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Bitcoin's Shared Ledger Technology: Money's New Operating System

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Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#71

Post by 2drew3 »

scintill76 wrote: post #68
2drew3 wrote: post #63

Earlier quoted context omitted.

More like once out of 30k+ transactions. PayPal, AirBnB, and Raise all faced similar challenges.

German police searched a house and seized stuff for months in one case[1], Amazon reversed gift credit in another[2]. Obviously this is no proof that fraud is rampant, but I still lean toward thinking fraud is too likely for me to want to be involved with using purse.io, especially if I wanted a good deal (big discount = more likely it's a carder cashing out a stolen card.) If nothing else these stories show there's…

Restrictions on buyers (unverified users are limited, 6 levels), social verification, behavior analytics (sift science), among others. User was made whole, police dropped the case, and we introduced $10,0000 guarantee. Not an excuse, but we were a team of 2 when that transaction happened, and it was 3 months after we started while we were in an accelerator.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#72

Post by Animats »

Jasper_ wrote: post #65
natrius wrote: post #29

Earlier quoted context omitted.

> I'm also familiar with Ethereum, and I still don't see it as better than a company-run database for anything like uber/airbnb/etc with a central company behind it. It's better because no one is taking a cut off of the transactions that the network enables. No one has to approve a new application that uses the network, so every application can build on top of the network. The people own the network, not companies. T…

That's a nice pipe dream. Unfortunately, it's not how Bitcoin has played out in the real world. The Bitcoin network has unfortunately not been owned by the people, but instead dominated by Chinese miners with ASICs. The current low-ball estimate based on public numbers is that Chinese miners account for ~70% of the hashrate -- see https://blockchain.info/pools As the database gets larger and larger, less and less peo…

"Bitcoin seems to be a vehicle for Chinese BTC miners to trade cheap electricity for VC money."

I suspect that some of the Chinese BTC mining is simply a way to convert yuan to dollars. That's hard to do from inside China, because the People's Bank of China imposes currency controls.

Back in 2013, it was possible to buy Bitcoin with yuan transferred through the banking system within China and sell it outside China for dollars. That's what cause the big run-up in Bitcoin to over $1000. Then the PBOC clamped down, which caused the big drop in Bitcoin to around $250.

Bitcoin mining, though, is viewed as manufacturing and export under Chinese law. Those activities are encouraged, and subsidies may be available for construction and power. The Bitcoins can be sold outside China for dollars or euros. So, even if the mining just breaks even, it has utility for the owners of the mining operations.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#73

Post by natrius »

Jasper_ wrote: post #65
natrius wrote: post #29

Earlier quoted context omitted.

> I'm also familiar with Ethereum, and I still don't see it as better than a company-run database for anything like uber/airbnb/etc with a central company behind it. It's better because no one is taking a cut off of the transactions that the network enables. No one has to approve a new application that uses the network, so every application can build on top of the network. The people own the network, not companies. T…

That's a nice pipe dream. Unfortunately, it's not how Bitcoin has played out in the real world. The Bitcoin network has unfortunately not been owned by the people, but instead dominated by Chinese miners with ASICs. The current low-ball estimate based on public numbers is that Chinese miners account for ~70% of the hashrate -- see https://blockchain.info/pools As the database gets larger and larger, less and less peo…

> The Bitcoin network has unfortunately not been owned by the people, but instead dominated by Chinese miners with ASICs.

This is not the ownership I'm talking about. It doesn't matter who gets the reward for a particular transaction. What matters is how many people are validating the transactions to ensure that no one is putting fraudulent data into a blockchain's database. Those Chinese miners that comprise 70% of the hashrate have no power to dictate which transactions are valid and which aren't. If they try to incorporate invalid transactions, they will be ignored.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#74

Post by mcintyre1994 »

TheDong wrote: post #7
natrius wrote: post #3

The "shared ledger" analogy for blockchains is limiting. If you want to understand the potential applications, you should stop using it in your thinking. Blockchains give us publicly writable databases . Such a thing never existed before. A blockchain has one or more programs that define what can be written to the public database. Bitcoin's program is mostly about distributing the 21 million coins to miners and preve…

It gives you a publicly writable database that is only secured by people desiring to throw away large sums of computation in an environmentally unfriendly manner. Writes are also slow (10 mins...) and requires relatively high bandwidth and space to be used securely. There's no reason that AirBnb or Uber would want their database to be public, slower, and broken as soon as people lose interest in splitting up mining.…

I agree with you on most points but the idea would be an Airbnb or Uber that don't take a large fee and make a large profit right?

I know this is all wishful thinking stuff but it doesn't seem fair to say this is terrible because companies that exist to centralise transactions within a space won't want it.

You're right that it doesn't seem to work without money though, and if it is a centralised service it's way more expensive than before. It all feels too theoretical when you get talking about multiple blockchains.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#75

Post by Jasper_ »

natrius wrote: post #73
Jasper_ wrote: post #65

Earlier quoted context omitted.

