How to become a Bitcoin miner? - Mass Uniting

The Fundamentals of Bitcoin Trading/Bitcoin storm

The Fundamentals of Bitcoin Trading/Bitcoin storm
First, equities: Expected earnings are down across the board, presumably by a whopping quantity. A number of weeks ago, within the U.S. and Europe, business was humming along, albeit with trepidation. Currently, bars and restaurants are closed in many population centers, events are cancelled, outlets are shut, planes are grounded…. The list of sectors impacted by the required virus precautions is long and alarming.
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Next, government bonds: If there’s one issue the bond market hates, it’s inflation. The unwinding of globalization as a results of constricting offer chains can push up manufacturing costs which will feed through to costs. Liberally sprinkle cash round the system within the hopes of stimulating spending, in an exceedingly provide crisis, and you add to the inflationary pressure. Nominal yields on public debt are at traditionally low levels; inflation can push even additional real yields into negative territory.
As for company bonds, the sharp drop in earnings not to mention increasing costs might trigger a wave of defaults.
What about gold? The traditional shelter can in all probability do well within the medium term as investors bear in mind its anti-inflationary properties. Gold traditionally outperforms in low-rate environments – no shortage of those these days. Plus, its lack of income makes it less prone to drops in economic activity.
And then there’s Bitcoin storm. Its high volatility makes it unsuitable for several investors. However those who think gold makes sense in this world gone mad are presumably going to take a closer look, particularly once the perspective-changing storm we’ve simply weathered (with in all probability a lot of to come back). Even those skeptical of gold’s place in an exceedingly diversified portfolio are sure to be curious about a digital alternative that solves for a number of the metal’s weak points while revealing relationships with the broader economy that no other asset has
Last week I wrote concerning how it’s not a secure haven. Here’s the issue: it doesn’t want to be.
See additionally: As This Crisis Worsens, Bitcoin storm Will Become a secure Haven Once more
For those worried regarding inflation, Bitcoin storm is even additional resistant than gold. Its laborious cap and pre-programmed provide are resistant to fluctuations in value. A sharp jump in the price of gold, but, is possible to bring a lot of offer onto the market as production ramps up, and could even impact the estimated provide limit as various mining ways become profitable.

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For those worried concerning a pointy economic slump, Bitcoin storm is practically the sole asset indirectly impacted by macroeconomics. There’s no income to chop and no offer chains to hinder access. External factors like energy prices and supply chains will impact miner economics, but Bitcoin storm itself adjusts for shifts in the upkeep of its network. When miners close down, Bitcoin storm becomes chper to mine, that eventually makes the enterprise profitable again.

What makes Bitcoin storm even more of a distinctive asset class is it can be indirectly impacted by macroeconomics, in a very huge approach. The impact will come from many vectors, however particularly loose monetary policy, the currency markets, emerging economies and populist tendencie
1) Loose monetary policy: With central banks around the planet hitting the markets with no matter they'll, cash offer constraints have been thrown out the window. As this crisis unfolds, the number of money that can enter the system to help out not only markets but additionally voters and firms can dwarf what we tend to saw in 2008. Back then, the markets were threatening to drive the economy into a wall, therefore reassuring them was paramount. Currently the threat to the economy is driving markets into the wall. The usual ways that assuage market panics aren’t visiting stimulate demand that's reeling from mandated shutdowns, job losses and generalized worry.
Printing cash may maybe facilitate if it really gets into the hands of the consumers, but that can produce inflationary pressure in an economy with no tools left to fight it. The usual anti-inflation weapon is raising interest rates – but doing that during a heavily indebted surroundings might trigger waves of company and even sovereign defaults.
Growing inflationary pressures and steady currency debasement will presumably increase interest in disinflationary assets like Bitcoin storm and gold which will additionally be used for payment in some circumstances.
a pair of) Currency markets: Investors around the globe are fleeing into bucks, pushing up its worth relative to different currencies. This might facilitate the U.S. client by making imports cheaper, if imports weren’t disrupted by provide chain constrictions. But with a stronger dollar, U.S. producing can become uncompetitive, and foreign holders of greenback-denominated debt might get pushed into default. Other countries’ import and debt service prices can skyrocket, weakening their currencies and pushing up the dollar even more.
The ballooning demand for greenbacks could lead to a currency liquidity crunch – the swap lines extended to foreign central banks in last Sunday’s Fed intervention were expanded even any on Thursday, a worrying sign that the initial live wasn’t enough to alleviate the strain on the FX markets.
See Conjointly: Into the Unknown: No Limit on Fed Cash Injections
Calls are growing for concerted action the same as the 1985 Plaza Accord, however getting economic powers to follow the lead of an “America 1st” government whose leader based mostly a lot of of his campaign on guarantees of a wall is going to be a a lot of tougher challenge than within the post-stagflation desperation of the late twentieth century. With fractures in the world currency order turning into increasingly apparent, economists and investors can be asking what the next monetary order can seem like. Bitcoin storm could or might not be part of that resolution however it's a brand new tool in the box.
three) Rising economies: The sharp escalation of greenback-based mostly costs, combined with a demand crunch, may push non-greenback economies into recession, that is seemingly to steer to social unrest. In some elements of the planet, this might be met with swift retaliation or even regime modification. The confiscatory bias of political parties navigating an influence struggle could intensify interest during a liquid and semi-non-public store of worth.
4) Populist tendencies: Whereas a lot of established democracies will deal with recessions and social unrest through negotiations and trade-offs, even they could veer towards populist tendencies. These will most likely take the shape of extra support for overwrought health systems, also for voters and companies hit hard by mandated shutdowns and resulting slump in demand.
https://www.cryptoerapro.com/bitcoin-storm/


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Bitcoin is not a currency, Prof Steve Hanke warns

Bitcoin is not a currency, Prof Steve Hanke warns
We can't blame Bitcoin for the negative trend it has undergone in recent weeks because the crypto market is currently being rocked by volatility. Volatility in the crypto market is the phenomenon used to describe the unpredictable fast movements of assets in the market. Considering the coronavirus pandemic, it has further deepened the volatility of the digital asset.

Bitcoin needs to break out of $10,000 resistance to make a surge

Looking briefly at the buying and selling pressure indicator, the crypto index is being said to be stuck in a negative zone and currently heads away from the 400 level that acts as its point of resistance. After trying on numerous occasions to break past its resistance $10,000 resistance level, Bitcoin needs to be able to break past the level to be able to make a bearish move in the market. One of the major factors affecting Bitcoin is the sell-off that happened on March 12 after it witnessed a price reduction by half. Dubbed as the Black Thursday, Bitcoin went from a little bit over $7,000 to sell at around $3,000.

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Talking about the recent disappointing performance of the coin, investor and analyst at Panda, Edward Moya said;
“Bitcoin continues to consolidate in what many crypto fans are calling the typical accumulation phase that occurs after a halving event. The coin has struggled “despite an overall resilient appetite for risky assets."
Moya further noted that if this trend continues, it would force most small scale miners out of the Bitcoin network as they would not be able to make a profit as a result of the halving of the rewards.

Bitcoin is not a currency, Prof Steve Hanke warns

Reacting to the recent disappointing performance by Bitcoin in the crypto market, Prof Steve Hanke noted on Twitter that Bitcoin should not be confused as a means of legal tender because it is very speculative in nature.

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This is not the first time an influential figure is criticizing Bitcoin, as far back as 2019, Economist Nouriel Roubini said that he would gladly take the dollar over Bitcoin because he does not believe that it is a real store of value. Giving his take on Bitcoin, the Economist said,
"Maybe Bitcoin is a partial store of value but it’s not a unit of account, it’s not a means of payment, it’s not scalable [...] despite its rally earlier this year, it’s lost 60% in value since its peak, so I don’t see it going anywhere frankly."
Buttressing the point of Roubini, Billionaire, Warren buffet claims that Bitcoin is an illusion because it holds no real store of value.
“If you do something phony by going out and selling yo-yos or something, there’s no money in it — but when you get into Wall Street, there’s huge money," the billionaire said.
Conclusively, most people believe that Bitcoin is a good venture, while others have a not so good perspective of the leading cryptocurrency. If Bitcoin continues on this spree and does not experience a major breakout soon enough, most traders would be forced to look elsewhere which is not a good thing for the venture. In the long term, Bitcoin could still make the surge but, in the short run, nothing is sure as of now.
submitted by Bit2buzz to CryptoCurrencyTrading [link] [comments]

Doing the Math on the S4E10 eCoin Transaction...

