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Why Ethereum is outpacing Bitcoin

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Re: Why Ethereum is outpacing Bitcoin

#121
post #116

Earlier quoted context omitted.

And? You're remarking on a surface-level resemblance to the greatest communication and economic innovation in human history. It's a disingenuous comparison.

Judging by the size of financial industry, the electronic money which could be programmed to do things with money without human help 24 hours per day is a serious threat to many companies in finance.

> do things with money without human help 24 hours per day

This was already possible before cryptocurrencies, hence how I'm able to buy anything online at any time of day and have it delivered to me within 24 hours.

Re: Why Ethereum is outpacing Bitcoin

#122

Earlier quoted context omitted.

WhalePanda in not an economist, not a digital coin developer, nor a professional coin analyst. At his website he describes himself as: "...I’m a Belgian Brand/Online Marketing/UX consultant with a passion for Bitcoin..." https://twitter.com/WhalePanda?ref_src=twsrc%5Egoogle%7Ctwca... Obviously partial to bitcoin but has no more "street cred" that I do: "a California fine artist, UI designer, with a passion for Ethere…

He also pulled off an insider trading stunt with the Monero maintainer. I'm not sure why people listen to this dude

Citation? (From curiosity, not skepticism.)

Edited: Ahh. Fake news announcement. http://bitsonline.com/fluffypony-speaks-troll-monero-market/

Re: Why Ethereum is outpacing Bitcoin

#123
post #9

The whole reason why Ethereum is "outpacing" Bitcoin is easiness of taking money from clueless "investors" that feel like they missed the boat on becoming rich through Bitcoin. https://medium.com/@WhalePanda/i-was-wrong-about-ethereum-80... It's going to be a big mess, one this bubble pops.

WhalePanda in not an economist, not a digital coin developer, nor a professional coin analyst. At his website he describes himself as: "...I’m a Belgian Brand/Online Marketing/UX consultant with a passion for Bitcoin..." https://twitter.com/WhalePanda?ref_src=twsrc%5Egoogle%7Ctwca... Obviously partial to bitcoin but has no more "street cred" that I do: "a California fine artist, UI designer, with a passion for Ethere…

I couldn't give two shits about 'who' he is; the points he makes are rock-solid. The ICOs are the only 'real' thing currently going on in the Ethereum space, and those ICOs will have costs that they actually have to pay. They are astoundingly fragile.

My best estimate is that the ICO market as a whole will have to be at least 3-4 times more successful than VCs if the house of cards is to stay standing. We're talking about a process that has to churn out unicorns to stay afloat.

Do you think smart contracts really make every business that uses them 3 to 4 times more valuable?

> That is to say I am using Ethereum for my art catalog or Catalogue raisonné as an ad hoc copyright tool and historical archive.

I honestly can't tell if you're taking the piss.

Re: Why Ethereum is outpacing Bitcoin

#124
post #55

The ICO mania definitely contributes to this, but so does the worry about a Bitcoin split. I've read a lot about it and could not give you a coherent answer of what is likely to happen and what would be the impact if it does or does not happen. So people like me (probably in top 5% of knowledge among Bitcoin holders about the technical aspects) put holdings in other coins to wait and see. The coins that stand to bene…

The split, and there will be a split but not with UASF, is the perfect proving ground for Bitcoin. The entire purpose of the whole experiment is to see whether it can successfully generate consensus, even in the face of intense disagreement or attack.

In this regard, I see it as inevitable that a chain will emerge that permits greater transaction throughput, and that consensus will organize around this chain. If it doesn't, then in a very real way the experiment will have concluded.

Re: Why Ethereum is outpacing Bitcoin

#125
post #40

Could someone that understands crypto better than me explain why Bitcoin's fees and transactions times have become so high all of a sudden? Is it just a matter of network congestion, or does it have as its root some underlying mathematical factor instead? Hoping to get a better answer here than on reddit. /r/bitcoin and /r/btc are both biased echo chambers.

Bitcoin blockchain has a limit of 1MB of transactions in a block. This was set in 2013, when Satoshi put it in place. He didn't give much explanation for it, but it was probably to avoid a spam attack. He said it could be raised later: https://bitcointalk.org/index.php?topic=1347.msg15139#msg151... There are arguments for and against increasing the blocksize. For: - Support more transactions per second - Lower fees f…

> This was set in 2013

Wrong date, it was July 2010 I believe.

Re: Why Ethereum is outpacing Bitcoin

#126

Could someone that understands crypto better than me explain why Bitcoin's fees and transactions times have become so high all of a sudden? Is it just a matter of network congestion, or does it have as its root some underlying mathematical factor instead? Hoping to get a better answer here than on reddit. /r/bitcoin and /r/btc are both biased echo chambers.

This is a reasonable start:

https://en.bitcoin.it/wiki/Block_size_limit_controversy

First, most people want Bitcoin to scale such that more people can use it. This can be done directly on the blockchain by allowing more transactions to be recorded in each block. Or it could be done with '2nd layer' solutions that periodically resolve on the Bitcoin blockchain. Such solutions require some changes to the Bitcoin clients people operate; the current 'most popular' version of this is called Segregated Witness, aka SegWit.

Right now, more people want to create transactions than can actually do so, thus a fee market has formed to get transactions included in blocks. This is why fees have increased.

It's a debate that sounds like a technical detail, but in reality it goes straight to the core of what Bitcoin is and how it will work. There is the debate over what changes will be made, but there is also a debate about how this decision will be made. Some feel that all changes to the Bitcoin protocol should be made with strong consensus, a conservative approach that has worked alright up to this point. Some still hope that this can be done, but the deep ideological division that belies this debate makes that seem unlikely. The alternative view is that Bitcoin is designed to handle these disagreements naturally by hard fork.