That's a nice pipe dream. Unfortunately, it's not how Bitcoin has played out in the real world. The Bitcoin network has unfortunately not been owned by the people, but instead dominated by Chinese miners with ASICs. The current low-ball estimate based on public numbers is that Chinese miners account for ~70% of the hashrate -- see https://blockchain.info/pools As the database gets larger and larger, less and less peo…

> The Bitcoin network has unfortunately not been owned by the people, but instead dominated by Chinese miners with ASICs. This is not the ownership I'm talking about. It doesn't matter who gets the reward for a particular transaction. What matters is how many people are validating the transactions to ensure that no one is putting fraudulent data into a blockchain's database. Those Chinese miners that comprise 70% of…

Something has to validate transactions. If miners don't do it, who else will? Clients run by users won't, because they can't store the 50GB-and-ever-growing blockchain locally. They simply use the SPV protocol, which trusts that somebody else has validated the chain for them.

As you can tell by the bitcoin.org alert, it was a serious issue that miners stopped validating transactions, because lots of wallets blindly trusted the longest chain, which was actually invalid.

The majority hashrate can effectively determine the longest chain, and thus, most wallet implementations out there.

Even if the wallets start doing limited validation, the Chinese miners could always exclude specific transactions they don't like.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#76

Post by toomim »

EGreg wrote: post #21

Why do blockchains need proof of work at all? It seems that this is only to solve the Byzantine Generals problem, not to prevent spam or something like that (which HashCash used). Given a network where every node eventually communicates with every other node, a vector clock is enough. You can simply have append-only trees! This data structure is ideally suited for distributed applications. In a smaller network, quest…

Proof of work tells you which version of history has the most work behind it.

Imagine you join the network, trusting nobody. All you trust are the laws of physics and computation. You ask everyone you see "What is the current status of the ledger?" People give you different answers.

So you choose the answer that has the most proof of work behind it. This is the one that the world is most invested in.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#77

Post by Synaesthesia »

dogma1138 wrote: post #48
natrius wrote: post #46

Earlier quoted context omitted.

Access isn't free, but anyone can write to it without permission. That makes it public. Individuals couldn't compete with SWIFT because they had no way to coordinate their actions. Public databases change that. The first phase will be financial institutions using blockchains to lower their costs. The second phase will be financial institutions pursuing new business models around blockchains anyone can access every ti…

Again you think that those blockchains will be publicly accessible which is incorrect, they'll have their own blockchains for their own settlement, maybe they'll have some sub-chains in the long run for end-users but still you can bet your house on that they'll find a way to ensure that users can't simply join the blockchain "fully" (e.g. find a way to separate wallets from mining, like BC does with mining pools for…

Yes but the price to write to the Blockchain is so low, a few cents that it's really accessible to everyone. I think Bitcoin is still a very significant development purely because it's completely independent from the existing global financial system.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#78

Post by chillydawg »

Jasper_ wrote: post #70
2drew3 wrote: post #69

Earlier quoted context omitted.

So the UI allows users to set a discount rate, similar to the way you set a limit order on etrade or Name Your Price on Priceline. I can place an order to buy AAPL for $100 or bid to stay in a 5 star hotel for $10. Doesn't mean they will get filled.

But they will be filled. By people who are very eager to cash out of some stolen credit cards or need some dirty money in someone else's hands. And, bonus points, in a way that makes the transaction irreversible.

Or, more likely, someone will jump in front of that request for 50% and ask for 45%. Then 40%, then 30, then 20 and then 8%. It's a market.

I do agree, though, that those very high discounts should be a red flag, if they're for any serious money. Stuff for $5 with a 50% discount is no big deal if someone just wants ot be rid of a card and doesn't mind losing a couple bux, which they'd end up paying in fees buying BTC anyway.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#79

Post by chillydawg »

Animats wrote: post #72
Jasper_ wrote: post #65

Earlier quoted context omitted.

That's a nice pipe dream. Unfortunately, it's not how Bitcoin has played out in the real world. The Bitcoin network has unfortunately not been owned by the people, but instead dominated by Chinese miners with ASICs. The current low-ball estimate based on public numbers is that Chinese miners account for ~70% of the hashrate -- see https://blockchain.info/pools As the database gets larger and larger, less and less peo…

"Bitcoin seems to be a vehicle for Chinese BTC miners to trade cheap electricity for VC money." I suspect that some of the Chinese BTC mining is simply a way to convert yuan to dollars. That's hard to do from inside China, because the People's Bank of China imposes currency controls. Back in 2013, it was possible to buy Bitcoin with yuan transferred through the banking system within China and sell it outside China fo…

I'm not sure how flooding the market with bitcoin trying to buy USD would drive the USD price of bitcoin up. I think you have something backwards here.

Re: Bitcoin's Shared Ledger Technology: Money's New Operating System

#80

Post by csomar »

vectorpush wrote: post #41

Bitcoin and blockchain enthusiasts have been claiming that bitcoin (or etherum) is going to take the world by storm any day now, yet all I ever see anywhere are big claims (revolutionizing payments, disrupting remittance, ending wars, freeing the people, destroying the banks etc, ad nauseam) with very little substance and lots of scams, frauds and dead-end ventures. Dark markets, internet gambling and a handful of ot…

Relevant Comment: https://news.ycombinator.com/item?id=10139978

You are not an idiot. You are just underestimating how large the "fraud" economy is, at a global scale. Think SilkRoad, Ponzi Schemes and Capital fleeing overseas.

Bitcoin can be huge in these industries and this can drive it to be huge overall and then it might become successful on the mainstream use.

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