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Topic: Bitcoin: The Digital Kill Switch - page 12. (Read 55236 times)

hero member
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April 02, 2013, 06:04:43 PM
Quote
I am thinking we really don't need the miners to process transactions. We only need them to create new coins and to keep a copy of the transactions that occurred independently of the P2P database.
You do realize exactly what the miners do, right?  They are not just out there playing the lotto.  They are performing vital duties with respect to verifying and validating the block chain.  That is what we are paying them for.


Yes of course. I am just thinking whether we can minimize what we need them for. I will need to think more deeply first, and then write it down more technically. I am not sure if what I wrote in the prior post will work. It was just off the top of my head.

My thought == we really only need the SINGLE block chain for the creation of coins.  After that, the BILLIONS of private key chains are sufficient independently. Tada!  I will explain more once I have thought it out more to make sure my initial intuition is correct.

Think of it like this, the creation of coins has to be agreed by everyone. The transfer of money only has to be agreed between payer and recipient. Just need a localized method of preventing double-spend instead of globalized, which I already offered.

The issue with this revolves around global time. I need to think about this more.

Okay I solved the key technical problem of consistent global time. This is simply a hash of each block in the chain. Each hash is a marker of relative global time. Really it doesn't need to be a hash, since the blocks will no longer contain transactions. It could just be any deterministic forward infinite series of numbers. Recursive hashes as a choice, adds a cost to targeting too far in the future.

(Side note, global hash time will be known before it happens, i.e. hash of prior hash is deterministically known a priori, so payers can send transactions that occur at known times in the future  Shocked)

So thus we don't need the mining peers to bundle the transactions into a block, in order to get collective agreement on when a transaction occurred. Instead, the payer need only include such a global hash in the payment sent, and then peers can independently save these, thus all peers agree on the "global hash time" the payment was sent.

If the payer sends a double-spend, the peers which have saved the prior conflicting spend will detect this, and we can choose our design whether to either ignore the double-spend or penalize it by confiscating the funds into the ether (lost forever). As I wrote earlier, we can have options for recipients to declare reserves so that payer has incentive not to attempt double-spend, as the reserve would be confiscated to the ether forever.

A double-spend can be achieved by getting peers to disagree about which transaction was sent first (due to network propagation order), if they are both marked with the same "global hash time". But I propose to penalize peers which refuse to mirror all transactions (exact mechanism described later), thus all peers will know there was double-spend. Again I propose the recipient can choose between waiting for sufficient time to be sure a double-spend is nearly impossible, or to attach a forfeitable reserve to insure the recipient will honor the transaction instantly.

The recipient will need to judge for himself (this will be a technology added on by third parties) what the risk factors are, e.g. if recipient can poll a significant proportion of the network for double-spend, then more probabilistic certainty sooner that the double-spend was not sent to any peer. The alternative is the forfeitable reserve optionally set by the recipient, which is unlocked from escrow back to the payer by the peers after the prescribed "global hash time" has been reached.

So therefor the block chain is no longer a block of transactions, but rather the collective agreement of the forward movement of time, and for doing this the mining peers are awarded new coins. Thus the 51% attack does not exist (or say it isn't a hard line in the sand between functioning and non-functioning system). And cartelization of the mining peers gains nothing except most of the new coins, which is only say 2.5% of per year of the money supply. Note the cartel could still make mining unprofitable by putting enough resources to bear that other miners did not get sufficient ROI for their contributed resources. Restoring debasement does not entirely eliminate the threat of monopolizing mining; rather only diminishes it (requires the cartel to need many more multiples of subsidy than otherwise).

Even if they have 99% the miners, they won't be able to block transactions entirely, and with the penalty for not mirroring transactions, the good peers will be evident to us. We can easily see who is doing mischief and route our transactions through peers we trust. In other words, the community has voting power over which peers to sort of ignore in real-time, without needing a fork. The most the bastards can do is get 2.5% per year.

Possibly we won't be keeping a history of transactions any more (although a peer could record this history), only the latest state of which public key owns which coins. I think we need the history to prevent rewriting history of who owns the money.

In theory, I've posit that I fixed the design of everything major that is wrong with Bitcoin (note my prior posts about improving anonymity).

P.S. The key flaw in my proposed hard-disk-space Proof-of-Work is how do we control the rate at which "block time" progresses? Even if all peers see that block time is going too fast, there is no mechanism to slow it down, since peers act selfishly to send their claim on the next block asap. So I may have to revert to CPU Proof-of-Work. Still thinking on this. Possibly we can require hard-disk work along with scrypt CPU work. Another solution is that if peers see block time is running too fast (outside the latency of network propagation), they can just refuse to accept new block time transmissions for a while. This would not stop transactions from processing. I think this might work.

