Thank you for making my point! You are exactly what I was looking for. A living example of someone who would be willing to trade scBTC for Truthcoin! And they said it won't happen
Answer: it might not be a scam! But if successful it will be inflationary to the Bitcoin system. And if inflationary to the system it will eventually destroy Bitcoin according to the great link I put up earlier about merge mining about currency competition .
I'm sorry but you have sorely misunderstood the gist of the comment in the link you posted. Worse, you mistakingly figured it would support your arguments.
lol, you love to try and say i'm wrong even when i'm right; as you admit below, i correctly understood what the guy is saying but since you think he is wrong, somehow i am wrong also simply b/c it disagrees with your view
dude, you're fouling me even when i'm nowhere close to receiving a pass!
not only are all sorts of altcoin Sidescams going to bolt themselves onto the Bitcoin MC as shown by Truthcoin but as odalv has shown even Silk Road 4.0. How do you explain that to the Feds?
Why do you think Truthcoin is a scam?
I would love to see a decentralized prediction market.Seen this yet?
https://download.wpsoftware.net/bitcoin/alts.pdfOf course, “developing your own cryptosystem” is the purview of only cranks and researchers, so it was reasonably assumed that none of these “altcoins”, as they were called, could ever be plausibly presented for public use.
Boy, were we ever wrong on that one.
...
If you are, or are planning to, develop and release an “altcoin” to the public, this document reminds you that you are playing with fire. This sort of behavior was cute on sci.crypt, a community populated mainly by cryptographic experts where there was no risk that your charlatanism would be mistaken for anything legitimate, and where there was no ability to store value in your scheme anyway.
...
The Bitcoin community differs in both those respects. Your crankery is not cute. You are not a cryptographer, and yet are releasing a homebrew cryptosystem, misrepresenting your own qualifications, and encouraging others to store value in your creation. These actions are incompetent, dishonest and reprehensibly dangerous.
lol.
That's Andrew Poelstra's "A Treatise on Altcoins". He's even harsher than many of us in this thread! He's also listed as an author on the sidechains whitepaper.
At any given time there is a certain amount of demand for a Bitcoin like currency to make transactions. That need doesn’t increase with more competition. That means that the transactional demand for Bitcoin is really the same as the transactional demand for all substantially similar forms of payment. As more currencies are competing to fill the same demand they actually reduce the demand for the other currencies as they become more widely used.
This theory is blatantly ignorant of network effect. This is another reason why I found it strange for you to pull this one up from the 2012 cementary where it belong.. You do realize this guy is the 2012 version of you
Essentially, his proposition is that because of merged-mining, Bitcoins' competing currencies will leverage the security of the network and create a race to the bottom for the most "cost-effective" currency.
Well it's been almost 3 years now and there has been no sign of his theory being proven right. Additionally, Bitcoin's network effect has been growing along, making it even less probable.
you just fouled out.
the reason it hasn't happened is b/c the only coin that has been MM'd on top of Bitcoin has been Namecoin out of public service. so no, the guys conclusions are not wrong or invalidated. btw, that's dooglus aka Chris Moore, a very talented Bitcoin early adopter who if you take the time to look is a
MAJOR contributor #8 in reputation, right up there behind Pieter Wiullie, in total rankings to Bitcoin Stack Exchange and our understanding of what Bitcoin is, so fuck off:
Basically the idea is that you assemble a Namecoin block and hash it, and then insert that hash into a Bitcoin block. Now when you solve the Bitcoin block at a difficulty level greater to or equal to the Namecoin difficulty level, it will be proof that that amount of work has been done for the Namecoin block. The Namecoin protocol has been altered to accept a Bitcoin block (solved at or above the Namecoin difficulty level) containing a hash of a Namecoin block as proof of work for the Namecoin block. The Bitcoin block will only be acceptable to the Bitcoin network if it is at the difficulty of the Bitcoin network.
The Bitcoin block chain gets a single extra hash when a merged mining block is accepted, and the Namecoin block chain gets a little bit more (because it includes the Bitcoin block) when a merged mining block is accepted. However, because of the Merkle Tree, the entire Bitcoin block doesn’t need to be included in the Namecoin tree, just the top level hashes (so the extra bloat to the Namecoin chain is not a big problem).
Since you make more money mining both Namecoins and Bitcoins miners will eventually all do merged mining, and the difficulty level for all block chains will eventually be the same.
Furthermore, the economic incentive to mine will be the combined economic incentive of all networks, making all networks more secure. Of course this allows competing networks (with different inflation rates) to quickly become secure. This subjects Bitcoin to more competition.
Ultimately the value of Bitcoin is a reflection of the need for Bitcoins to make exchanges. The more people using Bitcoin to make purchases, the more demand there is for Bitcoins, and the higher the price of Bitcoins goes. (Speculation also raises the price, but long term speculation is essentially a bet that the transactional demand for Bitcoin will increase in the future.) The higher the price, the higher the incentive to mine.
At any given time there is a certain amount of demand for a Bitcoin like currency to make transactions. That need doesn’t increase with more competition. That means that the transactional demand for Bitcoin is really the same as the transactional demand for all substantially similar forms of payment. As more currencies are competing to fill the same demand they actually reduce the demand for the other currencies as they become more widely used.
This means that ultimately, to the extent that currencies are interchangeable to end users, merged mining does not increase the overall security of the networks. The demand for currencies drives the price (and thus the value of the reward). Increased demand for any given currency results in decreased demand for others, lowering the incentive to mine for the other currencies. The total incentive is a function of total demand for all Bitcoin like currencies.
Except now competing currencies can market themselves as “as secure as Bitcoin but with lower transaction fees.” In other words there is a race to the bottom among competing currencies to offer the lowest transaction fees, because lowering the transaction fee doesn’t hurt the security of the network in comparison to the other merged mining networks. Users, following their own self interest, will adopt the currency with the lowest transaction fees as long as it has the same security of the competitors.
This will increase the price of the currency with the lowest transaction fee (because demand for the currency is higher), and decrease the price of the currencies with higher transactions fees (because demand for those currencies is dropping as it is being filled by demand for the competing currency). Because the currencies with the higher transaction fees were the ones generating the incentive to mine, overall incentive to mine will diminish. As long as a currency’s mining is merged with the freeloading currency, it will be powerless to increase incentives by imposing mandatory transaction fees.
The result will be a decrease in mining incentive, a decrease in mining, and ultimately all networks that allow merged mining will become insecure.