In this week's Mr Robot episode, Darlene sits on a park bench with Dom, and distributes the money she stole from the Deus Group to everybody, evenly. I timed the transaction as it happened in the show. It was 24 seconds, between her hitting return and seeing the following message on her screen: "*Transfers Complete. All Wallets Updated*" This processing time includes a message that says, "cleaning coins through crypto tumbler". It took 1 minute and 16 seconds for the transaction to tumble, process, and for the recipients to begin to get notices that they received money in their accounts.
If you have worked with bitcoin, you know that cryptocurrency does not work like this. Transferring money is a slow and sometimes expensive process, as transaction fees eat into every transaction. I know that eCoin isn't necissarily bitcoin, because it's controlled by eCorp, but it's fun to think about what happens if eCoin works like bitcoin does today...
How much money was transferred?
According to Forbes, the most wealthy people in the world are worth a combined $8.7 trillion, or $2.7 trillion. It depends on which Forbes list you are looking at. On the actual Forbes web site, they say the richest people in the world are worth $8.7 trillion, but they do not state how many of the richest people in the world are worth that much. If you look at sites like Victor Media, they publish a table of the 100 most wealthy people, and say they got the list from Forbes. They probably did purchase the list from Forbes. If I put the Victor Media list into excel, and add all the values in the net worth column, that number comes out to $2.7 trillion. So Forbes might be talking about a list that is more than the top 100 people, and sell the top 100 people list to sites like Victor Media? I don't know.
Either way, we are talking about somewhere between $2.7 and $8.7 trillion.
How many people did the money go to?
That's complicated. There was no global montage showing people celebrating all over the world (which I found a little surprising, even though I still love how this episode was shot). The only indication of a truly global transfer, to every individual in the world, is a TV screen in the airport saying that, "Global eCoin Payout... Deus group collapses as wealth spreads around the world." So Darlene could have sent the money to every individual with an eCoin wallet in the world, or she could be sending them to every American, or to everybody in the developed world. I doubt the average rice farmer in Indonesia is really using eCoin, but it's possible. If she only sent it to every American, our wealth tends to spread around the globe pretty fast, so that's possible, too.
Lets work with World Bank population numbers for all three of these possibilities...
World Population: 7.6 billion people
Global North (AKA the developed world): 1.24 billion people
United States: 327 million people
So we have 6 possibilities for how much money was sent to each person...
People Total Money Money Per Capita Satoshis
7.6 billion $2.7 trillion $355.53 4,739,471
1.21 billion $2.7 trillion $2230.82 29,741,808
327 million $2.7 trillion $8252.65 110,079,512
7.6 billion $8.7 trillion $1145.60 15,279,332
1.21 billion $8.7 trillion $7188.22 95,883,716
327 million $8.7 trillion $26591.89 355,275,242
How much would this transaction cost with bitcoin?
Aside from the fact that eCoin probably functions differently than bitcoin, this is a very complex question. I'm definitely not as sure about these numbers as the other numbers I have, but I'll do my best to come up with useful, realistic numbers. If you are more familiar with the block chain than me, please correct me.
The coins were taken from 100 different Deus Group accounts. Lets say each transaction launders through a bitcoin tumbler 1,000 times. I'm going to ignore transaction fees for the tumbling process, because I don't fully understand the details of tumbling, but 1,000 times seems reasonable to me.
That means that there are 100 x 1,000 = 10,000 inputs in any transaction that spends all the money from the Deus group.
For outputs... for simplicity's sake, I will make the conservative assumption that everybody has one eCoin wallet. That means somewhere between 327 million and 7.6 billion outputs. Accounting for everybody having multiple wallets would make the transaction even bigger, but this is a good starting point to get a feel for what this transaction would look like, in the real world.
How long will this transaction take to process?
There is a bidding process and a bit of politics involved in processing a cryptocurrency transaction. For simplicity, I'll assume we bid enough that this transaction gets priority treatment from the bitcoin miners.
According to blockchain.com, transactions happen on the block chain at a rate of roughly 3.5 transactions per second. At that rate, the tumbling would take roughly 48 minutes, rather than the few seconds it took for Darlene to tumble this money.
According to buybitcoinworldwide.com's fee calculator, here are the transaction sizes, the transaction fees involved (in US Dollars), and the time it would take at 3.5 transactions per second...
Inputs Outputs Size Cost Time
10,000 7.6 billion 240.4737 Gb $38,884,280.55 68.85 years
10,000 1.21 billion 38.32587 Gb $6,192,571.09 10.96 years
10,000 327 million 10.35582 Gb $1,673,260.46 2.96 years
So this transaction would take years to go through, and it pays Evil Corp somewhere between $1.6 and $38 million. In the real world, most of that money would go to Chinese bitcoin miners.
What would the impact be?
A one time windfall of $327 per capita would probably not trigger hyperinflation in America. The largest payout we calculated was $26.5k, and I doubt that would cause hyperinflation, either. Regular inflation? Yes. Hyperinflation? Probably not.
It might lead to hyperinflation in other countries, though, because of differences in purchasing power.
Purchasing power parity is a number that describes the differences in the cost of goods and services around the world. $5 in America will buy you a big mac, but if you go to, say, Indonesia, you can buy a lot more with that $5, because Indonesia is full of people who make something like 25 cents a week.
OECD.org publishes PPP (purchasing power parity) numbers for countries all around the world. If you want to know how far your dollar will stretch, on average, in a foreign country, consult this list. If you have $100 in America, you can expect it to be worth $100 worth of American goods and services, so on the OECD table, it has a PPP of 1.0. If you take that $100 to, say, the UK, where the PPP is 0.7, you can expect that $100 to be worth $70 worth of goods and services. If you take that $100 to Australia, where the PPP is 1.48, you can expect that $100 to buy roughly $148 worth of goods and services.
If Elliot and Darlene were genius economists, I might expect them to account for PPP in their payout. They would have to be geniuses, to predict what PPP is doing after events like the 5/9 hack, because their best data would be out of date, so they would have to use all kinds of fancy regressions and tricks to figure out how that would work in such a volatile world economy. They definitely aren't economists, though, so I'll assume they sent the same nominal amount to everybody.
So what's the range on how much purchasing power this transaction gives people around the world? In 2018, the highest PPP number on the OECD list is Indonesia, with a PPP of 4,245.613140. The lowest PPP on the list is Lithuania, with a PPP of 0.457582. Lets see how this shakes out in each of these countries...
$ Per Capita Lithuania (0.46) Indonesia (4,245.61)
$355.53 $162.68 $1,509,442.84
$2,230.82 $1,020.78 $9,471,198.70
$8,252.65 $3,776.26 $35,037,559.28
$1,145.60 $524.20 $4,863,774.41
$7,188.22 $3,289.20 $30,518,401.29
$26,591.89 $12,167.97 $112,898,877.60
What would this cause? People might predict a lot of different things. The Yang gang people probably strong opinions on this. I have a bachelor's degree in economics, so I believe I can predict that most mainstream economists would predict the following...
In Lithuania, when they get a few hundred to a few thousand dollars, they probably raise a pint to F Society, then put the rest towards a house or car payment, or buy themselves something nice. Minor inflation would happen, probably starting at the pubs, and that would worry financial types, but it would not cause any kind of major economic catastrophe.
In Indonesia, where everybody becomes an asset millionaire overnight, they will probably have hyperinflation, mass social upheaval, and violence.
In conclusion...
TL;DR: What Darlene did last night with eCoin isn't actually possible with bitcoin, and the impact in America might not be as great as you think, but the impact would be much bigger in poorer parts of the world.
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The Intellectual Foundation of Bitcoin比特幣的智識基礎. By Chapman Chen, HKBNews

