If Bitcoin takes over the world, i.e. "there can only be one due to network effects" theory (which I think is FUD), then Risto's net worth will exceed $10 billion. He can't spend that much in the remainder of his lifetime, unless he just writes huge checks for no reason whatsoever or tries to purchase an African village or something similarly bizarre. Distributing money any way other than a better designed coin will always be less efficient and less effective and more horrific.
Don't tell me you all will fund cancer research, etc.. because you don't have a clue about those industries and you will waste it just the same, probably be scammed as well. I've seen what happens to guys who centralized capital, [redacted]
I guess you missed the point that centralizing wealth destroys capital and that redistributing from centralized overgrown adolescents doesn't decentralize it again. The lost entropy is not reversible, instead the capital is destroyed and new smaller things will take their place yet all the large rotten oaks trees will die first before the benefit of the new saplings take hold. Those collapsing rotten economies tend to crush many people. You can reread my post which Risto quoted for the game theory and at least he is smart enough to recognize the game theory (i.e. logic and math) point. Of course I have empathy too, which is precisely why I don't want to destroy more capital by centralizing it for no gain. We should be using early adopters to drive the marketing to bring the masses in. Risto has been trying to bring in the little guys, but he is fighting against a coin supply curve which was designed by someone who was either ignorant or evil (and I doubt very much "Satoshi" was ignorant since he foresaw everything including that the mining would become centralized).
Now if your point is that redistributing from a larger number of adolescents than a fewer number of elite, the elite have time and time again demonstrated they are better at managing the masses, because they always win against you. And it is easy to see why, because they understand that they are going to reset everything so letting you all contribute to centralizing and destroying the remaining wealth means you really didn't deserve the talents in the first place.
Others of us will try for a real solution.
Topic: rpietila public diary -- Episode II - page 9. (Read 40823 times)
Cheer up! Don't fall for the FUD.
Distribution is only a problem when there's a power center to maintain the severe inequalities. Saying that wealthy won't spend their hoard is silly. As Risto knows, it's no fun to be rich if you don't live it up. And in fact most wealthy bitcoiners are not preselected as being great investors or money managers, so they will likely fritter it away like most people do (see most lottery winners). And if you think pitchforks will come out, just do what other wealthy people do: become famous for your philanthropy. Or send 90% of your coins to the CoinEater address, making everyone else's more valuable.
Distribution is only a problem when there's a power center to maintain the severe inequalities. Saying that wealthy won't spend their hoard is silly. As Risto knows, it's no fun to be rich if you don't live it up. And in fact most wealthy bitcoiners are not preselected as being great investors or money managers, so they will likely fritter it away like most people do (see most lottery winners). And if you think pitchforks will come out, just do what other wealthy people do: become famous for your philanthropy. Or send 90% of your coins to the CoinEater address, making everyone else's more valuable.
Others: how would you increase the number of bitcoin users in the next 18 months?
Christmas season is coming up and since I detest the ritual of going out and buying (mostly useless) stuff to show my acquaintances that I care about them on a predetermined day I am thinking about printing up some paper wallets, filling them with a modest amount of BTC and giving them out to my friends, together with instructions how to spend them, back them up and all that other stuff.
The most effective way to increase the user base imho would be to support merchant adoption in any way. Either by offering your products and services for BTC yourself - and thus blazing a trail through the local regulatory landscape and hopefully inspiring more people to do the same, when they see that it can be done. Or by asking merchants if they accept BTC and helping them set up the technology to do so.
Bitcoin thrives on the network effect, so every new user and every new "Bitcoin accepted here" create more and more new users.
Other than that, I travel a lot and create Anarchists, Bitcoiners, Couchsurfers and Discordian popes wherever I go
My long-term goal would be to fix the problems I've identified, and having more people with BTC ready to trade is an advantage.
I think Bitcoin is not even close to the bleak future:
- The 20 years until mining rewards fall below gold's inflation rate is actually a very long time
- Political decision-making is very slow, and there will not be uniform 100%+ tax on bitcoins in every country ever, rather I would expect tax competition between countries and blocks, and CGT-free zones like Germany currently is
- Instawallet type services can keep almost complete anonymity, because you don't divulge personal information in any step (not exactly know about IP stuff)
- Generating altcoins is easy
- People do not want to be controlled, which severely limits the opportunities to use the control material against them (illegitimacy problem). Smart people will not want to work for oppressive govt, limiting its potential. Govt also gets only a fraction of things done per man-hour because of its design.
