Topic: Fundamental bitcoin flaw - revisited (Read 9719 times)

This thread debunks your concerns pretty thoroughly. If you're so worried, maybe you should actually read and try to understand the replies instead of acting like you're so much smarter than everyone else and harping on like a broken record?

man, I am thankful everyday for Gavin.

Generally, schemes where people have to voluntarily contribute to maintain a public good don't work very well in practice.
The solution you've proposed would most likely fail since each individual concludes that they themselves needn't contribute (ie: voluntarily pay FEES) because the rest of the users will and the loss of their small contribution won't be noticed.  The most common real life solution to prevent these kinds of tragedies is to police/enforce the contribution and make it non-voluntary -- hence why it is illegal not to pay your tax contribution or why there are parking fines for exceeding free car parking time limits.  

This is why I personally believe that if bitcoin was better-thought-out at the start it, would have been preferable to have implemented a dead-coin sweep since it forces people to make regular fee-paying transactions or suffer a penalty.

I don't know if it has been mentioned yet, but if off-blockchain tx become so popular that they endanger the security, then all businesses who are involved in off-chain tx will basically be forced to invest into increased security themselves, perhaps by paying miners directly or by making nonsense-tx with high fees to attract miners.

Otherwise, their whole business would fail if the core Bitcoin system itself fails. They would basically have to decide between no more profits (due to breakdown of the Bitcoin system because of a lack of sufficient fees) or reduced profits (by ensuring the security of the network with their own investments). I am sure that all involved in such business would chose less profit over no profit anytime.

I think it could turn out to be a self-regulating system, basically. Or maybe not, for me Bitcoin is foremost a very interesting experiment, and I am sure we will have learned a lot even if it fails.

I've actually made the argument a few times.  It's just basic human preference.  Off-chain transactions are cheaper than on-chain ones.  They are faster.  Some mechanisms do not leave public trails of previous ownership.
Since they have these advantages over on-chain ones and the fact that these  are commonly wanted properties of a transaction people will choose off-chain in preference to on-chain.  

The only negative that anyone has so far given of off-chain is that it is less secure than on-chain.  However, in the case of DRM coin the truth of the matter is that for majority of day-to-day transactions it is good enough-- this is demonstrated by actual real-life practice today: ie, Consumers do use smart cards to buy stuff and very, very rarely complain about the want of security involved.  Smard cards are secured by the same type of technology has DRM (infact you could use smart cards to implement DRM coin).  In my home city I use a smart card every time I use the local transport system-- and so do 100's of 1000's of people everyday.  This demonstates that for small transactions (say less than $250) smartcard is good enough.  For larger transactions you can use more traditional banking systems (eg: similar to how gold is bought or sold-- the gold stays where it is in a vault but a record of what is bought or sold is recorded by the various banks involved.)  Not many people complain about the security of regulated banks: it is very,very rare for someone to be personally out of pocket due to a breach of bank security. When was the last time you heard of some having their money stolen from/by a bank and not being set-right again by the bank or the Government?  If banks that trade gold/cash etc, can handle their security so well why do you think they wouldn't be able to do the same with bitcoin?  Bank transfers of large amounts of bitcoin in this way would be very cheap, the bitcoin network simply couldn't compete with it!





Not quite.  My point is that bitcoin as-is with the transaction fees model will not be able to maintain network security due to the fact that you can do off-chain transactions.  My personal perferred solution to this problem is to change the bitcoin protocol so that miners make money by both transaction fees and by reclaiming old-untouched coin.  I actually like the idea that you can do off-chain transactions and believe it is the best way forward since it reduces block size.  I definitely do not want it locked down and gated.  If you read the OP you would know this.  (In the OP I also give other possible solutions to the problem).

Here is the proof:
step 1) buy a casascius coin
step 2) give it to somebody

Hey Boy, are you so dull or do you want to troll?

WHERE IS YOUR ARGUMENT


You state all the time: Off-chain transactions are cheaper. WHERE IS YOUR PROOF? That is what you have to show and to proof. Just claiming that something is magically cheap or even "totally free" doesn't count as argument.

OMG, I see now, you really do propose a world, in which every computer is manufactured by apple or microsoft or some other huge company, and includes a chip, which makes sure you don't have any control about your computer.

Even if you use a dedicated computer for DRM Coins, Sally and Ross still will have to trust the manufacturer of the dedicated computer / DRM to not steal their coins. This doesn't even need to be an obvious attack, but could also be executed by Sally, who works for the manufacturer of the dedicated computer / DRM and thus knows the secret keys.

Every DRM Scheme somewhere has its root keys, whose owner you have to trust. There are no root-keys for the blockchain.

Hopefully you people will begin to realise that off-chain transactions are going to be very popular and it is a real threat to bitcoin.

Again, where is your argument, dude?

Why are off-chain transactions necessarily bound to be very propular?? Why is that popularity necessarily and inevitably bound to be a thread to Bitcoin?

I've actually made the argument a few times.  It's just basic human preference.  Off-chain transactions are cheaper than on-chain ones.  They are faster.  Some mechanisms do not leave public trails of previous ownership.
Since they have these advantages over on-chain ones and the fact that these  are commonly wanted properties of a transaction people will choose off-chain in preference to on-chain.

Well, if you read and understood it then you would know that she *has* to boot securely if she wants to transact with Ross.  Ross's computer demands that Sally's computer proves that it has booted securely (this is known as remote attestation)


No, that's incorrect. Ross doesn't trust Sally.  He trusts Sally's computer and that the computer's TC chip hasn't been compromised.

Wow, the miners are only making less than $2,000 a day from TX fees. I'll be honest, that is a bit too low isn't it? How many miners are there? Over 10,000? So that is maybe $5 a day average per miner if my guess is right. Its not above electricity cost is it? or just barely.

You do make an interesting point beeblebrox.

I did make a couple of points a few pages back but you didn't reply, I would be interested what you thought of that?

Cheers.

Do you really think that that is enough to secure the network?

The TOTAL of all fees (not just Sastohi) for the last 24hrs (according to http://blockchain.info/stats) was 51BTC which gives an average of 0.012BTC/block that at the current exchage rate is about $0.5/block.  Do you really think that that is enough to secure the network?

With all the fuss about raising the max. blocksize limit to help SD increase their # of tx's even more (and their own statements about just how much more in tx fees they pay over the norm) I think there is simply *zero* evidence to support your theory (and what may happen in >100 years of very little point even discussing today).

And "as soon as the need for tx fees kicks in" (other than to prevent excess spam type tx's which of course is why fees already are needed and were right from the start) will be most likely be decades from now - so hardly something to create alarmist threads about IMO.