Satoshi get off my lawn!
legendary
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April 02, 2013, 06:03:00 PM
Demurrage (Freigeld/Freicoin) and Inflation (debasement) have similar effect, but demurrage is better.

Workers would not have to renegotiate their salaries anew all the time.

The best would be if inflation rate could be tied to the GDP. But that's not so easily possible unless we can and want a totally computerized P2P economy.

But I believe since crypto-currencies are non-monopolistic, unregulated (free) currencies, the economic textbooks of yore don't apply anymore.

We'd have a rich eco-system of monetary and exchange systems.

In a truely freed market, that means also in a free currency market, there is no such thing as an inflationary currency or a deflationary currency.

Because there is no currency that will be regulated top-down. We're largely only familiar to planned monetary systems.

In actuality, the differences between currency, commodity, and asset would dissolve.

Once the demand for bitcoins has largely satisfied, they will have to compete with any other asset out there.

They will stop acting in a deflationary way when there are better stocks to invest in. People will put their money there then.
hero member
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April 02, 2013, 05:46:06 PM
...

I think your idea of distributing seigniorage proportionally to capital is flawed because capital can be gathered through corrosive means. A good way of gaining capital is not nessesarily a good or stable mechanism for society. So i dont think capital alone is a good indicatior for how usefull an entity is to society and should not be a base for any reward from society. The capital alone and the power it brings should be enough and is probably already too much.
You see, people have weaknesses that can be easily abused.
Imagine a pharmacorp that invents a medicine that hooks everyone. You don't have to buy it, but if you do you're prety much hooked for life. They can build up capital pretty effectvely from all the junkies they created. A whole industry can be created around the use of this substance. Even better, the junkies will do the hard part of the actuall robbing of society. Meanwhile the pharmacorp cashes in on the junkies. It's a booming business.

...

That has already happened with alcohol and tobacco, and arguably with caffeine and processed sugar/high fructose corn syrup.

Exactly. But i can see much more serious applications of science.
Aint no debasement gonna help against that.
I mean, how long will it be before a croporation can grow their own genetically modified slave race?
How long before your job is replaced by an AI?

hero member
Activity: 518
Merit: 521
April 02, 2013, 05:25:34 PM
...

You see, people have weaknesses that can be easily abused.
Imagine a pharmacorp that invents a medicine that hooks everyone. You don't have to buy it, but if you do you're prety much hooked for life. They can build up capital pretty effectvely from all the junkies they created. A whole industry can be created around the use of this substance. Even better, the junkies will do the hard part of the actuall robbing of society. Meanwhile the pharmacorp cashes in on the junkies. It's a booming business.

...

That has already happened with alcohol and tobacco, and arguably with caffeine and processed sugar/high fructose corn syrup.

I agree with the above quoted portions. We must not give control of the capital to noobs in a way that they can be manipulated to corrupt the system.

The key to preventing the following quote, is to remove the ability of the collective to tax, confiscate, and abuse money so as to minimize their control over media and other means by which they can aggregate capital against humanity.

Also in my design for DURACASH, the debasement is only say 2.5% per year, so corrosive capital can't take more than 2.5% per year. Humanity's bursts of innovation and knowledge increases trump that 2.5%.

The cartel will be destoyed with DURACASH. I am perfecting the design which detaches the 51% attack from processing. The most they can steal is the 2.5% and even then it is a competitive race of capital, including the innovators who can aggregate capital at exponential rates, e.g. Google, Bitcoin creators, etc..

...

I think your idea of distributing seigniorage proportionally to capital is flawed because capital can be gathered through corrosive means. A good way of gaining capital is not nessesarily a good or stable mechanism for society. So i dont think capital alone is a good indicatior for how usefull an entity is to society and should not be a base for any reward from society. The capital alone and the power it brings should be enough and is probably already too much.

...
hero member
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Firstbits.com/1fg4i :)
April 02, 2013, 04:14:05 PM
...

I think your idea of distributing seigniorage proportionally to capital is flawed because capital can be gathered through corrosive means. A good way of gaining capital is not nessesarily a good or stable mechanism for society. So i dont think capital alone is a good indicatior for how usefull an entity is to society and should not be a base for any reward from society. The capital alone and the power it brings should be enough and is probably already too much.
You see, people have weaknesses that can be easily abused.
Imagine a pharmacorp that invents a medicine that hooks everyone. You don't have to buy it, but if you do you're prety much hooked for life. They can build up capital pretty effectvely from all the junkies they created. A whole industry can be created around the use of this substance. Even better, the junkies will do the hard part of the actuall robbing of society. Meanwhile the pharmacorp cashes in on the junkies. It's a booming business.