The Intellectual Foundation of Bitcoin比特幣的智識基礎. By Chapman Chen, HKBNews

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Summary: Bitcoin was invented by the anonymous Satoshi Nakamoto as recently as 2008, but it is backed up by a rich intellectual foundation. For instance, The 1776 First Amendment separates church and state, and contemporary American liberation psychologist Nozomi Hayase (2020) argues that money and state should similarly be separated. Just as Isaac Newton’s study of alchemy gave rise to the international gold standard, so has the anonymous creator Satoshi Nakamoto's desire for a “modernized gold standard” given rise to Bitcoin. Indeed, Bloomberg's 2020 report confirms Bitcoin to be gold 2.0. Montesquieu (1774) asserted that laws that secure inalienable rights can only be found in Nature, and the natural laws employed in Bitcoin include its consensus algorithm and the three natural laws of economics (self-interest, competition, and supply and demand). J.S. Mill (1859) preferred free markets to those controlled by governments. Ludwig von Mises (1951) argued against the hazards of fiat currency, urging for a return to the gold standard. Friedrich Hayek (1984) suggested people to invent a sly way to take money back from the hands of the government. Milton Friedman (1994) called for FED to be replaced by an automatic system and predicted the coming of a reliable e-cash. James Buchanan (1988) advocated a monetary constitution to constrain the governmental power of money creation. Tim May (1997) the cypherpunk proclaimed that restricting digital cash impinges on free speech, and envisioned a stateless digital form of money that is uncensorable. The Tofflers (2006) pictured a non-monetary economy. In 2016, UCLA Professor of Finance Bhagwan Chowdhry even nominated Satoshi for a Nobel Prize.
Full Text:
Separation between money and state
The 1791 First Amendment to the U.S. Constitution enshrines free speech and separates church and state, but not money and state. "Under the First Amendment, individuals’ right to create, choose their own money and transact freely was not recognized as a part of freedom of expression that needs to be protected," Japanese-American liberation psychologist Nozomi Hayase (2020) points out (1).
The government, banks and corporations collude together to encroach upon people's liberties by metamorphosing their inalienable rights into a permissioned from of legal rights. Fiat currencies function as a medium of manipulation, indulging big business to generate market monopolies. "Freedom of expression has become further stifled through economic censorship and financial blockage enacted by payment processing companies like Visa and MasterCard," to borrow Hayase's (2020) words.
Satoshi is a Modern Newton
Although most famous for discovering the law of gravity, Isaac Newton was also a practising alchemist. He never managed to turn lead into gold, but he did find a way to transmute silver into gold. In 1717, Newton announced in a report that, based on his studies, one gold guinea coin weighed 21 shillings. Just as Isaac Newton’s study of alchemy gave rise to the international gold standard, so has the desire for a “modernized gold standard” given rise to Bitcoin. "In a way, Satoshi is a modern Newton. They both believed trust is best placed in the unchangeable facets of our economy. Beneath this belief is the assumption that each individual is their own best master," as put by Jon Creasy (2019) (2).
J.S. Mill: free markets preferable to those controlled by governments
John Stuart Mill (1806-1873) the great English philosopher would be a Bitcoiner were he still around today. In On Liberty (1859), Mill concludes that free markets are preferable to those controlled by governments. He argues that economies function best when left to their own devices. Therefore, government intervention, though theoretically permissible, would be counterproductive. Bitcoin is precisely decentralized or uncontrolled by the government, unconfiscatable, permissonless, and disinflationary. Bitcoin regulates itself spontaneously via the ordinary operations of the system. "Rules are enforced without applying any external pressure," in Hayase's (2020) words.
Ludwig von Mises (1958): Liberty is always Freedom from the Government
In The Free Market and its Enemies, theoretical Austrian School economist Ludwig von Mises (1951) argues against the hazards of fiat currency, urging for a return to the gold standard. “A fiat money system cannot go on forever and must one day come to an end,” Von Mises states. The solution is a return to the gold standard, "the only standard which makes the determination of the purchasing power of money independent of the changing ideas of political parties, governments, and pressure groups" under present conditions. Interestingly, this is also one of the key structural attributes of Bitcoin, the world’s first, global, peer-to-peer, decentralized value transfer network.
Actually, Bloomberg's 2020 report on Bitcoin confirms that it is gold 2.0. (3)
Von Mises prefers the price of gold to be determined according to the contemporaneous market conditions. The bitcoin price is, of course, determined across the various global online exchanges, in real-time. There is no central authority setting a spot price for gold after the which the market value is settled on among the traders during the day.
Hayek: Monopoly on Currency should End
Austrian-British Nobel laureate Friedrich Hayek’s theory in his 1976 work, Denationalization of Money, was that not only would the currency monopoly be taken away from the government, but that the monopoly on currency itself should end with multiple alternative currencies competing for acceptance by consumers, in order "to prevent the bouts of acute inflation and deflation which have played the world for the past 60 years." He forcefully argues that if there is no free competition between different currencies within any nation, then there will be no free market. Bitcoin is, again, decentralized, and many other cryptocurrencies have tried to compete with it, though in vain.
In a recently rediscovered video clip from 1984, Hayek actually suggested people to invent a cunning way to take money out of the hands of the government:- “I don’t believe we shall ever have a good money again before we take the thing out of the hands of government, that is, we can’t take them violently out of the hands of government, all we can do is by some sly roundabout way introduce something they can’t stop” (4). Reviewing those words 36 years hence and it is difficult not to interpret them in the light of Bitcoin.
Milton Friedman Called for FED to be Replaced by an Automatic System
Nobel laureate economist Milton Friedman (1994) was critical of the Federal Reserve due to its poor performance and felt it should be abolished (5). Friedman (1999) believed that the Federal Reserve System should ultimately be replaced with a computer program, which makes us think of the computer code governing Bitcoin (6).[\](https://en.wikipedia.org/wiki/Criticism_of_the_Federal_Reserve#cite_note-:2-12) He (1970) favored a system that would automatically buy and sell securities in response to changes in the money supply. This, he argued, would put a lid on inflation, setting spending and investment decisions on a surer footing (7). Bitcoin is exactly disflationary as its maximum possible supply is 21 million and its block reward or production rate is halved every four years.
Friedman passed away before the coming of bitcoin, but he lived long enough to see the Internet’s spectacular rise throughout the 1990s. “I think that the Internet is going to be one of the major forces for reducing the role of government," said Friedman in a 1999 interview with NTU/F. On the same occasion, he sort of predicted the emergence of Bitcoin, "The one thing that’s missing, but that will soon be developed, is a reliable e-cash, a method whereby on the Internet you can transfer funds from A to B, without A knowing B or B knowing A." (8)
Of course, Friedman didnt predict the block chain, summed up American libertarian economist Jeffery Tucker (2014). “But he was hoping for a trustless system. He saw the need. (9).
Bitcoin Computer Code as Constitution in the Buchananian Sense
American economist cum Nobel laureate James Buchanan (1988) advocates constitutional constraints on the governmental power to create money (10). Buchanan distinguishes a managed monetary system—a system “that embodies the instrumental use of price-level predictability as a norm of policy”—from an automatic monetary system, “which does not, at any stage, involve the absolute price level” (Buchanan 1962, 164–65). Leaning toward the latter, Buchanan argues that automatic systems are characterized by an organization “of the institutions of private decision-making in such a way that the desired monetary predictability will emerge spontaneously from the ordinary operations of the system” (Buchanan 1962, 164). Again, "Bitcoin regulates itself through the spontaneous force of nature, flourishing healthy price discovery and competition in the best interest of everyone" (Hayase 2020).
Shruti Rajagopalan (2018) argues that the computer code governing how the sundry nodes/computers within the Bitcoin network interact with one another is a kind of monetary constitution in the Buchananian sense. One of Buchanan's greatest inputs is to differentiate the choice of rules from the choice within rule (Buchanan 1990). One may regard the Bitcoin code as a sort of constitution and "the Bitcoin network engaging in both the choice of rules and choice within rules" (Rajagopalan 2018) (11).
Tim May: Restricting Digital Cash may Impinge on Free Speech
Cypherpunks are activists who since the 1980s have advocated global use of strong cryptography and privacy-enhancing technologies as a route to social and political liberation. Tim May (Timothy C. May [1951-2018]), one of the influential cypherpunks published The Crypto Anarchist Manifesto in September 1992, which foretold the coming of Bitcoin (12). Cypherpunks began envisioning a stateless digital form of money that cannot be censored and their collaborative pursuit created a movement akin to the 18th Enlightenment.
At The 7th Conference on Computers, Freedom, and Privacy, Burlingame, CA. in 1997, Tim May equated money with speech, and argued that restricting digital cash may impinge on free speech, for spending money is often a matter of communicating orders to others, to transfer funds, to release funds, etc. In fact, most financial instruments are contracts or orders, instead of physical specie or banknotes (13).
Montesquieu: Laws that secure inalienable rights can only be found in Nature
In his influential work The Spirit of Laws (1748), Montesquieu wrote, “Laws ... are derived from the nature of things … Law, like mathematics, has its objective structure, which no arbitrary whim can alter". Similarly, once a block is added to the end of the Bitcoin blockchain, it is almost impossible to go back and alter the contents of the block, unless every single block after it on the blockchain is altered, too.
Cypherpunks knew that whereas alienable rights that are bestowed by law can be deprived by legislation, inalienable rights are not to be created but can be discovered by reason. Thus, laws that secure inalienable rights cannot be created by humankind but can be found in nature.
The natural laws employed in Bitcoin to enshrine the inalienable monetary right of every human being include its consensus algorithm, and the three natural laws of economics (self-interest, competition, and supply and demand) as identified by Adam Smith, father of modern economics.
Regarding mathematics, bitcoin mining is performed by high-powered computers that solve complex computational math problems. When computers solve these complex math problems on the Bitcoin network, they produce new bitcoin. And by solving computational math problems, bitcoin miners make the Bitcoin payment network trustworthy and secure, by verifying its transaction information.
Regarding economic laws, in accordance with the principle of game theory to generate fairness, miners take part in an open competition. Lining up self-interests of all in a network, with a vigilant balance of risk and rewards, rules are put in force sans the application of any exterior pressure. "Bitcoin regulates itself through the spontaneous force of nature, flourishing healthy price discovery and competition in the best interest of everyone," to borrow the words of Hayase (2020).
A Non-monetary Economy as Visualized by the Tofflers
In their book, Revolutionary Wealth (2006), futurists Alvin Toffler and his wife Heidi Toffler toy with the concept of a world sans money, raising a third kind of economic transaction that is neither one-on-one barter nor monetary exchange. In the end, they settle on the idea that the newer non-monetary economy will exist shoulder-to-shoulder with the monetary sector in the short term, although the latter may eventually be eclipsed by the former in the long run. What both the Tofflers' The Third Wave (1980) and Revolutionary Wealth bring into question is the very premise of monetary exchange. The vacuum left over by cash in such a non-monetary economy may be filled up by Bitcoin as a cryptocurrency.
Satoshi Nakamoto Nominated for Nobel Prize by UCLA Finance Prof.
UCLA Anderson School Professor of Finance Bhagwan Chowdhry nominated Satoshi Nakamoto for the 2016 Nobel Prize in Economics on the following grounds:-
It is secure, relying on almost unbreakable cryptographic code, can be divided into millions of smaller sub-units, and can be transferred securely and nearly instantaneously from one person to any other person in the world with access to internet bypassing governments, central banks and financial intermediaries such as Visa, Mastercard, Paypal or commercial banks eliminating time delays and transactions costs.... Satoshi Nakamoto’s Bitcoin Protocol has spawned exciting innovations in the FinTech space by showing how many financial contracts — not just currencies — can be digitized, securely verified and stored, and transferred instantaneously from one party to another (14).
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End-notes
  1. https://bitcoinmagazine.com/articles/bitcoin-is-the-technology-of-dissent-that-secures-individual-liberties
  2. https://medium.com/hackernoon/why-sir-isaac-newton-was-the-first-bitcoin-maximalist-195a17cb6c34
  3. https://data.bloomberglp.com/professional/sites/10/Bloomberg-Crypto-Outlook-April-2020.pdf
  4. https://www.youtube.com/watch?v=EYhEDxFwFRU&t=1161s
  5. https://www.youtube.com/watch?v=m6fkdagNrjI
  6. http://youtu.be/mlwxdyLnMXM
  7. https://miltonfriedman.hoover.org/friedman_images/Collections/2016c21/IEA_1970.pdf
  8. https://www.youtube.com/watch?v=6MnQJFEVY7s
  9. https://www.coindesk.com/economist-milton-friedman-predicted-bitcoin
  10. https://www.aier.org/research/prospects-for-a-monetary-constitution/
  11. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3238472
  12. https://www.activism.net/cypherpunk/crypto-anarchy.html
  13. http://osaka.law.miami.edu/~froomkin/articles/tcmay.htm
  14. https://www.huffpost.com/entry/i-shall-happily-accept-th_b_8462028
Pic credit: Framingbitcoin
#bitcoin #bitcoinhalving #jamesBuchanan #MiltonFriedman #AlvinToffler #FirstAmendment #LudwigVonMises #TimMay #freeMarket # SatoshiNakamoto #FriedrichHayek #Cypherpunk #Cryptocurrency #GoldStandard #IsaacNewton
submitted by HKBNews to Bitcoin [link] [comments]

