Topic: Miner cartel, Bankster cartel, or an altcoin? Your choice? - page 13. (Read 33243 times)

Id like to see mimblewimble, LN, schnorr and others before even considering anything like that... long ways to go bitcoin is dominant currently and is not looking back yet.

Tail emission can be added via hardfork, the miners will swallow that poison pill once the blockreward is small enough unless the coin is already dead. Tail emission dos not have to be constant, it just needs to decrease slower than maybe 1/price^(1/3), there is several good solutions but i never see thesw in altcoins, well they will be forgotten long before that becomes an issue.

Any hardforks ruins the trust in a coin and this is the real issue i see with Bitcoin unlimited.

A fee market actually requires a much larger blocksize cap, currently the bitcoin miners consumes 102KWh/transaction and it will go up even higher if the btc price go up. The issue is that the cost reqiure to secure a pow network increases with the price* and thus relying on transaction fees is doomed to failure, the only solution i see is to accept some inflation(limited supply is still possible) or that the coin will fail eventually.

*the incentive to attack a network will get bigger if the marketcap of the coin is bigger, if miners do not recieve enough they can 51% attack the network and profit from shorting the coin(more profitable than continued mining). ASIC mining might actually be a good thing once most coins has been mined, asic farms yas huge sunk cost and thus a large incentive for the coin to remain successful.

What i am trying to say is that btc is doomed, it will fail before lack of sensible tail emission becomes an issue. Btc=myspace, the network effect(log(n)n) will not save it.

Fungible money:  When one cannot determine any difference between instances of money.  For example, we each have a dollar bill, we swap and no one can tell.  But, if the serial numbers were recorded then it can be determined which bill is which.  A clean crisp new bill is worth more than an old raggedy bill in some/many places.

Bitcoin is an interesting mixture of really good fungibility and not even close to fungible.  If a miner takes care then they can create a portion of Bitcoin pretty much out of thin air with virtually no traceability; without care in theory it can be traced.  Each time bitcoins are transacted they tend to become more and more traceable.

I heard once that if you have a US $100 bill in your possession it is very likely to have been used in an illegal drug transaction.  In fact, it is quite likely to have trace amounts of cocaine on it.  I have not confirmed this but it sounds plausible.  If so then arguably you are in possession of something that endangers you.  It would behoove you to wash such clean.

Some altcoins are superior to Bitcoin in terms of fungibility, although they might come with other issues.

give me another phrase for "fungible money".

In past days I had a realization (or probably remembering something I had realized long ago) which I mentioned upthread but I'm confident readers didn't recognize the importance.

Fungible money awards the profits from volatility to the whale (or shareholder capital) with the most reserves who can backstop the speculation and collect a fee on the wave motion, i.e. the fee is a friction. This is what MPEx was doing and how he became so wealthy in Bitcoins (750,000+ BTC).

The point is that fungible money is a winner-take-all paradigm because even if there is competition, any system which imparts less risk to the one with higher economies-of-scale, is going to end up completely concentrated at some point. This is why Bitcoin can wags the altcoin's tail and not vice versa, but it is also why Bitcoin is not stable long-term. Because eventually all the capital will become concentrated in one whale or group.

This is why Nash's theory doesn't work in practice. But Nash was mathematically correct that if it is possible to have asymptotic number of stable currencies, then that winner-take-all tragedy-of-the-commons becomes an Inverse Commons.

And I posit that the way to achieve Nash's goal is something I am working on. I will not detail the reasons further right now. That is for a later time.

BU is a piece of work I tell ya... using bit 29 outside of the domain of versionbits for blockscaling when he could have used versionbits for that purpose... renders my correct assumption about using bit 29 for chainID information in AUXPOW code. https://www.reddit.com/r/btc/comments/62f96e/f2pool_syscoin_segwit_activation_failed_network/dfo82iz/

Now wangchun is in a dilemma with BU.

Rather it is an economic reality of the cooperating game theory equilibrium that Satoshi so cleverly designed.

@dinofelis was correct:





But this fungible money jockeying shit that will occur with power broker battles with Bitcoin and its altcoin derivatives is really noisy. I hope we can do better than this. A better model closer to Nash's asymptotic ideal instead of this master-slave Bitcoin/altcoins model that Satoshi gave us. And it is always the whales who profit on this noise, which is rent seeking waste. Fungible money and finance is not optimal.

