Isnt the author, well, supposed to keep his private key private? It was quite easy to create a text file with that 1b0be2162cedb2744d016943bb14e71de6af95a63af3790d6b41b1e719dc5c66 key and "geth account import key.txt" into a ethereum wallet to get a seemingly valid account. Please tell me that i am missing something very important here.
Uh, do you expect there to be any money in there?
Beyond the Bitcoin bubble
81–90 of 244 posts
Re: Beyond the Bitcoin bubble
#82Earlier quoted context omitted.
This - all things that can by done by SomethingSpecificCoin can be equally well done on smart contract platform ala Ethereum. There is no reason (except for rewarding founders and early investors) someone who want to provide taxi rides own specialized mining equipment for maintaining blockchain of a proprietary coin. I rode a taxi few months ago, and I don't remember having to change my currency for a TaxiCoin which…
It can be equally well done with a Postgres database.
You can't sell postgres table inserts.
Re: Beyond the Bitcoin bubble
#83Earlier quoted context omitted.
It's only adoption when at least one of these is true: a) people regularly trade it for goods or services b) people stop caring about the conversion rate to their local plain old fiat money currency a could greatly help b but it's not happening
c) the government accepts taxes in it
I don't think that is necessary. I could imagine a world where bitcoins are used for large portions of the economy, but the government still wants to use dollars.
But there is no indication anything but online drug sales are actually being conducted in bitcoin. And even online drug dealers are looking for a replacement because bitcoin is an awful currency.
Re: Beyond the Bitcoin bubble
#84Earlier quoted context omitted.
This - all things that can by done by SomethingSpecificCoin can be equally well done on smart contract platform ala Ethereum. There is no reason (except for rewarding founders and early investors) someone who want to provide taxi rides own specialized mining equipment for maintaining blockchain of a proprietary coin. I rode a taxi few months ago, and I don't remember having to change my currency for a TaxiCoin which…
It can be equally well done with a Postgres database.
And leave all the INSERTs and SELECTs to a trusted third party like Uber?
Re: Beyond the Bitcoin bubble
#85I don't understand the transit example presented in this article. I feel like I am missing something fundamental about the utility of any of these distributed services backed by their own type of coin. For the transit example you have some people who want to request rides, and some people who want to provide rides. OK. Someone develops an application to process these requests, in some kind of bidding system... How ar…
You hit the nail on the head, the challenge with Blockchain and Bitcoin is that it did two things, which together were supposed to tackle the original problem, peer to peer monetary exchange without a trusted intermediary.
So for that the blockchain provides the trust mechanism which is useful. However, the blockchain is just the channel, it needed a medium of exchange, you couldn't very well use USD because then you are back in the banking system.
Here, BitCoin is introduced.
However, the problem with BitCoin is that it initially has no value. So if I bought a nice coffee mug for $10, and I wanted to give it to you for BitCoin, well your BitCoin is currently worth nothing, so we can't have an exchange.
This is where the scarcity argument for BitCoin comes in, which is supposed to inflate the value of the currency, because it is limited. You can also see by the amount of BitCoin initially envisioned the scale of how large the peer to peer exchange network was supposed to be.
We are used to paying $1 for coffee, but are you used to paying 0.0000000001 BitCoin for a coffee?
Now absent speculation, the price of BitCoin would be reasonable, and determined by the effort of the miners, since they are exchanging their fiat currency for computers and energy, and that creates a stable layer for the price.
It would also stand to reason that until all of the Bitcoin are mined the price would continue to increase, because the amount of energy used to mine them increased, while the supply was limited.
If instead an equal output of energy produced and equal output of BitCoin, then BitCoin would have a stable price, that would track energy prices globally, and then the coin would have value because it would still take work to produce it, or you can simply purchase one if you don't want to waste the time mining it yourself.
And you can pay a premium for that already mined coin because it's more convenient.
It's also important to note that the system was already incentivized for miners because they are the ones processing transactions and they collect a fee. So if mining produced a 1:1 BitCoin exchange for fiat currency based on energy usage they would still make a profit from transaction fees like VISA, or for selling the BitCoin for a slight profit because some people wouldn't want to setup a miner themselves, or wait for their coins to be minted.
