell]

@albin persona managment systems have no need for stimulants.

 

[Dusty]

If Classic activates successfully, I will exit the ecosystem, since I would not consider the system robust enough for the long term.

A lot of other people are doing exactly the opposite: they will exit the system (and, in fact they already are doing it toward altcoins like ethereum) if a stupid and temporary Bitcoin limit can't be changed because a single commercial entity can veto this for their own agenda even if a great majority of users and business want it.

Of course a project where a handful of individuals are able to artificially cap the computation limit of the network is not a system robust enough for the long term.

Let my explain my reasoning, based on the assumption Bitcoin succeeds:

1. New people will join the system
2. The new people will try to change the 21M cap

That's not a reasoning, that's the usual Kore-bullshit propaganda where they try to conflate two extremely different changes together as they would be the same. We do not fall for it, try again on slashdot, maybe you will have more luck.

A raise of the limit is welcome by almost all the bitcoin ecosystem and if Kore would introduce a higher limit in the next release of the software I bet that there would be a very very rapid upgrade of the network. Also, there would be a major rally on the value.

I can bet also that if they would propose to change the 21M limit the whole majority of the network would laugh at them like never before and there would be a massive change of the software used, for example toward Classic of BU, because the people is not so stupid as you would like to be.

If a simple economic majority can impose arbitrary changes on the system, I consider Bitcoin totally useless.

If you are unable to differentiate from one change to another, your opinion is totally worthless.
Kore has introduced a lot of new features (opcodes like OP_CSV and much greater changes like segwit) without consensus, simply because of their position in handling which features go in the reference node.

So, an extremely tiny economic majority in Bitcoin is able to impose very high level changes on the system, but this does not seems to bother you.

 

[cypherdoc]

Sort of, but there's a very fundamental difference between the supply cap and the block size limit. On the one hand, "the 21M number for the supply cap was arbitrary, but preserving that status quo is crucial." On the other hand, "the 1-MB number for the block size limit was arbitrary, but not preserving that status quo is crucial." On a superficial level, that might sound like an inconsistency in my position. But again, the key difference is that the reliable scarcity of Bitcoin's money supply enhances its monetary usefulness (by allowing it to better serve the "store-of-value" function of money) whereas an artificially-constrained limit on transactional capacity undermines Bitcoin's monetary usefulness (by impairing its ability to serve the "medium-of-exchange" function of money). So it's really an apples-to-oranges comparison.

Related thoughts here:

• Two Approaches to Conceptualizing Bitcoin's Core Value Proposition

(By the way, for anyone who hasn't seen it, that post is one of my favorite things I've written about Bitcoin.)

thanks Roger, for reiterating the 3 characteristics of money, the last of which we have NOT achieved yet:

network effects / widespread acceptability - Only a form of money that is widely accepted is suitable for use as a "unit of account."

the bolded is actively being held back by kore dev in an attempt to force offchain solns that siphon tx fees off the mainchain and into the pockets of LN hub owners (which are inevitable imo) at the expense and deprecation/demise of the miners whose function is to secure the mainchain against attacks.

from a finance and speculative POV, this necessarily means tapping the Forex market; the biggest by far in the world. Bitcoin needs first and foremost to become a legitimate form of money or currency listed on that exchange. the only way to do that is for the tx volume and price to ramp several orders of magnitude before the fiat boys will even consider allowing it to be listed. it's just too small otherwise. "diluting" that requirement by allowing Bitcoin to become a mere settlement network for encumbered payment channel micro-tx's won't cut it. it will undercut it. the entire concept of Bitcoin as a settlement layer w/o it being it's own globally accepted currency first is the epitome of economic ignorance by Greggy, his dipshits, and the entire small blockhead crowd.

let native Bitcoin grow!
[doublepost=1465310170][/doublepost]

I think there is a perception among small blockers that the large blockers at too impatient.

now i know you're ignorant.

all one has to do is look at the full blocks that roll out day after day; which we predicted btw way back last year in the Spring as the signs were all there. plus, you ignore all the delayed tx's or tx's that get rolled off the mempool. and you ignore user complaints about these delays.

here's another of @awemany's great concepts that i'll share with you from a technical standpoint: all those tx's that get rolled off the over-stuffed mempools or that get replaced by RBF all create massive amounts of wasted processing power that full nodes had to go thru via transmitting, verifying, and storing, only to get "cancelled". that wouldn't happen if mempools were kept to a reasonable smaller size via more rapid "clearing" with bigger blocks. why is it that i never here kore dev talk about that waste and burden they're inflicting on those precious full nodes they claim to care so much about? as i sit here and look at my BW usage of my full nodes, i'm always shocked how little gets used.
[doublepost=1465310623,1465309696][/doublepost]

I think there is a perception among small blockers that the large blockers at too impatient.