Summary of Ryan Taylor's economics AMA

Ryan Taylor recently conducted an AMA (ask me anything) discussing the economics of reallocating Dash's block reward. The topic followed up on his "Improving Dash as a Store of Value" presentation from the 2019 open house. I've categorized and summarized his responses:
Objective: reduce the severity and duration of high inflation rates in our circulating supply
Implement joint masternode shares rather than a new proof of stake system
Increase masternode and treasury share of block reward, reduce mining share
Keep X11 mining for now, ensure Dash dominates X11 hashing by 10x
Block subsidy belongs to the network, to be used for all needs, not just mining
Commentary on masternode ROI, plans to conduct and release supporting analyses
Timing: discuss now, detailed proposals starting as early as next month
submitted by ISkiAtAlta to dashpay [link] [comments]

BitcoinSoV - Building stability on the backs of 0xBTC and BOMB

Summary:

BitcoinSoV is the worlds first Mineable & Deflationary currency*. It is based off of the 0xBitcoin EIP918 standard, and has a 1% token burn on every transaction as introduced to the world by BombToken. Both of these projects are very well respected, and hopefully this project is able to co-exist with them rather than compete. It is of my personal opinion that while these projects were stellar examples of what is possible, BitcoinSoV takes the best of the two and makes something that has long-term mass appeal.
The goal of BitcoinSoV is to become a Store of Value by fighting inflation, done through a fair start without a centralized body.

Note: There are some concerns that 0xBitcoin is deflationary by nature, so BitcoinSoV is not the first. I am not an economist, so I want to be forthright in the math. BitcoinSoV has a 1% burn that reduces the circulating supply for all transactions, in addition to having a Max Supply that 0xBitcoin has. I believe that this 1% burn is what makes the token deflationary when compared to 0xBitcoin or BTC itself. So while those may be deflationary once they meet their max supply (maybe call it non-flationary), BitcoinSoV is Actively Deflationary by nature of the transactional token burn.

Info:
Name: BitcoinSoV
Symbol: BSOV
Website: https://btcsov.com
Twitter: https://twitter.com/BSOV_
Telegram: https://t.me/BitcoinSoVCommunity
BitcoinTalk: https://bitcointalk.org/index.php?topic=5157386.0
Contract: https://etherscan.io/address/0x26946ada5ecb57f3a1f91605050ce45c482c9eb1#contracts
Precision: 8
Algo: Keccak256 (SHA3)
Mining Rewards: 50 BSOV per Block
Target Block Time: 10-13 Minutes (60 Ethereum Blocks)
Current Block Time: 1-2 Minutes.
Max Supply: 21,000,000 (theoretical max, it's already lower due to token burn)
Reward Halvening: 10,500,000 Tokens Mined
Expected Time To Halvening: ~5 years.
Expected Time to Max Supply: ~15 Years.
Burn Rate: 1% Per Transaction* (See notes below).


Mining:
The token is a mineable ERC20 token, allowing CPU/GPU/FGPA mining against the smart contract. Mining does require Ether to be spent on gas, as well as the cost of electricity.
As of right now, there has been about 20ETH spent in gas on mining this token, resulting in a circulating supply of 950,000 tokens.
All mining is done to the 0xBitcoin spec, all mining software for 0xBTC will work for BitcoinSoV.


Price and Exchanges:
The token is currently really easy to mine and should not be listed at an exchange at this time. When the difficulty increases and tokens become more scarce, applications will be submitted to popular exchanges. There is a great benefit here as the token has no developer fee or pre-mine, allowing it to be listed on the more difficult exchanges that adhere to US and EU compliance laws.
The token is currently listed on EtherDelta as a basic means to buy/sell, though it's encouraged to Mine these tokens at such an early stage.


