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What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

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Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#171

Post by trident1000 »

lozf wrote: post #135
opportune wrote: post #122

Earlier quoted context omitted.

The idea of bitcoin as a store of value and not a currency is a revisionist interpretation that became popular with the blockstream devs around 2017-18 when it became apparent that the bitcoin network was unsuitable for handling payments at scale and had fees too high to be useful for mundane payments.

These days there's the Lightning Network - an off-chain "layer" that enables both fast and small, cheap transactions - perfect for "mundane payments" - and even micro-payments with Bitcoin. It's already usable and still improving. Adoption will grow as the infrastructure continues to be built out. It's still early days for Bitcoin - no one sends AT commands to their modem to get online any more.

Layer 2 is mostly likely just going to be centralized services like Paypal and cash app. There will be several options now and in the future really.

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#172

Post by slickrick216 »

wyldfire wrote: post #163
kylebenzle wrote: post #35

Earlier quoted context omitted.

HN hates Bitcoin. I have never seen such a smart group of idiots in my life.

Bitcoin is great, but could be improved upon. Some interesting cryptocoins out there. But there's an enormous amount of dead weight P&D tokens and shitcoins that turn a lot of folks off. Plus there were a lot of businesses in the 2010s who decided to make some kind of centralized-bit-distributed-conensus version of some thing like supply chain. It's easy to be cynical with so many of these popping up.

Agreed there’s a lot of rug pulls out there but you got to take the good with the bad in cycles like this it’s a gold rush just like the many that have gone before it

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#173

Post by noch »

JumpCrisscross wrote: post #114
noch wrote: post #111

Earlier quoted context omitted.

> Bitcoin is a terrible savings vehicle for the same reason cash in checking accounts or collectibles are: there is no basis for its value. 10 years is a long time to hold an erroneous belief based on a misunderstanding of what money and assets are. I had the same wrong beliefs as you do now for a long time and misallocated capital at a crucial moment. Parker Lewis explains[0]: > [Bitcoin] is backed by the only thing…

> Therefore, that note derives its value from the implicit debt underlying it That is not what legal tender and “for all debts public and private” mean [1]. That language refers to dollars being currency “courts of law are required to recognize as satisfactory payment for any monetary debt”. On the Parker Lewis article, it’s cute but contrived. A straw man. Bitcoin is backed by nothing. U.S. dollars are, similarly, b…

> That is not what legal tender and “for all debts public and private” mean [1]. That language refers to dollars being currency “courts of law are required to recognize as satisfactory payment for any monetary debt”.

That's exactly what I said: that physical note has value only in so far as there is a debt with which to pay it. That debt is the value someone else's productivity created. If your dollars are backed by nothing, please send them all to me so I can keep them for you.

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#174

Post by rkagerer »

lukev wrote: post #131
formalsystem wrote: post #24

It's important to remember that the main thing Bitcoin needs to maintain is it's monetary policy and you can find it at any time right here https://github.com/bitcoin/bitcoin/blob/master/src/validatio... Anyone can query at any time the total amount of Bitcoin that have been issued without relying on anyone. After downloading the Bitcoin client just run gettxoutsetinfo You can try to guess how many dollars have been…

As someone who mined a bunch of Bitcoin back in the early days, I can state that this is a completely ahistorical viewpoint. Bitcoin was _absolutely_ touted as "digital cash" early on. The earliest transactions of Bitcoins were each news items in the community and the each new vendor that accepted it as payment was put forth as proof of Bitcoin's traction. Also comparing it to Apple stock is misleading. Stock represe…

Instead of "little/no utility" I'd say "price completely disconnected from utility".

Gold is used in lots of things, such as electronics and plating cowrie shells.

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#175

Post by dragonwriter »

noch wrote: post #111
JumpCrisscross wrote: post #29

Earlier quoted context omitted.

> if you view it as a savings technology then it's the best one that's ever been created Bitcoin is a terrible savings vehicle for the same reason cash in checking accounts or collectibles are: there is no basis for its value. Baseless assets other than gold have been numerously proposed, usually about once every generation in every cultural sphere going back to Republican Roman times, but unvaryingly fall out of fav…

> Bitcoin is a terrible savings vehicle for the same reason cash in checking accounts or collectibles are: there is no basis for its value. 10 years is a long time to hold an erroneous belief based on a misunderstanding of what money and assets are. I had the same wrong beliefs as you do now for a long time and misallocated capital at a crucial moment. Parker Lewis explains[0]: > [Bitcoin] is backed by the only thing…

> Incidentally, if you pick up a US dollar bill, you'll see the inscription: "this note is legal tender, for all debts public and private." Therefore, that note derives its value from the implicit debt underlying it.