such idiocy.

what do you call compromising from 20 to 8 to now 2MB? that's called patience. what have you done? absolutely nothing. that's called impatience and uncompromising from a bunch of economic and i dare say technical illiterates. i say technical b/c you're violating a simple CS concept of simplicity over complexity which is definitely applicable to a complex, multidimensional new monetary system such as Bitcoin that requires an understanding of multiple fields and game theory besides just a CS degree.
[doublepost=1465311672][/doublepost]another good section of @Roger_Murdock's reddit post (that should be required reading) that i liked:

"Transfer - The analysis here is pretty similar to the one for cash. In-person transfers are possible without a trusted intermediary (although still problematic), but trustless transfers at a distance are simply not possible. Of course, IOUs for gold can be transferred across distance electronically, but transacting in IOUs simply reintroduces the requirement for a trusted central authority."

so let me apply this once more to the concept of LN PC's. it seems to me that PC's are one giant zero conf tx. you might claim, "but the counterparties can at anytime get out of the PC and settle onchain". is that really the case? and always? i think many ppl have conceived of ways to at the very least "delay" a settling of a PC onchain; think ddos, full mempools that force fees higher than the closing tx has allocated, etc. the problem with the PC is that significant economic value is being exchanged as the parties progress bidirectionally back and forth across the channel with the updated tx's in essence being IOU's. how's that different than gold IOU representations described above? and we know what has become of gold as a settlement system; it's been totally perverted. LN proponents have even said that these PC's may never have to be closed as the updated tx IOU may traverse back and forth within the channel. all the while siphoning tx fees away from miners to LN hub owners who will profit from each tx that takes place. hmm, sounds very much like the brokers who facilitate and profit from gold futures trading.
[doublepost=1465311751][/doublepost]

In the spirit of reminding ourselves of the fundamental points. To my mind, the crucial thing right now is not so much the near-term fate of the 1 MB limit. It is the diversification of development. Having a single implementation and development team, which is subject to capture, is a failure point for Bitcoin.

yes, swapping out the current kore governors can be considered by some to be the most important change of all.

 

[cypherdoc]

https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2015-July/009815.html

Mike Hearn getting back into the fray. His words sounds so sane amongst a cacophony of ego and hidden agenda it's no wonder he gets a hard time.

Edit ... sorry old response missed the 2015 date. still good though.

.................................... quoted response....................



It hasn't even been tried.

The desperately sad thing about all of this is that there's going to be a fork, and yet I think most of us agree on most things. But we don't agree on this.

Bitcoin can support a large scale and it must, for all sorts of reasons.
Amongst others:

1. Currencies have network effects. A currency that has few users is simply not competitive with currencies that have many. There's no such thing as a settlement currency for high value transactions only, as evidenced by the ever-dropping importance of gold.

2. A decentralised currency that the vast majority can't use doesn't change the amount of centralisation in the world. Most people will still end up using banks, with all the normal problems. You cannot solve a problem by creating a theoretically pure solution that's out of reach of ordinary people: just ask academic cryptographers!

3. Growth is a part of the social contract. It always has been.

The best quote Gregory can find to suggest Satoshi wanted small blocks is a one sentence hypothetical example about what *might* happen if Bitcoin users became "tyrannical" as a result of non-financial transactions being stuffed in the block chain. That position makes sense because his scaling arguments assuming payment-network-sized traffic and throwing DNS systems or whatever into the mix could invalidate those arguments, in the absence of merged mining. But Satoshi did invent merged mining, and so there's no need for Bitcoin users to get "tyrannical": his original
arguments still hold.

4. All the plans for some kind of ultra-throttled Bitcoin network used for infrequent transactions neglect to ask where the infrastructure for that will come from. The network of exchanges, payment processors and startups that are paying people to build infrastructure are all based on the assumption that the market will grow significantly. It's a gamble at best because Bitcoin's success is not guaranteed, but if the block chain cannot grow it's a gamble that is guaranteed to be lost.

So why should anyone go through the massive hassle of setting up exchanges, without the lure of large future profits?

5. Bitcoin needs users, lots of them, for its political survival. There are many people out there who would like to see digital cash disappear, or be regulated out of existence. They will argue for that in front of governments and courts .... some already are. And if they're going to lose those arguments, the political and economic damage of getting rid of Bitcoin must be large enough to make people think twice. That means it needs supporters, it needs innovative services, it needs companies, and it needs legal users making legal payments: as many of them as possible.

If Bitcoin is a tiny, obscure currency used by drug dealers and a handful of crypto-at-any-cost geeks, the cost of simply banning it outright will seem trivial and the hammer will drop. There won't be a large scale payment network OR a high-value settlement network. And then the world is really screwed, because nobody will get a second chance for a very long time.

great summary @lunar

 

[Norway]

Hey guys, I had a chance to join @Justus Ranvier in the Crypto Show studio last night for a discussion on a brilliant essay by Daniel Krawisz called Reciprocal Altruism in the Theory of Money.

