Gold collapsing. Bitcoin UP.

[NashGuy]

Are you using the standard and accepted definition of fiat?

 

[Zarathustra]

Fiat is actually a stupid term for debt/credit, which is money since the invention of the economy (society/tribute/tax). Credit does not appear ex nihilo.

 

[BldSwtTrs]

Szabo is the one that got everyone on the topic of central-planning via his works that highlight Hayek. Hayek has an explicate definition for this phrase, which important because he cautions us against "central-planning". But you have not used Hayek's definition. Have you read Hayek's or Szabos works on this. Here I explain the difference between the bad kind of central planning vs a good kind: https://medium.com/@rextar4444/central-planning-the-kind-we-should-fear-and-the-kind-that-is-helpful-bb323a0284ad#.cqnbo13y6

I knew Hayek well before knowing Szabo. I don't think I am the only one here. I have read a good chunk of Hayek work and to be frank I find your blog post on central planning rather poor, sorry.

Central planning is always bad, the term "central" imply a top-down monopolitisc plan.

But Hayek loves planning. He just want many competing plans. He is against one big monopolistic plan that prevents others from implementing their own competing plan. To put it shortly, it is way better to have many bottum-up plans, than to have only one top-down plan.

There is also an antirationalistic argument in Hayek. He understood that reason is a limited tool. Maxwell doesn't seem to understand that. He thinks he is so clever that he can understand everything that need to be understood. The market, which aggregates all the wisdom around, is several orders of magnitude smarter than even the smartest team of engineers.

 

[cypherdoc]

Good collapsing. Bitcoin UP.

 

[AdrianX]

Agreed. We need to stop the conspiracy attacks, the FUD and counterproductive attempts to hardfork without consensus. We need to focus more on collaboration, discussion and research in a calm and patient way.

The biggest obstacle to overcome is censorship. If you're serious, censorship should not be tolerated, you should be focusing efforts on allowing communication to facilitate consensus firstly to dispelled the FUD and secondary to allow a consensus to form.

In the past you've said you're doing nothing to help facilitate this consensus, you've just said it's not you doing the censoring and you've give lip service to the idea that you don't support it.

If you want consensus you have to make sure everyone is able to participate.

 

[freetrader]

Claiming Bitcoin is apolitical is an instance of a particular political strategy (*).

Censorship is another.

Compromise might just be last on Blockstream's list.

(*) it's remarkably similar to other such strategems employed to win over the under-informed in certain current elections

 

[freetrader]

This is why core and other players are simply stalling, until the entropy builds up and such change can't happen.

May I introduce you to my friend, Mr Theory. He lives at the corner of Dude, and Catastrophe.
In other words, I think they are wrong in using this stalling tactic, and courting catastrophe (in terms of Bitcoin's success and in terms of their company).
Their stalling tactic has been called out for what it is - just another attempt at central planning.

But designing bitcoin so be implemented as Ideal Money in itself is a central planning folly. It cannot be done. Thats why Satoshi didn't try to do it.

The 1MB limit wasn't there initially. Then Satoshi added it to handle a specific situation (spam attacks early on in the life of the coin). Arguably, a good kind of central planning. Satoshi did it. Or didn't he? But he did it for an explicit reason, and that reason no longer holds, the limit has now become a hindrance rather than a help.

None of those currencies can compete with bitcoin because of that [ed: hard fork upgrades]. Look at ethereum and what change has done for them.

In Ethereum's case, I'd say it's too early to tell the effects of the fork. In the case of others (Dash, Monero) they've been doing that for a while, with no deleterious consequences. To say that these currencies cannot compete is ignoring their recent gains. But I'm sure you wouldn't ignore them.

Great ideas, but the whales cannot seek safe haven in such instable designs.

Free Willy. Sorry, I had to make that joke.

Gold isn't really highly transactable, bitcoin already crushes gold in this regard.