There's no such thing. That it can be used to pay debts doesn't mean there are debts underlying it, implicit or explicit. It means that if you incur a debt, and you have one, you can use it to resolve the debt.

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#176

Post by geofft »

formalsystem wrote: post #161
geofft wrote: post #150

Earlier quoted context omitted.

How do they actually use that Bitcoin to buy things of real value like food on the table? That is, if you're a family in Lebanon, what actual steps do you go through, having received some bitcoin from somewhere, to get some flour or chickpeas or whatever in your hand? Do you exchange the Bitcoin for local currency first (and if so, how) or do you pay the mill or butcher directly in Bitcoin (and what do they do with i…

You would go to an exchange and get local currency or US dollars instead if you need to spend it. But most people I know are just interested in it so they can preserve their wealth by bypassing capital controls. I’m Lebanese

Is the conversion to local currency not affected by inflation? Or if you convert it to US dollars, how do those US dollars get to the country and get past capital controls?

I'm specifically not asking about preserving wealth in the abstract - I'm curious about the mechanics of how it's used to put food on the table.

I guess maybe the question I should be asking is, who are the people who run the exchanges and how do they work? Why are they interested in accepting Bitcoin in exchange for more liquid currency, and where did they get that liquid currency in the first place? How do they determine the conversion rate? (Are they wealthy locals who already have lots of cash holdings who want to be wealthier and are willing to sell that cash for Bitcoin at a premium because they intend to hold the Bitcoin long-term / after major political changes?)

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#177

Post by wmf »

BMSmnqXAE4yfe1 wrote: post #156
wmf wrote: post #75

Earlier quoted context omitted.

Target date funds aren't complicated at all.

There is a lot of young people who think that stocks only ever go up. Wait until the the stock market crashes, and target date funds with it.

Target date funds aren't all stocks specifically to avoid this problem.

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#178

Post by fidelramos »

xorcist wrote: post #142
opportune wrote: post #122

Earlier quoted context omitted.

The idea of bitcoin as a store of value and not a currency is a revisionist interpretation that became popular with the blockstream devs around 2017-18 when it became apparent that the bitcoin network was unsuitable for handling payments at scale and had fees too high to be useful for mundane payments.

> 2017-18 when it became apparent that the bitcoin network was unsuitable That's an extraordinary statement. The scaling aspects of Bitcoin was apparent to everyone involved in the project from the start, including Satoshi. The limits of an architecture where everyone processes everyone else's transactions should be obvious to anyone reading the whitepaper. It is also the focus of the very first email replies. Few re…

Bitcoin doesn't need "everyone processing everyone else's transactions", only full nodes need to check transactions for validity. Bitcoin's whitepaper proposes SPV wallets, which are meant for end users and require minimum disk space and network bandwidth, and no need to run a full node.

I recommend this technical article on how Bitcoin (in its Cash fork) can scale to worldwide adoption (50 tx per day for each of 10 billion humans) even on today's hardware: http://blog.vermorel.com/journal/2017/12/17/terabyte-blocks-...

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#179

Post by UncleMeat »

BMSmnqXAE4yfe1 wrote: post #156
wmf wrote: post #75

Earlier quoted context omitted.

Target date funds aren't complicated at all.

There is a lot of young people who think that stocks only ever go up. Wait until the the stock market crashes, and target date funds with it.

Okay. BTC can crash too. There is no risk free financial instrument that generates wealth. But index funds are far more stable in the long run.

Re: What Bitcoin’s White Paper Got Right, Wrong and What We Still Don’t Know (2018)

#180

Post by DennisP »

jhoechtl wrote: post #120
DennisP wrote: post #70

Earlier quoted context omitted.

The fact that bitcoins can be transferred is the only reason they have value at all. You have to be able to exchange them for something else or they're worthless. The question then is whether 7 tx/sec really is sufficient to support broad global adoption, even if it's just for savings. Dollars and physical gold have no such limits. Other blockchains are vastly expanding scalability, as well as eliminating the energy…

> Other blockchains are vastly expanding scalability, as well as eliminating the energy usage. The energy usage combined with proof of work is the backing. If you break that for Bitcoin als is left is trust. The energy used and consumed is like the USD tied to gold (which it is no longer since quite some time)

The effort going into proof of work is the effect of Bitcoin's value, not the cause. Due to the difficulty adjustment, the total mining expense adjusts to be a little less than the real value of the reward offered.
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