...

That has already happened with alcohol and tobacco, and arguably with caffeine and processed sugar/high fructose corn syrup.
hero member
Activity: 518
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April 02, 2013, 04:04:44 PM
2. Karl asserts Seniorage is not a get-rich proposition (early adopters profiting), rather a responsibility to withdraw it when the economy is contracting, else the state can withdraw it, because society will demand it. I don't agree with this assertion that the government should increase the value of money during production contraction (so as to avoid rising prices) by removing currency. Let the market solve this, those what have capital can invest in production. I think seniorage should be distributed proportional to those who have the most capital, because they have demonstrated they know how to invest and increase production, but they shouldn't collect an interest for loaning and simultaneously receive the seniorage-- they have to choose (mining or loaning or investment in other production).


I think your idea of distributing seigniorage proportionally to capital is flawed because capital can be gathered through corrosive means. A good way of gaining capital is not nessesarily a good or stable mechanism for society. So i dont think capital alone is a good indicatior for how usefull an entity is to society and should not be a base for any reward from society. The capital alone and the power it brings should be enough and is probably already too much.

And Bitcoin's distribution of the world's future money supply to early adopters is superior? As if those early adopters who knew how to mine were more important to society than everything else going on in the world.  Roll Eyes

Rather we should reward early-adopters, but also debase them at a very slow 2.5% per annum over the long-term, so they can't hold the world enslaved just for one correct opportunity cost decision they made 100 to 1000 years before.

I just feel there must be a better way to assess usefullness to society than capital alone.

And precisely what would that metric be?

I am offering hard-disk space, so at least it is capital that most people already have to contribute, so we don't waste pre-existing and well distributed capital.




1. Karl asserts Bitcoin's future money supply is asymptotically ZERO (0). I agree:

May be, but you'll have to be pretty ingenious to lose 2x10^15 satoshi.

You missed the point. Over time coins are lost, that is unarguable. Thus at some point in the distant future, there will be 0 coins. That is unarguable. It might take a 50 years or a million years (we can't know because we can't differentiate hoarding from lost so we don't know the rate), but the statement "asymptotically ZERO" is mathematically unarguable.

Not knowing the rate of loss is very dangerous for adopting a currency. Bitcoin has no mechanism of debasement to counteract it.
hero member
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April 02, 2013, 03:48:57 PM

4. Karl asserts digital currencies are not stateless, and users doing acts of evasion will suffer (including not reporting capital gains on all transactions). I agree this is coming later, if the government can trace your transactions.

The beauty of this is that all the money stream constructions of multinationals that are now used to evade taxes can be traced down.

[...]

Having everything proven in the blockchain will reveal these money streams and alow us to act on them.
This mechanism of proof wil be an enourmous tool for society for keeping large institutions in check.

No it will be used asymmetrically against the citizens because the government is already asserting its asymmetric power:

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397607

(read the 4 posts by JustSaying (me) forward from the above linked one)

Don't miss the conclusion of that discussion:

http://esr.ibiblio.org/?p=4867&cpage=1#comment-397620



5. Karl points out that Bitcoin's transactions are slow. I agree this needs to be fixed.

This can be fixed in society just as 'easily' as in bitcoin. The root of this problem is trust.
Bitcoin sidesteps trust by using a cryprographic rigor. But i can easily see that you can open an account with your gas provider that alows you to get a certain amount of gas without the immediate need to prove you will pay for it.
In fact, i have such a relation with my power company. I pay a steady amount per time unit for my power and once in a while the actual meter is checked and everything is recalculated on basis of that measurement. In the end it becomes a steady economic stream which is good as everyone knows what to expect of the (near) future.

I have already presented a technical fix for DURACASH which enables instant insured transactions and avoids all the meta-trust overhead noise that you say Bitcoin needs. Tada! Wink
hero member
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April 02, 2013, 10:03:13 AM

1. Karl asserts Bitcoin's future money supply is asymptotically ZERO (0). I agree:

Quote
Bitcoin exhibits irreversible entropy.  A coin that is "lost", that is, which the current possessor loses control over either by physically losing their wallet or the key to it, can never be recovered.

[...]

It certainly is something that those who tout the currency think is good for the value of what they hold, but the irreversible loss of value can also easily lead people to abandon the use of the currency in which case its utility value to express goods and service preference is damaged, quite-possibly to the point of revulsion.