Not sure about that, if we compare volumes. Perhaps some gold experts can chime in.
My gut feeling is that in theory, you are right, but with the transactional limit on Bitcoin in force, Bitcoin is not able to compete yet in real terms. Perhaps I'm wrong on this.

There is no purpose is "solving" bitcoins transactional capacity, it is a feature, not a problem. It renders bitcoin like gold by the significant definition.

Well, we disagree on this. I don't believe it harms Bitcoin's value if it is transactable with very low fees - as long as those fees are sufficient to secure it.
I would like you to explain how difficulty to transact in physical gold contributes to its value. Rather, don't you think that more people would buy and sell gold if it was easier?
(I think the Far East actually provides proof of this)

In the meantime, feel free to point me to your "significant definition".

 

[Jonathan Vaage]

Gold failed because of excessive transaction costs - Gold 2.0 is a cargo cult.

Ideal Money, by Nash's definition, is a metric for value that is stable over time. It is an objective measuremeant.

@NashGuy:

I would recommend you read some Mises on the cause of "stabilization".

This Krawisz essay is also indispensable on the topic of "Ideal Money".

 

[Jonathan Vaage]

"Stability, the establishment of which the program of stabilization aims at, is an empty and contradictory notion. The urge toward action, i.e., improvement of the conditions of life, is inborn in man. Man himself changes from moment to moment and his valuations, volitions, and acts change with him. In the realm of action there is nothing perpetual but change. There is no fixed point in this ceaseless fluctuation other than the eternal aprioristic categories of action. It is vain to sever valuation and action from man's unsteadiness and the changeability of his conduct and to argue as if there were in the universe eternal values independent of human value judgments and suitable to serve as a yardstick for the appraisal of real action."

-Ludwig von Mises

 

[Tomothy]

You will always be able to tell its me even without admission

1 mb isn't what is special here, but the debate, the possibility of changing the limit in order to try to support a high transaction currency, tampers with the markets ability to see bitcoin like they see gold.

Bitcoin, scaled to a coffee money won't necessarily have this. Messing with its utility changes its value. I think we all agree on this.

To create Ideal Money, to create such a stable, objective, politically neutral metric, it MUST be the markets that ultimate choose it and levate it over time. And in order to entice this process we need a new standard for competition, that is unchanging and predictable in the way that gold is.

Thx.

First, thank you for your comments. I find them to be invaluable and refreshing as they seem to reflect the economic ideology influencing core's current actions with regards to their strategic plan.

So, secondly, I want to make sure I understand what you are suggesting.

Am I correct to assume that,

The ultimate goal of bitcoin is to, in plain terms, be a better hedge and store of value than gold? To this end, changing bitcoin, will negatively affect the possibility of this outcome? Specifically, increasing from 1mb to 2mb, as it would support more transactions would lower it's comparability to gold? Are you suggesting this, because it is assumed that gold is scarce rare and expensive and should not be changing hands to many people. I.e., we don't want everyone to have gold because it would make it less valuable?

If this is the case, and I'm close to understanding your concerns, additional information would be greatly appreciated. I think functionality of bitcoin along with it acting as a hedge and increasing store of value is not negatively impacted by, essentially, increased fungibility. I suggest this because if I want to buy a cup of coffee, bitcoin relative to fiat will, unless the experiment fails, always be a representative exchange. Such that, today if I buy a cup of coffee for $5.00 USD@$675USD/BTC, this would cost me 0.0074 btc. However, in five years from now if I bought coffee with BTC $5@$10,000USD/BTC 0.0005 BTC. BTC would still continue to act as both a hedge and a currency; what would be impacted by the 1mb size would simply be fungibility and capacity to act as a continued medium of exchange. The concern here, would be that if bitcoin fails to be able to serve it's purpose as a currency, albeit used in smaller denominations and smaller transactions, other options will take it's place.