Community Driven:
This token is a smart contract that has been launched, and barring any significant exploit found in 0xBitcoin, there is no plan to ever migrate away from it. As such, the token is completely operated by the community and has no plans to evolve into its own blockchain or anything else.
The community has come together to create videos, promotions, airdrops, bots, and more. If you are already participating, or get involved from reading this post and obtain a significant amount of BSOV, please consider donating to the marketing fund @ 0x88d97b2007e6aa6d728F003A32090C246EDf724E


Burn Rate:
All transactions have a 1% burn on the entire transaction, without rounding to the nearest whole number, which is where BSOV differentiates from BombToken. As such, you are able to send 0.0000001 BSOV and the precision is maxed out and cannot find 1%, in this case it errs on the side of caution and rounds down to 0, meaning 0.0000001 transactions have no burn. This is a calculated risk and accepted as the gas fee to abuse this would be significantly higher than what it's worth. I.e: You'd burn 15ETH to save 0.01 BSOV.
It is also possible to wrap this ERC20 token in a smart contract, allowing only burn to/from the contract, and the wrapped tokens to be traded without a burn. This is also the expected behavior on exchanges, as the movement of tokens on a centralized does not actually leave their network and as such does not burn until a user withdraws.


Other Details:
Since the token is decentralized and community driven, there is no marketing fund, or any real push to drive up price this early. Everyone is focused on the ecosystem and getting people involved at low cost right now. If you are wondering if this project has the steam to keep going, I encourage you to look at some of the stats.
I would suggest taking a look at 0xBitcoin to see how a similar token has thrived, and the performance of their early days. BitcoinSoV is currently outpacing 0xBitcoin's initial start when comparing number of miners, blocks mined, etc.
There is a limited supply of tokens to be used for giveaways and other marketing, so please follow the twitter or telegram group to know when and where to get your share.


Disclaimer:
I am currently mining BitcoinSoV and not affiliated with the creation of the project, just an active community member. I encourage everyone at this point to mine the token if possible, as you will see the greatest rewards that way. I fully anticipate price of this token to increase with time considering it's deflationary design, but no one really knows what will happen and I am not someone you should be taking financial advice from. Please invest either mining or purchasing at your own risk.
There may be stuff that I missed here, I am trying to best to be complete. If you have any questions please let me know and I will try my best to answer them.

Thanks!
submitted by RedditAdminUser to CryptoMoonShots [link] [comments]

Can Any Current Crypto Commodity Ever Be Used As A General Currency?

“In the long run, we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is long past the ocean will be flat again.” - John Maynard Keynes

Cryptocurrency Supply Algorithms And The Equation Of Exchange

Although I am a proponent for Bitcoin and view it as a good store-of-value, my belief is that all of the algorithms for cryptocurrency supply models that I have seen to date are not amenable to creating a cryptocurrency useful as a general currency. That is as a means for exchange-of-value as opposed to store-of-value. The following is my brief description of the models that I am aware of, followed by an explanation of why I believe they are not useful for as general currencies. At the bottom, I make a concluding remark on what I believe is a missing feature needed to realize a general currency.

Coin Supply Algorithms

N+1
In an N+1 algorithm, each time a block is produced, a constant incentive reward is added to the supply of coins. This means explicitly that the size of the coin supply will grow forever, unlimited. This sounds pretty good on the surface. If you are a miner, you are guaranteed that there will always be an incentive reward available for mining.
If we look at this from a total coin supply viewpoint, and a little high school math, the normalized change in supply is:
N+1/N
We then want to ask the question, how fast is the coin supply changing, as N goes to infinity since we are assuming that blocks are produced forever. This is:
Lim N->∞ N+1/N
Where N is the number of blocks produced. By L’Hôpital’s rule for those that remember a little highschool calculus (I had to look it up), we can take the derivatives of the numerator and denominator which results in 1/1 = 1. In the limit at infinity, the coin supply is a constant value, even though theoretically it grows forever.
Since infinity is only theoretical, what does this look like for blockchain use cases:
To give a feel for it, imagine that we are at the following 4 stages: 10 blocks have been produced; 100 blocks have been produced; 1000 blocks have been produced, and 10000 blocks have been produced. Adding one reward at each stage gives the following percent change in coin supply:
1 — (10 + 1)/10 = 10%
1 — (100+1)/100 = 1%
1 — (1000+1)/1000 = .1%
1 — (10000+1)/10000 = .01%
This demonstrates that the change in coin supply quickly dwindles to an insignificant amount, even though it continues to grow forever. To put this another way, the addition of each new incentive reward quickly becomes a very small fraction of the total coin supply. The coin supply can be thought of as relatively constant.
N + M*N/2T or N(1+M/2T)
T is units of time in discrete steps, and M is the number of blocks produced at each step. This is essentially the Bitcoin model. To make this clearer let’s assume that there is only 1 block produced at each step. This becomes N + N/2T or N(1+1/2T).
If we replace 2T with a new variable K, then this becomes:
N(1+1/K)
Where K increases forever. The summation of 1/K is the harmonic series and increases forever. Therefore, just like N+1 above, N(1+1/K) or N+N/K also increases forever. As with N+1, the rate of increase of the coin supply is then:
(N(1+1/K))/N
This is more simply 1 + 1/K. Thus, as K grows, we can see that the rate of increase tends towards zero as well. Further, since 1/K becomes a smaller and smaller fraction, eventually representing this as a value in a computer becomes impossible. For example, Bitcoin’s smallest fraction is 1 satoshi. When 1/K becomes smaller than 1 satoshi it will no longer be possible to have an incentive reward for a single block produced.
Given that both coin supply algorithms tend towards a relatively constant supply, in terms of use as a currency, we can view both as essentially equivalent. The only difference is how fast the supply tends towards a constant value, where the Bitcoin model is faster.
N
A third coin supply algorithm is a simple constant amount created in the genesis block. The coins are usually distributed using an airdrop or similar model. Since coins are not being created, the coin supply is by definition constant. If the distribution model used is an incentive reward model to distribute from the pool of coins, it is indistinguishable from one of the above 2 models. If the distribution model is a one-time event, such that all the coins are distributed then there is no incentive reward model.
From a viewpoint of use of currency all 3 models described above can be thought of as equivalent, given enough blocks have been produced for the first 2 models.

Marked To External Asset

There is the fourth model for coin supply which is intended to mark the value of the coin to an external index of some kind. This may be a physical asset like an ounce of gold, or another commodity. In this model, the coin can explicitly represent a unit of the external asset such as an ounce of gold. Regardless of whether the coin can be exchanged for the underlying asset or not, given that supply of commodities such as gold are constantly following the same mining algorithms as above, the marked to asset model is a constant coin supply model. If the distribution model used is an incentive reward model, then it is similar to the third model.

Marked To Value Of External Asset

There is a fifth model for coin supply where the value of the coin is marked to the value of an external asset like the USD, instead of the supply of the external asset, as was the case for marking to a commodity. In this model, the coin supply is changed to reflect the exchange rate of the coin against the value of the external asset. The objective is to keep the exchange rate constant on average over time. For example: assuming the objective is a 1-to-1 exchange between the coin and the USD, then if the coin’s value increases above the objective, more coins are printed, and vice-versa. That is, if the value of the coin decreases, given some means (i.e. burning), the coin supply is decreased to bring the exchange rate towards the objective.
In this model, the coin supply is not fixed but varies with the exchange rate. To the extent that the value of the external asset is relatively constant, and the value of the coin is relatively constant the coin supply will be relatively constant.
Although marking to the USD would seem to be a good idea, given that it is called a “reserve currency”, the USD is intentionally subject to inflation, theoretically, the coin to USD exchange will continue to decrease, requiring the coin supply to be decreased to maintain the objective of a constant exchange rate. Over time, this model can be viewed as decreasing the coin supply if marked to the inflationary external asset value.

Comparing Coin Supply Models

In summary, of the five models described above, four of them are essentially variations on a constant coin supply using various means to distribute the coin, while the fifth tries to keep the value of the coin constant against an external asset value, by managing the supply of the coin.
The equation of exchange: M * V = P * Y[1] tells us that if the amount of money supply, M, (i.e. the coin supply) is constant, and the velocity of money is relatively constant, then an increase in demands for goods (Y), will cause a decrease in the price (P), price deflation. That is, with a fixed coin supply the price of goods is expected to drop, thus increasing the value of the coin. Bitcoin’s increase in value is an example of this. (The Bitcoin ledger does not have the means to determine either prices (P) or goods (Y). Instead, I am inferring from the increase in the value of bitcoins that an increase in demand for Y is occurring. There are possible other explanations.)
However, it should be noted that in order for the equation of exchange to be valid, the assumption of the velocity of money is relatively constant must hold. If holders of the coin stop using it as a currency for the exchange of value, then the M * V = M * 0 = 0. There is no price in that coin for any goods or services. That is, the value of the coin collapses.
Conversely, if the velocity of the coin were to increase significantly, then this creates effectively more available coin, resulting in the price (P) of the goods and services (Y) to increase. This causes price inflation, which encourages coin holders to spend their coin as fast as possible to avoid losing value in the coin. As the price of goods becomes excessive, people shift from the coin to other forms of currency. As this happens, once more a collapse happens.
At an equilibrium point, the coin supply is constant, the velocity is constant, the demand for goods and services is constant, and therefore the price would be constant. At such an equilibrium point, a constant coin supply would be ideal. However, we can observe throughout history that such an equilibrium point is never reached.
Given any sort of constant coin supply, the value of the coin is expected to vary unpredictably and often wildly. Of the 5 models, the first 4 will always be subject to this. Although this may be interesting for speculators, usefulness for general currency is questionable.
The fifth model is to manage the coin supply against an external asset value. In essence, this is a substitution of the coin for the asset. Provided that the coin supply can be managed to reflect the objective exchange rate, the value of the coin should be stable relative to the stability of the external asset value.
However, in my opinion, this marking of value does not take into account exchanges that are wholly internal to the coin and its blockchain. The transfer of a coin balance from one account to another implies an exchange of value, thus the equation of exchange applies internally to the blockchain. This exchange of value is independent of the exchange rate of the coin value versus the external asset value. Thus, the coin supply can be seen as independent of the exchange of value on the blockchain.
Given this assumption, we can make the simplifying assumption that the coin supply is relatively constant with respect to the exchange of value on the blockchain. As a result, one would expect that even though the coin supply is managed against the exchange rate with an external asset, its value can still fluctuate wildly, beyond the ability of coin supply management to compensate. This, in turn, will impact the exchange rate, destroying the intended objective.
As a natural consequence, even with the approach of marking the value of the coin to external asset value, such as the USD, the expected volatility limits the usefulness of the coin as a currency.

Towards A General Currency

As stated in the introduction, I believe that none of the cryptocurrency models described are viable for use as general currencies. In my opinion, my brief non-rigorous analysis above demonstrates this likely to be true. The question remains, what else is needed to create a cryptocurrency that is viable as a general currency.
The equation of exchange shows us what is missing directly: In the equation M * V = P * Y, we can say that on every blockchain we can know the values of M and V directly. The account ledger explicitly shows us this, (ignoring encrypted exchanges). What we do not know is the other side of the equation. We do not know either price (P) or goods and services (Y) for any exchanges that are internal to the blockchain, that is between accounts on the blockchain.
If we compare cryptocurrencies with national fiat currencies, and cryptocurrency exchanges with foreign exchanges, we can see that the foreign exchanges relate the difference in prices in related economies. In comparison, the cryptocurrency exchanges appear to only relate the difference in demand for the cryptocurrencies themselves. This demand only manifests itself during the exchange of cryptocurrencies for each other and between fiat and cryptocurrencies and vice-versa.
It is my position that because the internal use of cryptocurrencies on their own blockchains is currently hidden, none of the above coin supply models will create a currency stable enough to be useful as a general currency. If/when a cryptocurrency model is created that takes into account the currently hidden internal exchange of value, then we will have realized a general currency.
[1] https://en.wikipedia.org/wiki/Equation_of_exchange
submitted by PrasagaOfficial to u/PrasagaOfficial [link] [comments]

Is segwit2x the REAL Banker takeover?

DCG (Digital Currency Group) is the company spearheading the Segwit2x movement. The CEO of DCG is Barry Silbert, a former investment banker, and Mastercard is an investor in DCG.
Let's have a look at the people that control DCG:
http://dcg.co/who-we-are/
Three board members are listed, and one Board "Advisor." Three of the four Members/advisors are particularly interesting:
Glenn Hutchins: Former Advisor to President Clinton. Hutchins sits on the board of The Federal Reserve Bank of New York, where he was reelected as a Class B director for a three-year term ending December 31, 2018. Yes, you read that correctly, currently sitting board member of the Federal Reserve Bank of New York.
Barry Silbert: CEO of DCG (Digital Currency Group, funded by Mastercard) who is also an Ex investment Banker at (Houlihan Lokey)
And then there's the "Board Advisor,"
Lawrence H. Summers:
"Chief Economist at the World Bank from 1991 to 1993. In 1993, Summers was appointed Undersecretary for International Affairs of the United States Department of the Treasury under the Clinton Administration. In 1995, he was promoted to Deputy Secretary of the Treasury under his long-time political mentor Robert Rubin. In 1999, he succeeded Rubin as Secretary of the Treasury. While working for the Clinton administration Summers played a leading role in the American response to the 1994 economic crisis in Mexico, the 1997 Asian financial crisis, and the Russian financial crisis. He was also influential in the American advised privatization of the economies of the post-Soviet states, and in the deregulation of the U.S financial system, including the repeal of the Glass-Steagall Act."
https://en.wikipedia.org/wiki/Lawrence_Summers
Seriously....The segwit2x deal is being pushed through by a Company funded by Mastercard, Whose CEO Barry Silbert is ex investment banker, and the Board Members of DCG include a currently sitting member of the Board of the Federal Reserve Bank of New York, and the Ex chief Economist for the World Bank and a guy responsible for the removal of Glass Steagall.
It's fair to call these guys "bankers" right?
So that's the Board of DCG. They're spearheading the Segwit2x movement. As far as who is responsible for development, my research led me to "Bitgo". I checked the "Money Map" https://i.redd.it/15auzwkq3hiz.png And sure enough, DCG is an investor in Bitgo.
(BTW, make sure you take a good look take a look at the money map and bookmark it for reference later, ^ it is really helpful.)
"Currently, development is being overseen by bitcoin security startup BitGo, with help from other developers including Bloq co-founder Jeff Garzik."
https://www.coindesk.com/bitcoins-segwit2x-scaling-proposal-miners-offer-optimistic-outlook/
So Bitgo is overseeing development of Segwit2x with Jeff Garzick. Bitgo has a product/service that basically facilitates transactions and supposedly prevents double spending. It seems like their main selling point is that they insert themselves as middlemen to ensure Double spending doesn't happen, and if it does, they take the hit, of course for a fee, so it sounds sort of like the buyer protection paypal gives you:
"Using the above multi-signature security model, BitGo can guarantee that transactions cannot be double spent. When BitGo co-signs a BitGo Instant transaction, BitGo takes on a financial obligation and issues a cryptographically signed guarantee on the transaction. The recipient of a BitGo Instant transaction can rest assured that in any event where the transaction is not ultimately confirmed in the blockchain, and loses money as a result, they can file a claim and will be compensated in full by BitGo."
Source: https://www.bitgo.com/solutions
So basically, they insert themselves as middlemen, guarantee your transaction gets confirmed and take a fee. What do we need this for though when we have a working blockchain that confirms payments in the next block already? 0-conf is safe when blocks aren't full and one confirmation should really be good enough for almost anyone on the most POW chain. So if we have a fully functional blockchain, there isn't much of a need for this service is there? They're selling protection against "The transaction not being confirmed in the Blockchain" but why wouldn't the transaction be getting confirmed in the blockchain? Every transaction should be getting confirmed, that's how Bitcoin works. So in what situation does "protection against the transaction not being confirmed in the blockchain" have value?
Is it possible that the Central Bankers that control development of Segwit2x plan to restrict block size to benefit their business model just like our good friends over at Blockstream attempted to do, although unsuccessfully as they were not able to deliver a working L2 in time?
It looks like Blockstream was an attempted corporate takeover to restrict block size and push people onto their L2, essentially stealing business away from miners. They seem to have failed, but now it almost seems like the Segwit2x might be a culmination of a very similar problem.
Also worth noting these two things, pointed out by Adrian-x:
  1. MasterCard made this statement before investing in DCG and Blockstream. (Very evident at 2:50 - enemy of digital cash watch the whole thing.) https://www.youtube.com/watch?v=Tu2mofrhw58
  2. Blockstream is part of the DCG portfolio and the day after the the NYA Barry personal thanked Adam Back for his assistance in putting the agreement together. https://twitter.com/barrysilbert/status/867706595102388224
So segwit2x takes power away from core, but then gives it to guess who...Mastercard and central bankers.
So, to recap:
EDIT: Let's not forget that Blockstream is also beholden to the same investors, DCG.
Link to Part 2:
https://www.reddit.com/btc/comments/75s14n/is_segwit2x_the_real_banker_takeover_part_two/
submitted by poorbrokebastard to btc [link] [comments]