Did F2Pool just signal SegWit on Litecoin.

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So Bitcoin maintains its immutability because the richest whales in the kingdom dominate it and they will experience mutual self-destruction if they defect, where 'defect' means to try to mutate the protocol. The economics and cooperative game theory was explained upthread, e.g. my summary rebuttal to @jbreher.

One hypothetical threat to Bitcoin's immutability is where another altcoin would gain a higher marketcap, due to the analogous arbitrage master/slave vulnerability quoted below. But this won't happen with Litecoin gaining more adoption with SegWit (presuming @dinofelis and I are correct that Bitcoin will never have SegWit and LN), because Lightning Networks is centralized hubs meaning private fractional reserve banking, which thus means all the profit from it will be ultimately settled between those power brokers on the Bitcoin blockchain. The transaction settling of LIghtning Network channels on the Litecoin blockchain is for transactional settlement not for power broker settlement. The tail doesn't wag the dog. And thus Litecoin will never be more valuable than Bitcoin, for the analogous reason that Nash explained why silver can't be as valuable as gold (c.f. my upthread rebuttal of @r0ach for the relevant Nash quotes). Litecoin might rise to 1/10 of Bitcoin's market cap, similar to silver's ratio to gold when silver was used as a wide-spread currency.


Thus any threat to Bitcoin only comes from an altcoin that gains massive adoption in a value activity that is not susceptible to fungible finance (because otherwise the profit of the activity will be siphoned off to the finance power brokers and settled on the Bitcoin blockchain). If such an altcoin attained a larger marketcap than Bitcoin, then Bitcoin would be the tail that can't wag the dog and so then the power broker Nash equilibrium of Bitcoin can fail. As I stated upthread, the collapse of the efficacy of finance will not happen overnight. Thus Bitcoin's immutability is not in danger near-term.

I presented upthread already my thesis on the knowledge age, value of knowledge, and the inexorable decline of the efficacy of finance w.r.t. to knowledge value.

In short, fungible money is a winner-take-all paradigm because of the power vacuum.

But if the money is non-fungible knowledge, then nobody is in control of the paradigm (which is the asymptotic result Nash was searching for). I have a surprise coming.

The tail doesn't wag the dog. If knowledge value is traded directly in an Inverse Commons, finance is the tail.

Sorry but I still see LTC under $1 before any long term uptrend (IF ANY, ever)... too many bagholders, bear didn't touch target.. so I'd never touch it or have any of my friends touch it until if cleans up shop and creates some blood.

I don't believe in a "bankster cartel".

I know the theory about the supposed "Blockstream conspiration" - "banksters want to harm Bitcoin, so they would like it to stay small and highly dependant on centralized payment processors". But I don't think they would have any success with such a dumb strategy, as every altcoin could replace BTC relatively fast and we have also already a real contender (Ethereum) that is focusing on on chain scaling.

In the case of miners, things are not so clear - I think there may be mining pools conspiring to maximize profit regarding transaction fees. But if a decision they take would harm Bitcoin (e.g. a hard fork) they would shot into their own knee because they depend on a highly-valued Bitcoin token.

I think the current stalemate is simply because of stubbornness and short-sighted thinking on both sides. There might be some interest conflict behind, but I'm sure if it was only that it could be solved with a solution similar to the Roundtable Consensus.

Polarization, simply, is en vogue now.

PoW is only immutable on the master blockchain. The lesser altcoins can be manipulated by arbitrage employing the fulcrum of the master Bitcoin. Litecoin appears to ready to lose its immutability and adopt SegWit because the miners and whales (who are the same in both BTC and LTC btw) are able to take advantage of the ability to dominate a lesser market cap with a greater one. This creates a game theory opportunity where the previously manipulation of LTC to force it to be undervalued will now be reversed so that there will be scarcity of mining supply thus motivating miners to vote for activating SegWit to maintain the ramp up in the price.