- USA is getting more and more isolated, it is not impossible that the outcome will be a peaceful implosion like USSR.
Others: how would you increase the number of bitcoin users in the next 18 months? I have given everyone of my friends who ask, BTC0.25 in Facebook. If you give too little, they will forget about it or not interested in receiving. If you give too much, they will feel uneasy towards you and are prone to sell it. Giving in general does not work, for the reasons AnonyMint outlined above. Only if people give real value in return, will the exchange increase general well-being by making both parties better off. (With half-forced giving, you never know if either party is better off afterwards. Same with tax, you lose definitely, but in most cases also society loses.)
I think of Hypertiger.
The Robo ATM is going to require a palm scan and a face scan with government-issued photo id.
They have a RoboCoin ATM in Vancouver and my friends and I have used it many times. It *only* requires a palm scan and this is just for Canadian AML/KYC compliance. You do not have to give the machine any other information. It does not scan your licence, require your name, and you could wear a paper bag over your head and still buy coins, if you were so inclined. In fact, I bet you could buy a cadaver's hand from a crooked mortician and use that! Seriously, it is pretty low key and relaxed.
Are you serious?
It will not remain so casual. All small things look great, and as they become more widespread society expects certain things.
I listened to the interview with the principle of that company and he said the design requires all those 3 I mentioned to comply with KYC laws.
The operators of each machine decide, based on guidance from the company. So it is possible that operator is being more lax, but the government can clamp down at any time. The government would be wise to wait until the Robo ATMs are widespread and depended upon, before clamping down and requiring the full capabilities of the design.
If that is the case, I imagine other people who are not concerned about their privacy would be willing to use their information to buy bitcoins from the ATM and then transfer them to you for a small fee.
And due to public ledger, they can thus be compelled by the authorities to reveal the identity of every person they transfered these BTC to or otherwise face culpability for all downstream transactions for these coins.
You guys are ignoring the very serious issue of tainted coins in Bitcoin.
I have thought about this deeply and refuted core dev gmaxwell on this.
The Robo ATM is going to require a palm scan and a face scan with government-issued photo id.
They have a RoboCoin ATM in Vancouver and my friends and I have used it many times. It *only* requires a palm scan and this is just for Canadian AML/KYC compliance. You do not have to give the machine any other information. It does not scan your licence, require your name, and you could wear a paper bag over your head and still buy coins, if you were so inclined. In fact, I bet you could buy a cadaver's hand from a crooked mortician and use that! Seriously, it is pretty low key and relaxed.
Are you serious?
It will not remain so casual. All small things look great, and as they become more widespread society expects certain things.
I listened to the interview with the principle of that company and he said the design requires all those 3 I mentioned to comply with KYC laws.
The operators of each machine decide, based on guidance from the company. So it is possible that operator is being more lax, but the government can clamp down at any time. The government would be wise to wait until the Robo ATMs are widespread and depended upon, before clamping down and requiring the full capabilities of the design.
If that is the case, I imagine other people who are not concerned about their privacy would be willing to use their information to buy bitcoins from the ATM and then transfer them to you for a small fee.
I don't know why you think my short-term goal is to cause people to invest less in Bitcoin. I have even stated the opposite in Risto's other thread. Perhaps it is because I have mentioned that I think it is very risky from a tax perspective for large wealth to invest in Bitcoin.
My long-term goal would be to fix the problems I've identified, and having more people with BTC ready to trade is an advantage.
My long-term goal would be to fix the problems I've identified, and having more people with BTC ready to trade is an advantage.
AnonyMInt:
I have read everything you wrote in this thread and the other "sidetracked " one. I think that when it comes down to it you will get the opposite effect of what you are looking for. Instead of people heading your warnings it will encourage most to expand their investment into bitcoin. You come off as VERY intelligent and someone that knows what he is talking about. Combine that with the words bitcoins and millions and above and you got yourself a recipe for the opposite of what I think you intended.