AMA Summary

By popular demand, I've taken the automatically-generated transcript of the AMA video and broken it down to bullet points. Of course, this is not a word-for-word transcription and I've paraphrased a few things, so it's highly recommended you watch it for yourself: https://youtu.be/FGOSDZbETr4
Team Goals/Priorities – seen in current and future job postings
Coin accessibility
Adoption
Project Apollo
Awareness about Aion (video choppy here)
Unity Economics
Building the next “Killer App”
Enterprise Ethereum Alliance
WinMiner
Hackathons
Awareness in developer communities
Marketing
Java developer interest
Integrations
Market position
MavenNet
TRS
Interoperability
Anthony “Pomp” Pompliano interview
(Video skipped)
Big Enterprises
Singularity University
Charles Hoskinson/IOHK/Cardano
Challenges as FoundeCEO
European presence
ConsenSys
Value to Aion
Interoperability (part 2)
Runway
Thank you so much for being patient with us. Stay tuned for our weekly AMAs from different members of the team, community surveys, and these quarterly video AMAs. There's going to be a lot more information coming out of the project especially as we wrap up Unity.
submitted by a_toad_a_so to AionNetwork [link] [comments]

Why the debate about blocksize is irrelevent, and the next phase of Bitcoin

This is my first post here, but I'm well known and hated on BTC (I got banned from Bitcoin for calling that Bashco guy a fucking idiot, which he is). Anyways, since this is supposedly a market based Bitcoin sub, I thought maybe there's some people who appreciate cutting all the bullshit politics out of the Bitcoin conversation.
To summarize my position, it would be thus:
So, with that out of the way, here's why all this current debate about scalability is pointless.
The growth of Bitcoin up until now has been overwhelmingly been powered by crypto-tech geeks (the hobbyists, the coders, the anarcho capitalists, the ideologists etc). For these people, the underlying technology has been what's most important to them. For them, things like block size and scalability are of the utmost importance. These people often think that Bitcoin is going to replace fiat currency, or replace the entire global financial system (it isn't. It's going to become a significant part OF the global financial system, but to think it will replace it is extremely naive and amateurish thinking that massively underestimates the enourmous complexity of the financial system, as well as the huge amount of inertia built into it). These are the people who brought Bitcoin from a weirdo techie project to a major $100 billion market. That's an impressive achievement, but that phase of Bitcoins growth is now coming to an end. We are now entering the next phase, where the primary drivers of growth will not be tech people, but finance people. The Big Boys. The institutional dollars that move all major markets (whether it be stocks, bonds, fx, commodities etc); the hedge funds, the pension funds, the mutual funds, ETF's, high net worth individuals etc. We're still in the very beginning stages of this second phase. Bitcoin is still too risky for most of this money (which is inherently conservative), but the more risk adverse members of this group (mostly the higher risk hedge funds and risk taking HNW individuals) are just now starting to dip their toes in. As the market becomes bigger and more liquid, the volatility will greatly go down and the percieved risk will go down as well, and eventually the more risk averse members of this group will take the plunge. That will take several years probably. The problem for the first group (the tech centric folks) is the finance boys have way, way, way more money then them, and it's THEIR money that's going to guide the development of Bitcoin. Everything follows price eventually, from miners to devs, to investments to infrastructure. And so unfortunately for the cryptoanarchists who thought that Bitcoin was going to bring down the System, it will be the System that determines what Bitcoin will be.
Which brings me to my main point: If you want to make money, you have to think about what each group values. Sure, for the tech group, perhaps things like block size or the minuatae of which SegWit is better is the most important factors in which coin you should invest in. But that group is no longer in control. The finance guys are. And so you need to ask yourself, what does THIS money value? I can promise you it isn't block size, or what's in the White Paper. For these guys, the most important thing for them is being able to get their money out if/when they need it. And for that, they need market size/liquidity. Of course, the underlying coin has to actually work (which Bitcoin clearly does). But it's far more important to these guys to be invested in the most liquid market then try to suss out the incremental tech improvements in each coin.
That's what the pro BCH crowd doesn't get. They may be ABSOLUTELY RIGHT about their tech argument (that bigger blocks are better) and yet still get crushed, because the thing THEY are valuing is not what the market values. And I believe BTC's current size advantage gives it an insurmountable advantage. I say insurmountable because I believe it's too late for any other coin to catch up, as BTC's first move advantage has given it a positive feedback loop that will continue to power it further and further ahead.
It works like this: There's trillions of dolalrs poised to enter cryptos over the next few years. The vast majority of this money values market size/liquidity over all else, and so will naturally gravitate to the biggest/most liquid market (BTC). In turn, the very act of all this money flowing into BTC will make BTC even BIGGER and more liquid then it's competitors. In turn, this makes BTC even MORE attractive to the next round of money coming in, which means it gets bigger and eve more liquid still. Which in turn makes it even MORE attractive.....etc etc....
Think about it. If you have, say, $1 billion to put into crypto (an entirely reasonable sum for the types of ppl we're talking about. Bill Ackman put several billion on an Herbalife short ffs) are you going to put it into the $100 billion BTC market? Or the $5 billion BCH market jsut because you like big blocks? Of COURSE you're not going to put a stake equivalent to 20% of the entire market. The very act of buying would cause price to explode several hundred % only to crash back down when you, as the primary buyer, are finished. And after your hedge fund is fully invested, let's say you take heavy losses on your stock portfolio and you need to get your money out quickly. Try removing $1 billion quickly from a $5-$6 billion market and you're going to crash it. So you've bought in at extreme highs and sold out at extreme lows. This is how newbs trade, not multi billion dollar hedge funds.
So many people waste so much time and energy debating the shit that doesn't matter that they totally ignore the factors that do. It'd be like buying Apple shares based on which executives get the best parking spaces, rather then how many iPhones you expect them to sell this year.
This dynamic (BTC as the biggest market outperforming all other coins significantly) has been in effect since the Aug 1 fork, and I believe it's for the exact reason I state above. And we should expect this dynamic to be the driving force behind the crypto markets for the next few years going forward.
submitted by BTCrob to BitcoinMarkets [link] [comments]

Transcript of the community Q&A with Steve Shadders and Daniel Connolly of the Bitcoin SV development team. We talk about the path to big blocks, new opcodes, selfish mining, malleability, and why November will lead to a divergence in consensus rules. (Cont in comments)

We've gone through the painstaking process of transcribing the linked interview with Steve Shadders and Daniell Connolly of the Bitcoin SV team. There is an amazing amount of information in this interview that we feel is important for businesses and miners to hear, so we believe it was important to get this is a written form. To avoid any bias, the transcript is taken almost word for word from the video, with just a few changes made for easier reading. If you see any corrections that need to be made, please let us know.
Each question is in bold, and each question and response is timestamped accordingly. You can follow along with the video here:
https://youtu.be/tPImTXFb_U8

BEGIN TRANSCRIPT:

