Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

b.qr.ae

Post reply on HN
Print view View original

111–120 of 324 posts

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#111

Post by rlpb »

sbierwagen wrote: post #78
bad_user wrote: post #57

Earlier quoted context omitted.

Actually many cryptographic algorithms that got defeated, haven't been defeated with " new discoveries in mathematics ". Also, you can't really prove that such an algorithm is secure. You can only prove that it exhibits certain properties that make it more secure versus other algorithms. Judging by how cryptographic methods got defeated in the past, I think it's safe to assume that it's only a matter of time.

Also, you can't really prove that such an algorithm is secure. Incorrect. One Time Pad encryption is provably secure. (Proven by Claude Shannon, no less; as in, the guy who invented information theory.) It is impossible to decrypt if you do not have the key.

...subject to your key being safe, produced from a good source of entropy and never used anywhere else. Is this provable?

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#112

Post by hugh3 »

weavejester wrote: post #89
Vivtek wrote: post #75

It's a pyramid scheme, just dressed up in high-tech, vaguely libertarian clothing. That's why sensible governments (not the "bank lobby") are starting to ban it - it's inherently a bad idea (unless you're an early adopter - just like any pyramid scheme). Bitcoins are no different from tulip bulbs.

Bitcoin looks nothing like a pyramid scheme. There is a relationship between the value of a bitcoin and the demand, but that's true for any product.

Bitcoin looks exactly like a pyramid scheme from a money-transfer point of view. Money gets shifted from gullible suckers to the folks who invent the scheme, until one day you run out of people willing to sign on for the scheme, at which point everything collapses and the late adopters are left holding the bag.

It's kinda sad. I think when it happens I'll make like edw519 and self-publish a book "The Best Of Hugh3" in which I publish all my "told you so" comments. And hey, maybe just to be charitable I'll sell copies for a million bitcoins each!

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#113

Post by kwis »

cturner wrote: post #49

Trollish headline. One fair non-structural criticism, a weak, temporary criticism and two things billed as criticisms that aren't. 1) Early adopters. I couldn't find a point here. I think he's saying that it's unfair that some people get in early. But in the current system, it's unfair that government (through tax law and control of force) mandates that you use a form of money that doesn't function well as a store of…

> It's just false.

No, you just misunderstand the actual statements.

Deflationary currency doesn't mean that people don't buy anything. It means that the supply and demand curves shift, reducing (but not completely eliminating) investment and consumption. The magnitudes of the shifts vary depending on the product being discussed, but the direction of the shifts is the same in every case.

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#114

Post by hugh3 »

jacques_chester wrote: post #30
lorax wrote: post #20

Talk about an overly dramatic headline, the "post that killed Bitcoins"? but the submitter isn't even sure if the arguments are valid? (And has hacker news turned into bitcoin news? it seems like there are several bitcoin links a day)

HN goes in cycles. (This is a trivial observation, since pretty much everything goes in cycles). * Subject X is broached in an exciting blog post. * The submission receives massive upvotes and hundreds of comments. * Subject X simmers. Soon various HN link-targets (AVC, that Steve fellow, TechCrunch, the other guy here called Jacques) begin weighing in, netting their initial submitters still hundreds more karma. * Be…

In this particular case, the whole process is made easier by the fact that bitcoin enthusiasts form a self-organizing PR machine.

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#115

Post by [deleted] »

sethg wrote: post #98
cturner wrote: post #49

Trollish headline. One fair non-structural criticism, a weak, temporary criticism and two things billed as criticisms that aren't. 1) Early adopters. I couldn't find a point here. I think he's saying that it's unfair that some people get in early. But in the current system, it's unfair that government (through tax law and control of force) mandates that you use a form of money that doesn't function well as a store of…

in the current system, it's unfair that government (through tax law and control of force) mandates that you use a form of money that doesn't function well as a store of value The governors of the Federal Reserve are appointed by the President and confirmed by Congress, and politicians, for all their numerous faults, understand that if the economy goes in the crapper it hurts their chances of getting re-elected. So th…

