Topic: Gold collapsing. Bitcoin UP. - page 579. (Read 2032291 times)

No worries, very Gentleman!

What's the problem with doing 100k TPS on the main chain?

(other than non-answers like "it's hard to do")

There are many brilliant people working on crypto technologies, but they are so in love with the technology and with their own ideas, they neglect to consider how their academic, theoretical work may apply to the world of finance. After all, bitcoin directly relates to finance. Whether one considers bitcoin money or a commodity or a hybrid thereof, it unequivocally falls in the realm of finance just as much as it falls in the realm of programming, hacker culture, and crypto maths. I like all this stuff, so it's easy for me to get excited and follow along, but as a finance professional, I also see the other, sorely neglected side of the proverbial coin. The disconnect is enormous. (They would make great quants, haha.) I too often see bitcoin's brightest minds focusing on the minutiae of esoteric problems, while not unimportant, are not the immediate issues bitcoin merchants and users are interested in.

Your post about a "whale" disrupting things is very interesting and not as far-fetched as some would believe.

At this point, I think it's very important for people working on Bitcoin, sidechains, and all blockchain-related technologies, whatever they may be, to clearly state in lay terms WHY their work is important and necessary, which is to say, what problems their proposed solutions solve. Satoshi was very good at this.

I also will defer to Adam on sidechain implementation. He seems to have an incredible and deep grasp of how they may function.

about why consensus is hard, and more so for two different implementations, here are two presentations first on language security as it applies to host security and software compatibility and second on bitcoin consensus.  The first is quite eye opening even for security researchers (ie people who are experts in host security).

language security https://archive.org/details/The_Science_of_Insecurity_

bitcoin consensus programming https://www.youtube.com/watch?v=on5ySFK0aoY#t=39m50s

Have a listen, particularly to the first one and then we can discuss further (here or PM or bitcoin-dev or #bitcoin-wizards or whereever).  I am genuinely interested to help resolve the discrepancy of opinion around this, as its actually to my mind significantly misunderstood, and dangerous for bitcoin.

Adam

If you would allow me to chime in only because it offers an opportunity to propose REAL potential problems with sidechains and not phony simplistic self-serving nonsense ones.

As I see things, sidechains effect Bitcoin simply as large, well funded, often fairly active whales.  Nothing more, and it doesn't matter how they work in their own back-ends (chains, tokens, ledgers, distributed, proprietary, whatever.)  These whales happen to really really really want Bitcoin to work because their lives depend on it (with one exception shown below.)

Problems:

 1) being well-funded, the whales could crowd out other users of native Bitcoin.

 2) these whales might get into battles with one another and try to use native Bitcoin as a cudgel causing collateral damage.

 3) One whale might become so successful it may at least think it can swallow Bitcoin whole and take over (what I call 'shooting the moon.')

 edit - 4) A 'seismic event' within a sidechain could create a undesirable transient in native Bitcoin activity.

I'll defer to Adam on the number of sidechain implementations he sees.  He's stated it as a small integer as I recall.  I would hope for many more in part because it would help to mitigate against some of the potential problems I see.

Yes, NASDAQ is more than sufficient. Generally speaking, any security listed on a major exchange, such as NASDAQ or DJIA, is considered adequately regulated for institutional and professional investment purposes. Another way to look at it is, in the United States for example, if the SEC, FINRA, DTCC, or NASAA are involved, then the investments are in theory permissible on a professional level. Similar regulatory boards and enforcement agencies in other countries operate in much the same way.

There are exceptions, mostly contingent upon the nature of the fund that's investing and other factors such as the clients' risk profile or initial investment amount.

There are plenty of professional investors who would love to invest in exotic, high-risk instruments such as Bitcoin, but they also know that if they don't follow the law, i.e., investing clients' funds in regulated securities markets, then they can easily be sued and shuttered into oblivion.

At the highest levels of finance, most of what investors spend there time on is considering investments against possible litigation.

Note that the most recent transaction may not be when the coins last changed hands.

If the price had been increasing all the time, the output amount X in an UTXO times the price P(t) at that time would be only an upper bound to the purchase price of those coins.   However, because of the subtantial drops in price, and the large trade volumes during price drops, not even that is true.   Moreover, coins that are deposited on the exchanges are changing hands without a corresponding record in the blockchain. 

Adam, would you mind clarifying a few things? I do understand the core blockchain system quite thoroughly, but these side-chain concepts are new to me and I want to make sure I understand. Correct me if I'm wrong, but a federated peg would be easier to implement than a SNARK peg or a SPV peg, right? No hard or soft fork? But on the other hand, am I correct to assume that the failure points of a federated peg are theoretically more dangerous?

