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Bitcoin money ≠ the Gold Standard.

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Re: Bitcoin money ≠ the Gold Standard.

#41

Post by olalonde »

hasenj wrote: post #34
olalonde wrote: post #17

Earlier quoted context omitted.

You're right in the sense that the free software movement as advocated by Richard Stallman is at odds with capitalism. I really meant "Open source software isn't at odds with capitalism". But I don't think we should exclude the capitalism debate from an intelligent discussion since it has pretty huge implications. If you're advocating a system that is incompatible with capitalism, you have to first make the case for…

It's not as if we live in a purely capitalistic system. In a pure capitalism, there would be no taxes. Yet here we are living in a system where the government takes money from you, specially if you're really rich. It's not as though any idea that's at odds with capitalism will require "an alternative system". There's not gonna be any change to the system that requires a new theory of economics. Suppose bitcoins are a…

I agree that we don't live in a purely capitalist system and in fact, I don't like to call it that way as it undermines its meaning. In a truly capitalist system we wouldn't have this discussion at all since there'd be no federal reserve and currencies would be free to compete against each others. In my opinion, Bitcoin (and the gold standard in some ways) is as close to capitalism as it gets.

Re: Bitcoin money ≠ the Gold Standard.

#43

Post by dfox »

hasenj wrote: post #29
olalonde wrote: post #21

Earlier quoted context omitted.

Again, Open Source is not at odds with capitalism. Capitalism doesn't mean making money or selling stuff. In fact, charities aren't at odds with capitalism. Did you know that Wikipedia's founder, Jimmy Whales, is a libertarian?

Ah careful. RMS's Free Software is not the same thing as Open Source. Open Source in and of itself is not at odds with capitalism. But Free Software is at odds with some ideas of capitalism. (In my humble opinion anyway, which is really irrelevant to my original point).

can you point out the difference between "free software" and "open source" that causes one being at odds with "some ideas of capitalism", while other is not? Apart from "free software" being connected with RMS's ideology.

Re: Bitcoin money ≠ the Gold Standard.

#44

Post by dfox »

msy wrote: post #40
hasenj wrote: post #37

Earlier quoted context omitted.

That's not a good idea. Being passionate about bitcoin doesn't imply you should convert all your money to bitcoins. In fact I would never advice anyone to invest too heavily in it: treat it like a side project, like an experiment. Maybe accept it as a form of payment for some non-essential products or services that you provide. Maybe try to make some trading with bitcoins. Try to see if you can buy a pizza maybe with…

Why not? If the crypto is bulletproof and the theory is sound shouldn't it be the ultimate place to keep your money?

Because market value of BTC is not at all stable or proven as the market is quite small. It is entirely imaginable that somebody will design similar, but slightly better system (faster transactions, more efficient implementation, whatever) that will cause most bitcoins traders to move there. Essentially, system like this depends entirely on market, while nothing has "inherent value", most physical things can be still exchanged for something (and actually gain value) after market crashes, when this kind of virtual market is abadoned, you are left with completely worthless big chunk of data.

Re: Bitcoin money ≠ the Gold Standard.

#45

Post by dalke »

hasenj wrote: post #28
jsn wrote: post #8

Earlier quoted context omitted.

Free software isn't at odds with capitalism (you don't have to extract monetary profit from everything you do in capitalism). Neither is bitcoin. Government-controlled paper money, on the other hand, definitely is at odds with free market.

I think free software is at odds with certain capitalistic ideas: As a private owner of a "production" factory, you have control over your products, and through this control you gain profit. Contrast this with communism, which views private control over things which are needed by the public (like food) as a bad idea because the person in charge gets to limit the freedom of others (or some idea similar to that). Free…

The issue is your statement "you have control over your products" does not apply.

Copyright law legally prevents you from including someone else's software in your work, unless you get permission. The GPL grants you that permission so long as you follow the terms of the license. In other words, it isn't "your products", it's a joint product, and the other contributor wants a say on how the joint product is delivered.

If your product doesn't use anyone else's license, then the FSF does say that it's morally reprehensible to not have free software, but they stay well within copyright law to change the system from within.