I have read everything you wrote in this thread and the other "sidetracked " one. I think that when it comes down to it you will get the opposite effect of what you are looking for. Instead of people heading your warnings it will encourage most to expand their investment into bitcoin. You come off as VERY intelligent and someone that knows what he is talking about. Combine that with the words bitcoins and millions and above and you got yourself a recipe for the opposite of what I think you intended.
The Robo ATM is going to require a palm scan and a face scan with government-issued photo id.
They have a RoboCoin ATM in Vancouver and my friends and I have used it many times. It *only* requires a palm scan and this is just for Canadian AML/KYC compliance. You do not have to give the machine any other information. It does not scan your licence, require your name, and you could wear a paper bag over your head and still buy coins, if you were so inclined. In fact, I bet you could buy a cadaver's hand from a crooked mortician and use that! Seriously, it is pretty low key and relaxed.
I thus assume you don't get the point. Redistributing money does not decentralize it. It is worse than flushing it down a toilet (worse because it creates the wrong incentives and behavior for the recipients). The only way that capital can be distributed productively is when people produce something for it because they then make local decisions about optimum (i.e. profitable) resource allocation. If you understand fitness and simulated annealing, then you understand everything else is inefficient. Inefficient doesn't reach a less ideal equilibrium, rather it is a death spiral.
You do have the skill to make everything sound bleak
Great post, still.
This concludes my replies to all posts of this thread that I wanted to comment on.
Bitcoin devalues the western financial system by 1000000000x or so. That is the same as declaring war on the masses.
They have more guns than you do.
99% of people are relatively poor - its not the purpose of Bitcoin to change that. As long as people have excess food and good housing, there is no reason to be concerned about the fact that wealth is concentrated in 1% of the population.
Bitcoin devalues the western financial system by 1000000000x or so. That is the same as declaring war on the masses.
They have more guns than you do.
Quote
I am going to attempt to stop you. I realize you can't see your errors. I am trying to teach, but I doubt you will even read the links I provided above.
As a matter of fact, I met Eric Raymond in Austin where I worked at an AI research company. His comments on democratic politics are interesting. But I am satisfied that economic injustice is solvable by the political process. Not absolutely solvable - just good-enough solvable. In particular, I believe that household purchasing power, when unfairly allocated, can be recognized and fixed by the political process, stemming from the will of the voting majority in democratic jurisdictions, or by well-meaning technocrats elsewhere.
Then you did not comprehend it deeply or did not deeply understand what I wrote about degrees-of-freedom == potential energy. The game theory has no natural equilibrium, rather it is a death spiral into individualizing the benefits and socializing the losses.
There is simply no way to convince a socialist (big government, government can solve every problem). All we can do is get out-of-your-way as you destroy yourselves over and over again in history. How many dark ages, genocides, wars, etc (that all derive from the economic failure of democracy) do I have to cite? Any way, it wouldn't make any difference, because you are unable to hear our logic. You have your ideas fixed in your mind and we minanarchists (small government) have ours fixed in our mind.
Stalemate.
Suppose in some possible world, that the three Trinity College crypto guys are revealed to be Satoshi Nakamoto, and suppose that in 2018 they are bitcoin trillionaires. Would not the UK do something about redistributing their windfall? Or more likely, they would voluntarily distribute the majority of it.
I thus assume you don't get the point. Redistributing money does not decentralize it. It is worse than flushing it down a toilet (worse because it creates the wrong incentives and behavior for the recipients). The only way that capital can be distributed productively is when people produce something for it because they then make local decisions about optimum (i.e. profitable) resource allocation. If you understand fitness and simulated annealing, then you understand everything else is inefficient. Inefficient doesn't reach a less ideal equilibrium, rather it is a death spiral.
Until socialists understand that basic economics, they are perpetually doomed to repeat the megadeath outcomes over and over in history.
Economics is not what you think should be. Morals and ethics have nothing to do with economics. Rather it is what is most efficient. Due Coase's Theorem (which derives from the Second Law of Thermodynamics), nature will route around an inefficiency eventually. Society can obstruct barriers and create imbalances, and the longer they do that with government (centralization), then the worse the implosion when nature goes around the cancer.
