Topic: "Failure to Understand Bitcoin Could Cost Investors Billions" (Bitcoin's flaws) - page 12. (Read 43254 times)

I wonder if the current system that we have for innovating in the cryptocurrency space is the most efficient if we are going to address the concerns the OP has about Bitcoin.  Instead of starting a new altcoin everytime their is an idea for a new feature it would be interesting to have an alt-coin evolve new features over time.  An alt-coin would be more able to do this than Bitcoin because the market cap would be lower and so would the overall risk of screwing it up.  It could be called EvoCoin.

https://bitcointalksearch.org/topic/m.5377702

https://bitcointalksearch.org/topic/m.5363483

https://bitcointalksearch.org/topic/m.5355485

To all those who say that anonymity will enable illegal activities, I remind them that so did cash. So should we eliminate physical cash and move to a state controlled digital currency in order to eliminate all crime? But my prior post about the DEEP STATE, shows that the criminals control the state! Ukraine is another evidence that all nation-states are corrupt. Come on Statistards, admit you are wrong!

I am pleased to see how the forum responded to the idiotic OP about "How do we prevent money laundering and assasinations?".

The bigger the cheese, the more mice who come to feed on it. If we put control of all the money in the hands of the state, the incentive is much larger for the criminals to go capture the state. This is why we have a DEEP STATE. There is no way to legislate or make a democracy that prevents this. You have to eliminate the cheese using a decentralized technology, so there is nothing for the criminals to go after.

Armstrong admits we need to eliminate taxation at the nation-state level, but he doesn't provide a way to accomplish that!

http://armstrongeconomics.com/2014/02/24/the-fourth-branch-deep-state-in-plaint-sight/


Readers must listen to Bill Moyer's interview about the DEEP STATE that has taken over the U.S.A. government.

In The Future of Cryptocurrency I posit that the existence of decentralized anonymous cryptocurrency is needed to protect weaker forms of non-anonymous cryptocurrency from government capture and centralization.

This post is to pre-empt those who are sending me private messages asking which projects do I recommend.

I like the conceptual directions that are exemplified in anoncoin, ethereum, memorycoin, but so far no one has put it all together in one. And IMO the economics design, algorithms, and some technical details of those 3 efforts are lacking.

Thus at this time, I can't recommend a project. I am hopeful that the right project will appear soon.

Ethereum is doing some important foundation experimentation on decentralized contracts. I think it is important to pay attention to that as well as the features I enumerated in the OP. I think everyone knows by now that I had been in contact with Charles Hoskinson about my altcoin efforts before and during when he decided to join Ethereum. My problem (especially as a U.S.A. citizen in an Obama+NSA world) is I don't want to be the known lead developer on a coin that builds the new economy that replaces the government to a large extent. So I am looking to play a side role and donate the algorithms I have developed at this point. Unfortunately I don't like the priorities at the Ethereum (and I have not shared my thoughts on this with them), so I've decided not to give them my algorithms at this time. I am observing first. I will not detail further as it would reveal strategy that I wish to keep secret. So please don't ask me. My suggestion is observe the market place of altcoins over 2014. Hopefully I will have passed on my algorithms to a capable project, and it is possible it could end up being Ethereum at some point. But I am not in any discussions with them at this time. They need to first prove their scripting design is the correct one. I don't like project development arguments. In that case, the market is quickly the decider.

Pentax, (I appreciate your points and) the problem is precisely that everyone is trying to work within the system. Thus there is no check & balance on the system. Have you forgotten the Boston Tea Party (which was about circumventing England's Tea Act and the colonists had fled England to circumvent the severe oppression there) from your high school U.S. History class or are you not from U.S.A. This freedom lead to the U.S.A. becoming the most productive economy in the world.

Today it is very difficult to physically escape to a physical place where there will be no "financial repression" (term proposed recently by the IMF) because the G20 has laid out plans to cooperate to track down all wealth (with the NSA agreeing to provide the information, this is documented by a link in my Mad Max thread). The developing countries are dependent on the G20 and are implementing its edicts such as compliance with the FATCA law.

By implication you argue that the system can be braked by working within it to maintain some sanity, but you apparently ignore the Iron Law of Political Economics, which insures that the system will spend more than it can produce until it has destroyed all production. The only way to destroy all production is to kill the people. Thus megadeath is always the end game of unbraked governance a.k.a. socialism or collectivism. This is not just a philosophical ideology. It has happened over and over again throughout human history. It is science, because it is measured fact. Even God warns about it in the Bible and even the megadeath outcomes we've seen repeat throughout history, so obviously man knew about this phenomenon for over two millennia.