Have you considered that perhaps it's copyright's temporary monopoly grant which is "at odds with certain capitalistic ideas"? After all, copyright in US law comes from promoting "the Progress of Science and useful Arts", not making profit.

Re: Bitcoin money ≠ the Gold Standard.

#46

Post by Tichy »

contactdick wrote: post #30
Tichy wrote: post #24

Earlier quoted context omitted.

Bitcoins are only generated every 10 minutes (on average), so it would probably not be worth it for a company to dedicate a huge cluster of computers to it. At most they could earn 50 BTC/10 minutes, no matter how much computing power they'd throw at it. It get's more interesting if a company could calculate blocks faster than all the other nodes combined. Then that company could forge the complete chain of transacti…

well the motivation to make money is a fairly strong one for a lot of people - many worse things are done every day because of it.

Yes, but destroying BitCoin would not make you any money. At least I don't see how.

Re: Bitcoin money ≠ the Gold Standard.

#47

Post by dfox »

tlrobinson wrote: post #38
gritzko wrote: post #18

Technically, BitCoin is hardly scalable. As every participant needs to be aware of every transaction, that gives O(N^2) computational/storage cost, assuming N is participants and transactions~participants. May be cured by a dedicated central server storing all the transactions, but then it is not P2P anymore.

I was wondering about this after reading a little about how BitCoin worked. It sounded like every client needed to know about every transaction ever, which clearly can't scale to a mainstream currency. Perhaps there's a way to partition/shard the historical data?

there really is way to "shard" historical data. But mainly, it is expected, that most users will not use whole transaction history, but trust majority opinion of network without actually verifying it or even use services of established network nodes without actively participating in network. This can be seen even now, when there are disjoint sets of nodes that actually perform "useful" transactions (users) and nodes that timestamp them (miners).

Re: Bitcoin money ≠ the Gold Standard.

#48

Post by Tichy »

msy wrote: post #40
hasenj wrote: post #37

Earlier quoted context omitted.

That's not a good idea. Being passionate about bitcoin doesn't imply you should convert all your money to bitcoins. In fact I would never advice anyone to invest too heavily in it: treat it like a side project, like an experiment. Maybe accept it as a form of payment for some non-essential products or services that you provide. Maybe try to make some trading with bitcoins. Try to see if you can buy a pizza maybe with…

Why not? If the crypto is bulletproof and the theory is sound shouldn't it be the ultimate place to keep your money?

It only has value if people accept it as payment. Cryptography is only part of it.

Re: Bitcoin money ≠ the Gold Standard.

#49

Post by spenvo »

gritzko wrote: post #18

Technically, BitCoin is hardly scalable. As every participant needs to be aware of every transaction, that gives O(N^2) computational/storage cost, assuming N is participants and transactions~participants. May be cured by a dedicated central server storing all the transactions, but then it is not P2P anymore.

This is a good point and is one of a large number of challenges BTC faces. Right now, a small transaction fee ensures that your transaction will be processed quickly. This distributes the cost of validating the transaction. Eventually, we may see the transaction fee structure become less of an option and more of a necessity.

BitcoinJ (the Google 20% time project) uses a very compressed and less comprehensive block chain to make transactions but is not intended to be used to generate coins.

In other words, the problem is being mitigated. The level of innovation in the BTC community is jaw dropping.

Re: Bitcoin money ≠ the Gold Standard.

#50

Post by msy »

dfox wrote: post #44
msy wrote: post #40

Earlier quoted context omitted.

Why not? If the crypto is bulletproof and the theory is sound shouldn't it be the ultimate place to keep your money?

Because market value of BTC is not at all stable or proven as the market is quite small. It is entirely imaginable that somebody will design similar, but slightly better system (faster transactions, more efficient implementation, whatever) that will cause most bitcoins traders to move there. Essentially, system like this depends entirely on market, while nothing has "inherent value", most physical things can be still…

So if this is an unstable, unregulated market that shouldn't be used for anything more serious than pizza at what point is that going to change? What magical thing is going effect to change?

And if that thing doesn't exist, what is this apart from a more complicated way to waste electricity than Seti@Home?

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