31–40 of 86 posts
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> A 51% attack seems inevitable. So, what are you going to do with your 51% of the network? Somehow double spend $150m before everyone upgrades their clients?
Just mine no transactions. After the network grinds to a halt the exchange rate will crater and then you can close out your short position.
http://gavintech.blogspot.com/2012/05/neutralizing-51-attack...
This analogy can be applied to almost anything. According to this criteria, coffee could be considered a startup: the growers of the beans are the founders, the hipsters sipping their cold frappuccinos at Starbucks are the evangelists, and the price for one pound of coffee beans is its market price. The only problem here is that coffee is a commodity, not a startup. Anyone can grow it and sell it. Likewise, bitcoins…
The better comparison is to oil. Oil is a commodity, in that anyone can buy it and sell it: but there is a fixed amount of it, and one can only acquire oil by taking oil from the fixed supply. Further, the earlier you got into oil, the more money you made, and the same is true of Bitcoin: the authors have made out to the tune of [100M or more](http://bitslog.wordpress.com/2013/04/17/the-well-deserved-fo...) simply by being the first miners.
So I don't know exactly what kind of definition you want to use for "startup", but bitcoin is certainly software, that was written by a small team of people, that solves a problem, that has made the authors wealthy in a very short amount of time. If someone like Rockefeller started out today, I think we would probably characterize his operation as a "startup", and the founders of Bitcoin are doing much the same thing that he did.
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Given time everyone will come to realize that bitcoin is a very complex and elaborate ponzi scheme. One that will rewrite the books on scams.
How is it a ponzi scheme?
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How is it a ponzi scheme?
Bitcoin ecosystem by design rewards the early adopters, since the more people use Bitcoin, the higher the value will go up. I also got the feeling that if Bitcoin does fail, it will go down in history as another Ponzi scheme. Which made me rethink about Ponzi scheme. Everyone in Bitcoin community genuinely believes that Bitcoin will succeed. I am sure it was like that with Ponzi scheme too. Theoretically Bitcoin can…
I love Bitcoin and own some myself, but from the title I expected this article to be about how the "founders" of Bitcoin cash out from an early financing round and spend the rest of their days rich, regardless of whether the concept survives.
Given time everyone will come to realize that bitcoin is a very complex and elaborate ponzi scheme. One that will rewrite the books on scams.
This analogy can be applied to almost anything. According to this criteria, coffee could be considered a startup: the growers of the beans are the founders, the hipsters sipping their cold frappuccinos at Starbucks are the evangelists, and the price for one pound of coffee beans is its market price. The only problem here is that coffee is a commodity, not a startup. Anyone can grow it and sell it. Likewise, bitcoins…
That's much like the incentive-alignment of founding (and early-investor) equity in a startup venture. You know what your share is, and want it to be worth more. So even separate from any salaries or formal-obligations, you can be expected to improvise to help collaboratively create the world where your shares are more valuable.
Other equity is similar: it's a claim on a certain package of legally-respected rights. (You can vote in board elections; you can collect dividends; you receive pro-rata value in case of liquidation.) Those rights might be worth a lot, in certain possible futures, or nothing, in others. If you're an employee-stockholder, you may be a bit more motivated that someone on a fixed salary. If you're an outside shareholder, you'll still "talk your book" and perhaps even direct other investments in ways that synergistically boost the startup.
People describe Bitcoin as crypto-currency or crypto-commodity, but its biggest impact may be as crypto-equity.
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I agree with the first sentence, but I'm pretty sure the NSA could do it. Until recently it would have only cost a few million dollars to fab enough ASICs for a 51% attack. I haven't seen a recent analysis, but it's probably still only in the 10s of millions (possibly 100s of millions)
The NSA probably specializes in general purpose computational power, they couldn't afford to compete with ASICs at this point. But they probably could destroy any alt-coin alternative to bitcoin in a heartbeat, especially Litecoin which is designed to be mined by general purpose hardware.
this is an absurd statement because the us military, nsa, and cia design their own custom chips and have a black budget to finance the operations and some of the most talented and experienced mathematicians, scientists, and programmers to back them up. when the central banks actually find bitcoin to be a threat they will crack the encryption, do a 51% attack, or conduct some other discrediting attack on its validity and security. I am short term bullish on bitcoin though I am hoping for the best for btc or other decentralized digital currencies.
This analogy can be applied to almost anything. According to this criteria, coffee could be considered a startup: the growers of the beans are the founders, the hipsters sipping their cold frappuccinos at Starbucks are the evangelists, and the price for one pound of coffee beans is its market price. The only problem here is that coffee is a commodity, not a startup. Anyone can grow it and sell it. Likewise, bitcoins…
Earlier quoted context omitted.
How is it a ponzi scheme?
Bitcoin ecosystem by design rewards the early adopters, since the more people use Bitcoin, the higher the value will go up. I also got the feeling that if Bitcoin does fail, it will go down in history as another Ponzi scheme. Which made me rethink about Ponzi scheme. Everyone in Bitcoin community genuinely believes that Bitcoin will succeed. I am sure it was like that with Ponzi scheme too. Theoretically Bitcoin can…
Other than that, the only thing you mentioned is that "people want it to succeed". There are far more important pieces that are needed for something to be a Ponzi scheme and you haven't described how Bitcoin suffers from those attributes.