Regarding a defense of the Technological Singularity, it is off-topic here. Suffice it to say that I believe all relevant intelligent human behavior, and likewise the behavior of human organizations, can be modeled as learnable skills. My own research, following the advice of Alan Turing, is to create a computer system capable of being taught skills, and then proceed to teach it.
I refuted that logic resoundingly in my blog article which I provided a link to in my prior post. I also studied A.I.. That is where I learned about simulated annealing.
Your blog post mentions human creativity as a counterexample. An important AI skill that I worki on is the ability for the computer to write and modify computer programs. This is the sort of creativity that interests me.
I thus believe you missed my point. The salient reason is that AI can never exceed the entropy we have, which I reasoned in great detail in my blog even covering Kurzweil's rebuttals on the genome. That is fundamental. The best you could hope for is to reproduce life itself. You will not exceed life. Any machine you produce, humans can leverage it. You will not enslave the humans in unpredictability (an entropy regime) that does not already exist, as the Technological Singularity claims.
Capital Gains Tax is one thing that greatly hinders bitcoins from being distributed, and should be abolished.
Wealth tax and capital gains together could really squeeze you. Socialism doesn't reduce taxes. What reduces taxes is destroying the socialism with competition from a low-tax jurisdiction. See the Heritage Foundation data and sort on Government Spending:
http://www.heritage.org/index/explore
And realize that means the masses are prospering in that low-tax jurisdiction. Not like Bitcoin where the only who are prospering are the early adopters and the masses are not gaining any benefits.
Problem for us as individuals is we will be taxed by our national id, not by jurisdiction. We are marked already from birth.
98% of humanity won't have any bitcoins when it enters a bubble and this is a problem, since these are already the laggards, and by buying at the bubble, they make their situation worse, not better. Any thoughts?
The only potential solution I see is an altcoin which distributes coins continuously to CPU-only miners (while not diluting capitalists too rapidly since the coin is appreciating orders-of-magnitude faster than the small coin rewards). This will also raise the transaction rate (velocity of money), because the bottom 97% have a wealth distribution based on using money as cash, not as a store-of-value:
http://physics.umd.edu/~yakovenk/papers/PhysicaA-299-213-2001.pdf
Quote
I am going to attempt to stop you. I realize you can't see your errors. I am trying to teach, but I doubt you will even read the links I provided above.
As a matter of fact, I met Eric Raymond in Austin where I worked at an AI research company. His comments on democratic politics are interesting. But I am satisfied that economic injustice is solvable by the political process. Not absolutely solvable - just good-enough solvable. In particular, I believe that household purchasing power, when unfairly allocated, can be recognized and fixed by the political process, stemming from the will of the voting majority in democratic jurisdictions, or by well-meaning technocrats elsewhere.
Suppose in some possible world, that the three Trinity College crypto guys are revealed to be Satoshi Nakamoto, and suppose that in 2018 they are bitcoin trillionaires. Would not the UK do something about redistributing their windfall? Or more likely, they would voluntarily distribute the majority of it.
Regarding a defense of the Technological Singularity, it is off-topic here. Suffice it to say that I believe all relevant intelligent human behavior, and likewise the behavior of human organizations, can be modeled as learnable skills. My own research, following the advice of Alan Turing, is to create a computer system capable of being taught skills, and then proceed to teach it.
Your blog post mentions human creativity as a counterexample. An important AI skill that I am developing is the ability for the computer to write and modify computer programs. This is the sort of creativity that interests me.
Potential bitcoin profit provides yet another way to bootstrap this effort. And I have in mind using bitcoin as an internal currency for the system of human-mentored software agents that comprise my AI architecture.
Then just wait the required approximately 2 years and you will be a millionaire if bitcoin stays on track.
Don't you remember when Jason Hommel was worth $15 million in 2007, then everything crashed.
Saying you are millionaire in Bitcoin is like saying "I expect the world to be a Neverland".
Just remember what Obama said, "you didn't earn that".
You were called "Robber Barons" in the last Great Depression.
No one wants to hear that indeed "it is too good to be true" as ALL such get rich quick schemes always are.
