Topic: Gold collapsing. Bitcoin UP. - page 569. (Read 2032291 times)

I have to give it to you Jorge…despite the lack of references, the unsubstantiated claims and the ridiculous rhetoric, that was a well-written and effective troll.  

I think it was an effective troll because you're starting to get it.  That what really matters is not Bitcoin's speed, ease of use, or its 'features'; what gives Bitcoin its value is that it's not controlled by any central authority…that the Blockchain is an accurate ledger, accessible to the world according to the protocol rules.  

Will this always be the case?  Well, that really is the $3.8 billion dollar question, isn't it?  Does the experiment work?  Are the incentives enough for the network to enforce the protocol rules objectively?  Or will it devolve into an oligopoly?

Despite your claims to the contrary, the truth is that we don't know whether the experiment will continue to work or not.  But so far it is working, and every month that passes by where it continues to work increases the chances for continued success.  There are risks: the dwindling numbers of full-nodes, mining centralization, core development centralization, etc.; however, there's also a growing community of talented people passionately working to address these risks.

If it does work--if Bitcoin remains decentralized and continues to grow--then not only will it represent a great advancement for economic freedom, but it will also put that trillion-dollar pie in the sky within arm's reach.

You might want to get a few, in case it catches on.  

Yes, you have a chain of A -> B -> C

Normally the miner would build on C, but if a cartel with a high percentage wishes to reject C, they simply build on B instead.


Somewhat. It doesn't have to be only their own blocks, it can be other blocks that follow their rules.

I don't remember a proposal from Gavin to defeat this sort of 51% attack, just his IBLT proposal which gives an incentive to include the standard set of transactions, but only to a miner that isn't large enough to define this standard. Given the ability to "set the standard" IBLT might give the cartel more power, I'm not sure.

This argument is superficial and flawed.  The users can reject unorthodox blocks, but cannot create orthodox ones; whereas the mining cartel can block the orthodox chain while keeping their unorthodox chain open and functional.  So the users cannot oppose the miners, nor interfere with their operation.   Each user has only three options: (1) stop using the bitcoin system and lose all his coins, (2) upgrade to the cartel's revised protocol and continue use the full network, or (3) upgrade to some 'rebel' protocol which is run by a tiny CPU/GPU network.  (He can opt for both (2) and (3) at the same time, or switch between them any time; but then he will risk committing or be victim of double-spending.)

Please do read the detailed "script" that I posted to reddit:

http://www.reddit.com/r/Bitcoin/comments/2qdfat/without_downvoting_me_to_hell_can_someone_explain/cn5s41z
http://www.reddit.com/r/Bitcoin/comments/2qmfgw/so_warren_buffet_says_bitcoin_is_bs/cn82t3q
http://www.reddit.com/r/Bitcoin/comments/2qmfgw/so_warren_buffet_says_bitcoin_is_bs/cn7rxz1


 

I just skimmed the info about IBLT yesterday to figure out what the fuck that was.  Seems kinda cool.

One thing that I wondered right away what whether it could provide an efficient way to allow miners to make sure they were not wasting their time working on blocks which contained naughty {color}-listed transactions.

Off-hand I would actually kind of prefer the old-school free-form add-hoc ordering.  It just feels to me like it would be a bit harder to attack being less systematic.

The big 'win' with IBLT seems to only really come into play if/when large block sizes happen since it seems to be the very goal of the solution to preemptively do away with the natural advantage that small block have in terms of transfer times.  I'd rather see this problem attacked by allowing a move toward transaction fees playing a role myself (being now 6 years or so since the genesis block), but that's just me.

In the here and now, and seemingly for a while to come yet, it is the case that a 'free' global internet has plenty of capacity to support block sizes in the current size class without the IBLT optimizations really being all that necessary (notwithstanding the aesthetic qualities of efficiency.)  I'm also not aware of what a more structured ordering would bring to the table other than perhaps making it more efficient to gather transaction fees or (ab)use the blockchain as a generic stamping engine or something.

I, and a minority of others it seems, are mainly interested in how (and if) Bitcoin could perform if the global internet does not offer today's level of ambivalence.  Or is plainly hostile to Bitcoin and peer2peer traffic more generally.  In that case capacity would drop significantly, and it is for that reason that I'm leery of paying much heed to the theoretical constraints that exist now or are projected in the future.

edit: Inverted Bloom Lookup Tables.  I hate it when people use acronyms to much and to early for the average reader...  Basically they are a condensed way to notate a list of transactions (aka, a block.)  Thus, if one already has the transactions (because they've been listening on the same network and the network is working) they can assemble the same block as someone else and be sure it is right rather than download the block containing the same data they already have.  (As i understand things.)

A miner does not reject blocks, a miner can only build on top of a chain of blocks.

What you are describing is an attacking miner only building on top of their blocks and not on top of any blocks. That is the very definition of a 51% miner attack. The reason an attacking miner needs 51% is so their chain, that only includes their blocks with their inclusion rules, grows faster than the rest of the network.

There are two possible paths here.
1) There are two competing chains where one chain has only the attacker's blocks and the other chain has the honest miner's blocks. The goal of the attacker is to make their chain with their inclusion rules the longest. The network here can optionally choose the honest chain (which is what Gavin's proposal does). It also require 51% to pull off, which I don't think is possible anyway.
2) The blocks from both the attacker and honest miners build on top of each other in a single chain. In this this situation the honest miners include all transactions skipped by the attacker, and the attack fails.

Then by your reasoning guessing, it should be almost guaranteed to happen.

How about a friendly wager that the next block halving happens right on schedule? I'll be generous and make it an even-odds bet, although for something almost guaranteed to happen you might as well give me some nice odds for betting against it.

