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BTC Endgame

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Re: BTC Endgame

#71

Post by fny »

PragmaticPulp wrote: post #43
nostrademons wrote: post #17

You don't need a DoS attack under the assumptions of this project. It's already assumed that you control ~80% of hash rate, so you execute a 51% attack that mass double-spends coins and destroy all confidence in the integrity of the currency. Poof, nobody uses it. Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. That they haven't is one reas…

> rather, it'll be because the U.S. has destroyed the dollar. There's value in cryptocurrency simply in it being an alternative that's readily available, so that civilization doesn't stop if the U.S. does end up miscalculating and hyperinflating the dollar. Even before Bitcoin, we had plenty of other alternative currencies that could have replaced the dollar. I’ve been reading headlines speculating about the dollar b…

US monetary dominance is up for grabs. This doesn't mean the US is necessarily supplanted as the world reserve currency, but it does mean lots of trade may dedollarize to some extent. My bet is there will be two major currency zones. Dollar/Euro in the West + Middle East + India, Renmimbi in the East + Australia + Africa.

Given the explosion of debt to GDP in the west vs the east, I see no way the Renmimbi will not continue to appreciate against the dollar, and I fully expect Chinese monetary dominance to increase with the government's continued annexation of Hong Kong.

BTC will probably dominate in countries were currency value is routinely destroyed (developing nations, Russia, the US and Europe to some extent) but as only as a back channel currency: I doubt any major commodity market or trade is ever going to be priced in BTC.

Re: BTC Endgame

#72

Post by nostrademons »

PragmaticPulp wrote: post #43
nostrademons wrote: post #17

You don't need a DoS attack under the assumptions of this project. It's already assumed that you control ~80% of hash rate, so you execute a 51% attack that mass double-spends coins and destroy all confidence in the integrity of the currency. Poof, nobody uses it. Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. That they haven't is one reas…

> rather, it'll be because the U.S. has destroyed the dollar. There's value in cryptocurrency simply in it being an alternative that's readily available, so that civilization doesn't stop if the U.S. does end up miscalculating and hyperinflating the dollar. Even before Bitcoin, we had plenty of other alternative currencies that could have replaced the dollar. I’ve been reading headlines speculating about the dollar b…

"If Bitcoin somehow did become an alternative world currency and USD was out of the running, wouldn’t that create great incentive for China to crash Bitcoin prices and drive everyone to use their national currency?"

It would, but there's no guarantee that if people left Bitcoin they would end up in RMB. More likely they'd jump to another cryptocurrency, or to Euros. People tend to distrust the last party that fucked them over.

I could see a dangerous situation if China let Bitcoin thrive for a generation, let all the other currencies wither on the vine through normal market mechanisms, and then decided to exercise their national control over Bitcoin. That's basically the Amazon strategy - make your product so appealing that all the other retailers go bankrupt, and then jack up prices once there's no alternative and a whole generation assumes you're the normal way to buy things. (Come to think of it, that's kinda the U.S. dollar strategy now.) But that's a generation off, so naturally I'm not thinking of it, and I doubt very many others outside of HN are either.

Re: BTC Endgame

#74

Post by core-questions »

afavour wrote: post #58
nostrademons wrote: post #17

You don't need a DoS attack under the assumptions of this project. It's already assumed that you control ~80% of hash rate, so you execute a 51% attack that mass double-spends coins and destroy all confidence in the integrity of the currency. Poof, nobody uses it. Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. That they haven't is one reas…

> China gains no benefit from destroying Bitcoin Right now they don't, no. But to my mind Bitcoin being subject to the whims of a major world power is a big knock against it, given that it aims to be a currency alternative. I don't want such an alternative to subject to any kind of geopolitical mood.

Yes. Much like mutually-assured-destruction with WMDs, we need to try to keep China to Maybe the US government doesn't mind that? Maybe they hope it will die, and send everyone flocking back to the dollar?

Re: BTC Endgame

#75

Post by AffableSpatula »

AffableSpatula wrote: post #59
dingus9 wrote: post #50

Earlier quoted context omitted.