This is not true, incidentally, for something like a gold coin.  The coin can be lost or stolen but unless it's lost over the side of a boat at irretrievable depth it can be recovered and the person who recovers it can spend it.  What constitutes "irretrievable depth" has a great deal to do with exactly how many coins might be there too


May be, but you'll have to be pretty ingenious to lose 2x10^15 satoshi.
hero member
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April 02, 2013, 09:58:30 AM
hero member
Activity: 840
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April 02, 2013, 08:24:09 AM

3. Karl asserts currency should appreciate relative to productivity increases, but be constant otherwise. I think it an impossible goal because it is impossible to measure the price level in an economy because goods & services change. Also I don't think old capital should be rewarded for being idle forever, thus a small debasement encourages capital to not become too stale. Gold's 2.5% may be a good balance.

Quote
Time preference is the ability to choose to perform a service or sell a good now but obtain and consume the other part of the transaction for yourself later.  With a perfect currency time preference has no finger on the scale; that is, the currency neither appreciates or depreciates over time against a reasonably-constant basket of goods and services.  Since technological advancement tends to make it easier to produce "things" in real terms, a perfect currency reflects this and makes time preference inherently valuable.  This in turn forces the producers of goods and services to innovate in order to attract your economic surplus from under the mattress and into their cash registers, since not spending your economic surplus is in fact to your advantage.  Today's fiat currencies intentionally violate the natural time preference of increasing productivity, but even yesterday's metallic standards did a poor job of representing it.  The problem here is the State, which always seeks (like most people) to get something for nothing and what it winds up doing instead (since getting something for nothing is impossible) is effectively stealing.


Debasement certainly is a usefull tool for preventing the hogging capital.
But i feel it should scale with the power the capital represents in society.
So it should be increasingly hard to hoard more capital and should be basically free of debasement for low ammounts.

But this is a pretty pointless discussion because multinationals (the corporations ruling the world and causing most of these problems) just evade the whole thing by parking their profits in countries where such laws do not apply.
Ever noticed how some movies don't make a profit despite breaking all box office records?
The truth is they did make a very good profit, they just dont want to pay back society for creating this opprtunity for them.
So they move their profits to some bank through a construction and -poof- it's gone.

At the moment debasement only serves to keep everyone else out of the supranational playgrounds of the multinationals. It doesn't touch them.
So your idea would actually hurt society in general while not addressing the point that the problem that caused you to think of debasement as a solution has gone way out of hand already.
We need something completely different to even get started on retreiving all this value from these entities.


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April 02, 2013, 08:12:31 AM


5. Karl points out that Bitcoin's transactions are slow. I agree this needs to be fixed.

Quote
Cryptocurrencies have a secondary problem in that because they are not self-validating there is a time delay between your proposed transaction using a given token and when you can know that the token is valid.  Bitcoin typically takes a few minutes (about 10) to gain reasonable certainty that a given token is good, but quite a bit longer (an hour or so) to know with reasonable certainty that it is good.  That is, it is computationally reasonable to believe after 10 minutes or so that the chain integrity you are relying on is good.  It approaches computational impracticality after about an hour that the chain is invalid.

This is not a problem where ordering of a good or service and fulfillment is separated by a reasonable amount of time, but for "point of transaction" situations it is a very serious problem.  If you wish to fill up your tank with gasoline, for example, few people are going to be willing to wait for 10 minutes, say much less an hour, before being permitted to pump the gas -- or drive off with it.  This makes such a currency severely handicapped for general transaction use in an economy, and that in turn damages goods and service preference -- the ability to use it to exchange one good or service for another.  What's worse is that as the volume of transactions and the widespread acceptance rises so does the value of someone tampering with the block chain and as such the amount of time you must wait to be reasonably secure against that risk goes up rather than down.

This can be fixed in society just as 'easily' as in bitcoin. The root of this problem is trust.
Bitcoin sidesteps trust by using a cryprographic rigor. But i can easily see that you can open an account with your gas provider that alows you to get a certain amount of gas without the immediate need to prove you will pay for it.
In fact, i have such a relation with my power company. I pay a steady amount per time unit for my power and once in a while the actual meter is checked and everything is recalculated on basis of that measurement. In the end it becomes a steady economic stream which is good as everyone knows what to expect of the (near) future.
Once bitcoin becomes so big that this realy starts to form a major problem you will find that there are many reasonable ways to fix these types of trust problems. Usually the transactions that require speed are the ones that transfer the least value.
I can even imagine a currency coming into existance to fill in this gap and act as the currency part for bitcoin. This coin would have a smaller blockchain and have a shorter acknowledge time from the network. And this would be justified because the value contents of individual transactions will be low.

For large transactions i would argue that speed is actually a bad thing.
Notice what happened when computers were alowed to fight over price at incredible speed with lots of capital. Speed is a destabilizing factor on those scales so it's actually better to have some energetic cost to transactions on these levels so they can change only slowly and only out of deliberation and not just in panic.
hero member
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April 02, 2013, 07:56:36 AM

4. Karl asserts digital currencies are not stateless, and users doing acts of evasion will suffer (including not reporting capital gains on all transactions). I agree this is coming later, if the government can trace your transactions.