How would this benefit bitcoin as a hedge/store of value? If anything, it seems to artificially limit it's growth based on the assumption that bitcoin is ONLY a commodity/hedge/store of value, and not also a currency. For that to be the case, you would need to prevent people from being able to use it to send p2p transactions to one another. This could be done by artificially limiting the number of transactions per block and increasing fees of utilizing such a transaction in order to force users to go through a centrally planned and watched off channel option.

Again I seem to come full circle as to what a general user's idea of bitcoin is, how this is characterized, and how long term planning seeks to fulfill that concept. Is the end goal for bitcoin to not be peer to peer money and instead institution to institution transaction? If so, why not just use ripple?

 

[NashGuy]

I knew Hayek well before knowing Szabo. I don't think I am the only one here. I have read a good chunk of Hayek work and to be frank I find your blog post on central planning rather poor, sorry.

Interesting.

Central planning is always bad, the term "central" imply a top-down monopolitisc plan.

Can you cite/quote this in Hayek's work (my blog has citations), that central planning is always bad? The infrastructure for the American constitution was centrally planned, planned by a relatively select few, do you claim Hayek was wholeheartedly against it?

But Hayek loves planning. He just want many competing plans. He is against one big monopolistic plan that prevents others from implementing their own competing plan. To put it shortly, it is way better to have many bottum-up plans, than to have only one top-down plan.

So you are suggesting that Hayek felt there should be many constitutional frameworks? Can you quote or reference these sentiments from him? Or are these YOUR sentiments? Since anyone can fork bitcoin and make there own implementation, and anyone can create an alt-coin, how is against Hayek? Satoshi created bitcoin and left it the way it is, if you have read Hayek how does he feel that people feel entitled to changing his project when they could otherwise create their own?

There is also an antirationalistic argument in Hayek. He understood that reason is a limited tool. Maxwell doesn't seem to understand that. He thinks he is so clever that he can understand everything that need to be understood. The market, which aggregates all the wisdom around, is several orders of magnitude smarter than even the smartest team of engineers.

Can you quote where Hayek calls reason limited? For some problems I think it is true the markets are smarter in a sense. But what we have here is a collective of individuals, each that are suggesting they themselves are smarter than the engineers, and the engineers keep suggesting that the network, the market that exists, does not agree with the individuals complaints.
[doublepost=1469027565][/doublepost]

Fiat is actually a stupid term for debt/credit, which is money since the invention of the economy (society/tribute/tax). Credit does not appear ex nihilo.

I must ask the same question you avoided, are you using your own definition or the accepted definition. Can you cite your sentiments here in regard to accepted scientific/academics? Or are you saying something that is not generally accepted?

 

[NashGuy]

First, thank you for your comments. I find them to be invaluable and refreshing as they seem to reflect the economic ideology influencing core's current actions with regards to their strategic plan.

Cheers!

So, secondly, I want to make sure I understand what you are suggesting.

Am I correct to assume that,

The ultimate goal of bitcoin is to, in plain terms, be a better hedge and store of value than gold? To this end, changing bitcoin, will negatively affect the possibility of this outcome? Specifically, increasing from 1mb to 2mb, as it would support more transactions would lower it's comparability to gold? Are you suggesting this, because it is assumed that gold is scarce rare and expensive and should not be changing hands to many people. I.e., we don't want everyone to have gold because it would make it less valuable?

No I am suggesting the act of CHANGE in this regard is what will render bitcoin less valuable as a gold/inflation hedge. In order for it to be sought this way it must be predictable not malleable.

If this is the case, and I'm close to understanding your concerns, additional information would be greatly appreciated. I think functionality of bitcoin along with it acting as a hedge and increasing store of value is not negatively impacted by, essentially, increased fungibility. I suggest this because if I want to buy a cup of coffee, bitcoin relative to fiat will, unless the experiment fails, always be a representative exchange. Such that, today if I buy a cup of coffee for $5.00 USD@$675USD/BTC, this would cost me 0.0074 btc. However, in five years from now if I bought coffee with BTC $5@$10,000USD/BTC 0.0005 BTC. BTC would still continue to act as both a hedge and a currency; what would be impacted by the 1mb size would simply be fungibility and capacity to act as a continued medium of exchange. The concern here, would be that if bitcoin fails to be able to serve it's purpose as a currency, albeit used in smaller denominations and smaller transactions, other options will take it's place.