Moreover, as one whose company is currently developing private mining hardware, how do these peg/token side chains directly affect the bitcoin mining protocol (in terms of the block header's nonce, merkle root, etc), if at all? Absent a fork, nothing changes?

Well, my question above was not rhetorical.  Is the fact that the ETF is listed on NASDAQ sufficient to enable those restricted investments?  Or are there other conditions that depend on the nature of the fund and its assets?

Maybe for the same basic reason you don't get into the car with the nice man who offers you candy.

I think it was more JorgeStolfi with the internal ledger (the sofa/couch in bitstamps office?),  I would not call an internal ledger a chain - a chain has to be real-time publicly audited  I think, to be called a chain.

With federated peg there is a real side-chain, including mining, consensus rules etc and then the federated peg servers act as a protocol adaptor - the peg servers are full nodes on the side-chain, and pegged coins are paid to their multisig address (eg 10 of 15) and the side-chain fullnodes and miners watch the multisig address on the bitcoin network, and coins arriving there count as a peg to put coins into the side-chain; and when the side-chain hashrate majority approves a return peg to reanimate a coin, the federated pegs are watching the side-chain as they are full nodes there too, so they release the funds to the address the return peg tells them to.

Now obviously the limitation is if >= 10 of the federated peg servers are hostile or compromised, they could take the coin without approval of the side-chain.  But short of that it is the side-chain consensus and miners etc that arbitrate what coins move across the peg.

Adam

Adam why not support OT. With SC as proposed users don't own there one coin they are trusting the decentralized network managed by pitting incentives to secure the coins.

SC proponents overlook the change SC make to the incentive system and think it's safe.

I'm open to changing my mind,  why don't you put some of that $21m into a peer review economic impact study?

The nonsense you spout about where your profit comes from is damaging to BlockStream's motives.

I had mis-read that somehow cypherdoc was anticipating sidechain data in the mainchain.  One of the reasons I was against this was privacy.

Even a correct reading that there was total transparency within a sidechain system (including at the Bitcoin nexus) has some privacy negatives which I would (for many uses) prefer to avoid when possible.

As I stated, as long as I as a user can be confident that I have 'sole control' of my value in a sidechain, that is all I need.

I do think that people from the top to the bottom tend to get tunnel vision and assume a blockchain architecture to be the only considered solution.  I never did.  I consider it a wonderful solution for 'reserve' duty (often because of the transparency features which are a double-edged sword), but simply not a good match for 'exchange' duty.  Your pal Rusty fell into this trap IMHO though I very much appreciate his conceptions of slop...they guy must be an engineer

On a theoretical level (mine), tokenized solutions:

 - nix the latency hassles associated with blocks
 - are inherently efficient since the allow 'nature' to be balance sheet which nobody need care about in minute detail.
 - promote (potentially, depending on implementation) privacy due to this lack of need for minute detail accounting.

The change jingling around in one's pocket is a good example of a 'tokenized' system and it works fantastically.  One might say it works 'to well' for some people's tastes and don't know how much longer old-style currency will be hanging on in our modern digital world.

Lol, Gox wouldn't run out of Bitcoin. It would be short fiat. Trust is earned, and services need to earn it, and markets need to price it in.

To harp on, to fix the abuse of trust in the world today we need to fix the trust in the money we have trusted systems to manage the other relationships, they're hardly broken and in need of SC's.

tvbcof think SC's are tokens, not blockchains.
brg444 is confused about SC's.
Adam ruminates about manipulating the issuance curve & even deleting future block rewards.
Odalv calls a federated server internal database a SC.
JStolfi calls a SC a Bitstamp couch.
LTC looks to be dying.
BTC price plummets (to support @peak of last top)
i may be getting SC's.

the world is falling apart.

yeehaw.

you've been agreeing with a lunatic 

Also... (just about) every investment analyst talks their book.  They are trying to net some fees.  Until the ETF comes out, they are not in on any of the deals.  Once they get a cut of the trade, they can change their tune and start trying to shill for bitcoin instead of against it.

So in addition to unlocking a lot of potential investment fund, it unlocks the media, coopts them.

Face it, a single investor could pretty much buy the current bitcoin float on the exchanges.  It isn't though the unlocking of the funds is that big of a a deal.  But changing the investment news media tide is going to change a lot of minds and hearts.  Some of these may even bother to learn what bitcoin really is, and that is where it becomes a good thing.

As an engine for price manipulation the ETF is a monster, it can wreck massive damage. but as a tool we can leverage to educate, it is hard to beat.

One coin to rule them all:

this

Permit me to quote myself from another thread.....