There is no fixed number, of course. Rather, as the number of independent entities in a majority set of miners increases, their interest will be more aligned with the interest of the users.  (This is true of democracy too, by the way.)

In the case of bitcoin, one additional problem is that bitcoin ownership is highly concentrated too, and the largest holders are not miners.  So, even if the protocol were somehow fixed to require consensus of all miners (instead of just a set with 51% power), the miners would still be largely disjoint from the users, whether one counts people or bitcoins held.  So the miners might still change the protocol to increase their revenue at the expense of the users.  (Would PoS be a partial solution to this problem?)

The likelyhood of getting N mining entities to cooperate with a protocol change attempt depends also on the benefit that the miners will get from it.  For example, I would guess that nearly all of them would approve a postponement of the next reward halving.

http://gavintech.blogspot.ch/2012/05/neutralizing-51-attack.html

SCs will help too, it will be backup network :-)

Are you referring to the IBLT proposal? That would indeed make miners' blocks propagate faster if they include the same set of transactions instead of trying to make their own rules. However, it wouldn't really help in the case of a large cartel, since the cartel's miners would all use the same rules, so it is the others mining (using for example the current largely non-discriminatory rules) that would actually suffer.

This is incorrect. A cartel with a high percentage could, within the protocol, reject blocks that don't follow its transaction inclusion rules. It doesn't take 100% to completely block some or all transactions from the chain.


This has probably already happened to some extent. The physical (as opposed to pool) mining is somewhat centralized. It was even during the CPU and GPU eras -- specialists build big mining farms (Satoshi is rumored to have had a pretty nice one), the rest don't. But the early ASIC era when there was only a relatively small quantity of gear in the world that represented the bulk of all of the hash power made matters much worse (when ghash had 50% a large portion of that was their own actual equipment), but only temporarily. That kind of transition will likely never happen again.

Gavin had a decent description of it (and other solutions) to address the possibility of 51% attack that withheld transactions a couple years ago, but I couldn't quickly find it.

It's definitely not a POS system though, mining still relies on hashing that anyone can participate in. It would only provide an additional priority advantage to blocks with more transactions in them. If all miners include all transactions in the P2P memory pool then its the same as what we have today. If an attacker decided to withhold transactions, then they'd be at a disadvantage and need progressively more than 51% of total hashing power as they processes less and less transactions.

POS provides rewards proportional to the amount of currency already owned/controlled. The scheme above is not influenced by the amount of currency owned/controlled, so it's definitely not POS.

You're rhetoric is utterly ridiculous.

Upgrading a piece of software is not "revolt." People upgrading in response to an instance of obvious abuse are not "rebels," they are ordinary users.


You are completely confused. New users would be the ones with the easiest upgrade path -- just install the current version. Furthermore they would want the version of software that interoperates with all the other users.

Users don't care about mining, and every wave of bitcoin users cares even less. Your whole mining-centric view of bitcoin is as bad as the people who see mining and immediately respond "free money from the interwebs!"

In fact your "cartel" has much more to lose from attempting to do this. Not only the potential loss of their equipment value, but simply the guaranteed value at risk of burning electricity to accomplish that might not work.

Finally, a CPU/GPU network supporting bitcoin would be neither small nor insecure. It wasn't then (during the GPU and CPU eras) and it wouldn't be now. It is easy to make silly comments about "the cartel would just rent cloud mining and attack the network" if you have never seen what happens in the cloud mining market when even a small altcoin shows a bit of success. Let me give you a hint to get you started: most of available cloud mining capacity (and it isn't really that much) would already be mining bitcoin honestly (for mining profits).

That doesn't sounds like a very good idea.

You've just described turning Bitcoin into a proof of stake system.

That is the crux of your argument and it is so simply not true on many levels.

It is the P2P node network which validates and protects the integrity of the network, not miners. The miners only determine _ordering_ of transactions on the blockchain. That is how the system works.

A mining cartel can not change the terms of service, even if they have 51% or 90% of hash power. If they change the terms of service the blocks they produce would be considered invalid and rejected by the P2P network. Maybe network confirmation times would run a little slower until the next difficulty adjustment, but that would be the only impact.

About the only thing a mining cartel could do is refuse to _confirm_ certain transactions (such as black listed addresses). But unless the cartel has 100% of has power, which is impossible, these transactions would simply wait for an honest miner's block. And even this has simple solutions which Gavin and others have proposed and have ready if needed (such as including the economic value of a block's transactions in addition to difficulty, this would lower the height/priority of chains that do not include all the transactions that honest miners are including).

On top of this the miner centralization issue is not a long term problem anyway. The system will naturally decentralize over time. With the introduction of ASICS it was difficult to obtain hardware and professional setups had an advantage in procurement only. However centralized mining installations in datacenters naturally are at a cost disadvantage vs. home style setups which have free space and cooling. As the ASIC market matures I think we'll seem a shift back towards more decentralized mining anyway. Computing used to be the same way, at first we only had large centralized mainframes, today your average US home probably has 30+ processors in their house without even realizing it.

The only part that will remain centralized are pools, here the market tends to settle on 2-5 main pools historically. But pools are not a threat in regards to centralization, if any decided to cause issues the vast majority of their users would simply switch to a different pool. Attacks by pools are only effective at destroying the business model of the pool itself.

keep buying

So GHash.IO decided to split into several pieces to stop scaring bitcoin noobs? Very smart...

What is your number threshold for a amount of combined pools over 51% in which you would feel safe? 10, 20, 100?  I don't think it would be hard to get 100 mining pools to conspire together.

The 4 largest named slices already add to more than 51%.  That is why I used "4" in my posts.

Dow -202

Jorge, why do you keep ignoring the data?  in fact, this chart has been distributing out more evenly for over a year now: