rkbabang Posted November 8, 2017 Author Posted November 8, 2017 The single most important demographic opinion on Bitcoin: https://www.forbes.com/sites/spencerbogart/2017/11/08/7-stats-that-highlight-a-millennial-propensity-for-bitcoin/#4297b62232c4 Decent chance 120B will look very very cheap down the road. It seems unsustainable for bitcoin or any blockchain-based currency to carry all the unnecessary data with each transaction. Bingo. They are looking at scaling solutions... It's just kind of crazy that it's valued at $120B and they haven't implemented scaling yet. Usually when you develop a software solution that needs to scale you take care of that at step 1, not after the software is live. The complete dataset with all of the age groups included is interesting as well: https://drive.google.com/file/d/0B0Lpn9mr-a-8d0gyalVMZjJ5YkE/view
jmp8822 Posted November 8, 2017 Posted November 8, 2017 The single most important demographic opinion on Bitcoin: https://www.forbes.com/sites/spencerbogart/2017/11/08/7-stats-that-highlight-a-millennial-propensity-for-bitcoin/#4297b62232c4 Decent chance 120B will look very very cheap down the road. It seems unsustainable for bitcoin or any blockchain-based currency to carry all the unnecessary data with each transaction. Bingo. They are looking at scaling solutions... It's just kind of crazy that it's valued at $120B and they haven't implemented scaling yet. Usually when you develop a software solution that needs to scale you take care of that at step 1, not after the software is live. I am very intrigued to see what happens to bitcoin in a major global recession (perhaps in the next year or two?). People loved internet stocks in the late 1990s. I have a feeling the 20-30 somethings at the time were the most confident in their internet stock holdings (these people had never seen stocks decline, perhaps like bitcoin holders today). Did their confidence prevent them from losing 90-100% of their money? People that ask me about bitcoin are certainly intrigued by the price rising - if that is why you are buying it, who will be left to buy when it's 'cheap'? I'm not sure there will be enough bitcoin bargain-hunters to stop the panic.
rkbabang Posted November 8, 2017 Author Posted November 8, 2017 The single most important demographic opinion on Bitcoin: https://www.forbes.com/sites/spencerbogart/2017/11/08/7-stats-that-highlight-a-millennial-propensity-for-bitcoin/#4297b62232c4 Decent chance 120B will look very very cheap down the road. It seems unsustainable for bitcoin or any blockchain-based currency to carry all the unnecessary data with each transaction. Bingo. They are looking at scaling solutions... It's just kind of crazy that it's valued at $120B and they haven't implemented scaling yet. Usually when you develop a software solution that needs to scale you take care of that at step 1, not after the software is live. I am very intrigued to see what happens to bitcoin in a major global recession (perhaps in the next year or two?). People loved internet stocks in the late 1990s. I have a feeling the 20-30 somethings at the time were the most confident in their internet stock holdings (these people had never seen stocks decline, perhaps like bitcoin holders today). Did their confidence prevent them from losing 90-100% of their money? People that ask me about bitcoin are certainly intrigued by the price rising - if that is why you are buying it, who will be left to buy when it's 'cheap'? I'm not sure there will be enough bitcoin bargain-hunters to stop the panic. That will be me left buying when its cheap. The more panic the better. Another chance to buy at $100 or $1 would be greatly appreciated.
Guest Schwab711 Posted November 8, 2017 Posted November 8, 2017 The single most important demographic opinion on Bitcoin: https://www.forbes.com/sites/spencerbogart/2017/11/08/7-stats-that-highlight-a-millennial-propensity-for-bitcoin/#4297b62232c4 Decent chance 120B will look very very cheap down the road. It seems unsustainable for bitcoin or any blockchain-based currency to carry all the unnecessary data with each transaction. Bingo. They are looking at scaling solutions... It's just kind of crazy that it's valued at $120B and they haven't implemented scaling yet. Usually when you develop a software solution that needs to scale you take care of that at step 1, not after the software is live. This sounds like another way to say "there are so many fools left to sell to!" It takes slightly more than 8 days of energy for the average house to complete each bitcoin transaction. If 10x more people used bitcoin then I'd guess at least 10% of all US electricity consumption would go towards bitcoin mining (currently 0.7% but we'd need to account for consumption inflation inherent to bitcoin design)... We'll all be spending our bitcoins to pay our electricity bills to keep our bitcoins valuable!
Fat Pitch Posted November 8, 2017 Posted November 8, 2017 This is to discount moore's law. Don't you think there will be advances in ASCI chips to make them more energy efficient? 5 billion has been invested in mining hardware just this year alone. The single most important demographic opinion on Bitcoin: https://www.forbes.com/sites/spencerbogart/2017/11/08/7-stats-that-highlight-a-millennial-propensity-for-bitcoin/#4297b62232c4 Decent chance 120B will look very very cheap down the road. It seems unsustainable for bitcoin or any blockchain-based currency to carry all the unnecessary data with each transaction. Bingo. They are looking at scaling solutions... It's just kind of crazy that it's valued at $120B and they haven't implemented scaling yet. Usually when you develop a software solution that needs to scale you take care of that at step 1, not after the software is live. This sounds like another way to say "there are so many fools left to sell to!" It takes slightly more than 8 days of energy for the average house to complete each bitcoin transaction. If 10x more people used bitcoin then I'd guess at least 10% of all US electricity consumption would go towards bitcoin mining (currently 0.7% but we'd need to account for consumption inflation inherent to bitcoin design)... We'll all be spending our bitcoins to pay our electricity bills to keep our bitcoins valuable!
writser Posted November 8, 2017 Posted November 8, 2017 And what would smart miners do if chips suddenly get twice as efficient?
Guest Schwab711 Posted November 8, 2017 Posted November 8, 2017 This is to discount moore's law. Don't you think there will be advances in ASCI chips to make them more energy efficient? 5 billion has been invested in mining hardware just this year alone. The single most important demographic opinion on Bitcoin: https://www.forbes.com/sites/spencerbogart/2017/11/08/7-stats-that-highlight-a-millennial-propensity-for-bitcoin/#4297b62232c4 Decent chance 120B will look very very cheap down the road. It seems unsustainable for bitcoin or any blockchain-based currency to carry all the unnecessary data with each transaction. Bingo. They are looking at scaling solutions... It's just kind of crazy that it's valued at $120B and they haven't implemented scaling yet. Usually when you develop a software solution that needs to scale you take care of that at step 1, not after the software is live. This sounds like another way to say "there are so many fools left to sell to!" It takes slightly more than 8 days of energy for the average house to complete each bitcoin transaction. If 10x more people used bitcoin then I'd guess at least 10% of all US electricity consumption would go towards bitcoin mining (currently 0.7% but we'd need to account for consumption inflation inherent to bitcoin design)... We'll all be spending our bitcoins to pay our electricity bills to keep our bitcoins valuable! Energy usage per transaction has gone up steadily over time despite the 2 major efficiency jumps: 1) generic to specialized equipment; and 2) improvements to specialized mining equipment. The greatest efficiency gains are in the early years. The amount of "deadweight data" increases at a greater exponential rate than Moore's Law ever did for chips. Tack a transaction factor on due to an increased usage and hardware efficiency only delays the inevitable, imo. 99% of the data being processed in every bitcoin transaction is unnecessary and that % increases with each transaction. That is foundation of bitcoin's design. I think blockchain will find uses but I don't think it will find anywhere near as many applications as is speculated. It's not really revolutionary imo. It seems a bit like taking a census every time a child is born.
Hielko Posted November 8, 2017 Posted November 8, 2017 And what would smart miners do if chips suddenly get twice as efficient? Actually we can just look at what happened historically when bitcoin went from CPU mining to GPU mining, and then from GPU mining to ASICs. Those moves increased the computational efficiency by an order of magnitude more than just 2x. Guess what happened? The mining difficulty just increased rapidly to nullify those computational gains. It really blows my mind how so many people don't understand this basic property about bitcoin. It's security through spending more resources than is economically viable for an attacker to use. The whole algorithm is designed to be "unnecessary" computationally complex. Computing hashes that start with a bunch of zero's is totally pointless, except that it's a perfect way to use computational resources (energy) in a way that forces an attacker to do the same thing..
pau_ Posted November 9, 2017 Posted November 9, 2017 Bram Cohen (BitTorrent creator) announces a new cryptocurrency with aim to reduce power consumption required for a secure blockchain/currency TechCrunch: BitTorrent inventor announces eco-friendly bitcoin competitor Chia Chia site w/ whitepaper and talk
Hielko Posted November 9, 2017 Posted November 9, 2017 Bram Cohen (BitTorrent creator) announces a new cryptocurrency with aim to reduce power consumption required for a secure blockchain/currency TechCrunch: BitTorrent inventor announces eco-friendly bitcoin competitor Chia Chia site w/ whitepaper and talk I like the idea, but I don't think it can work (but will admit that I haven't read the whole technical paper). But the basic argument is as follows. If it's a "green" solution with less power and resource consumption (because it's using unused space) it's vulnerable because these cheap resources would also be available for an attacker.