Speculation occurred because of the limited supply and the increasing difficulty of mining, absent those two things, the value of BitCoin once established would actually be very stable and could in essence become a medium of exchange.
Re: Beyond the Bitcoin bubble
#86Earlier quoted context omitted.
The 'coin part' already has a name and it's not a new innovation. Large part of financial innovation in the last century is based on the idea that is now called coin. It's called derivative. If you have something valuable that can be traded, it can be made into derivative and traded in existing markets. Practically anything, physical things, electricity, indexes, future events or prices, insurances, storage capacity,…
Derivatives are just instruments to bet against or for market trends of assets. There are futures contract, options, swaps and other derivative vehicles for every market, be it cryptocurrency or forex. What makes you think the coin part represents that derivative?
A derivative is a security with price that depends on the value of the underlying asset.
Bitcoins are derivatives for the blocks in the blockchain. You find a new block and you have a coins. Bitcoin value depends on the value of the underlying, the blockchain network.
Re: Beyond the Bitcoin bubble
#87Re: Beyond the Bitcoin bubble
#88Earlier quoted context omitted.
It can be equally well done with a Postgres database.
And leave all the INSERTs and SELECTs to a trusted third party like Uber?
Works pretty well. If you want to minimize trust you can add signing, encryption and hash-chaining to your central database, but I doubt people actually care much about any of that.
Re: Beyond the Bitcoin bubble
#89I am personally hoping we can survive the speculation craze and reach a point where we can use the block chain technology in revolutionary (or even evolutionary) ways. Since it’s tax time I can’t help but feel that the true long term danger to block chain technology isn’t draconian government regulation, it’s the IRS. For example I have a transaction earlier this year where I purchased some software for $15 BTC equiv…
For a while I have been thinking about a startup idea, a Stripe Atlas for tax free cryptocoin trading if you will. There are tax free vehicles, but so few people actually understand the initial tax implication of buying and selling coins like yourself, I don’t think the market would be there.
Curious, what might you be will to pay for such a service?
Re: Beyond the Bitcoin bubble
#90I hope the technology matures beyond 'blockchain' and marketing drops the 'coin' moniker and the gold rush dies down. Cryptographically verified distributed log files should have negligible hype value and be hidden part of the infrastructure. I predict that 10 years from now normal relational databases have infrastructure for shared, authenticated and verified rows and columns and we laugh at the ICO era.
>I predict that 10 years from now normal relational databases have infrastructure for shared, authenticated and verified rows
I'm not sure I understand what you're predicting exactly. The big breakthrough of bitcoin is having a globally shared ledger without requiring any trust. In my experience most relational databases have a relatively straightforward trust model (i.e. the DB belongs to the organization using it and is fully trusted). In these situation the blockchain is completely overkill and unnecessary as far as I can tell.
There are cases where one might want to distribute the database for redundancy or archival (like the contents of Wikipedia for instance) but in this case you trust the original issuer and you only need to be able to validate the authenticity and integrity of a copy which can be easily achieved by having Wikimedia signing a hash (or merkle tree) of the dump. All these technologies are involved in the blockchain but they're not innovations. Basically you have bitcoin minus the mining, so just a fancy linked list of SH256 hashes.
On the other hand if you have a use case where you want to arbiter a database across untrusted people then you must make mining rewarding enough that you reach a critical mass that makes attacks impractical. I can't imagine how you could do that without the "coin" part. People mine cryptocurrencies not because they want to protect it but rather because they want to make a profit out of it. Remove the mining rewards out of Bitcoin and watch as the mining power collapses to a tiny fraction of its current value. If you want to protect your distributed Wikipedia article history and there's no direct monetary reward for it I doubt you'll reach a very high hash rate which will make it relatively easy for a dedicated attacker to rewrite history.
The "coin" moniker is not just a lack of imagination by people working with this technology, it's an integral part of why it works in the first place.