Topic: A simple bitcoin Q/A. Learn new and interesting stuff about bitcoin. - page 3. (Read 27389 times)

An ETF is an exchange-traded fund, basically a fund that owns a variety of assets enabling investors to own individual portions of the fund via a tradeable token. The value of the fund will rise and fall depending on the value of the assets it owns. It is tradeable, as are the underlying assets (on their own specific markets), so savvy investors can potentially take advantage of any difference in value to make arbitrage trades.

There is plenty of talk about crypto ETFs, and these would work by owning a selection of cryptocurrencies, likely to be market leading coins with high liquidity, constantly trading to maintain the specified/desired ratio. This spreads investors' risk across multiple currencies without having to make a number of trades to do so, therefore if the overall market value of the coins in the portfolio goes up, the value of the ETF will increase accordingly.

The concept of a Bitcoin ETF hit the news recently when the SEC (US Securities and Exchange Commission) rejected the Winklevoss brothers' second attempt to create one and list it on a regulated stock exchange. According to this article, there have been 'seven blockchain based ETFs approved so far in 2018'.

I'm sure there is someone who will be able to go into more detail, but reckon this covers the basics.

This isn't directly related to bitcoin, but I just thought people should know more about this. There have been proposals for bitcoin ETFs to the SEC, and got rejected at least twice.

Question: Explain what is an ETF and how it works?

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Apologies for not being around for this thread. Have lot a personal issues going around.

The difference between the blockchain that is allowed and the traditional blockchain is that there is someone specifically to control the blockchain that is allowed, while the traditional blockchain can be controlled by anyone, even controlled by the one who made the blockchain. And a more detailed explanation is that traditional Blockchain is a public blockchain, anyone can read blockchain data, but that is of course through the process and with a series of rules. while the Blockchain that is permitted is a private blockchain and is controlled in a way that can read or write data on the blockchain. Only verified entities that can run blockchain nodes are allowed.

This is a question which seeks more of opinions than facts. So doesn't actually count as a question. Will visit this thread later.

Hash is the checksum. It is the result of the hash function.

I have already posted an article regarding the hash functions and the differences between two of most famous hashing algorithms, SHA256 (Used in almighty Bitcoin!) and Scrypt (Used in Eth blockchain).

As it is a rather long post I am not gonna quote or paste in here for the sake of tidiness of this thread, If you wanna take a look at that you are more than welcome!

Cheers!

PS:
Kudos for the great work done by the OP and hope you will become a merit source in near future as the community (Not talking about shitposters but about the members who cares about the forum! ) desperately needs more and more active merit sources!   

I will add a question to keep this going.

We have seen bitcoin evolving from a payment option (currency) to an investment medium over time. Since the concept is still new , is more evolution possible ? If yes, in what forms can it be used in future.

Since his name is not Bill gator or pugman, I suppose I get no merits, but still it was an easy question which I wanted to answer! If you can still count my answer that'd be appreciated.
By the way I double posted because the rules are "10. No editing your posts after giving your initial answer. Making edits will disqualify your answer."

17,157,700 coins are in circulation out of the total supply of 21,000,000; that is 81.70% as of today.

Every 210.000 blocks the rewards are halved, with the next halving expected at 630000th block which is expected to be reached on May 2020.
So, the speed by which we're moving to 100% is continually beeing slowed.

Where are we at bitcoin now ? How many left to mine and how many is in circulation?

Hash is an algorithm/function  that will  give a fixed size string when input of variable length is given . They are like "One Way " because from  outputs you will not be able to guess input (that make it almost impossible to invert). Instead you need to do trial and error with series of Inputs to check which input is giving the desired output.

Using trial and error will require high computational power and even a change of single bit in input , output will be completely different. It is quite rare but it is possible to get same hash for 2 different inputs.

Storing password  by using hash function in database will be most practical and useful approach because even if the site database is hacked then hacker will able to see the hashed passwords not the real passwords and they will be of no use to hacker (as reversing hash is almost impossible)

Bitcoin uses SHA-256 algorithm to generate the bitcoin address from the public key.

Hash is an encrypted value or set of values generated by compressing data of arbitrary size to data of fixed size using a hashing algorithm. It saves storage space and ensures high level of security of the hashed data.
Hashes are generated by hashing algorithm and there various types. For example, bitcoin uses SHA-256 whiile ethereum uses keccak-256, but both algorithms create 256-bit hash irrespective of the size of the input string.

Hash is a mathematical algorithm that takes a large data of any size, make a calculation and create another smaller and fixed size data as output.  It is designed to be a one-way function, that is hard or almost impossible to be reverted.

In Bitcoin we use "secure hash algorithm 256". Bitcoin miners need to produce proof of working buy solving the puzzle to be rewarded. They need to combinate all the inputs ( the most recent transactions+timestamp+reference of the previous block ) with their own Nonce. The combination of Nonce + inputs is tried several times. When the hash value with less or equal to the target of the network is found the miner is rewarded.

Wiki
wiki2
99BTC
wikiBtc

Newb question: What is a hash? How is it generated?

We are all no doubt painfully aware of the process of Inflation whereby a government controls the level of interest rates and of essential services and products within their countries borders. The gradual drip-drip increases (often far in excess of the official published rates) mean we get poorer year by year as the money we have buys less and less. The difference between Inflation and Hyperinflation is that Hyperinflation is where the government increase prices beyond everyone's expectations and sometimes with catastrophic results, a recent example of this would be Venezuela.