Quote
Those who are using Bitcoin as a means to try to foil currency controls or state prohibitions on certain transactions are asking for a criminal indictment not only for the original evasion act itself but also the possibility of a money-laundering indictment on top of it, and the proof necessary to hang you in a court of law is inherently present in the design of the currency system!

Here the fundamental problem of wide acceptance comes into view.  This is the problem that the proponents of the system are most-able to address through various promotional activities.  Unfortunately it also leads to deception -- either by omission or commission -- of the flaw just discussed.  To the extent that the popularity of the currency is driven by a desire to "escape" state control promotion of that currency on those grounds when in fact you are more likely to get caught (and irrefutably so!) than using conventional banknotes is an active fraud perpetrated upon those who are insufficiently aware of how a cryptocurrency works.


The beauty of this is that all the money stream constructions of multinationals that are now used to evade taxes can be traced down.
I hope you understand that multinationals are taking money out of the economy constantly and stack that in banks of countries where they pay no taxes to society. They have removed 9/10 of the world currency but are unable to use it because that would mean they have to pay taxes. Meanwhile, on paper, they have a bad time and need to be saved.
The reason the US issues more dollars to be printed is because dollars are disapearing from society. The only way to maintain some sort of fluidity is to throw in money on the other side from where they are taken out.
Our world economy is powered by money put in by society on one end and taken out by corporations on the other.

Having everything proven in the blockchain will reveal these money streams and alow us to act on them.
This mechanism of proof wil be an enourmous tool for society for keeping large institutions in check.
hero member
Activity: 518
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April 02, 2013, 02:26:41 AM
http://market-ticker.org/akcs-www?post=219284

1. Karl asserts Bitcoin's future money supply is asymptotically ZERO (0). I agree:

Quote
Bitcoin exhibits irreversible entropy.  A coin that is "lost", that is, which the current possessor loses control over either by physically losing their wallet or the key to it, can never be recovered.

[...]

It certainly is something that those who tout the currency think is good for the value of what they hold, but the irreversible loss of value can also easily lead people to abandon the use of the currency in which case its utility value to express goods and service preference is damaged, quite-possibly to the point of revulsion.

This is not true, incidentally, for something like a gold coin.  The coin can be lost or stolen but unless it's lost over the side of a boat at irretrievable depth it can be recovered and the person who recovers it can spend it.  What constitutes "irretrievable depth" has a great deal to do with exactly how many coins might be there too

2. Karl asserts Seniorage is not a get-rich proposition (early adopters profiting), rather a responsibility to withdraw it when the economy is contracting, else the state can withdraw it, because society will demand it. I don't agree with this assertion that the government should increase the value of money during production contraction (so as to avoid rising prices) by removing currency. Let the market solve this, those what have capital can invest in production. I think seniorage should be distributed proportional to those who have the most capital, because they have demonstrated they know how to invest and increase production, but they shouldn't collect an interest for loaning and simultaneously receive the seniorage-- they have to choose (mining or loaning or investment in other production).

Quote
I mentioned above about fiat currencies being able to be issued and withdrawn.  There is often much hay made about the principle of seigniorage, which is the term for the "from thin air" creation of value that a state actor obtains in creating tokens of money.  Seigniorage is simply the difference in represented value between the cost of emitting the token (in the case of paper money, the paper, security features and ink) and the "value" represented in the market.  There is much outrage directed at the premise of fiat currency in this regard but nearly all of it is misplaced because people do not understand that in a just and proper currency system the benefit of seigniorage comes with the responsibility for it as well, and it is supposed to be bi-directional.

That is, in order for time preference to be neutrally expressed, less the natural deflationary tendency from productivity improvement, the government entity issuing currency gets the benefit of seigniorage when the economy is expanding.  But -- during times of economic contraction they also get the duty to withdraw currency (or credit) so as to maintain the same balance, as otherwise the consequence is inflation -- that is, a generalized rise in the price level and the destruction of the common person's purchasing power.

That this is honored in the breach rather than the observance does not change how these functions are supposed to work, any more than the fact that we have bank robbers means we shouldn't have banks.  This, fundamentally, is why currency schemes like Bitcoin will never replace a properly functioning national currency and are always at risk of becoming worthless without warning should such a currency system arise, even ignoring the potential for legal (or extra-legal) attack.

Simply put there is no obligation to go along with the privilege that the originators of a crypto-currency scheme have left for themselves -- the ability to profit without effort by the future efforts of others who engage in the mining of coins.