Your concern here doesn't attend to its use as a gold. You are implying if bitcoin cannot be highly transacted it will lose its relevance, but gold has not lost its relevance and it is relatively costly and inefficient to transact.

How would this benefit bitcoin as a hedge/store of value? If anything, it seems to artificially limit it's growth based on the assumption that bitcoin is ONLY a commodity/hedge/store of value, and not also a currency. For that to be the case, you would need to prevent people from being able to use it to send p2p transactions to one another. This could be done by artificially limiting the number of transactions per block and increasing fees of utilizing such a transaction in order to force users to go through a centrally planned and watched off channel option.

You are talking about this in regards to limiting the transaction capacity which is true, but such limit of growth does not effect bitcoin's growth as an inflation hedge, it just moves it to bigger and bigger players that can transact, and smaller players that could still hodl.

You are not using the same definition for the phrase centrally planned as Hayek or Szabo, and their are plenty of alt-coins that are not centrally planned like fiat, in which users could transact with re: coffee money purchases etc.

Again I seem to come full circle as to what a general user's idea of bitcoin is, how this is characterized, and how long term planning seeks to fulfill that concept. Is the end goal for bitcoin to not be peer to peer money and instead institution to institution transaction? If so, why not just use ripple?

Yes this long-term planning you refer to, in regard to trying to CONTINUOUSLY scale bitcoin to fit a certain niche use IS the central-planning folly Hayek cautioned us vs. If bitcoin is used by bigger players that does not mean it is no longer a p2p money. Ripple is not as secure vs change as bitcoin. Bitcoin is something even the banks can't change, that is what we want. We want to force the governments and banks on the bitcoin/gold standard.

 

[Christoph Bergmann]

First, thank you for your comments. I find them to be invaluable and refreshing as they seem to reflect the economic ideology influencing core's current actions with regards to their strategic plan.

So, secondly, I want to make sure I understand what you are suggesting.

Am I correct to assume that,

The ultimate goal of bitcoin is to, in plain terms, be a better hedge and store of value than gold? To this end, changing bitcoin, will negatively affect the possibility of this outcome? Specifically, increasing from 1mb to 2mb, as it would support more transactions would lower it's comparability to gold? Are you suggesting this, because it is assumed that gold is scarce rare and expensive and should not be changing hands to many people. I.e., we don't want everyone to have gold because it would make it less valuable?

If this is the case, and I'm close to understanding your concerns, additional information would be greatly appreciated. I think functionality of bitcoin along with it acting as a hedge and increasing store of value is not negatively impacted by, essentially, increased fungibility. I suggest this because if I want to buy a cup of coffee, bitcoin relative to fiat will, unless the experiment fails, always be a representative exchange. Such that, today if I buy a cup of coffee for $5.00 USD@$675USD/BTC, this would cost me 0.0074 btc. However, in five years from now if I bought coffee with BTC $5@$10,000USD/BTC 0.0005 BTC. BTC would still continue to act as both a hedge and a currency; what would be impacted by the 1mb size would simply be fungibility and capacity to act as a continued medium of exchange. The concern here, would be that if bitcoin fails to be able to serve it's purpose as a currency, albeit used in smaller denominations and smaller transactions, other options will take it's place.

How would this benefit bitcoin as a hedge/store of value? If anything, it seems to artificially limit it's growth based on the assumption that bitcoin is ONLY a commodity/hedge/store of value, and not also a currency. For that to be the case, you would need to prevent people from being able to use it to send p2p transactions to one another. This could be done by artificially limiting the number of transactions per block and increasing fees of utilizing such a transaction in order to force users to go through a centrally planned and watched off channel option.