Right. The protections against this are already baked into the protocol. 51% attacks don't make sense because you're hurting yourself 51% and hurting everyone else 49%. And for this theoretical attack you'd probably need to sustain 90%+ hash power for a long time. Your first hurdle will be producing enough ASICs to surpass current hashrate by nearly 10x. Solve that problem and you'll need a massive amount of energy a…

The protections aren't baked into the protocol because they don't account for external real world motives of nations states which could incent them to act in a "non-economic" way according to the internal rules of the Bitcoin game.

This isn't a temporary speeedbump, it's a permanent end to proof of work mining as an investable activity (and viable sybil resistance mechanism for bitcoin).

Re: BTC Endgame

#76

Post by AffableSpatula »

dingus9 wrote: post #57
xur17 wrote: post #14

Earlier quoted context omitted.

I also imagine that after a few days of the network being jammed up, getting social consensus to fork the network to use a different hashing function would be fairly viable.

Right. And now this theoretical actor that controls 10x the hashrate of the rest of the world has lost 10x the amount of capital invested compared to the rest of the mining world. It's the equivalent of shooting a bullet through your chest to shoot your enemy in the finger.

The purpose of this project is to have people be specific about what ruleset they would fork to which could prevent this kind of attack.

Re: BTC Endgame

#77

Post by AffableSpatula »

DSMan195276 wrote: post #69
AffableSpatula wrote: post #33

Earlier quoted context omitted.

I'm not so sure. If you don't need proof of work to secure a blockchain, then why is the free market of Bitcoin consensus continuing to expend huge amounts of capital to stick with it as its sybil resistance mechanism? If it wasn't considered a value destroying move, the transition away from PoW would've happened already no?

> If it wasn't considered a value destroying move, the transition away from PoW would've happened already no? I think there's a conflict of interest issue here that would prevent such a move even if it would be worth it - the miners clearly have an incentive to keep the current PoW mechanism, as without it they're left holding a bunch of expensive useless tech. And without the miners willing to go along with a move f…

The attack scenario is an adversarial nation state who is not motivated economically and is intent on sabotage of the network.

Re: BTC Endgame

#78

Post by swinglock »

Laforet wrote: post #53
nostrademons wrote: post #17

You don't need a DoS attack under the assumptions of this project. It's already assumed that you control ~80% of hash rate, so you execute a 51% attack that mass double-spends coins and destroy all confidence in the integrity of the currency. Poof, nobody uses it. Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. That they haven't is one reas…

How would a hyperinflation on the US dollar cause civilization to stop? In any case, crypto trading since 2017 has been nothing but people buying and selling imaginary ticker symbols on unregulated exchanges. For example, XVG and ETC has been subject to successful 51% attacks more than once and every time the price was hardly affected. And each time the "solution" to deep chain reorg involved the exchanges freezing a…

> PoS is still vaporware

Why is that? Aren't Cardano and Polkadot PoS as they claim or doesn't it work?

Re: BTC Endgame

#79

Post by MattGaiser »

pvarangot wrote: post #37
nostrademons wrote: post #17

You don't need a DoS attack under the assumptions of this project. It's already assumed that you control ~80% of hash rate, so you execute a 51% attack that mass double-spends coins and destroy all confidence in the integrity of the currency. Poof, nobody uses it. Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. That they haven't is one reas…

> Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. When you say "China" do you mean like an actor that can make coordinated decisions? Or just a geographic region? I'm asking out of curiosity because yeah there's a lot of miners in China across many geographic regions but I never saw any evidence that they even talking to each other, even le…

We are talking about China. There is a supreme actor who gets to make coordinated decisions if they so choose.

Re: BTC Endgame

#80

Post by DSMan195276 »

AffableSpatula wrote: post #77
DSMan195276 wrote: post #69

Earlier quoted context omitted.

> If it wasn't considered a value destroying move, the transition away from PoW would've happened already no? I think there's a conflict of interest issue here that would prevent such a move even if it would be worth it - the miners clearly have an incentive to keep the current PoW mechanism, as without it they're left holding a bunch of expensive useless tech. And without the miners willing to go along with a move f…

The attack scenario is an adversarial nation state who is not motivated economically and is intent on sabotage of the network.

I don't understand what you're getting at, I was pointing out why Bitcoin hasn't moved to PoS even if it may actually be better.
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