Click and read these for details:

https://bitcointalksearch.org/topic/m.18399606
https://bitcointalksearch.org/topic/m.18405746

Disagree. Because the cost of voting is not free, i.e. democracy is centralized. Actually a small number of highly knowledgeable whales who have conflicting priorities (such that a stalemate is attained, which appears to be the case now with Bitcoin as you had previously posited) is more decentralized because these whales are not manipulable into voting as a colluding bloc, except perhaps to defend the status quo. And this is precisely the conceptual reason why Bitcoin may still be decentralized. But the danger is that over time the paradigm is a winner-take-all due to either the marginal utility of economies-of-scale (within the Bitcoin protocol) being perfectly constant and/or the inability of the Bitcoin small block, non-shrinking (money supply, i.e. not a deflationary supply) system to adapt to the knowledge age as finance becomes inexorably less efficacious w.r.t. to knowledge value (i.e. the NWO will be able to bring those whales into submission to the higher authority of an externality). I would much prefer if possible a protocol wherein the power of everyone is essentially nil. I think I may have such a design, but I am highly skeptical as I should be.

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Real world example of how non-ideal money (i.e. money that can be manipulated) distorts markets:

https://www.armstrongeconomics.com/international-news/europes-current-economy/the-euro-crisis-the-previous-debt/

https://www.armstrongeconomics.com/international-news/greece/greek-govt-is-40-of-gdp/

Buy moooore

Ok, then what shall we do?

Code is not master.  This is what crypto guys don't seem to understand, probably because mostly they are software guys.  Cryptography is mathematics, not software.  If you mix in economic incentives, code will follow incentives of the protocol, not the other way around.

For instance, you could write a piece of software that encrypts text, and that decrypts text, with a secret key.  If the software as such, is secure, but the cryptographic protocol isn't, then you will soon find someone who will write the right software to crack the broken cryptography, even if the original version would never allow you to do so.  If the *protocol* can be cheated or broken, the "official software" cannot stop you from breaking it.

Same with crypto currencies, except that now you mix in cryptography and economic incentives.  If the *protocol* can be gamed, then no piece of "official software" will stop you from gaming it.  Software *implements* protocols, but software IS NOT a protocol.  If the protocol is faulty, there's no way to save it with "good" software that would not give you permission to abuse of the faults.

The important part in crypto is NOT software.  It is protocol.  The protocol will determine the software (including the software to game it).

There is a difference between "unequal wealth distribution" and "centralization".  Centralization happens, when decisions of change, permissions of participation etc.. can be taken by a small set of colluding entities (in other words, by one single meta-entity), changing former engagements, even with respect to one single participant.

In other words, when it becomes possible to vote, and to obtain a majority for change.  When one can vote, and one can hope to obtain a majority (that is, all positive voters are colluding), you have a centralized system.  Even if they consist of one million different voters, they have become a single colluding entity capable of change against the agreements made with a minority, even with respect to one single participant.

Of course, the smaller the number of votees needed to do this, the higher the probability of de facto centralization.  And if one single votee is possible, you have a truly centralized system.  

Whether these votes need to obtain 10%, 50%, 90% of whatever "stake" (nodes, real-life persons, stake, hash rate, quantity of prime numbers, amount of Mc Donnalds hamburgers eaten in the past or whatever) is allowing change doesn't matter.  What matters is whether such collusion can be reached or not.

The only way to actually change a decentralized system, is if ALL participants agree with it.  Decentralization is the way to impose "respect of contract".  The only fair way to change an existing contract, is if ALL parties signing the contract agree upon changing it.  "majority change of contract" is not done, it is ripping off the minority in disagreement.

And now, the question is: how can you obtain a "majority vote" in a truly decentralized system (centralizing it, in other words) ?
By bribing voters.  How can you bribe them ?  With rewards.  If a majority can vote relatively MORE REWARDS for themselves, the decentralized system becomes centralized, the minority is screwed and the contract is broken.

This is why one cannot have "rewards" in a truly decentralized system in its basic functioning (the system can be used to give rewards to people, but not by its intrinsic functioning) ; and why one cannot have voting systems or "governance".  

Centralization is bad, not because of "inequality", but because of "breach of contract".  Of unilateral contract modification, majority (of whatever weight) over minority (the screwed ones).

Global party in Tallinn starting today.

(This is comparable to Silverclub or Malla opening events in 2011, 2014, respectively, so a big party of 50 VIP plus the others )