3. Karl asserts currency should appreciate relative to productivity increases, but be constant otherwise. I think it an impossible goal because it is impossible to measure the price level in an economy because goods & services change. Also I don't think old capital should be rewarded for being idle forever, thus a small debasement encourages capital to not become too stale. Gold's 2.5% may be a good balance.

Quote
Time preference is the ability to choose to perform a service or sell a good now but obtain and consume the other part of the transaction for yourself later.  With a perfect currency time preference has no finger on the scale; that is, the currency neither appreciates or depreciates over time against a reasonably-constant basket of goods and services.  Since technological advancement tends to make it easier to produce "things" in real terms, a perfect currency reflects this and makes time preference inherently valuable.  This in turn forces the producers of goods and services to innovate in order to attract your economic surplus from under the mattress and into their cash registers, since not spending your economic surplus is in fact to your advantage.  Today's fiat currencies intentionally violate the natural time preference of increasing productivity, but even yesterday's metallic standards did a poor job of representing it.  The problem here is the State, which always seeks (like most people) to get something for nothing and what it winds up doing instead (since getting something for nothing is impossible) is effectively stealing.

4. Karl asserts digital currencies are not stateless, and users doing acts of evasion will suffer (including not reporting capital gains on all transactions). I agree this is coming later, if the government can trace your transactions.

Quote
Those who are using Bitcoin as a means to try to foil currency controls or state prohibitions on certain transactions are asking for a criminal indictment not only for the original evasion act itself but also the possibility of a money-laundering indictment on top of it, and the proof necessary to hang you in a court of law is inherently present in the design of the currency system!

Here the fundamental problem of wide acceptance comes into view.  This is the problem that the proponents of the system are most-able to address through various promotional activities.  Unfortunately it also leads to deception -- either by omission or commission -- of the flaw just discussed.  To the extent that the popularity of the currency is driven by a desire to "escape" state control promotion of that currency on those grounds when in fact you are more likely to get caught (and irrefutably so!) than using conventional banknotes is an active fraud perpetrated upon those who are insufficiently aware of how a cryptocurrency works.

5. Karl points out that Bitcoin's transactions are slow. I agree this needs to be fixed.

Quote
Cryptocurrencies have a secondary problem in that because they are not self-validating there is a time delay between your proposed transaction using a given token and when you can know that the token is valid.  Bitcoin typically takes a few minutes (about 10) to gain reasonable certainty that a given token is good, but quite a bit longer (an hour or so) to know with reasonable certainty that it is good.  That is, it is computationally reasonable to believe after 10 minutes or so that the chain integrity you are relying on is good.  It approaches computational impracticality after about an hour that the chain is invalid.

This is not a problem where ordering of a good or service and fulfillment is separated by a reasonable amount of time, but for "point of transaction" situations it is a very serious problem.  If you wish to fill up your tank with gasoline, for example, few people are going to be willing to wait for 10 minutes, say much less an hour, before being permitted to pump the gas -- or drive off with it.  This makes such a currency severely handicapped for general transaction use in an economy, and that in turn damages goods and service preference -- the ability to use it to exchange one good or service for another.  What's worse is that as the volume of transactions and the widespread acceptance rises so does the value of someone tampering with the block chain and as such the amount of time you must wait to be reasonably secure against that risk goes up rather than down.
hero member
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April 01, 2013, 10:10:24 PM
Quote
I am thinking we really don't need the miners to process transactions. We only need them to create new coins and to keep a copy of the transactions that occurred independently of the P2P database.
You do realize exactly what the miners do, right?  They are not just out there playing the lotto.  They are performing vital duties with respect to verifying and validating the block chain.  That is what we are paying them for.


Yes of course. I am just thinking whether we can minimize what we need them for. I will need to think more deeply first, and then write it down more technically. I am not sure if what I wrote in the prior post will work. It was just off the top of my head.

My thought == we really only need the SINGLE block chain for the creation of coins.  After that, the BILLIONS of private key chains are sufficient independently. Tada!  I will explain more once I have thought it out more to make sure my initial intuition is correct.

Think of it like this, the creation of coins has to be agreed by everyone. The transfer of money only has to be agreed between payer and recipient. Just need a localized method of preventing double-spend instead of globalized, which I already offered.

The issue with this revolves around global time. I need to think about this more.
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Merit: 521
April 01, 2013, 09:40:52 PM
There are 2000+ reads on this thread, perhaps because for example maxkeiser has linked to this thread via David Morgan's copy of my article:

http://maxkeiser.com/2013/04/02/ag-fredericks-on-bitcoin/

(see bottom, right of page)

I am still working on getting this information out to more people who might be willing to publish it even more widely.

