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Taproot, Bitcoin’s long-anticipated upgrade, has activated

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Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#21

Post by robbie-c »

lugorrr wrote: post #4
nanna wrote: post #2

When will BTC move to an energy efficient protocol?

When will everyone only do energy efficient things. Stop the global party. https://blog.bitmex.com/bitcoins-carbon-footprint/

I skimmed this but it seems pretty heavy motivated reasoning.

> However, despite being extremely energy intensive, per unit power consumed, Bitcoin mining is probably one of the most environmentally friendly activities in the world. This is due to the unique flexibility with respect to where the power is required. This means miners often choose renewable power due to the low stable costs or miners are able to use otherwise wasted or stranded energy. This is a fact often claimed by Bitcoin proponents and it is probably true. Per unit power consumed Bitcoin is likely to be exceptionally environmentally friendly.

Ok, but what's actually happening? We can pontificate about how bitcoin mining could be hypothetically switched over to entirely renewable power because it is geography and time independent, but what's the cold hard reality?

What % of energy used in bitcoin mining is from coal or other fossil fuels?

What's the delta amount of fossil fuels burned compared to bitcoin not existing? How does that compare to other ways of sending money digitally?

Any defence of bitcoin on environmental grounds that dodges that question is flaky at best.

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#22

Post by kjrose »

TekMol wrote: post #6

A crazy thing with Taproot is: A company could create a virtual bank to handle all transfers with its suppliers by doing a single onchain transaction. From the outside, it would look like a normal "Someone sent some coins from address A to address B" transaction. But internally, a key needed to spend the funds is only valid if the company and all of its suppliers sign it. This means every time there is a transaction…

How does this handle someone spending bitcoin outside of the virtual bank?

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#23

Post by vageli »

robbie-c wrote: post #21
lugorrr wrote: post #4

Earlier quoted context omitted.

When will everyone only do energy efficient things. Stop the global party. https://blog.bitmex.com/bitcoins-carbon-footprint/

I skimmed this but it seems pretty heavy motivated reasoning. > However, despite being extremely energy intensive, per unit power consumed, Bitcoin mining is probably one of the most environmentally friendly activities in the world. This is due to the unique flexibility with respect to where the power is required. This means miners often choose renewable power due to the low stable costs or miners are able to use oth…

> What % of energy used in bitcoin mining is from coal or other fossil fuels?

> What's the delta amount of fossil fuels burned compared to bitcoin not existing? How does that compare to other ways of sending money digitally?

How would it be possible to answer any of those questions reliably when any individual could set up a miner at their home?

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#24

Post by KptMarchewa »

TekMol wrote: post #14
teekert wrote: post #12

Earlier quoted context omitted.

"And all of the transaction were free", Wait? Since when are transactions free and instant? Is that part of this upgrade? The only costs are with the "bank transaction"?

A second layer transaction does not involve the Bitcoin network. When Katy wants to pay ₿3 to Billie, Katy just sends a key (via email or some API) to Billie which enables Billie to withdraw ₿3 from the account of Katy. But Billie does not do that. Billie just keeps that message like you keep your login to your bank account. When Katy wants to pay another ₿5 to Billie, Katy sends a key to Billie which enables Billie…

Can you send 8worthless$ using that method, then move money out of the account via normal transfer?

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#25

Post by piaste »

TekMol wrote: post #14
teekert wrote: post #12

Earlier quoted context omitted.

"And all of the transaction were free", Wait? Since when are transactions free and instant? Is that part of this upgrade? The only costs are with the "bank transaction"?

A second layer transaction does not involve the Bitcoin network. When Katy wants to pay ₿3 to Billie, Katy just sends a key (via email or some API) to Billie which enables Billie to withdraw ₿3 from the account of Katy. But Billie does not do that. Billie just keeps that message like you keep your login to your bank account. When Katy wants to pay another ₿5 to Billie, Katy sends a key to Billie which enables Billie…

However, if nothing happens on the Bitcoin network, then the funds aren't locked down, are they?

In other words, Billie has no guarantee that the key she holds will be valid tomorrow; Katy could empty that account at any time, and Billie would then hold nothing except the evidence of Katy's wrongdoing.

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#26

Post by TekMol »

kjrose wrote: post #22
TekMol wrote: post #6

A crazy thing with Taproot is: A company could create a virtual bank to handle all transfers with its suppliers by doing a single onchain transaction. From the outside, it would look like a normal "Someone sent some coins from address A to address B" transaction. But internally, a key needed to spend the funds is only valid if the company and all of its suppliers sign it. This means every time there is a transaction…

How does this handle someone spending bitcoin outside of the virtual bank?