writser Posted November 9, 2017 Posted November 9, 2017 FWIW the economist on cryptocurrencies: https://www.economist.com/blogs/buttonwood/2017/11/greater-fool-theory-0
no_free_lunch Posted November 9, 2017 Posted November 9, 2017 Bram Cohen (BitTorrent creator) announces a new cryptocurrency with aim to reduce power consumption required for a secure blockchain/currency TechCrunch: BitTorrent inventor announces eco-friendly bitcoin competitor Chia Chia site w/ whitepaper and talk I like the idea, but I don't think it can work (but will admit that I haven't read the whole technical paper). But the basic argument is as follows. If it's a "green" solution with less power and resource consumption (because it's using unused space) it's vulnerable because these cheap resources would also be available for an attacker. Maybe it could work, it is an intriguing option. Just not sure how you can "know" the proof of storage, how do you prevent people from claiming the same storage more than once? You can't fake proof of work. I also didn't read the white paper so it's probably in there. This option still doesn't address scaling of transactions. Even the lightning network is only a mitigation. With lightning you still need to write to the main blockchain when you open a channel and you need to write to the blockchain to close the channel. So imagine if you have a large channel open to some company and you suddenly question the company's integrity. You are stuck waiting for your chance to write to the main blockchain and close the channel out (with the blockchain running at 6 or 7 transactions per second). If you have millions of users in this funnel, it could get ugly. It seems the only solution to scaling is a combination of sharding of the actual chain, off-chain solutions light lightning and I don't know maybe even the occasional freeze point. Perhaps blockchain will just muddle through all of this and people will accept the complexity, I mean existing financial solution are not perfect either. I just want to point out that there are a lot of unsolved problems given how much people have bought into this.
no_free_lunch Posted November 11, 2017 Posted November 11, 2017 Some comments on the bitcoin lightning network here. The author is not entirely pessimistic on scaling but suggests off-chain shards might be necessary. Now, maybe you have heard about something called 'the lightning network'. It is important to understand that the Lighting Network (networked bi-directional payment channels) does very little to scale the number of users. Use of payment-channels requires on-chain transactions to both open and close channels. More importantly, money has to be tied up in those channels and, at a practical level, ordinary users cannot afford to lock up thousands of dollars in open payment channels; subjecting themselves to volatility risk they may not be comfortable with or is simply more money than they have. Things like the Lightning-Network provide a great solution for very low value payments (think less than a $1) but doesn't really do much for the higher-value use case. Individual users still need to be able to hold value, directly on chain. Even if they don't need to perform on-chain transactions on a daily basis, maybe just once a week, or once every two weeks, the same problem applies. You need a massive blocksize limit to accommodate them. Also, the average backlog would grow to be measured not in hours, but in days and weeks, maybe even months. (@see Nyquist sampling theorem ) http://codesuppository.blogspot.ca/2016/11/the-problem-with-on-chain-scaling-is.html
SharperDingaan Posted November 11, 2017 Posted November 11, 2017 FWIW the economist on cryptocurrencies: https://www.economist.com/blogs/buttonwood/2017/11/greater-fool-theory-0 The supply of Bitcoin is essentially vertical, and moves based on todays expectation of tomorrows price. If we think prices are going up we do not offer our Bitcoin up for sale - reducing supply, raising price, and fulfilling our expectation. The same thing occurs in Real Estate, and is common practice. It is highly likely that the introduction of both Bitcoin options and syndicated loans (Bitcoin as collateral) will generate (material new) institutional demand (cryptocoin hedge funds) for Bitcoin. Most folks would expect that new demand to raise the price of a Bitcoin, and hold back their Bitcoin IN ANTICIPATION of selling later at a HIGHER price still. The result is something very similar to the Tulip Mania of the Netherlands, that occurred way back when. Manias are by definition - not rational by normal standards; they have their own internal logics - & every one is different. The only common denominator is that they require a bag holder - & everyone is convinced that it is not them. SD
Libs Posted November 16, 2017 Posted November 16, 2017 Stumbled onto this piece about bitcoin, the origins of mediums of exchange, and much more. He sees Bitcoin as here to stay ( as a medium of exchange). I liked this section: <I have previously argued why there is no theoretical reason that a medium of exchange has to start out being material.9 It only has to be a scarce good. The digital age, and Bitcoin itself, have made it clear that goods do not have to be tangible. Despite word choices such as commodity in classic writings on this subject, there is no fundamental economic reason that a physical material has to be what secures the essential monetary characteristics—foremost scarcity. The supposed need for tangibility is an association leftover from the range of examples that was available prior to the internet age.> https://static1.squarespace.com/static/5720adbdc6fc0891cbcce17c/t/580d685959cc689a7b411ba4/1477275058522/On+the+Origins+of+Bitcoin+Graf+03.11.13.pdf
