Topic: Any solutions for a problem? (Read 1186 times)

damage Bitcoin how

I agree with you, i think the wide adoption of cryptocurrencies is a two step process where the investors come aboard invest, and then spread the phenomenon so that the mass adoption occurs..for example the investment of winklevoss twins in bitcoins and some of their campaings to promote bitcoins which makes the common people start to use bitcoins.

I think the ethereum project has solution if F2F tranaction is the good one,
The ethereum  project provides decentralized exchanges..so there you have it

We are working on a solution to address this problem... will be announce the launch soon.

There are many ways to solve problems, and it will depend on your situation, your knowledge, your attitude, and your problem to determine the best approach.

The simplest solution, I think, for a crypto currency to eliminate the exchange as an achilles heel, is to become what was called in the stable coins discussion as a "mordor coin".

i.e. no issuance limit. coin issue being tagged to energy use. i.e. coins being issued as long as it is certain to burn a certain amount of energy. The currency experiences atleast 3 drops in value when the technology transitions from  CPU to GPU, GPU to FPGA, FPGA to ASIC and then stablilizes forever.

The name mordor coin comes from the wasteland of mordor since the incentive is to keep running the mines as long as you have access to energy. It is not a pretty picture, but it is a solution to incentivize people to run their own mines instead of approaching exchanges, whenever the price of the coin increases too much from what people can gain by just running their own machines.

now this is  some thing  to think about.

Freicoin has attempetd to  do   some  thing  to  spur a change in the was currency circulation is done. but not  perfect  enough ..

I do think  that  there  could  be a  better  way to  implement a  system, that would sustain it self in a turbulent ecosystem, some thing that can be  perpetual that adjusts it self  on the  bases of the  total volume movement  of coins, that  adjusting  keeps  hording  at  check. adjust the  coin supply up or  down  based  on the  network  and   economic status. i  dont  think a cap  on the number  of coins  can  be  set, given  the  number  of  coins  that do  get lost. That too need to be  factored in.

But a  fixed rate  on  crypto  is  a  disaster waiting to happen.

To eliminate these exchanges, what can be done is when a F2F transaction is done, along with the address, and amount exchanged also put the price at which the exchange is done.

Then the block chain, will calculate the avg. price of the btc at that moment, due to this transaction.

This can eliminate exchanges, but its just a stupid idea. Because there are many flaws...and you would have guessed them.

Thus we even THOUGH the exchange is weekest link, its important one.

Refer to E07 of Letstalkbitcoin.com , its an audio series discussing about bitcoin. In this perticular episode they talk about exchanges. Although it was recorded in April i think, but it indicates the same things that we are seeing now.

Yeah Freicoin always had all the right signs, but not enough Dev support, even Jorge Timon is now working elsewhere. I had covered Freicoin over a year ago on my blog. It has some good possibilities if the dev arena gets better.

http://bensonsamuel.com/2012/10/27/jorge-timon-an-interesting-involved-bitcoiner/

In my opinion, this investment problem is a good problem to have. There is no alternate to it.
Because when we put a money in the system to replace, the existing one, you can't just go ahead and give people the new money.
How will will you make sure that this new money is wide spread? and be used? It can't happen instantaneously.
Investor go ahead and make a hype for that money and there are ups and downs. Then only the regular people come in and use it.

Take for example, a property project that a builder is building. He invites investors to invest in his project, because the builder knows that common people won't come until either the project is completed or its news has been spread. After the project gets completed, slowly the common user comes and uses it. This give the project the true value.

The same is with bitcoin, if it had not been introduced to investors, you can't make it wide spread. And if that doesn't happen, how will it overthrow the current system.

And, you can't blame the investor for this. Also, if the problem and barriers, like now won't come then you don't know the system will survive or not.
And its not easy to change the existing system, without reluctance and objections

Free market equilibrium will reject the notion of set/controlled pricing model and the whole thing will collapse on its head because it is not backed by anything.

I find the idea of demurrage and Freicoin's implementation very interesting. Its a brave attempt to code a very real crypto problem. I am not saying its a good solution, only time can tell but its the correct identification of the problem and a laudable attempt. It forces us to see Freicoin as something other than a commodity (which ironically might spell trouble for them in the long run if it does not get retail traction). It might be ahead of its time because no matter what we say as a community we don't actually see cryptos as a currency, we see it as an avenue for a quick buck - well most of us anyway.

Inflation I think should not be applied to price but to purchase parity. In due course purchase parity of what you have in hand erodes when supply increases. What a dollar can buy for you today will always be a lot less than what a dollar can buy for you in 1900. Friecoin tries to reduce what you have in hand when the real solution I think should be to reduce the value of what you have. In real terms this is done by increasing money supply. The Fed Reserve does this by continuously printing money from thin air - (the world's greatest Ponzi scheme if you ask me).

Can we code for inflationary tendencies, sure we can. Each year a variable number of blocks can be made available to be discovered thereby keeping monetary supply infinite and adaptable year on year. Coins that go out of circulation and/or hoarded are not such a big problem. The variable can be determined based on a number of factors that effect the ecosystem. Keeping variable discovery as an option also mitigates early mover advantage to some extent, because every year more people can join in. Reinforced supply will keep the exchange price in check as well which will also have an influence of the difficulty of mining.

