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China orders Bitcoin exchanges in capital city to close

bbc.co.uk

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Re: China orders Bitcoin exchanges in capital city to close

#191

Post by XR0CSWV3h3kZWg »

tboyd47 wrote: post #109
strgcmc wrote: post #98

Earlier quoted context omitted.

Nothing "stopping" it, except the tens (hundreds?) of millions of dollars worth of hardware investment it would take before your new hashrate becomes at all competitive. It's a bit like saying there's nothing stopping you from launching your own soft drink and beating out Coca Cola (you could try, but you probably won't win). China has a huge and possibly insurmountable lead in not just existing built hardware, but a…

Miners have very little power over Bitcoin as a whole. They are constrained both by Bitcoin's rules and economics. If they mine invalid blocks or optimize for something other than fees, the operation will turn unprofitable. If they just stop mining, the mining difficulty will adjust and suddenly ASICs will not be needed to turn a profit. There is a delicate balance in Bitcoin, currently tipped slightly in their favor…

Miners obviously are okay taking a hit as there are plenty that are working on the less profitable BCH chain.

Re: China orders Bitcoin exchanges in capital city to close

#192

Post by eternalban »

thephyber wrote: post #172
eternalban wrote: post #96

Earlier quoted context omitted.

Let's do a little searching for "anonymous" in the memory hole : http://www.newsweek.com/virtual-currency-bitcoin-anonymous-w... https://www.newyorker.com/magazine/2011/10/10/the-crypto-cur... https://arstechnica.com/tech-policy/2011/06/bitcoin-inside-t... https://techcrunch.com/2011/05/20/bitcoin-ven-and-the-end-of... https://gizmodo.com/5803124/what-is-bitcoin Hah. So the usual suspects were pimping it, in 2011, as…

If you use an exchange, you are one step removed from the cryptocurrency. Complaining about the lack of privacy of BitCoin when using an exchange is like complaining that you did an illicit transaction in front of a police station to ensure you didn't get mugged, but are surprised when the police use security camera footage as evidence against you.

Straw man, much? Who is "complaining"?

I am pointing out that it was "sold" as "anonymous", by the establishment. And it clearly could not be that, per spec.

In fact, I also remember that this feature of cryptocurrencies was subtly communicated to a larger audiance in conjunction with stories about "a group of hackers called Anonymous" -- you know, those guys with their suited headless figure in front of a globe with imperial laurels logo. (Someone must have gotten a good lolly laugh coming up with that zinger of a logo. Or possibly merely sniffed in contempt.)

Re: China orders Bitcoin exchanges in capital city to close

#194

Post by tonfa »

yourapostasy wrote: post #177
occamrazor wrote: post #93

Earlier quoted context omitted.

Forex commissions are lower than 1%. Which exchanges offer better rates on a fiat/bitcoin/fiat transfer?

Where are you getting below 1%, and how much are you exchanging? I'm working with 5-figure USD amounts, drafted on paper checks, and I'm averaging right around 1-1.2% after all costs are accounted for, but not below that.

Stock broker with FX, market spread and low fee, total result can easily be less than 0.1% (and even a lot less most likely closer to 0.01%).

Re: China orders Bitcoin exchanges in capital city to close

#195

Post by betterunix2 »

mamon wrote: post #49
TeMPOraL wrote: post #31

Earlier quoted context omitted.

> governments want control over money Of course. And for a good reason. People utter this line as if governments wanting control over money was somehow bad . Money, within all human societies that exist or existed, is pretty much synonymous with power. It is the tool that allows an individual to incent, compel and coordinate other people to do what said individual wants. With $1 you can make someone cook you a hot do…

This is so wrong that I don't know where to start. First of all, people tend to forget that government is not made of angels. It is made of humans, who are susceptible to the same flaws as the rest of us: greed, hunger for power, etc. Therefore we should try to limit the power government has over us to only basic necessities. Second of all, historically, human societies functioned quite well with multiple competing c…

> In the end money is just a commodity, same as bread, so we should let the market decide which currency to use, without any monopolies, state-owned or other.

Is there some reason to believe that markets can exist without government intervention of some kind? At a minimum someone needs to ensure that the participants in the market are not killing each other. Even in prison economies there are de facto "governments" (inmates with power in the prison hierarchy) that keep the "market" orderly and decide the rules.

In the absence of government, trade tends to be limited to occasional encounters between groups of people and too infrequent for any kind of market to form as an emergent phenomenon. In the absence of government, an encounter between strangers can quickly turn into a deadly fight, and an offer to trade may just as easily be a pretext for killing someone to steal their possessions. Markets can only exist when the worst outcome of a bad deal is getting swindled.