Some think that the $150 trillion in debt can be restructured (i.e. longer payout terms for the lenders and bond holders, some debt forgiven), but the problem with this is that it is essentially taking away money from the lenders thus there will be less lending and thus the global economy will implode. The amount of debt is simply too large to do a restructuring as the world did with the $billions of Latin American debt in the 1990s. If we instead take money (bail-ins, raising taxes) from the savers and producers (which is the currently announced plan of the IMF, Obama, Merkel, etc), then again the global economy will implode. But only the part of the global economy which requires capital, i.e. the industrial economy. The Knowledge Age doesn't require stored monetary capital.

This is why the governments had decided to borrow more and double the global debt from $75 trillion since 2008, because there is no way out.

What that additional borrowing did was delay the adjustment and pumped up the developing countries with dollar bonds debt. Thus now the developing countries are short the dollar (owe dollars) and thus we will see a massive dollar rally as the USA economy will boom as capital rushes out of the developing world into the dollar from 2014 to 2015.75. Then the strong dollar and loss of developing export markets will strangle the USA economy.

So what does the required (unavoidable) adjustment look like? All those whose incomes in some way derive from that ever expanding debt will become destitute. This basically means everyone except the high-tech workers who are forming the new Knowledge Age economy which is very profitable and doesn't depend on the debt (because the way to become more efficient as the debt implosion proceeds is to utilize more high-tech and remember the Knowledge Age doesn't require stored monetary capital).

Thus most all future profit will be earned in the high-tech economy. The industrial economy will die even more rapidly once the debt bubble stops growing (which is must because we've already saturated the developing world with debt,, e.g. the third-world country of the Philippines has 9 of the 38 largest shopping malls in the world and the 11th largest mall in the world at more than 100 football fields in size, but SM North Edsa is even larger!). For example, there is probably an order-of-magnitude of oversupply of industrial manufacturing capacity in Asia (mostly China). And the 3D printer will within 20 years render most of the factories useless.

The government will not be able to tax this high-tech economy. There won't be any physical location to go investigate or monitor. It will be very distributed, not large corporations rather dominated by small companies often of 1 individual. So the future will be the anonymous crypto-currency. This is where all the future economic activity will be.

As this accelerates, you will see the top-down G20 system implode with all pensions nationalized into worthless, healthcare systems that kill you, etc.. You will see people scamper to try to find a way to be part of this new decentralized economy. Approximately 50% of the global population will be unemployed. It is going to massive upheaval. But as we come out the other side by 2032, the world will be a much different place where the decentralized economy has won and taken over.

If not, we will be in a Dark Age with megadeath.

There is no other possibility due to the fact that the $150 trillion debt is not just some accounting ledger entry. Rather as I explained above, it is a reality of (the current vocations of) most people being not needed, i.e. uneconomic and not profitable. The accumulated size of the unprofitable vocations is $150 trillion. That is a huge 200 year high. We are headed for massive train wreck.

P.S. Here you can see why cpu-only mining clearly subverts the government.

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Disclaimer: I am not advocating any one do any illegal activities. My use of the word "circumvent" means avoid a law's applicability and/or jurisdiction, not commit a crime. I am not providing legal nor tax advice. I am not a professional adviser, please consult your own. I am merely sharing my thoughts and anything you do after reading my thoughts is your own responsibility.

Who decides when it has become problematic?  Then they institute control and become the thing they so despise. and so it goes.

all of this is theoretical.  I think it falls apart early on in that there is no way anything is simply going to circumvent the law.  Unless you're the current president of the US, of course, but that's another argument.

It dies in the crib if it is intentionally set up for government circumvention.  I just don't think it's practical to base an ideological argument for an eventuality such as an operational financial system in lieu of current fiat systems, on a foundation that is so critically flawed.  

The amount of time and effort put into circumventing would be better spent trying to work within the system.  We'll disagree, I know, but that is the only practical mechanism I see, while any attempt at circumvention that drifts outside the law, or espouses that in any way, is most likely wasted energy.

Contentionism posits that some top down control is needed to restrain anarchy. It also posits that all such top down control has a tendency to grow without restraint.
When top-down control becomes problematic (limits free discourse or prosperity) a counter-force is needed to circumvent the top down control.  

It is the existence of the counter-force that is important. It provides an outlet or escape hatch which acts as a soft restraint on the top-down controller. The top-down controller knows that if the authority is abused people with circumvent and undermine the control.

This is also why a truly anonymous decentralized currency is needed despite the fact that such a currency can be used to circumvent laws and be used for criminal behavior. Its very existence will act as a check on government and may allow for more efficient but less secure non-anonymous cryptocurrency to escape government capture. For the physical economy cryptocurrency can never be truly anonymous. Thus it will never be completely safe from a government gone insane. The ability of individuals to flee from government control acts as a needed sanity check and (hopefully) will keep the top-down controller from acting irrationally.      