Different approaches come to mind.

One is that one of the participants is a virtual bank on its own. This would be similar to the old banking system. How do you send money to someone who uses a different bank? By telling your bank to talk to their bank.

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#27

Post by 323 »

rawtxapp wrote: post #19

One of the most interesting things in this experiment was the speedy trial imo. We now have an agreed way to change/improve consensus rules. It's very difficult to get a handful of people to agree on something, let alone all the different participants in this global/borderless system.

That's because bitcoin is so centralized these days, that you can get all the people that matter in a room and hash things out.

Note how half of the Bitcoin network nodes don't support taproot yet, but it's irrelevant. The few nodes that matter do support it.

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#28

Post by TekMol »

piaste wrote: post #25
TekMol wrote: post #14

Earlier quoted context omitted.

A second layer transaction does not involve the Bitcoin network. When Katy wants to pay ₿3 to Billie, Katy just sends a key (via email or some API) to Billie which enables Billie to withdraw ₿3 from the account of Katy. But Billie does not do that. Billie just keeps that message like you keep your login to your bank account. When Katy wants to pay another ₿5 to Billie, Katy sends a key to Billie which enables Billie…

However, if nothing happens on the Bitcoin network, then the funds aren't locked down, are they? In other words, Billie has no guarantee that the key she holds will be valid tomorrow; Katy could empty that account at any time, and Billie would then hold nothing except the evidence of Katy's wrongdoing.

    Katy could empty that account at any time
That would be a pretty lame virtual bank then :)

Realistically, the spending conditions are either limited by time. So Billie knows she needs to withdraw until a certain date or Katy could betray her. Or the spending conditions contain a punishment for betrayal. So if Katy tries to withdraw money she assigned to Billie, Billie can intervene, get her money and punish Katy.

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#29

Post by [deleted] »

robbie-c wrote: post #21
lugorrr wrote: post #4

Earlier quoted context omitted.

When will everyone only do energy efficient things. Stop the global party. https://blog.bitmex.com/bitcoins-carbon-footprint/

I skimmed this but it seems pretty heavy motivated reasoning. > However, despite being extremely energy intensive, per unit power consumed, Bitcoin mining is probably one of the most environmentally friendly activities in the world. This is due to the unique flexibility with respect to where the power is required. This means miners often choose renewable power due to the low stable costs or miners are able to use oth…

[deleted]

Re: Taproot, Bitcoin’s long-anticipated upgrade, has activated

#30

Post by G3rn0ti »

teekert wrote: post #12
TekMol wrote: post #6

A crazy thing with Taproot is: A company could create a virtual bank to handle all transfers with its suppliers by doing a single onchain transaction. From the outside, it would look like a normal "Someone sent some coins from address A to address B" transaction. But internally, a key needed to spend the funds is only valid if the company and all of its suppliers sign it. This means every time there is a transaction…

"And all of the transaction were free", Wait? Since when are transactions free and instant? Is that part of this upgrade? The only costs are with the "bank transaction"?

Parent talks about the „Lightning Network“ — a Layer 2 scaling solution for Bitcoin. Beware: I am still a crypto noob but I am still going to try to explain how I understood the system so far. Edited: Minor terminology and typos.

Roughly speaking the Lightning Network works similar to a „current account“ that businesses have between each other but does not require the actors to trust each other. The parties initiate a transaction by each one sending Bitcoin to a public multi signature address. The resulting transaction cannot be spent by any one alone. Now, this unspent transaction serves as an initial balance and opens a channel between the parties on the layer 2 network. Bitcoin may now be wired back and forth between the parties on layer 2 w/o needed to be settled individually on the Bitcoin block chain. Finally, if all parties agree by signing a second, settling transaction the resulting balance is written back to the Blockchain to whatever address the participants initially agreed upon. Theoretically, there could have been billions of Bitcoin transactions over the years on the Lightning Network which would be eventually represented by only two transactions on the chain.

Now, taproot improves this scheme by introducing Schnorr signatures. Up to now every member of the multisig transaction I just talked about needed to contain the public keys of all parties which in turn needed to be verified against all their private keys. Since transactions are limited in their size, this limited the applicability of multisig transactions. Now, Schnorr signatures allow for aggregation of public keys so the transaction only needs to contain a single number instead of hundreds or thousands. Of course, this also speeds up validations of transactions.

I hope this all made sense. I have yet to see practical applications of a Lightning Network „scheme“ but I heard El Salvador is using it for cheap Bitcoin transactions (although not applying Schnorr signatures yet).

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