 

Fixed rate of distribution of the Crypto at a set price with inflation calculations to raise the price marginally every day?

Its a chicken and egg situation isn't it.

As long as there is no widespread adoption it will be used more as a commodity and less and less as a currency, hence high in speculation and low on transaction. I am given to understand that a majority of the Bitcoins in existence are actually horded by a significantly smaller number of people.

That is actually counterproductive to Bitcoins if circulation is limited and supply is finite. What ever Bitcoins actually end up circulating are from the lower end of the strata. With limited supply its inevitable that the price will drive up and it leaves the entire ecosystem highly vulnerable to volatility - both market driven, event driven as well as malicious.
 
Its also very interesting that governments around the world will prefer that this remains a commodity and not treated like a currency because it is an existential threat to fiat. I speculate that in 2014 it will continue to be build and used a commodity with the entry of institutional investors. The ban on third party payment systems from using bitcoins is an attempt to subvert Bitcoin's natural progression of retail adoption.

Yeah, this seems to be the problem of the day.

Yes the problem with this is that when you  assigne an object a value it can be used both in terms of investment and  barter(money).

How we distinguish this and make it  implemented is to make people realize it is  a  better  option as a  transactory medium than investment.

I cant  fathom how this can be implemented in a code. 

I agree completely that this anyone calling this an investment product is making a scam statement.

but, most of text that you have posted, points back to the ideology rather than something that can be assured in code.

Have you read  the  forum post  in which  Satoshi Nakamoto , talks about the  Wikileaks acceptance of Bitcoin, he said  that  this  would not bee  good  he did not  want  a  sudden  world wide  interest in  bitcoin, and was  warning  against it. 

The reason he  was doing this  is that he  knew that sudden  acceptance  of  bitcoin  would , Firstly, it would raise  prices which  crates Bubbles, always.  Secondly, it would give  Authorities  very little  time to  understand the  concept and  mostly get it blocked.

The  problem China faced is that The  Investors got to it. Investing  in Bitcoin  in  such institutional manner  would always  be  bad.  China  has alot  of   Bitcoin  Vendors, sellers and  service provider, it  was not  in proportional manner to the investors and service providers.

I  blame the  Investor  factor  to this fall. the Tulip madness was true  in case of  china. Now  that the Chinese  government  has asked banks to  stop working  with bitcoin  companies . the  only option  the bitcoin  companies  have is  a  Face to face  exchange. or a  distributed  network  to  collect  cash but that would  cost  to much. Right now  bitcoin is  not  so strong  that it  can  survive  without  a  banking  facility . it needs the  existing  banking  infrastructure  to   grow. Now,  the  only  bitcoiners  that  will be there in china  are  the  hobby based bitcoiners, bitcoin miners, the mining  companies, and  a few    goods and  service providers. in a way  is  a  good thing bitcoins  would  go back to the  tech  guys again.

For  China  i  say this  was a  Good  thing  that happened  to them,  this came about  when  china  now  has  a  lot  of bitcoin and  litecoin already in  the  country. It  will give rise  to  innovative  solutions  and workarrounds that  we  need in a  case  of  a non -banking  environment. Atleast  it  will be  a  good  Test  environment.

What i Caution India with is that, not  to hype  Bitcoin  as a  investment  tool. this hype  will  create  a  much unneeded bubble. Investors in the  currency  is not  a  requirement, Bitcoin is a  currency  system it  was  designed to  be  used  as  such it needs to  be conveyed  that Bitcoin  is  a  currency not a  investment  tool. we need to  first  start  having  some  online stores and  merchants  start  using   bitcoin.  keep the  press  away  from  blowing  this  out  of   proportion, and have  more  technically sound  people  involved in  the  bitcoin  community, in  building  a   community  that can help  things  grow.  This is an opensource  project  the  concept of an opensource  project is  user freedom and  public collaborations, the community  needs to   be  more  involved in helping  others and  working  together  in  building  ideas. Business type of  things are  good. But right now, at this  point is where a community is needed, not  business cutthroat competition, and giving  luster shine  information to  gullible people(face it  there are alot of   idiots  out there). Business  cutthroat  involvement  can  come  later  after  2-3 years. India  is at a stage then  when bitcoin  were  first released when the  community  was the  one  supporting  the project  the  ones  who contributed  to  open ideas and  collaboration  were the  ones,  that  was  able to  help bitcoin come  to the  point  it is at now. It needs it  community  to  work  together first.


Not really  we  need is  a  exchange  that can  be  viable  in  a   banking  blockade type situation, pick points  and  third  party  payment  processors, an exchange  can  use. and in  the goods and  services part  we  dont  actually need the   physical  shops  any more  it only  needs   a  good  amount  of online traders and  service  providers working on it.

Bitcoin Exchanges/ brick and mortar end points will always be the weakest link in the eco-system. We just got a full HD demo from China today.
While, these moves cannot damage Bitcoin much, by design, Bitcoin was meant to be more of a F2F kinda commodity.

How can these F2F transactions be tracked and how can they influence/ set the market prices?

Anyone who has been working on something like this and would like to exchange some notes would be awesome.