Re: China orders Bitcoin exchanges in capital city to close

#196

Post by contingencies »

nikcub wrote: post #43
cs702 wrote: post #15

As soon as I read this, two words came to mind: Capital flight. A growing number of Chinese nationals has been using Bitcoin to siphon money out of China over the past several years.[1][2] Not surprisingly, the Chinese government is cracking down on this innovative form of capital flight. [1] http://www.theepochtimes.com/n3/1891021-how-chinese-use-bitc... [2] http://www.theaustralian.com.au/business/markets/chinese-i…

> The saver can then exchange bitcoin for dollars at any of the global bitcoin exchanges without anyone ever knowing his identity. This is where the "Chinese people use Bitcoin to exfil capital" story falls apart. It's near impossible to open a foreign bank account and pass KYC from within China as a Chinese citizen. You have to travel to Macau or Hong Kong - and if you're doing that you may as well use the cheaper a…

This matches what I see on the ground in Shenzhen and in HK banks. Even the latter are getting squeezed about mainland capital inflow now. There are still mechanisms through international corporate relationships and licensed investment channels to exfiltrate large sums. The regulator in question is the 外汇管理局 or "foreign exchange management bureau". Smiles from Zurich.

Re: China orders Bitcoin exchanges in capital city to close

#197

Post by flatfilefan »

tannerbrockwell wrote: post #22

China will nationalize the domestic miners and treat Bitcoin as a commodity asset that the state controls. I believe this will immediately cause a constriction in supply as those coins will not be sold at least initially on the open market. Look for this messaging to coincide with the pronouncements around the new five-year plan(FYP)[1]. As the first major section of the 13th FYP, innovation is emphasized as a corner…

Why a disruptive nationalisation should be better than just buing the bitcoins on the open market? Or investing into the new rigs itself?

Re: China orders Bitcoin exchanges in capital city to close

#198

Post by amalcon »

aianus wrote: post #44
TeMPOraL wrote: post #31

Earlier quoted context omitted.

> governments want control over money Of course. And for a good reason. People utter this line as if governments wanting control over money was somehow bad . Money, within all human societies that exist or existed, is pretty much synonymous with power. It is the tool that allows an individual to incent, compel and coordinate other people to do what said individual wants. With $1 you can make someone cook you a hot do…

The state by definition has monopoly on violence, not power in general. You don't want a state with total centralized power over the economy because you end up with places like North Korea or the USSR with uncompetitive industry and shortages.

I strongly dislike that definition of the state.

Such a state as described in the pithy phrase has never actually existed. Even the very strongest states have violence that the state was powerless to stop. That objection can only be resolved by reducing the strength of the term "monopoly" to something more like plurality control, but then it does apply to power in general.

Simply put, if some other coalition has more general power than the state, then it has the option to become the de-facto state. There are lots of terms for this, depending on the party with the power: from revolt and coup to occupation to ineffective government.

There's a discussion to be had about how to best allocate that plurality control to minimize abuse, and physical force is likely a component of such an allocation. It's far from clear, however, that an allocation of only physical force is viable even if it is desirable.

Re: China orders Bitcoin exchanges in capital city to close

#199

Post by betterunix2 »

vasilipupkin wrote: post #116
sova wrote: post #101

Earlier quoted context omitted.

https://www.neowin.net/news/china-experimenting-with-its-own...

I don't get it. What's the point of a country issuing a cryptocurrency? isn't decentralization the whole point of bitcoin, ethereum, etc. ?

There are various forms of decentralization. Bitcoin tries to be as extremely decentralized as possible but you can greatly increase energy efficiency by centralizing a few aspects. Here is a thought experiment:

Imagine a system where the money is issued by a central authority. The users would register their identities with the authority, and receive a certificate. When the bank issues money, it assigns a random serial number R, and it signs it with the bank's key and specifies whose money it is by the user's public key U: S[U, R]. Now suppose Alice has S_Bank[Alice, R] and wants to pay Bob. She can sign the money over to Bob: S_Alice[Bob, S_Bank[Alice, R]]. Bob could do the same to give Charles some money.

Eventually, someone will deposit the money they received with the bank. The bank will check if money with the same serial was ever deposited previously. It can then catch the cheater who double-spent the money by looking for the "fork" in the signature chain. So if the bank tied identities to some offline ID, the police can go arrest the fraudster (or you can imagine other punishments, like blacklisting them from the entire system, etc.).

Notice that even though money creation, identification, and double-spending defense are all centralized, payments remain decentralized: unlike credit cards etc., in this system, one need not contact the bank in order to spend money. True, there may be more of a delay in catching double spending; on the other hand, we have gotten rid of the very expensive mining process. We have also avoided one of the more subtle and annoying issues with Bitcoin: bootstrapping the P2P connection (you only need to connect to whomever you are trying to pay when you are trying to pay them).

[This is just a simplified version of "ecash," which cryptographers have been studying since the 1980s. What I left out is the mechanism for ensuring payment privacy, which is pretty interesting in the offline payments case.]

Re: China orders Bitcoin exchanges in capital city to close

#200

Post by freeloop2 »

tboyd47 wrote: post #149
DINKDINK wrote: post #126

Earlier quoted context omitted.

No. Miners can only double spend transactions if they have > 50 % of the hash rate. The only purpose of miners is to add proof of work to in exchange for new coins that users value. If the proof of work is on a chain that contains valid transactions and conforms to consensus rules, it'll be valuable.

But that would just create an invalid side chain and result in all the miners' hash power being wasted. https://bitcoin.stackexchange.com/questions/55316/what-happe...

Your link doesn't address the question. It's about an invalid transaction within the block, not the refusal to place a particular transaction into one. With over 50% of mining power you can definitely do this.
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