Ron Paul's strategy was to spread information, so at least I am doing that. Let's see if I can also spread a better implementation.

I've got 2000 reads on the marketoracle copy of the article already (2.5 days) and those readers are not finding this thread,  because it wasn't linked. My past articles have gotten up to 25,000 readers over time.

You simply can't stop me from getting the information out there, no matter how much you might filibuster (troll) this thread with your nonsense theories about "tinfoil hats and ufos". Rational people are not interested in such nonsense. We are more interested in facts, such as how corrupt the kangaroo courts are:

http://armstrongeconomics.com/2013/03/31/so-what-part-of-ny-courts-r-corrupt-you-did-not-understand/

And what part of "torture repeats throughout history" do you not understand:

http://armstrongeconomics.com/2013/04/01/euro-capital-flight-begins/
hero member
Activity: 518
Merit: 521
April 01, 2013, 08:51:48 PM
Powerful people always form cartels, there's no "might do" about it. This is simply because it's always more profitable (in the long run) for small groups to work together against the public than to compete. Long term planning always wins over the burst benefits of the short term.

I see no way the wealth vector from the old system wouldn't be able to flood into a mining system (as in if one machine can do a thing, a million machines can do a thing a million times.) It would be good to be able to construct a cryptocurrency that does not rely on mining in this way. Something where value is generated corresponding to real physical value (like human work or a product.) But then you lose the ability to entice people into the currency by playing off greed (like bitcoin,) making it extremely hard to implement.

To truly tackle this beast with a currency you would need to get at all three pillars of empire. Coinage, for sure, but also the courts (international, national) and religion (media and education.) To attempt to topple the tower by attacking just one pillar would be possible, but it has increased difficulty because the other fundaments stand ready to compensate and flood in. It must be designed so that it can stand up to this. The solution whatever it is must be holistic, outlaw-friendly and jihad-proof.

Jubalong,

You are spot on. I am impressed by your intellect, it would be my pleasure to know you more.

I am contemplating a solution to the 51% attack.

I am thinking we really don't need the miners to process transactions. We only need them to create new coins and to keep a copy of the transactions that occurred independently of the P2P database.

My idea which would also make transactions instantaneous, is that benefactor of a payment will stipulate how much reserve the payer has to attach to the payment. This reverse is returned to the payer after some time, when we are sure the payment has propagated into the P2P database. If the payer submits multiple spends within that time window, he forfeits everything including the reserve amount.

Perhaps that could be an optional mode perhaps, with the current single block chain as an alternative for those who don't want the option above.

Since only the payer's private key can create a duplicate spend, no malicious miner can do this.

Thus if 51% refuse to record the transaction, the other 49% do record the transaction. No harm done.

When the benefactor polls the database to see if a payer's balance is correct, any miner can respond.

The 51% is only need to determine who created the coins. From there, it is the private key that determines where the funds went to.

So as you said, keep the greed part for creating coins and get rid of the 51% attack on processing. We were thinking along the same lines, and I just hadn't written down (collected/assimilated) the thoughts I been having since yesterday.

The fact that Satoshi did not design the system this way (along with all the other weirdness, even the developers said he disappeared when they pushed to know his identity), is another reason I am Occam's Razor that he was working for the cartels. But whether this is true or not, isn't really worth arguing over and my thesis does not depend on it.

I need to think more if this is a viable design. This was just off the top of my head.

I am liking my choice of a name more and more, seems perfect:

DURACASH

If the 51% goes berserk and creates coins faster than the prescribed rate, then (some of) the benefactors will stop honoring those later coins. So they defeat themselves.
hero member
Activity: 840
Merit: 1000
April 01, 2013, 08:50:53 PM
I think people here may be a bit madder and overexcited than I imagined.
Nah, the usual folks on this forum don't burn through tin foil hats like this guy does.

Are you still embarrassed for accusing me of FUD and being ignorant of the facts? Play your slimeball troll politics (devoid of any technical facts) in a non-technical arena please. We are trying to get some serious work done here. Go throw sand in another sand box please. I won't go pesker you there.

Please don't tell me I am going to continually ward off of these posts that are devoid of facts attempting to obfuscate/filibuster the technical discussion? Are we doing open source here, or a spit ball contest?

PLEASE DON'T FORCE ME TO LOCK THE TOPIC.

Because I have work to do, and I can't be here constantly looking to see if you are being unethical again.
LOL., at least you're entertaining.
I've seen the threads you have started recently.
Funny stuff.

hero member
Activity: 518
Merit: 521
April 01, 2013, 08:50:47 PM
Powerful people always form cartels, there's no "might do" about it. This is simply because it's always more profitable (in the long run) for small groups to work together against the public than to compete. Long term planning always wins over the burst benefits of the short term.