The current fiat-printing stimulation by coordinating central banks could soon be tapered off as the world economy recovers from the Great Recession.
There is no recovery. This is an illusion of increasing debt. I explained this at the following linked post, as well have a link there to the astronomical total debt-to-GDP ratios, e.g. 550% for the UK for example.
http://blog.mpettis.com/2013/10/hidden-debt-must-still-be-repayed/#comment-3179
I believe you are living in Neverland. Do you have any rationale to support that statement?
We are seeing a bounce in dollar and euro because capital is pulling out of BRICs due to the end of China's imbalanced economy. The commodity bubble peaked and is in a slow motion crash.
India is crumbling. The collapse has stalled but will renew after a bounce. Ditto China, Brazil, Russia, etc.
Accordingly, I expect world stock markets to return to more typical valuations during the same period that bitcoin reaches full adoption by speculators.
Indeed you may see a double in US stock markets due to this capital rushing from periphery to the reserve economies. This will drive US interest rates up, which will lay the foundation for the collapse in 2016.
After 2016, all hell will break loose.
Thus at the same time stock markets are slumping, bitcoin will be a contrasting boom. That might be the narrative that lures the last large cohort of bitcoin investors.
Peripheral stock markets slumping because this wave of globalization via expansion of debt is peaking, US stock market will blast off to a double between now and end of 2015 because capital is running back to the safest haven and this causing a boom in US real estate and markets.
I am not worried about income and wealth inequality being aggravated by bitcoin adoption. Economic injustice is solvable by the political process in respective jurisdictions.
No it is not. Political action invariably makes everything worse.
You fail to understand the basic game theory of political economics. Learn from Eric S Raymond, the creator of "open source" who has a claimed 150 - 170 IQ:
Some Iron Laws of Political Economics
As an aside, achieving the Technological Singularity is my life's mission - I am an active artificial intelligence researcher,
Technological Singularity is complete nonsense. I explained why on my blog:
http://unheresy.com/Information%20Is%20Alive.html
and believe that when computers and robots put nearly everyone out of work, the political process will find a fair way to allocate purchasing power to human consumers - in a future economy growing exponentially without the constraints of human labor.
You don't understand the physics of math. Degrees-of-freedom is potential energy. When you redistribute capital in effect you centralize it, thus you destroy all the potential energy in the economy.
If you boomer socialists have your way, you will destroy humanity and we will be in a MadMax dark age.
I am going to attempt to stop you. I realize you can't see your errors. I am trying to teach, but I doubt you will even read the links I provided above.
If you disagree with me, why not try to convince me with math and logic as my links above do.
P.S. I don't intend this as a personal insult. But if you are going to make statements that are consistent with destroying the world (from my perspective), please be prepared to support your reasoning with math, data, and logic.
98% of humanity won't have any bitcoins when it enters a bubble and this is a problem, since these are already the laggards, and by buying at the bubble, they make their situation worse, not better. Any thoughts?
Yes. Barricade yourself on a Caribbean Island.In all seriousness, you touch upon a very important problem. When the whole economic landscape changes and The Last Big Bankrun (on the dollar dominated fiat system) hits us, most people will find it extremely unfair that early adopters sit on this wealth and their private pensions as well as the government's pension schemes are gone. There is one solution for that though. I will outline it in another thread.
http://lifeboat.com/blog/2013/04/bitcoins-dystopian-future
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We need people thinking about this. I’ll admit that many of the things I wrote about may not happen at all, or may happen very differently than I imagine. However, there are lots of people touting the fantastic benefits that bitcoin and its children can give us, and I don’t see anybody talking about how bad things could potentially get.
We need solutions. When the government finally starts taking decentralized currency seriously, it will probably be doing so in a state of panic. We need to be advising governments now about how they can survive the storm and protect their populace. We need to think of ways the government can pay for its most critical operations, and what legislation makes sense to mitigate these new risks while preserving as much freedom as we can.
