Topic: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion - page 18700. (Read 26706963 times)

http://www.marketoracle.co.uk/Article55413.html
US Dollar Crashes, Gold And Bitcoin Skyrocket As Economic Recovery Lie Is Exposed

Wait till we hit 666.66 on the way down lots of walls popped up at that price

Well, the basic idea was, to make a decentralized network computer executing smart-contracts (not especially for a currency function, more like automated "transactions", colour tokens (like open company shares), crowdfunding (like this DAO monstrosity:)), where ether is the "fuel" to run the scripts. So it is highly different from the Bitcoin network in regard of its purpose.

But, there are problems with this idea. Both technical and social:

1. it uses a Turing-complete scripting language, so it can create infinite loops - this is supposed to be negated by using ether for every processing cycle, but still can jam up the network for awhile in theory, it is an attack vector;

2. the problem of scaling: it can not, because, every script (smart contract) must be run by every node, or the network spilt, so it can get much-much-much more hardware heavy than processing a ~300 bytes bitcoin tx.
Also, the ORDERING is different (and uncontrollable) for different nodes - because how data propagates on a network, which can totally fukup the whole idea of interdependent contracting aka: the order how script I. or script II. occupies/operates in the next block can be paramount, if scI depends on the execution of scII., and they get implemented in a different time order, they crush (fail to run, since the dependency is behind the execution order for every node downloading the new block with executable scripts -"transactions").
In short, the interblock ordering of "transactions" are not necessarily interchangeable, while in bitcoin, they are! That is a key technical unavoidable difference. The proposed solution, to split the nodes to process different executable is against the basic idea, and creates more profound problems...

3. strictly speaking, Ethereum has no (yet) known enforceable, algorithmic monetary policy (we do not know if it is fixed at what number or what is the inflation rate if not, how exactly will it transform into the PoS consensus, also, PoS can not work on the long run, because it has too many attack vectors, especially with a script running environment). Also, pre-mined -huge red flag -, which means very strong centralization, and direct control over the protocol in few hands (remember, no anonym PoW random nonce mining took place, because, premining!!!).

In bitcoin, after and since the genesis block, anyone can see the unchangeable monetary policy: 21mil coins, reward drop after every 210,000 blocks, PoW consensus.

4. those who were studying the DAO made it obvious - even before the shameful "IPO" ended -, that you can not use the same token directly for financing actual projects, while the investor's tokens are both committed (frozen), and an external force (the market price of ETH) can interfere with those project's financial plans. (If the DAO commits say, 100k ether to a project, which is supposed to worth $100k, but suddenly ETH drops 10%, they won't be able to pay the contractors, and they already committed, and can not change their "votes", while can not have enough $ - unless the contractor takes ETH, but than he faces the same problem - DAO could work, IF crypto would only be the de facto world currency, but only than).

5. Assmaster, i disagree. Bitcoin is scaling, BECAUSE it is a dumb network (LN for example). Just like Ethernet, or tcp/ip, they are dumb, but additional layers can use the easy, secure, simple basis of it. Ethereum is too complicated in itself to be layered on, forces way too complicated and self-conflicting goals to nodes, and never actually was designed to be a currency (it is a script running network platform, not designed to be an immutable, decentralized trust network with several exahash/s security power).

JJG are you also saying that BTC price depends on the hashrate (production costs) and not the other way around???

There's a slight difference: If the price is high due to scarcity, then there is more slippage and volatility versus if the price is high without scarcity. Also the holders have to fear a drop that would occur if the hoarded coins suddenly became available.

They can establish their business model in any way that they want, whether that means cashing out on a daily basis or holding coins for years.  It does not matter, and the whole bitcoin infrastructure does not give a shit about what they decide to do on an individual basis.  If those coins are not available for circulation, then the bitcoin community will use whatever coins are available. 

In the end if the behavior of the miners causes there are not enough coins, the price of bitcoins will go up, and if there are too many coins the price of bitcoins will go down... so who gives a shit whether miners hoard coins or liquidate them immediately.. the market will adapt to whatever the supply is... and for the most part, bitcoin works the same, if the price is $1 per bitcoin or $1million per bitcoin, even though the interaction with other financial systems is going to differ whether there is a $20 million market cap or a $10 trillion market cap. 

Ultimately, each of the miners decide for himself/herself how many coins s/he is going to sell, if any, and the miners are a diverse of enough of group, at least so far, that they are likely not coordinating their decision(s) regarding selling/holding.  If for some reason, the bitcoin market creates a space in which miners are able to coordinate their decisions, then likely the space is going to need to be reconsidered at that time.

Once miner decides to hoard coins instead of selling it's not the mining side of business that handles it but the investment/trading side so. For all purposes at that point it's an investment. Which just muddies up the argument if price follows the hashrate (indirect cost of production), or hashrate follows the price.

lol