Topic: rpietila Altcoin Observer - page 115. (Read 387493 times)

The mini-blockchain idea is an undermining in terms of security. This is ok, as long as it might nevertheless fits well somewhere in a broad range of different security/scalability trade-offs. However I see two obvious concerns to make it deserves a meaningful place on that range at the moment.

The first concern is that it could be achieved with something based on the bitcoin blockchain, in fact all these trade-offs could be all linked and based on bitcoin, you don't need a completely separated altcoin to achieve that particular security/scalability trade-off.
The second concern is that the scalability in terms of storage of the blockchain, is a non-issue. Even for bitcoin. Even for cryptonote if it takes 10 times the bitcoin size. The real challenges are the bandwidth and computational power required to receive/check/broadcast transactions in a VISA-scale crypto network.

Anything that plays with the ratio security/scalability can be based on the same intrinsic currency (and most likely it will be bitcoin). For something else to be actually really needed, you must completely go out of that range of security/scalability trade-offs and seek for something fundamentally differents. Yes, Monero, I'm looking at you.

My major complaint about XCN is that it isn't interoperable and convertible with BTC.   It should have been done that way.  How far you can take that is debatable.  That you could take it a lot farther than XCN did is obvious.

Maybe it would have taken a giant server to host a TB block chain 10+ years ago but these days that can be accomplished quite easily. And it's only going to get better as time goes on.

AnonyMint's argument centered around scaling to the petabyte level. I think it's safe say that's not going to happen with Bitcoin.

I like the idea of a mini-blockchain and it's nice to see some new technology. But I'm not really convinced that's really enough to do it at this point.

This is exactly why Cryptonite was created to take advantage of mini-blockchains.  Instead of a 1TB blockchain that takes a giant server to be hosted, mini-blockchains may be run anything from smartphones on up.  XCN has the entropy advantage of proof-of-work and the democratic decentralization/small footprint advantages of proof-of-stake.

Of course XCN doesn't exist in a vacuum, and will allow Bitcoin to focus on large transactions/wealth preservation by taking the burden of small transactions off its already bloated blockchain.

+1, Gavin is just talking of the technical requirements to run a full node on a bitcoin network with orders of magniture more transactions than in 2011. It's just purely facts, it has nothing to do with "planning", even less with political agendas of some sort.

its this kind of ridiculous embellishment that destroys potentially helpful, enlightening dialogue.

I don't think you've paid attention over the years if this is in doubt.  Gavin has planned on a mega centralized BTC all along, (no, I am not shilling for Peercoin):

https://www.youtube.com/watch?v=EIIkHfU2o8Y

Hm, yeah it would be strange to disqualify anything based on grounds of potential future regulations that may or may not exist on technical variables of something that may or may not change. If those types of regulations pop up and do prove to be detrimental .. that would be a different story. Until they show me they can enforce those regulations (that may or may not even happen), I guess I can't really take the articles for what they're worth. Good catch, I almost just accepted something without question that I read on the internet!

These articles may be misleading.  The body of court practice and precedent is large and complex, but fairly clear.  How it will be applied to crypto is less clear, but the natural and direct application can be quite disruptive.

But what makes my money valuable? I'm not ruling out that people will choose their medium of exchange in the future (and I think we both clearly hope that the choice will be cryptocurrency?). I'm saying that that choice will be from a plethora of cryptocurrencies that either exist or are created at the time of choice.

Dedicated mining hardware is hard to seize if it's decentralized and is spread out over many different physical locations mining anything that can be of value that is a cryptocurrency, regardless of which cryptocurrency it is. The first seizure of a centralized mining outfit will be when this is proven .. because again crypto has no guns .. so it's a bad idea to centralize one of the main things that gives it security and value, while at the same time has extreme value.

Look what happened to Gox. Would the impact be nearly as devastating if, instead these little tokens of value were spread out into multiple cryptocurrencies? I wouldn't think so. What's exploding in the last year since then? Alternate cryptocurrencies are exploding. I'm not talking about the scam ones - everyone hates those. I'm talking about cryptonite, monero, darkcoin (shudder), counterparty, maidsafe, blackcoin. Some are crap, but the reality is that It's not a leap to say that their innovation has been hastened by the realization that these things become incredibly centralized very quickly. With little to protect the value that's at hand, and the only legitimate way of protecting such value being currently to spread it out amongst many other alternatives so that when that hand comes to scoop .. there's less to grab up .. what other solution can be had?

