Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Bitcoin is largely controlled by a small group of investors and miners

techspot.com

Post reply on HN
Print view View original

321–330 of 486 posts

Re: Bitcoin is largely controlled by a small group of investors and miners

#321

Post by rhinoceraptor »

anonporridge wrote: post #108
nuerow wrote: post #94

Earlier quoted context omitted.

> Soooo. . . you're saying a tiny fraction of the population controls the vast majority of the resource? You mean just like every other major resource on the planet? :) I understand the need to try to dismiss this problem, specially from those who have a dog in the race, but the dream of having a magical pseudo-currency that solves all problems and unexplainably makes everyone richer and richer just falls out flat if…

> magical pseudo-currency that solves all problems and unexplainably makes everyone richer and richer That's not what's exciting about bitcoin. What's exciting is that it is the first digital, global money that isn't protected by the proof of violence of the state. The US dollar is the world reserve currency because the United States is the best in the world at deploying destructive power, and the British and French…

Bitcoin isn't a currency, it doesn't function as such. It can only support at most a few dozen transactions per second.

It's a speculative instrument, and its value is propped up by Tether, which pretty much everyone agrees is incredibly fraudulent.

Re: Bitcoin is largely controlled by a small group of investors and miners

#322

Post by rndmind »

latchkey wrote: post #77
pcwalton wrote: post #9

Earlier quoted context omitted.

> Never mind that doing so would destroy the value of the cap/opex invested. "Bitcoin is centralized, but that's OK because the central authorities can be trusted to do the right thing" isn't exactly a compelling argument. Especially when decentralization is supposed to be one of Bitcoin's major selling points.

I'm not talking about trust, I'm talking about financial motivation. We don't need to trust miners for bitcoin to work and if we do trust them, what is the downside to someone who is just validating transactions? They built a better gold. People trust gold. They put the majority of it into vaults and trust the people who run those vaults. This is the best solution anyone has ever come up with to digitize gold. It doe…

Unless of course, ECSDA gets hacked... then the new "gold" immediately drops to zero value.

And I say that as a bitcoin and eth proponent and long time holder. I'm just saying, we should be careful before we jump to conclusions this is still experimental technology ( even encryption itself is still young, and implementation is very prone to error )

Re: Bitcoin is largely controlled by a small group of investors and miners

#323

Post by [deleted] »

Sammi wrote: post #268
olalonde wrote: post #236

That's a pretty misleading headline. Miners and investors do not control Bitcoin regardless of their hash power or amount of BTC owned. 50+ miners is also well enough to prevent any 51% attack. Finally, the ownership estimate is flawed given that it relies on blockchain analysis. The existence and popularity of custodial wallets (e.g. exchanges) makes this sort of analysis extremely unreliable.

The nodes control the network. The nodes decide what happens or does not happen in the bitcoin network. Bitcoin holders have no say in this. Bitcoin miners have no say in this. This has been thoroughly proven in the bitcoin block size wars. The miners where in favor of an increase, but this meant nothing as the nodes where not, and a change in the protocol requires the nodes to adopt it.

[deleted]

Re: Bitcoin is largely controlled by a small group of investors and miners

#324

Post by throw0101a »

rglover wrote: post #61
jayd16 wrote: post #21

Earlier quoted context omitted.

This is just desperate whataboutism. The inequality of life is certainly brutal but it doesn't make Bitcoin a populous utopia either. Besides that the numbers aren't equivalent. Holding stake and controlling its exchange are not the same thing, at least not for Bitcoin or democratic state controlled currencies.

A decentralized money that government can't touch is the definition of a populous utopia in money terms. Bitcoin, by nature, is the most democratic form of money to ever exist on the planet. That more people don't get behind it and buy at least a little bit is mind boggling. Government fiat is and always will be a source of controlling the population and limiting their ability to build wealth.

> Government fiat is and always will be a source of controlling the population and limiting their ability to build wealth.

Quite the opposite: fiat is what allows wealth to be built.

Under (e.g.) the Gold Standard, those who owned the gold controlled the wealth as the amount of gold was fixed and finite. If you wanted to expand the economy and needed "money" to do so, you had to literally dig up more gold. The finite amount was a limit on how economic activity could happen. And those in control of the gold could dictate terms (e.g., interest rates on loans) on its use.

And while Bitcoin can perhaps be sliced more finely (satoshis) than gold (ounces/grams), the principal is the same: there's a finite amount.

Meanwhile, in a credit-based fiat currency system, any bank can create money on demand by issuing loans. Need more liquidity to help an economy (keep) grow(ing)? Just encourage more loans.

Re: Bitcoin is largely controlled by a small group of investors and miners

#325

Post by nuerow »

christophilus wrote: post #304
nuerow wrote: post #295

Earlier quoted context omitted.

> The government can print USD for themselves, effectively stealing money from everyone through inflation. Not quite. The only people bitten by inflation in the long run are those who stockpile cash and intend to perpetually live off capital gains without contributing anything to society. Meanwhile, the vast majority, which are either salaried employees or own businesses, see both their income and expenditures adjust…

AKA stealing from the elderly to fund today’s excesses.