Again I seem to come full circle as to what a general user's idea of bitcoin is, how this is characterized, and how long term planning seeks to fulfill that concept. Is the end goal for bitcoin to not be peer to peer money and instead institution to institution transaction? If so, why not just use ripple?

Hehe, that's some euphemistic. If you take "Nashguys" comments as representing for Core's ideas and world building, you excessively underestimate core's ability to create "real theories" that connect cypherpunk and libertarism (what doesn't mean these theories are correct).

What nashguy / pokertravis is doing on and on and on is that he takes a term he finds ("Ideal money"), talks about a person he heard of ("Nash"), connects this to the most simplified version of the small-block-camp ("resisting change"), writes blog posts about it, tries to bring this posts to reddit - and now unfortunately this enlighenig thread - and calls everybody "unsincere" and a "troll" who doesn't cheer on his thoughts.

It is not even intellectually funny to break this thoughts.

Core's thought are similar, but dig much deeper into Adam Back's ossification theory and Luke-JRs pontification idea to create an idea of digital gold that has nothing to do with "nashguys" ideal money. don't want to attack, i just want this thread to not waste pages with this.

 

[freetrader]

No I am suggesting the act of CHANGE in this regard is what will render bitcoin less valuable as a gold/inflation hedge. In order for it to be sought this way it must be predictable not malleable.

Let's watch what happens with the Ethereum price in the next few days, weeks and months.
They've just successfully hardforked a much more controversial change (reverting unpleasant history).

 

[pekatete]

Yes I 100% agree. I have now and have always been in favor of increasing the limit. Even 8MB is fine with me, as I told Gavin before he supported XT.

You do have a nasty habit of not addressing the crux of the matter / point at hand, I'll para-quote for you:

... what you need to admit (to yourself for all I care!) is that you can not predict what the bitcoin network will be like in 2140.

 

[freetrader]

@Christoph Bergmann :

Bloomie said he'll let us know before when we run out of pages on this thread. /s
(I'm lying, Bloomie said no such thing - cypherdoc is procuring new pages for us all, thanks!!!)

Since I have some left-over space on my post, I will put this here because sometimes a well-written blog post illustrate a particular viewpoint better than some tit-for-tat forum posts:

http://www.coindesk.com/did-john-nash-help-invent-bitcoin/

 

[lunar]

@NashGuy

First a slightly apprehensive welcome to you on this forum as reasoned intelligent debate has so far set this place apart. Long may it stay that way.

Nash's relation to bitcoin came from my insight on Ideal Money.

A word to the wise. It's quotes like this that get you downvoted to oblivion on reddit. You were not the first here. (even if you did come to these conclusions in your own perfect vacuum) Furthermore, i've not seen any particularly new insights from you. It might be advantageous to back you rhetoric down a little and realise we are ALL advancing by standing on the shoulders of giants, who in turn had giants of their own. Some humility and willingness evolve your understanding would almost certainly help you get your point across. Which incidently you seem to have many valid things to say. May they be received better.

Welcome aboard.

 

[NashGuy]

Let's watch what happens with the Ethereum price in the next few days, weeks and months.
They've just successfully hardforked a much more controversial change (reverting unpleasant history).

For how long should we watch though? All we have is empirical evidence that bitcoin crushes all other alts in this regard.

Btw, and to be clear, I had nothing to do with this article and I am willing to publicly suggest that no authors involved in this article are familiar with Nash's works:
http://www.coindesk.com/did-john-nash-help-invent-bitcoin/
http://www.coindesk.com/did-john-nash-help-invent-bitcoin/

 

[Tomothy]

Ok, So you've given me lots to think about and digest which will take some time. However, I wanted to strike while the iron was hot for this first part.

Re: 1mb/2mb change.

"No I am suggesting the act of CHANGE in this regard is what will render bitcoin less valuable as a gold/inflation hedge. In order for it to be sought this way it must be predictable not malleable."