A hard fork is a split of the Bitcoin blockchain into different incompatible chains. In this case, it would be a split over the maximum permissible block size; one group would allow larger blocks, and another would refuse them. This would lead to a situation where miners choose which chain to mine on. Miners are incentivized by mining rewards (coinbase rewards), and thus have an economic incentive to mine on the chain they believe will have the greatest market value. This will likely result in a positive-feedback mechanism where one chain dominates the other; this has played out on the Ethereum chain where 'classic' ether is worth far less. A stable split is also possible, and thus there would be two versions of Bitcoin with different rules. Any coins generated or transacted pre-fork would be valid on both chains, but post-fork would commit to one chain or the other.

As for the bigger blocks, it comes down to predicting how the network will behave with larger blocks. It would permit more transactions, without question. It would also increase the bandwidth and data storage requirements of full-node operators. Basically, it would be more expensive to operate the Bitcoin network (which is distinct from the cost to secure it, which is scheduled coinbase inflation and txn fees). It would also mean that miners that are closer to each other on the network (via latency and throughput) would have a competitive advantage as they would confirm each other's valid blocks more quickly, and thus there are concerns about miner centralization. Such centralization presents a point of failure for the network.

Make no mistake; it is very difficult to predict what will happen with different protocol parameters. There's a lot of game theory that you can do to try to understand it. For instance, miners may mine larger blocks to include more transactions, and thus transaction fees, but risk slower propagation of their valid block through the network. In the case of valid blocks being found at the same moment, the one that propagates faster will 'win' and the other will be orphaned. Some argue that the risk of orphaned blocks is an effective limit to blocksize, and thus no blocksize limit is needed. It would also peg transaction fees to the marginal risk of a block being orphaned.

Re: Why Ethereum is outpacing Bitcoin

#127

Earlier quoted context omitted.

> just toy applications that have no practical purpose What? Look at all the ICOs: https://mona.co/ and this: http://www.coindesk.com/150-million-tim-draper-backed-bancor... and here more: https://www.coingecko.com/ico?locale=en

> https://mona.co Sound great, like most cryptocurrency marketing hype... where is the product? How do I get my hands on it? Let me guess "coming soon". > http://www.coindesk.com/150-million-tim-draper-backed-bancor... Ok, so a bunch of people spent their money on eth internet tokens... what exactly is the practical use case here? > https://www.coingecko.com/ico?locale=en So you've linked to a huge list of projects b…

> Ok, so a bunch of people spent their money on eth internet tokens... what exactly is the practical use case here?

Use case here is that there is smart contract that guarantees you that you are the owner of those specific tokens.

How you want to solve that with bitcoin?

Re: Why Ethereum is outpacing Bitcoin

#128

Between this and Fred Wilson's recent comments, it's pretty neat seeing a meme take shape right before our eyes. I'm not saying this article is wrong, but that it offers little substance. My pet theory is that Ethereum will transiently surpass Bitcoin in market cap in the next weeks, triggering a 5x surge in Bitcoin's price. Ethereum will then follow, and what happens next is anyone's guess. Why do I think that? Uh..…

why would it trigger a surge in bitcoin's price? The event is unprecented, and will happen during a time of uncertainty in BTC's future, due to the impending hard fork. It would seem to me that the event would cause ETH to surge instead.

My thinking is that certain parties with vested interest in BTC may attempt to drive up the price to prevent ETH from stealing the spotlight. Of course, several large firms now have a vested interest in ETH as well, so the best option might be to own both.

Re: Why Ethereum is outpacing Bitcoin

#129
post #116

Earlier quoted context omitted.

Judging by the size of financial industry, the electronic money which could be programmed to do things with money without human help 24 hours per day is a serious threat to many companies in finance.

> do things with money without human help 24 hours per day This was already possible before cryptocurrencies, hence how I'm able to buy anything online at any time of day and have it delivered to me within 24 hours.

blockchains with smart contracts can automate away entire financial industries; title holding company comes to mind.

Re: Why Ethereum is outpacing Bitcoin

#130

Earlier quoted context omitted.

WhalePanda in not an economist, not a digital coin developer, nor a professional coin analyst. At his website he describes himself as: "...I’m a Belgian Brand/Online Marketing/UX consultant with a passion for Bitcoin..." https://twitter.com/WhalePanda?ref_src=twsrc%5Egoogle%7Ctwca... Obviously partial to bitcoin but has no more "street cred" that I do: "a California fine artist, UI designer, with a passion for Ethere…

I couldn't give two shits about 'who' he is; the points he makes are rock-solid. The ICOs are the only 'real' thing currently going on in the Ethereum space, and those ICOs will have costs that they actually have to pay. They are astoundingly fragile. My best estimate is that the ICO market as a whole will have to be at least 3-4 times more successful than VCs if the house of cards is to stay standing. We're talking…

Calling Ethereum a house of cards is terribly hyperbolic but to clarify, here is what Ethereum has going for it.

These are some of the companies, banks and countries interested in the technology. J.P. Morgan Credit Suisse CME Group British Petroleum UBS ING Microsoft Thompson Reuters

Countries: Singapore Russia China

The United Nations even sent aid to 10,000 Syrian Refugees Using Ethereum Blockchain. http://www.coindesk.com/united-nations-sends-aid-to-10000-sy...

...And I am not "taking a piss" and neither are all of the above Ethereum businesses, countries and banks.

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