The Lifeboat Foundation is attempting to provide this thinking, advice, and solutions. They are already getting ready for a new advisory board, culled from computer scientists, economists, and bitcoin experts. If you make a fortune from your investments in decentralized currency, I urge you to consider how you can help all the people harmed by these rapid changes. Many bitcoin enthusiasts seem to think they will get to retire on a private island with a harem and a stable of Italian sports cars. This is wrong. Bitcoin investors need to someday become bitcoin philanthropists, and our giving needs to be targeted at helping all the people we have harmed. The Lifeboat Foundation is one option, but I’m sure there will be others.
We need solutions. When the government finally starts taking decentralized currency seriously, it will probably be doing so in a state of panic. We need to be advising governments now about how they can survive the storm and protect their populace. We need to think of ways the government can pay for its most critical operations, and what legislation makes sense to mitigate these new risks while preserving as much freedom as we can.
The Lifeboat Foundation is attempting to provide this thinking, advice, and solutions. They are already getting ready for a new advisory board, culled from computer scientists, economists, and bitcoin experts. If you make a fortune from your investments in decentralized currency, I urge you to consider how you can help all the people harmed by these rapid changes. Many bitcoin enthusiasts seem to think they will get to retire on a private island with a harem and a stable of Italian sports cars. This is wrong. Bitcoin investors need to someday become bitcoin philanthropists, and our giving needs to be targeted at helping all the people we have harmed. The Lifeboat Foundation is one option, but I’m sure there will be others.
98% of humanity won't have any bitcoins when it enters a bubble and this is a problem, since these are already the laggards, and by buying at the bubble, they make their situation worse, not better. Any thoughts?
Have you seen dukong's bitcoin ranking search? http://btc.ondn.net/search
The current blockchain holdings by address yield this distribution ....
Code:
Balance Rank
1 BTC 195,629
10 BTC 91,885
100 BTC 10,128
1,000 BTC 1,127
10,000 BTC 95
100,000 BTC 3
Total 2,062,380
At full adoption, one could reasonably expect the same ratios of large to small holdings, with large growth below 1 BTC. Addressing your point, let's think about when the 98% of humanity acquires bitcoins. I believe it will not be in the next few years when bitcoin reaches full adoption by financial speculators, rather the masses will adopt bitcoin when it is the universal payment mechanism, e.g. everyone has a mobile debit account denominated in bitcoins for everyday point of sale purchases.
There is a lesser percentage of humanity that invests in securities and precious metals. Here in the USA, that is about 50%. It is the investor class that will propel bitcoin to the bubble you mention. My logistic bitcoin price analysis suggests that the exponential increase of bitcoin prices will continue for a few more years, therefore in the final exponential year perhaps 10x more new investors will participate - and those are the ones who may be buying near the top.
The current fiat-printing stimulation by coordinating central banks could soon be tapered off as the world economy recovers from the Great Recession. Accordingly, I expect world stock markets to return to more typical valuations during the same period that bitcoin reaches full adoption by speculators. Thus at the same time stock markets are slumping, bitcoin will be a contrasting boom. That might be the narrative that lures the last large cohort of bitcoin investors.
I am not worried about income and wealth inequality being aggravated by bitcoin adoption. Economic injustice is solvable by the political process in respective jurisdictions. As an aside, achieving the Technological Singularity is my life's mission - I am an active artificial intelligence researcher, and believe that when computers and robots put nearly everyone out of work, the political process will find a fair way to allocate purchasing power to human consumers - in a future economy growing exponentially without the constraints of human labor.
This and the following discussion is, I think, high quality concerning the economic threats to Bitcoin.
I have high hopes for the Bitcoin ATM's, since they can quickly disperse bitcoins to many hands, which I consider important. I think that having individuals with large bitcoin stashes is equally important, but that is already achieved and will probably not change that much due to inertia alone. Educating the BTC1,000+ holders is my job. We need much more people like me, who quit their day job and do some thinking.
There is some talk concerning starting a think tank for people who are strongly committed in crypto and liberty. PM me.
I have high hopes for the Bitcoin ATM's, since they can quickly disperse bitcoins to many hands, which I consider important. I think that having individuals with large bitcoin stashes is equally important, but that is already achieved and will probably not change that much due to inertia alone. Educating the BTC1,000+ holders is my job. We need much more people like me, who quit their day job and do some thinking.
There is some talk concerning starting a think tank for people who are strongly committed in crypto and liberty. PM me.
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