[deleted]

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#116

Post by vladd »

util wrote: post #108
vladd wrote: post #39

Bitcoin is a marketing-based currency in the sense that it has no real value besides the fact that it was the first currency with cryptographic properties that gained widespread adoption: if someone would take the code and fork it into an alternative ("Webcoins"), the intrinsec value of a Webcoin would be zero (unless it also found a way to gain market share or early adopters). That's very similar with a Ponzi scheme…

It seems like this in particular applies to most government-issued currencies as well (except that they have very good marketing and market share). Each currency itself has no intrinsic value and depends on "marketing" (reputation of the government minting it) and market share (number of places accepting it). If people lose faith that a government will do a good job managing its currency or even think that the govern…

A government collects taxes from all the businesses and people in a given country, which is huge in terms of being able to provide value. Bitcoin has no such thing.

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#117

Post by hugh3 »

dogas wrote: post #22

I think the other article ( http://apenwarr.ca/log/?m=201105 ) written about bitcoin failing is more detailed and contains potentially more plausible ways of how bitcoin can fail. The openwarr article refers to potential failures with the SHA256 backbone of bitcoins. "With bitcoin, a single failure of the cryptosystem could result in an utter collapse of the entire financial network. Unlimited inflation. Fake transac…

That's not a "potentially more plausible" way for it to fail. It's merely a theoretical vulnerability. The bursting of a bubble in the price of a worthless asset, though -- that's, historically-speaking, a dead certainty.

Come on, people. This isn't the first asset bubble in history (though it may be the most cleverly-designed). We all know how it ends. People keep paying ever-higher prices for the asset, hoping it will go up. And it does for a while. Then one day, the price of the asset stops going up, people realise they don't want to own this asset now it's stopped going up, the value collapses, ka-pow, it returns to a more natural value.

For a real estate bubble, this may mean a halving in prices, because the natural value of real estate is quite high. For bitcoins, the natural value is zero.

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#118

Post by achompas »

awt wrote: post #88
Vivtek wrote: post #75

It's a pyramid scheme, just dressed up in high-tech, vaguely libertarian clothing. That's why sensible governments (not the "bank lobby") are starting to ban it - it's inherently a bad idea (unless you're an early adopter - just like any pyramid scheme). Bitcoins are no different from tulip bulbs.

Why is it inherently a bad idea? Why is it a pyramid scheme?

Because Bitcoins are being suggested as an alternative to fiat money. However, given their current rate of appreciation, Bitcoins are actually an investment, not a currency.

What is their inherent value, then? Commodities (whether precious or industrial) can be used in production or for luxury goods. Equities generate profits, which are subsequently shared with investors. What do Bitcoins do? Nothing.

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#119

Post by foxhill »

rlpb wrote: post #111
sbierwagen wrote: post #78

Earlier quoted context omitted.

Also, you can't really prove that such an algorithm is secure. Incorrect. One Time Pad encryption is provably secure. (Proven by Claude Shannon, no less; as in, the guy who invented information theory.) It is impossible to decrypt if you do not have the key.

...subject to your key being safe, produced from a good source of entropy and never used anywhere else. Is this provable?

keeping the key safe, yes, using the key once, yes, but need not be random at all (with in reason - a key of 0s is feasible, under the pretense that the cipher text, which would be equal to the plain text, is the cipher text for any message with the same length, for some key)

the key space being the same size as the message space, and cipher text space means that all messages of equal length are possible, with no way of knowing which one is the correct one. i suppose, a theoretical attack would be to be to enumerate all messages in the english language, XOR them with the cipher text, and see which resulting keys come close the properties of the PRNG used..

even non-determinism can't help you here, i'm afraid.

Re: The Quora post that killed Bitcoins. Please discuss if his arguments are valid.

#120

Post by doctororange »

Wow. Have to disagree with every one of his points. Total link bait here - I really doubt the success or failure of bitcoin will depend much on what one guy on the internet reckons.

I love that his final argument is just "Something will go wrong - I dunno what, but something will." Mm. Top notch.

Post reply on HN