 

Ha ha that is funny. I never expected to make the first page of Google when I started that thread.

From what I can tell from the article those forecasters have correctly identified the proximate cause of the coming Economic Devastation but have not yet seen past that to the more ultimate cause.  

As far as I am aware the insights of Contentionism are unique. Google has spent considerable effort developing algorithms to sort filter and identify unique content. Perhaps that is why it has made the first page.

  

 

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please repost without quoting
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Repost your reply without quoting my entire message. For one thing, I edited my message significantly since you quoted it.

Secondly, it is making the thread hard to read when you only write one sentence below my very long quote. No need to quote me, just kindly repost your one sentence reply.



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A reply of yours, quoted below, was deleted by the starter of a self-moderated topic. There are no rules of self-moderation, so this deletion cannot be appealed. Do not continue posting in this topic if the topic-starter has requested that you leave.

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You do realize that you are asking people to adhere to a narrow set of rules while running a self moderated thread proposing anarchy.  Quoting what one is replying to is pretty standard.

Anyway, no big deal.

We can agree to disagree on the basic fundamental arguments of the thread.  While the debate is interesting, and I don't totally disagree with you about some of this, I'm not going to be handed a rule card and asked to toe the line as you see fit, or have posts deleted if you don't like my formatting, of all things, so I'll thank you for some interesting debate and move on out of here.

This is the bifurcation mentioned upthread and Pentax is on the losing side where no finance survives.


I think people fail to comprehend that the $150 trillion debt, means $25,000 for every living human, including babies, elderly, and those billions who live in countries where the average person doesn't generate even $5000 income per year (not to mention basic needs such as food comprising a large portion of their income). When the IMF says this is a 200-year debt high, that doesn't seem to register in the mind of people can only think in terms of life in western nations during their and their parents lifetime.

The law and the system behind it is entirely bankrupt and it will be confiscating everything. Finances will not survive. Changing the law won't make it not bankrupt because the people are unable to accept a non-corrupt system because they themselves are already corrupted by the system as explained below.

Whether you like it or not, the only way to survive is anarchy. Peaking (collapsing) socialism will devolve to every man for himself either in total Mad Max chaos or in a decentralized trust system of organized anarchy, i.e. mutually agreeable rules for freedom that don't devolve into centralization (socialism).

You better pray I succeed in the latter outcome, otherwise there is only megadeath and destruction ahead.

CoinCube this genre of post is another evidence that socialism can't abort. You see my theories in action. The people can't comprehend that their system is bankrupt and that there is no possible top-down solution. Laws can't turn 60-year old people into 20-year expert computer programmers, biotech experts, nanotech experts, etc.. The socialism destroyed (appropriate to the Knowledge Age) education, reproduction, and has set up a massive failure. You've got a society with mostly the wrong skills, the wrong understanding of what is possible, etc.. Instead the people have been busy creating that $150 trillion global debt by learning and doing vocations that are useless in the coming Knowledge Age. This is what debt does. It misallocates human capital (lifespans) by allowing them to do uneconomic activities.


To see why the peaking socialism will tax itself into megadeath as it has repeatedly done throughout all human history since Mesopotamia...

Just look at the glossy eyes of the women in this Q&A debate on man-made, global warming (AGW). You can see they really believe (the "good salesman vs. bad salesman" Hegelian dialectic that has been programmed into their brains by TV and the state-school system) there are "carbon bullies" and totally fail to comprehend the truth.

And you can see practicaldreamer over there in the Anonymity thread, continuing to conflate orthogonal concepts.

and that's where we part ways.  nothing that circumvents the law, or makes any attempt to do so will survive.  period.

the answer is not to circumvent, the answer is to change the law or to see that the laws we want to protect bitcoin are passed.  to change the system, you have to work within it, like it or not.

we need lobbies and lawyers just like any other interest group if we want to do that, otherwise, you're right, this will be defanged, beaten down and ultimately destroyed.

Why The Only Solution is Technological

By the time you realize I am correct, you will be behind the others who realized earlier. Most people are still on the Titantic rearranging the deck chairs (see quote of Hoover). This is why the USA is actually booming until 2015.75, because capital is now fleeing into the USA from the emerging (peripheral) markets where the riots first manifest. But this ends up at the core reserve currency at the end game 2016ish. We can see how regulation appears to be a very loving and correct direction (listen to her charming speach). She is head of the IMF that is proposing 10% confiscation (termed "financial repression") of bank account balances across the EU to bring debt back to 2007 levels (i.e. not a solution and they will have to come back for more and more).