People will always look for ways to preserve their wealth it is a natural form of survival and this has often been done by converting FIAT cash which we know is continually depreciating into other forms of Investment such as rare paintings, antiquities or precious metals. When Hyperinflation is within the borders of a country then citizens of that country may choose another FIAT currency to use as their store of value. Again using the example of Venezuela they choose to adopt the usage of US$ as a store of value.

The founding premise of Bitcoin was that it could not be controlled by the world central banks it was supposed to be a coin of the people for the people. By adopting the usage of Bitcoin instead of FIAT we could be insulated from the practices of Inflation or worse Hyperinflation as there is no greedy Government dictating how far the Satoshi in my pocket will go.

So we have defined hyperinflation and the effect it has on a currency. The difference with Hyperbitcoinization is seen as a massive value change in a troubled currency in relation to Bitcoin itself as people no longer want to use their own currency for wealth preservation and instead opt for Bitcoin as a preferable store of value. This becomes more prevalent as hyperinflation affects several or the majority of countries at the same time. So if we see a global collapse of the established monetary we will also likely witness Global Bitcoinization at the same time.

Hyperbitconization

It is an inflection point that show the expansion of the bitcoin market to the detriment of another market, that is, massive adoption of bitcoin along with a decay of fiduciary coins.

As well as the appearance of Bitcoin after the financial crisis of 2008, the Hyperbitconization is stimulated by deficiencies in the current market, where the fast adoption of Bitcoin will be the a way to guarantee monetary stability, which is so important.

Venezuela can be highlighted as an example of hyperbitconization, since the country is passing by a historical crisis of governmental origin; Your fiat currency, the Bolivar, is in extreme devaluation. In addition, the interest and demand by Bitcoin in this country is considerable.
Using Google trends, it is easy to realize that the country that has the most interest in research in Latin America, referring to Bitcoin is Venezuela.

Thus, it can be said that it will be the exponential transition of a currency in force to the Bitcoin, but in a decentralized way not in a way carried out by a specific monopoly.

To be honest, I heard this term very first time in my crypto currency journey even I am aware of Zimbabwe and Venezuela  crisis.

Hyperbitcoinization will be bitcoin induced demonetization of the currency. Current currency  value (in terms of purchasing power ) will  diminish and people will use bitcoin as a currency.
Hyperbitcoinization is a voluntary transition from an inferior currency to a superior one (here in case is Bitcoin).

Reference: https://nakamotoinstitute.org/mempool/hyperbitcoinization/#selection-79.0-82.0

I am leaving the aspects of the definition now and will try to analyse it on terms of it feasibility.

Cases where it happened probably .
1. Zimbabwe :  Bitcoin is gained popularity there but instead  of Hyperbitcoinization  there I will say bitcoinization  is happened there. Their currency
                       was never holding any ground against any of the world currency and people simply embraced Bitcoin as a better currency.
2.Venezuela   : This looks me the perfect example of hyperbitcoinization. Even Bitcoin is illegal there but still people are embracing the better currency
                       i.e  bitcoin and taking risks to mine it.
3.Japan          : This is interesting example where government  is embracing the bitcoin  and bitcoin value is increased in accordance to japanese
                        currency Yen. Look like hyperbitcoinization is getting supported by government instead of resisting it they are moving towards a global  
                        and  better currency.
4.Rest of the world: Since majority of World trade is done in USD $(Dollars). Bitcoin value raised significantly in a year so we can assume the
                        hyperbitcoinization is taking place all over the world.

Factors that will limit the speed hyperbitcoinization or will not allow it to happen.
1.  Number of transaction supported  by Bitcoin Network in a second is still very less, so moving whole fiat system  in current bitcoin network will cause congestion ad it will not able to replace the system even people are willing for it.
2.Transaction fees of bitcoin depend open in input and output instead of number of bitcoins getting transferred. So Transaction fees might look very high or might me more than cost of item if you are purchasing a very cheap item. (Like a  piece of loaf in developing country)
3.Confirmation time is still around 10 minutes and nobody will be willing to remain in queue for 10 minutes if I am purchasing some grocery items that combined cost  might be couple of Dollars only.

Conclusion: hyperbitcoinization is possible and all the limitation I discussed might be overcome by use of Lightning Network or Bitcoin Debit/Credit card sytem.

                      

 

Question: Define hyperbitcoinization.

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Ah..ok
I was misguided before but thanks.

What an amazing thread pugman, it is great to actually find a way that people can stand a chance to earn some merit.

A permissioned blockchain is one that has an access control layer built into the blockchain nodes.

The main difference between a permissioned blockchain and a traditional one is the participants of the network have the ability to restrict who can take part in the consensus of that particular blockchain. So essentially it is not open for just anyone to take part in the validation or mining they need to be granted the rights to do so first.

My understanding is that as per data manipulation Permissioned Blockchain will be same as public blockchain. Only difference is that not all Nodes involved in blockchain will able to do the write operation.

We cannot put all the records in the public view even we use blockchain.
Hospitals cannot put the patient records in public blockchain. Banks cannot put their records(account details etc) in public blockchain.

Companies will provide records to legal authorities but we can not put everything in blockchain for general public viewing.