I agree on the natural monopoly point, but the dilution point I don't see at all.  You simply asserted that the collapse of the aggregate alt economy was the (implied, primary) cause of btc price atrophy.  I question the causal link, and assert that even in the presence of a (hypothetically postulated) clear causal mechanism, any such pressure is insignificant in comparison with other, larger factors.  I named fraud and related property crime as one such factor which I think would overwhelmingly dominate over any impact of altcoin price fluctuations, taken as an isolated aggregate factor.

Did I miss anything?

aminorex
You need to review the logic presented in my examples to better understand the mechanics of the dilution. Observing the relative value after the transactions complete, not the short term effects of buying/trading for BTC that show it is not quite the contrary.

kbm
What buys guns? What buys governments? There may be a point of critical mass where the populations of the world become enlightened enough to choose what their medium of exchange will be, or there may not be. Don't read more into my statements than what they state. If dedicated mining hardware is seized, will the network fail or will it consolidate the efforts of the populace against the misanthropes that performed this act of violence? What of the coins that already exists, will they be seized? There are too many unpredictable variables to adopt a complete pessimism but I wouldn't put all my eggs into a crypto-basket either. Currently, crypto-coin is a warning to the central banks. The future will tell us more.

I think people can still mark your coins/transactions with bitcoin, in that if you're aware that one BTC was traded for something in one part of the world you could have a different part of the world 'marking' it for regulation in a different part of the world because of that. I would believe that the ability to do so is a direct result of 'network marked' transactions. Maybe we're talking about different kinds of markings? Maybe I'm totally wrong? Can anyone tell me that this is not the case?

add: I'm pretty sure I've seen threads dedicated to discussing these types of fungibility issues .. I'll go look for them.

OK so it's not the coins themselves that can be traced, but the people:

http://www.coindesk.com/bitcoin-fungibility-essential/
http://www.coindesk.com/government-sale-bitcoin-establishes-fungibility-precedent/

But still .. you can be singled out for taking the wrong coins from the wrong people. I think I saw someone post a coinbase picture saying they can't use their coins but instead can only withdraw them because of such an issue .. i'll look for it.

I think he's trying to poke fun at them, no?

I don't know much about cloak but I'm highly skeptical. Especially reading a couple pages of that thread. It's the lowest common denominator of cryptocurrency over there.

Says the same idiot who tried to say he had more XCN than existed. You're not only a liar, but a damned stupid one.

Sorry, it wasn't meant as a personal insult. I was strictly referring to the possibility of Bitcoin becoming the only form a currency used and was not attempting to imply anything other than that.

despites the technical superiority, the network is (close) to neutral from outer influence on a world wide scale. the monetary supply is known and (almost) unalterable and what is most important: it is neutral in that sense that the network does not mark your transaction - the moment this will be changed I am out. this is not some libertarian bullshit dream, this is the real value of this network and that is the reason why it has a huge potential.

So the statement then is more that bitcoin would be reserve currency. While I wouldn't mind that at all, due to owning bitcoin, I'd have to make the point that there are still massive political and physical barriers that need to be dealt with that people are still grappling with today (I believe BRICS just met and formed something to bypass the fed pretty recently). The only way the current reserve currency for the world got to its current place is with guns and resources. Crypto doesn't have guns. Who is going to support it as a world currency? There's no political affiliation therefore nobody is standing behind it with guns and resources saying it's going to be worth a lot throughout your lifetime.

What does crypto offer? Lots of hopes and resources saying it's going to be worth a lot in my lifetime. No guns, or imposition of will. Only investors, and their word that it will be worth more next year. I'm not currently convinced that without some serious political endorsements (not just regulation - and more like the entire country of Argentina) that any of this will ever go anywhere unless some country with a metric shitton of both guns and resources happens to start using it. (edit: anywhere besides lowering transaction fees to almost zero -- that's still extremely valuable and was the main reason I've invested.)

But which one of them would let themselves be at the mercy of the various mining hardware scattered across the entire world (mostly not in their control) that's required to get that sweet inflation in their money supply so they eventually don't have to pay $.01 for 50 loaves of bread? Who would be the first to jump on that train? This is the basis of my statement - nobody would voluntarily do that, they would make their own fork and run on that chain, where there would be a very large amount of niche-filling currencies.

Thought-provoking.  Thanks for sharing.

Quite the contrary.  Alt coins are one of the primary use cases of BTC.  You cannot get alts unless you first get BTC (with exceptions for mining, &c, which are relatively insignificant except in eggregious pre-mine cases, which aren't relevant to the point).  Consequently, there is more demand for BTC.  No dilution is even possible until alts are usable in cases where they displace BTC.  So far these are insignificant.  My estimation is that outright scams (whether via scamcoins or hacks or fractional reserve, what-have-you) are the largest value-drain on the BTC economy, by two orders of magnitude.  The biggest drain on BTC value is emission, but that is independent of the size of the economy.