My opinion is that anything that does not circumvent law (which can be a legal activity, e.g. see the "Don't follow me, I'm the 5th car") is going to end up destroyed just like that dramatic upthread chart of the population of Rome falling from 1.3 million to 30,000 (because everyone fled the government). Apparently the-powers-that-be in the USA government are moving towards totalitarian allegiance analogous to recent events in the Ukraine. The entire premise of the Economic Devastation thread is that the Ineptacracy of socialism can't stop until it kills everything or until one of the following occurs:

• A new technology renders the government impotent.
• A Benevolent dictator like Caesar crosses the Rubicon to restore sanity

Note the people rising up as in Ukraine is not a solution, because they have no economically viable technology to remain decentralized. They will fall right back into the power vacuum of democracy with escalating chaos with Egypt as a recent example, because the fundamental problem is economic bankruptcy due to peaking socialism and debt (the people are not ready to embrace the decentralized Knowledge Age and the end of a public welfare and retirements system). Only a dictator or a technological solution to the power vacuum is a solution at this time (the contentionism has swung to anarchy because the time to make new social constitutions is not now for reasons stated).

And the benevolent dictator is also not sustainable, e.g. Rome continued to destroy itself after the vested interests of socialism killed Caesar. This is why only technology is responsible for sustainable gains in the lives of the people. Note CoinCube and I have postulated that in the theory of contentionism (a new term we invented) the top-down order (with socialism being one form) plays a role in the organization necessary to spawn new entropy, e.g. decentralizing technology.

Thus the only popular thing left standing will be the one that is impervious to government.

Gold and silver hoarding leads to a feudal Dark Age (which historically typically have long durations, e.g. 600 years), because the velocity-of-money (V in the Quantity Theory of Money) collapses. V is already down -50% since 2008. Capital is already running and disappearing into hoards. This will accelerate (as more frogs wake up from their blissful ignorance of what is going on and jump out of the boiling pot) if we don't have technological solution very soon.

And I have good news for you. I've had an additional epiphany recently that I have not written about publicly. I am becoming uber confident that Bitcoin is not the future of commerce, finance, and business. And become more confident I see (all the economic and algorithmic details of) the future technology in my mind's eye. Stay tuned, it won't be too long now. Commerce, finance, and business will never go back to centralized again. This changes the order that had existed since Mesopotamia.

So this isn't about crossing a crisis and coming back to the same notions of the way things are today. This is leaving the old ways behind forever.

P.S. Three prominent forecasters (with not such stellar prediction performance as Martin Armstrong who predicts the same, yet all with a correct model) are predicting "economic devastation" ahead. CoinCube do you think they read your thread and got that quoted term from you? (your thread in in the top 3 listings at Google for that quoted term)

P.S.S. W.r.t. to Bitcoin becoming government compliant, there is this problem that there isn't just one global government (yet), so its global fungibility will be pecked away by the discordant nation-state vultures. And as the recent Mt.Gox fiasco exemplifies, there isn't anything the government touches that doesn't get bloated and less efficient.

"An elephant is a mouse built to government specifications." - Lazarus Long.

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Disclaimer: I am not providing legal nor tax advice. I am not a professional adviser, please consult your own. I am merely sharing my thoughts and anything you do after reading my thoughts is your own responsibility.

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Update: there is a new thread on anonymity which is quite astute and exemplifies the evolving improvement in the knowledge of the community.

Well I can't disagree.  They have the tools, and they'll use them, no doubt.

And I agree it's utter bullshit, although I do not see anything whatsoever that can be done about it.

Not adhering to laws results in bitcoin going underground.  If that happens, people may think it will still retain value/use, but I am not one of them.  If it is not an accepted medium of exchange now it is no more likely to be so after some financial meltdown or Mad Max situation.

If bitcoin is not widely adopted, and the financial system melts down, it isn't worth anything.  Then it's gold, silver, the normal things.  Stuff.  If it is widely adopted it may well be a great hedge against exactly that sort of thing; and on a financial level and with enough ease of access, that a lot of people could afford to squirrel away some amount, but only if they know it exists, know how to use it and have a realistic expectation that it will have value that will be portable and insulated from fiat meltdown.

Widespread adoption is basic to use in any future scenario, including a global meltdown, which I'm not going to argue isn't going to happen, as I'm as amazed as anyone with what I see going on in that department.  To allow for adoption that you have to follow the law, even if it sucks because you know damn well half of it was written so governments can stick their noses in places it doesn't belong, behind the guise of the greater good, whatever the hell that means anyhow. 

It's not a matter of not understanding anything, I don't think, it's a difference of opinion on what actually has the better chance at any sort of real success. 

Bitards either don't understand or wish to sweep under the rug how grave the threat from centralization is.

https://bitcointalksearch.org/topic/m.5305055