The Crypto Show - Yoshi Goto of Bitmain Justus Ranvier of StashCrypto and Jon Vaage

(The first segment of the show is an interview with Yoshi Goto of Bitmain - our discussion begins at 42:22)

You can read the essay over at the Satoshi Nakamoto Institute or wait for the release of the audio narration I've begun working on. I can't recommend it highly enough!

Mind blown!

 

[cypherdoc]

also, this concept of a fee mkt as it relates to trying to get out of a time dependent LN PC. being able to use RBF or whatever to raise one's tx fee to get into a block is NOT a true market. the practicalities of it, as we've already seen, are difficult to execute in any sort of efficient way, unlike a true market. one has to go to some obscure, seldom used fee estimation website, or trust a generic in app fee estimator like exists in Mycelium or Armory. in Mycelium, the choices are just Normal, Priority, Low Priority, Economic. that's too broad. anyone who trades real markets understand that you need to see bid asks on a level 2 or 3 screen realtime to get a real sense of trading efficiently in a true market. and, you need huge volumes. plus, as we all well know, the mempools can swing wildly in the face of a spam attack jacking the tx backup to huge MB levels and rather quickly and for prolonged periods of time. ideal for manipulating some LN PC that needs to "get me out" rather quickly. LN proponents will then say, "but that will all be fixed with better tools". answer: NO. No b/c the mempool fee mkt doesn't have speculators within it. it only consists of real economic tx's. speculators like me were soundly denounced in the early days of Bitcoin as being disruptive, interfering, greedy, out for yourself types that denigrated Bitcoin. what a joke. i remember having long protracted battles with geeks who didn't understand the importance of speculation in providing liquidity to markets, esp a free one like Bitcoin. so again, kore gangs conception of a "fee mkt" for mempools is so broken and ignorant. they need to be moved out. they are hurting Bitcoin.

 

[sickpig]

being able to use RBF or whatever to raise one's tx fee to get into a block is NOT a true market

especially if you could find the resource you're looking for a lower price in alternative markets.

 

[cypherdoc]

To repeat my self again, which I know is very frustrating to you guys. Once you realize the community will not let you have a narrow victory, you will win.

"worsen your chances of winning and you will win".
[doublepost=1465314252][/doublepost]

The big-win approach is key

"worsen your chances of winning and not only will you win but you will win bigger!"
[doublepost=1465314422][/doublepost]

I appreciate the responses, because new entrants on the forum may be confused if his statements are not refuted.

yeah seriously. i don't know if you guys noticed but we are getting to readership levels or views per day that are approaching that of the old thread on BCT.
[doublepost=1465314860,1465314047][/doublepost]

This is actually something I agree with.

Satoshi described how to achieve this big win. Put out code that forks at a given block height, give people enough time to make their mind up about it and let them vote by running it - or not.
The Nakamoto consensus rules will take care of the rest.

Funny how other coins manage to do this on a regular basis and still prosper. Maybe they are on to something.

屮 屮 屮​

I'll add one thought. I've never seen any other open source project where the incumbent resorts to such undemocratic, authoritarian and deceptive measures as the "leadership" of Bitcoin Core has over the last year or more (Blockstream steers clear of direct accusations by convenient use of independent contractors, or sending their officers to attend meetings as individuals, although their conflicts of interest are clear as day to everyone else).

If this were some other project, I probably wouldn't care less and just switch to another technology.

But it's Bitcoin. So I'll fight tooth and nail until this goonish threat is either eliminated, or there is no more hope. I don't want to paint all Core contributors with the same brush, it just seems there are some among them who 'can't help being evil'.

Peace & love,

spot on.

i'm not even a CS yet i can tell the toxicity emanating from /u/nullc and kore gang is unique and way over the top for any OSS project. and the financial COI's are clear as day.

yes, release a HF w/o signalling and based on a future block height and let the market choose. i'm sure this terrifies @jonny1000.

 

[albin]

Krawisz's article on Reciprocal Altriusm is fascinating as hell.

He's the kind of brilliant polymath from CS that I want to see looking into economics / game theory.

 

[Norway]

@albin
I took a quick look at it, and decided to wait for @Jonathan Vaage's audio version that is in the making

 

[Richy_T]

@jonny1000 You're mistaking what with how. Bitcoin is P2P electronic cash that has a distributed consensus system as one of it's features.

Indeed, there are many prior distributed consensus systems. Bittorrent is an obvious one. You want to join the network, you pick a (one of many FWIW) compatible client. Want new features like DHT? Upgrade your client. Bittorrent doesn't suit you? Try gnutella or something else. Client going in a direction you don't like? Pick a different one.