I see no way the wealth vector from the old system wouldn't be able to flood into a mining system (as in if one machine can do a thing, a million machines can do a thing a million times.) It would be good to be able to construct a cryptocurrency that does not rely on mining in this way. Something where value is generated corresponding to real physical value (like human work or a product.) But then you lose the ability to entice people into the currency by playing off greed (like bitcoin,) making it extremely hard to implement.

To truly tackle this beast with a currency you would need to get at all three pillars of empire. Coinage, for sure, but also the courts (international, national) and religion (media and education.) To attempt to topple the tower by attacking just one pillar would be possible, but it has increased difficulty because the other fundaments stand ready to compensate and flood in. It must be designed so that it can stand up to this. The solution whatever it is must be holistic, outlaw-friendly and jihad-proof.

Jubalong,

You are spot on. I am impressed by your intellect, it would be my pleasure to know you more.

I am contemplating a solution to the 51% attack.

I am thinking we really don't need the miners to process transactions. We only need them to create new coins and to keep a copy of the transactions that occurred independently of the P2P database.

My idea which would also make transactions instantaneous, is that benefactor of a payment will stipulate how much reserve the payer has to attach to the payment. This reverse is returned to the payer after some time, when we are sure the payment has propagated into the P2P database. If the payer submits multiple spends within that time window, he forfeits everything including the reserve amount.

Perhaps that could be an optional mode perhaps, with the current single block chain as an alternative for those who don't want the option above.

Since only the payer's private key can create a duplicate spend, no malicious miner can do this.

Thus if 51% refuse to record the transaction, the other 49% do record the transaction. No harm done.

When the benefactor polls the database to see if a payer's balance is correct, any miner can respond.

The 51% is only need to determine who created the coins. From there, it is the private key that determines where the funds went to.

So as you said, keep the greed part for creating coins and get rid of the 51% attack on processing. We were thinking along the same lines, and I just hadn't written down (collected/assimilated) the thoughts I been having since yesterday.

The fact that Satoshi did not design the system this way (along with all the other weirdness, even the developers said he disappeared when they pushed to know his identity), is another reason I am Occam's Razor that he was working for the cartels. But whether this is true or not, isn't really worth arguing over and my thesis does not depend on it.

I need to think more if this is a viable design. This was just off the top of my head.

I am liking my choice of a name more and more, seems perfect:

DURACASH

If the 51% goes berserk and creates coins faster than the prescribed rate, then (some of) the benefactors will stop honoring those later coins. So they defeat themselves.
hero member
Activity: 518
Merit: 521
April 01, 2013, 08:12:34 PM
I think people here may be a bit madder and overexcited than I imagined.
Nah, the usual folks on this forum don't burn through tin foil hats like this guy does.

Are you still embarrassed for accusing me of FUD and being ignorant of the facts? Play your slimeball troll politics (devoid of any technical facts) in a non-technical arena please. We are trying to get some serious work done here. Go throw sand in another sand box please. I won't go pesker you there.

Please don't tell me I am going to continually ward off of these posts that are devoid of facts attempting to obfuscate/filibuster the technical discussion? Are we doing open source here, or a spit ball contest?

PLEASE DON'T FORCE ME TO LOCK THE TOPIC.

Because I have work to do, and I can't be here constantly looking to see if you are being unethical again.
hero member
Activity: 518
Merit: 521
April 01, 2013, 08:11:08 PM
The only required fix is to not stop making new coins.

Have you looked at Freicoin?

Yes I read the older discussion in the forum between the creator of Freicon and the person proposing Stablecoin. One uses demurrage which is basically a storage fee, and the other proposes a system-wide transaction fee. As I understand, both of these system varying the fees.

But I am not sure if they give those fees to the miners?

The system-wide transaction fee can be subverted, the cartel can send refund transactions.

If I remember correctly, the Freicon only charges demurrage on each transaction, so again it can be subverted.

So I am not sure if those systems address the cartelization attack vector.

Also Freicon's website is designed for PhD in economics, not for mass adoption.

Remember I created CoolPage drag+drop WYSIWYG web creation software for dummies in 1998 for Yahoo Geocities free hosting, Fortune City free hosting, etc. before friendster existed. I had a million users.

I create products for the mainstream. I know how to create user friendly products.

CoolPage.com has not been updated for 11 years. Sales just recently trickled to 0.

Something where value is generated corresponding to real physical value (like human work or a product.)

Have you looked at Ripple?

I am against money born as debt as the M0 base of the monetary system. What ever anyone wants to build on top with fractional reserve is fine, but it is not what I am working on.
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