Jurgis Posted December 15, 2017 Posted December 15, 2017 https://www.bloomberg.com/news/articles/2017-12-14/bitcoin-points-way-to-massive-change-for-commodity-businesses I have couple questions for blockchain/crypto experts: 1. When these companies are talking about using blockchain for trading physical commodities or for land register, what underlying blockchain are they planning to use? I would assume they are not building this on top of Bitcoin blockchain, are they? Are they using blockchain of one of the public cryptos or deploying their own? 2. Assuming they are using their own blockchain, how is security achieved? I doubt that proof-of-work security works for small/private crypto setups. Are then they using something else? Just relying on single trusted authority (but then why use blockchain)? 3. Why not use DBs? For simplicity, let's assume transaction write-once journaling DB which is pretty much the same as blockchain except not distributed. Especially in the case of crop land registry in Ukraine, I don't see how blockchain can prevent fraud any more than such DB. What are scenarios where blockchain prevents fraud and centralized DB doesn't? Corrupt bureaucrat transferring your land to someone else by changing DB without your knowledge? How would they do that if DB required your authorization/code/password? Hacking? Why hacking DB would be easier than hacking blockchain (also see question2 regarding how the heck you achieve blockchain security on own blockchain)? Edit: This https://www.economist.com/news/briefing/21677228-technology-behind-bitcoin-lets-people-who-do-not-know-or-trust-each-other-build-dependable and https://en.wikipedia.org/wiki/Blockchain answer most of the questions above (if you read through and think a bit...coin ;D)
rkbabang Posted December 15, 2017 Author Posted December 15, 2017 https://www.bloomberg.com/news/articles/2017-12-14/bitcoin-points-way-to-massive-change-for-commodity-businesses I have couple questions for blockchain/crypto experts: 1. When these companies are talking about using blockchain for trading physical commodities or for land register, what underlying blockchain are they planning to use? I would assume they are not building this on top of Bitcoin blockchain, are they? Are they using blockchain of one of the public cryptos or deploying their own? 2. Assuming they are using their own blockchain, how is security achieved? I doubt that proof-of-work security works for small/private crypto setups. Are then they using something else? Just relying on single trusted authority (but then why use blockchain)? 3. Why not use DBs? For simplicity, let's assume transaction write-once journaling DB which is pretty much the same as blockchain except not distributed. Especially in the case of crop land registry in Ukraine, I don't see how blockchain can prevent fraud any more than such DB. What are scenarios where blockchain prevents fraud and centralized DB doesn't? Corrupt bureaucrat transferring your land to someone else by changing DB without your knowledge? How would they do that if DB required your authorization/code/password? Hacking? Why hacking DB would be easier than hacking blockchain (also see question2 regarding how the heck you achieve blockchain security on own blockchain)? Edit: This https://www.economist.com/news/briefing/21677228-technology-behind-bitcoin-lets-people-who-do-not-know-or-trust-each-other-build-dependable and https://en.wikipedia.org/wiki/Blockchain answer most of the questions above (if you read through and think a bit...coin ;D) You are correct. I think the word "blockchain" is becoming a trendy buzz word and you will see companies trying to get in on the hype with "blockchain based" this and "blockchain based" that in order to boost their stock price, but a private blockchain where you have to trust the people who control it is nothing but an inefficient database. If it isn't running on a public distributed blockchain then it isn't safe. To answer your first question right now most companies running on public blockchains (or planning to) are using Etherium. There is also IOT, ADA, EOS, NEO, and soon to be released Tezos, which support this kind of thing. Blockchains such as BTC, BCH, LTC, DASH, BTG, XMR, etc ... are just currencies. There is also Ripple which is only a currency and a private blockchain which I think will be valueless long term for the reasons that you enumerated (you have to trust Ripple the company). There is going to be a lot of money thrown at a lot of valueless things for a long time based on hype, buzzwords, and outright fraud before people in general understand this stuff.
mattee2264 Posted December 16, 2017 Posted December 16, 2017 https://ftalphaville.ft.com/2017/12/07/2196526/what-happens-when-bitcoins-market-cap-overtakes-world-gdp/ Interesting article on the FT to the effect that the market structure even with the advent of futures trading could see prices go a lot higher.