 

[cliff]

yeah seriously. i don't know if you guys noticed but we are getting to readership levels or views per day that are approaching that of the old thread on BCT.

Thread quality is really good, better than any BTC thread anywhere else IMHO. New ideas, old ideas, debate, depth, etc. I change my mind all the time and am constantly re-thinking arguments and positions. This thread is a laboratory of sorts - I don't feel intimidated about sharing kooky ideas or trying on positions that aren't necessarily that popular here etc. Thx 2 all.

 

[cypherdoc]

Eth moving exactly counter to Bitcoin. who says Eth isn't benefiting from Bitcoin's problems?:

[doublepost=1465322730][/doublepost]lol, /u/ydtm killing it again. i swear, he must read this thread:

https://www.reddit.com/r/btc/comments/4mzm94/with_onchain_bitcoin_p2p_electronic_cash_the/

 

[theZerg]

first selloff is since the rise is correlated with compact block FAQ release... its not that there is anything wrong with compact blocks per se, but the fact that Core is dead set against leveraging Unlimited's work could be showing investors (or one investor anyway) the magnitude of the NIH syndrome.

 

[Bagatell]

@theZerg coincidental I think. 12hr psar just went bearish as did KDJ, MACD and willy.

 

[cypherdoc]

CSV gaining ground:

https://www.reddit.com/r/Bitcoin/comments/4my1aj/f2pool_signalling_support_for_csv_soft_fork_its/

 

[Aquent]

@jonny1000 , you amuse me. You think you have the right to impose your thought upon all "even if price goes to zero", and, what gives you that right? Are you the only brain on an earth of seven billion minds?

Is it upon you, sir, to order us, and dictate to us what must be, "even if price goes to zero"? Did god speak to you and tell you what is absolutely right? Has some demon given you some secret knowledge whereby you know for absolute certainty what course of action we must take and thus based on that you must follow it "even if price goes to zero"?

Get some sense. Slap your face, twice, perhaps with both hands, and get some water on it to cool down. There are no absolutes on earth (even though that may be an absolute thus proving the point). There is a big mass of people with their own opinions and ideas. However, we have a solution that has served us incredibly well for some 500 years. It is called science. It is an idea which proposes that when we have a hypothesis, we undertake experiments, and based on the data, reach to what we can with higher confidence call facts.

You should try more of science and less of theology @jonny1000 , especially of the utterly destructive kind which suggests that it is your opinion at all costs, for, of course, we all know you are god on earth and hold the greatest truths. Greater than those of Jesus, or Socrates or indeed Copernicus.

Get a hang of yourself!

The issue here isn't theological. Your position that no hardfork should happen without "strong consensus" is unenforceable. If miners wished to hardfork they can. What are you going to do about it? If users and businesses side with them and a small minority does not, where is your enforcement? You think it is your words or dicta that stops it? You think theology has any say in an utterly capitalistic and self interested system?

What has given us a golden age of 500 years now is science, not priesthood! Your theology is deplorable. Your explicit stance that you would rather see bitcoin cease to exist than follow a course you personally - a nobody - disagrees with, defies any logics.

That all said, your position for small blocks is not necessarily wrong. I wrote an article about it today which I should think many so called large blockers would not like, but science is science and, you know, I like science: http://cointelegraph.com/news/blocksize-must-be-capped-says-princeton-study

But you do this entire community no justice when you don't get down to the table with logics and facts and persuasion, but try and rise above analysis and declare absolutists positions of let bitcoin burn if the entire world does not agree with your own little insignificant mind.

 

[Peter R]

@Aquent:

I've met the authors and discussed this topic with them. Their result applies in the distant future when the block reward disappears. This is consistent with my fee market paper, as I was only able to show the existence of the fee equilibrium for non-zero inflation rates.

That being said, I believe I will soon be able show that the fee market will hold under the perfectly-competitive market assumption even when the block reward runs out.

The Princeton authors argue (as @Aquent quoted):

“In order to solve the problem, the backlog must contain a significant volume of value in transaction fees, not just a large number of transactions… The backlog must also be large enough that it rarely, if ever, empties. This means that users who submit transactions to be published may need to wait for potentially unbounded amounts of time for their transactions to make it into the Blockchain.”

I agree with this. However, I think we can show that this will happen naturally without a block size limit even at zero inflation. IIRC, the Princeton work assumes that all miners have the same marginal cost per hash. I believe that by assuming a distribution of costs per hash, and acknowledging that a fraction of the network will always hash no matter what (for example, hot water heaters), that the required backlog will be generated. The network hash rate would no longer be constant over the course of the ten minute block interval, but rather grow larger and larger as more and more fees build.

Haha just hand-wavving on my part for now, I know, but I think I can prove it.