> * AKA stealing from the elderly to fund today’s excesses.*

I appreciate a good appeal to pity, but unfortunately you got it completely wrong. Even though pension funds use investments to complement their investment pool, they are primarily funded through contributions from the employer and existing members as an income redistribution scheme[1].

[1] https://www.investopedia.com/terms/p/pensionplan.asp

Re: Bitcoin is largely controlled by a small group of investors and miners

#326

Post by throwaway248329 »

superice wrote: post #197
anonporridge wrote: post #105

Earlier quoted context omitted.

Yes. Inflation is a tax.

Inflation is a "tax" on owning money, an equalizing force if you will. Deflation is a "tax" imposed that benefits large holders of the currency on people who hold less or none of that currency. There is ofcourse also the moral argument for inflation: society pays you because you it values what you sold or did. That valuable service is not going to be worth as much 50 years into the future, so inflation is the cost im…

Inflation is a tax for poor people who don't and often can't hold assets that appreciate with time. It not only makes their savings worth less, but also makes their fixed salary have less buying power.

The wealthy love inflation since it's just going to pump their assets and redistribute money from the poor into their pockets.

Re: Bitcoin is largely controlled by a small group of investors and miners

#327

Post by hnbad »

nuerow wrote: post #206
hnbad wrote: post #203

Earlier quoted context omitted.

> Is it ok if someone participating in a Ponzi scheme is fleeced just because you accuse him of being greedy? I know this is counter-intuitive, but yes. Yes, they think that. They think that human nature is to be greedy and screw other people over to your own advantage. This is what they mean that capitalism is natural because it builds on human nature. Nevermind that for most of history human societies have been bui…

> Nevermind that for most of history human societies have been built on gift economies or that humans always cooperate in times of extreme crisis unless there are external influences explicitly preventing it. The key point here is that in BTC, or any crypto or unregulated market, there is no external influence preventing it. In fact, there are only external influences ensuring that they will screw up the little guy a…

> The key point here is that in BTC, or any crypto or unregulated market, there is no external influence preventing it. In fact, there are only external influences ensuring that they will screw up the little guy and fleece them out of their hard-earned money.

I'm not sure you're replying to the right point since it seems you largely also share the opinion that crypto is mostly a scam even if not every participant is in on it.

I was talking about hierarchies of power. Capitalism, caste systems, patriarchies (think of Middle Eastern "honor" systems), literally having a gun pointed at your head, etc. Those are external influences that can prevent and disrupt cooperation that would otherwise arise naturally.

If I see an overturned car on the road side, I stop to see if I can help. But if I'm on the way to my job which I need to continue having a roof over my head and feed my family and being late could get me fired and it's hard to find something else, I'm more likely to just move on.

Re: Bitcoin is largely controlled by a small group of investors and miners

#328

Post by hnbad »

leesalminen wrote: post #239
hnbad wrote: post #214

Earlier quoted context omitted.

Sure but why do you think that is. What currency oil is quoted in has more to do with foreign policy than economics. Regardless of what reasons the US may have had to invade Iraq in 2001, Saddam Hussein was literally on record in 2000 for planning to switch away from quoting Iraqi oil in US dollars to the Euro[0]. There was a ton of talk about the 2001 invasions being about the US oil reserves for itself but that's b…

Just to be clear, the US invaded Iraq in 2003, not 2001. https://en.m.wikipedia.org/wiki/Iraq_War

I stand corrected. Post-9/11 was a weird time and it kind of all blurs together.

Re: Bitcoin is largely controlled by a small group of investors and miners

#329

Post by jstanley »

danbruc wrote: post #300
dannyw wrote: post #287

Earlier quoted context omitted.

What miners do is irrelevant: the code known as bitcoin, with a 21M hard cap, simply will reject any block that creates more than its allowed bitcoins as invalid, the same way it rejects a random string of bytes as invalid.

Depending on your definitions this might or might no be true but it also might be totally irrelevant. There is a protocol and system specification. There are implementations of that specifications. There is a distributed system running those implementations. And the distributed system has a state. Each of those can change and each of those or a combination of them could arguably be called Bitcoin. If everyone would r…

The point is you need the economic majority to be on side in order to succeed with a hard fork. Just the top 50 miners switching on their own isn't enough.

Re: Bitcoin is largely controlled by a small group of investors and miners

#330

Post by jstanley »

capableweb wrote: post #279
arcatek wrote: post #275

Earlier quoted context omitted.

If they start to play with different rules, one of the hard fork remaining branches (or both) will be refused by everyone on the network and be worthless. There's no telling whether it'd be the "hijacked" branch or the original one - assuming they control 50%+ of the mining power, there's a decent argument that the remaining miners would follow their lead if only to stay on the largest branch.

Developers of the core protocol would notice, add a flag and then miners/clients/exchanges who want to remain with the same dev team can signal they want to follow the "dev" chain instead of the "miner" chain. Usually forks have checkpoints as well so things can't change willy-nilly.

If blocks in the "miner" chain break the rules of the "dev" chain, then no flag is required. You'll automatically stick with the chain that contains valid blocks, as determined by the implementation that you're running.
Post reply on HN