So, bitcoin is always changing. There are new changes imminently scheduled to be added to the codebase. We now have RBF, Compactblocks, new CLTV stuff, and soon we will have Segwit. Implementation has been suggested as soft fork changes or as hard fork changes but the means in which they are adopted will also impact bitcoin. Absent mining support, these changes will not occur.

In similar fashion, how does a 1mb change to 2mb change, when compared with the abovementioned changes (segwit/ln) render bitcoin less valuable as a gold/inflation hedge?

For bitcoin to be predictable and not malleable it seems like this experiment could be better suited as a candidate for an adaptive block size requirement. This would prevent future arguments about when the proper time of increasing a block has been reached

Additionally, it has been indicated that larger blocks are needed. This is a position supported by core programmers as it is a pre-requisite for LN, i.e. 4mb blocks, 3mb for witness data, 1mb for regular transactions or something; so it's not a question of whether or not the current 1mb limit will ultimately be changed but when and how it will be implemented. (I.e., 2mb or an adaptive block size scaling implementation).

Do you intend to actually state and argue that the issue is not the block size but how the political discussion is framed and participated in by all group members including core developers, miners, node operators, and users? I.e, How it comes to pass that the block size is increased from 1 mb to 2mb? (Did we increase the blocksize because people yelled and threatened and so we changed it) Is the actual concern not the size but the perception that one group is beholden to the whims of another? And ultimately, aren't all groups subject to first, the miners and second the users?

If 1mb to 2mb renders bitcoin less valuable as a gold inflation hedge, what happens when bitcoin includes segwit and LN which allows, essentially, offchain transactions? It seems that this is more of a fundamental and dramatic change then 1mb to 2mb. Does this affect it's capacity as a store of value and if so how and in what manner?

 

[NashGuy]

Thank you lunar for the sentiments and advice...in regard to this

You were not the first here. (even if you did come to these conclusions in your own perfect vacuum)

Are you suggesting there was someone discussing Nash's Ideal Money before me, especially in regard to bitcoin? Because that is what I claimed as being first at.
[doublepost=1469031034][/doublepost]Yes timothy. Some things will change and some things should not. Change in this regard can also be a pandora's box.

Do you intend to actually state and argue that the issue is not the block size but how the political discussion is framed and participated in by all group members including core developers, miners, node operators, and users? How it comes to be that the block size is increased from 1 mb to 2mb? Is the actual concern not the size but the perception that one group is beholden to the whims of another? And ultimately, aren't all groups subject to first, the miners and second the users?

This seems to speak to the direction I am pointing at. We are expecting change, but we should not be trying to target optimization of bitcoin as a currency especially in the name of increasing to changing its valuation. This means the the future perceived value is not predictable. Everyone wants what they call ideal money (not by Nash's definition), and so they feel bitcoin must be designed to represent that. This is the central-planning folly. No single person, no group, is able to propose a plan/design for such a currency.

What Nash proposes is we design a politically uncorruptable money that functions like gold, which bitcoin does at 1mb, which is NOT ideal money by everyone's definition, but will be the catalyst to bring ALL our global currency system's into order. The asymptotic result, because of the market competition, will be Ideal Money by Nash's definition.

That is to say, and this attends to your sentiments directly, changing the block size is not bad per se, but changing it to optimize bitcoin as a currency as well as its value, is a very very bad thing.
[doublepost=1469031141][/doublepost]

If 1mb to 2mb renders bitcoin less valuable as a gold inflation hedge, what happens when bitcoin includes segwit and LN which allows, essentially, offchain transactions? It seems that this is more of a fundamental and dramatic change then 1mb to 2mb. Does this affect it's capacity as a store of value and if so how and in what manner?

yes you ask perfect questions. I think people won't like my answer, but you will understand it: not necessarily....

but we might continue to debate about which things do and don't, and why this might be true. The test is in regard to Hayek's cautions, that we don't try to target things that cannot be targeted with empirical data.