Jurgis Posted December 16, 2017 Posted December 16, 2017 https://ftalphaville.ft.com/2017/12/07/2196526/what-happens-when-bitcoins-market-cap-overtakes-world-gdp/ Interesting article on the FT to the effect that the market structure even with the advent of futures trading could see prices go a lot higher. Why world gdp? I'm sure the interstellar object that just visited us was here to buy bitcoin for Vegans. After all there's only 21mln bitcoins available IN THE WHOLE GALAXY (actually in the whole UNIVERSE!)! Buy them before aliens show up and slurp up all the liquidity!
Jurgis Posted December 17, 2017 Posted December 17, 2017 Just buy coal! https://www.bloomberg.com/news/articles/2017-12-15/turning-coal-into-bitcoin-dirty-secret-of-2017-s-hottest-market
Jurgis Posted December 20, 2017 Posted December 20, 2017 Just buy coal! https://www.bloomberg.com/news/articles/2017-12-15/turning-coal-into-bitcoin-dirty-secret-of-2017-s-hottest-market Power Denmark or mine bitcoin? ::) Who cares about Denmark! ;D https://www.washingtonpost.com/news/energy-environment/wp/2017/12/19/why-the-bitcoin-craze-is-using-up-so-much-energy/?utm_term=.84fcb47ec3aa
rkbabang Posted December 20, 2017 Author Posted December 20, 2017 https://srsroccoreport.com/gold-mining-industry-fuel-costs-explode-in-a-decade/
beerbaron Posted December 20, 2017 Posted December 20, 2017 So quick calculation: 591 000 000 Gallons of oil at $2.50/Ga = 1.5 Billions in energy Cost per year Lowball estimate for bitcoin mining: 1 000 000 kWh @ $0.10/h * 24 *365 = $876 000 000 Highball estimate for bitcoin mining 4 000 000 kWh @ $0.10/h * 24 *365 = $3 504 000 000 So here is the billion dollar questions: If today's power consumption for bitcoin mining is the same as a big chunck of the overall gold produced. What is going to be bitcoin mining power consumption next year or 10 years from now? It seems to me that it is just not a scalable solution, energy efficiency gains on the IC side cannot offset an exponential growth, at least not at this stage and not with silicon. If I were in the bitcoin business I would do everything in my power to address this issue... Is there solutions that would not compromise the security aspect or fragment the network? I don't know... but I'd like to hear about it because that is a pressing matter. Can the technological side support the demand? Saying that comparing BC to 1995 internet is not the same at all. In 1995 there were OC-192 communications lines available, a solid history of the silicon process increasing 50% per year, a solid understandind of where the theorical limits were to speed and size (can't go smaller than an atom). Hence, a lot of room to grow the technical side to support the demand. All in all, the internet had technological tailwinds while crypto currencies have technological headwinds. Maybe I'm wrong but I son't see how it would make sense to spend 100B in energy cost in 5 years for now to save on a fraction of that in transactions. IMO SD has a pragmatic view of the whole picture, I would listen to him for anybody thinking to invest. BeerBaron
Jurgis Posted December 20, 2017 Posted December 20, 2017 Proof of work is likely not scalable. Possible solutions: 1. Keep proof of work, but optimize everything you can try to optimize: efficiency, block size (increase), side channels, etc. This could work. It's likely to be cumbersome and it may lead to other drawbacks (loss of security?, bigger/slower transactions?). 2. Figure out blockchain without proof of work. There are people working on this. This might be a solution. Will this be implemented? Will it be as secure as proof of work solution? Will it be accepted? News in couple years! 8)
wachtwoord Posted December 20, 2017 Posted December 20, 2017 POW scales very well because the difficulty adapts to the perceived value in the system. This is exactly the intention. Funny how people always want to fix things that aren't broken ...
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