Connor: 02:19.68,0:02:45.10
Alright so thank You Daniel and Steve for joining us. We're joined by Steve Shadders and Daniel Connolly from nChain and also the lead developers of the Satoshi’s Vision client. So Daniel and Steve do you guys just want to introduce yourselves before we kind of get started here - who are you guys and how did you get started?
Steve: 0,0:02:38.83,0:03:30.61
So I'm Steve Shadders and at nChain I am the director of solutions in engineering and specifically for Bitcoin SV I am the technical director of the project which means that I'm a bit less hands-on than Daniel but I handle a lot of the liaison with the miners - that's the conditional project.
Daniel:
Hi I’m Daniel I’m the lead developer for Bitcoin SV. As the team's grown that means that I do less actual coding myself but more organizing the team and organizing what we’re working on.
Connor 03:23.07,0:04:15.98
Great so we took some questions - we asked on Reddit to have people come and post their questions. We tried to take as many of those as we could and eliminate some of the duplicates, so we're gonna kind of go through each question one by one. We added some questions of our own in and we'll try and get through most of these if we can. So I think we just wanted to start out and ask, you know, Bitcoin Cash is a little bit over a year old now. Bitcoin itself is ten years old but in the past a little over a year now what has the process been like for you guys working with the multiple development teams and, you know, why is it important that the Satoshi’s vision client exists today?
Steve: 0:04:17.66,0:06:03.46
I mean yes well we’ve been in touch with the developer teams for quite some time - I think a bi-weekly meeting of Bitcoin Cash developers across all implementations started around November last year. I myself joined those in January or February of this year and Daniel a few months later. So we communicate with all of those teams and I think, you know, it's not been without its challenges. It's well known that there's a lot of disagreements around it, but some what I do look forward to in the near future is a day when the consensus issues themselves are all rather settled, and if we get to that point then there's not going to be much reason for the different developer teams to disagree on stuff. They might disagree on non-consensus related stuff but that's not the end of the world because, you know, Bitcoin Unlimited is free to go and implement whatever they want in the back end of a Bitcoin Unlimited and Bitcoin SV is free to do whatever they want in the backend, and if they interoperate on a non-consensus level great. If they don't not such a big problem there will obviously be bridges between the two, so, yeah I think going forward the complications of having so many personalities with wildly different ideas are going to get less and less.
Cory: 0:06:00.59,0:06:19.59
I guess moving forward now another question about the testnet - a lot of people on Reddit have been asking what the testing process for Bitcoin SV has been like, and if you guys plan on releasing any of those results from the testing?
Daniel: 0:06:19.59,0:07:55.55
Sure yeah so our release will be concentrated on the stability, right, with the first release of Bitcoin SV and that involved doing a large amount of additional testing particularly not so much at the unit test level but at the more system test so setting up test networks, performing tests, and making sure that the software behaved as we expected, right. Confirming the changes we made, making sure that there aren’t any other side effects. Because of, you know, it was quite a rush to release the first version so we've got our test results documented, but not in a way that we can really release them. We're thinking about doing that but we’re not there yet.
Steve: 0:07:50.25,0:09:50.87
Just to tidy that up - we've spent a lot of our time developing really robust test processes and the reporting is something that we can read on our internal systems easily, but we need to tidy that up to give it out for public release. The priority for us was making sure that the software was safe to use. We've established a test framework that involves a progression of code changes through multiple test environments - I think it's five different test environments before it gets the QA stamp of approval - and as for the question about the testnet, yeah, we've got four of them. We've got Testnet One and Testnet Two. A slightly different numbering scheme to the testnet three that everyone's probably used to – that’s just how we reference them internally. They're [1 and 2] both forks of Testnet Three. [Testnet] One we used for activation testing, so we would test things before and after activation - that one’s set to reset every couple of days. The other one [Testnet Two] was set to post activation so that we can test all of the consensus changes. The third one was a performance test network which I think most people have probably have heard us refer to before as Gigablock Testnet. I get my tongue tied every time I try to say that word so I've started calling it the Performance test network and I think we're planning on having two of those: one that we can just do our own stuff with and experiment without having to worry about external unknown factors going on and having other people joining it and doing stuff that we don't know about that affects our ability to baseline performance tests, but the other one (which I think might still be a work in progress so Daniel might be able to answer that one) is one of them where basically everyone will be able to join and they can try and mess stuff up as bad as they want.
Daniel: 0:09:45.02,0:10:20.93
Yeah, so we so we recently shared the details of Testnet One and Two with the with the other BCH developer groups. The Gigablock test network we've shared up with one group so far but yeah we're building it as Steve pointed out to be publicly accessible.
Connor: 0:10:18.88,0:10:44.00
I think that was my next question I saw that you posted on Twitter about the revived Gigablock testnet initiative and so it looked like blocks bigger than 32 megabytes were being mined and propagated there, but maybe the block explorers themselves were coming down - what does that revived Gigablock test initiative look like?
Daniel: 0:10:41.62,0:11:58.34
That's what did the Gigablock test network is. So the Gigablock test network was first set up by Bitcoin Unlimited with nChain’s help and they did some great work on that, and we wanted to revive it. So we wanted to bring it back and do some large-scale testing on it. It's a flexible network - at one point we had we had eight different large nodes spread across the globe, sort of mirroring the old one. Right now we scaled back because we're not using it at the moment so they'll notice I think three. We have produced some large blocks there and it's helped us a lot in our research and into the scaling capabilities of Bitcoin SV, so it's guided the work that the team’s been doing for the last month or two on the improvements that we need for scalability.
Steve: 0:11:56.48,0:13:34.25
I think that's actually a good point to kind of frame where our priorities have been in kind of two separate stages. I think, as Daniel mentioned before, because of the time constraints we kept the change set for the October 15 release as minimal as possible - it was just the consensus changes. We didn't do any work on performance at all and we put all our focus and energy into establishing the QA process and making sure that that change was safe and that was a good process for us to go through. It highlighted what we were missing in our team – we got our recruiters very busy recruiting of a Test Manager and more QA people. The second stage after that is performance related work which, as Daniel mentioned, the results of our performance testing fed into what tasks we were gonna start working on for the performance related stuff. Now that work is still in progress - some of the items that we identified the code is done and that's going through the QA process but it’s not quite there yet. That's basically the two-stage process that we've been through so far. We have a roadmap that goes further into the future that outlines more stuff, but primarily it’s been QA first, performance second. The performance enhancements are close and on the horizon but some of that work should be ongoing for quite some time.
Daniel: 0:13:37.49,0:14:35.14
Some of the changes we need for the performance are really quite large and really get down into the base level view of the software. There's kind of two groups of them mainly. One that are internal to the software – to Bitcoin SV itself - improving the way it works inside. And then there's other ones that interface it with the outside world. One of those in particular we're working closely with another group to make a compatible change - it's not consensus changing or anything like that - but having the same interface on multiple different implementations will be very helpful right, so we're working closely with them to make improvements for scalability.
Connor: 0:14:32.60,0:15:26.45
Obviously for Bitcoin SV one of the main things that you guys wanted to do that that some of the other developer groups weren't willing to do right now is to increase the maximum default block size to 128 megabytes. I kind of wanted to pick your brains a little bit about - a lot of the objection to either removing the box size entirely or increasing it on a larger scale is this idea of like the infinite block attack right and that kind of came through in a lot of the questions. What are your thoughts on the “infinite block attack” and is it is it something that that really exists, is it something that miners themselves should be more proactive on preventing, or I guess what are your thoughts on that attack that everyone says will happen if you uncap the block size?
Steve: 0:15:23.45,0:18:28.56
I'm often quoted on Twitter and Reddit - I've said before the infinite block attack is bullshit. Now, that's a statement that I suppose is easy to take out of context, but I think the 128 MB limit is something where there’s probably two schools of thought about. There are some people who think that you shouldn't increase the limit to 128 MB until the software can handle it, and there are others who think that it's fine to do it now so that the limit is increased when the software can handle it and you don’t run into the limit when this when the software improves and can handle it. Obviously we’re from the latter school of thought. As I said before we've got a bunch of performance increases, performance enhancements, in the pipeline. If we wait till May to increase the block size limit to 128 MB then those performance enhancements will go in, but we won't be able to actually demonstrate it on mainnet. As for the infinitive block attack itself, I mean there are a number of mitigations that you can put in place. I mean firstly, you know, going down to a bit of the tech detail - when you send a block message or send any peer to peer message there's a header which has the size of the message. If someone says they're sending you a 30MB message and you're receiving it and it gets to 33MB then obviously you know something's wrong so you can drop the connection. If someone sends you a message that's 129 MB and you know the block size limit is 128 you know it’s kind of pointless to download that message. So I mean these are just some of the mitigations that you can put in place. When I say the attack is bullshit, I mean I mean it is bullshit from the sense that it's really quite trivial to prevent it from happening. I think there is a bit of a school of thought in the Bitcoin world that if it's not in the software right now then it kind of doesn't exist. I disagree with that, because there are small changes that can be made to work around problems like this. One other aspect of the infinite block attack, and let’s not call it the infinite block attack, let's just call it the large block attack - it takes a lot of time to validate that we gotten around by having parallel pipelines for blocks to come in, so you've got a block that's coming in it's got a unknown stuck on it for two hours or whatever downloading and validating it. At some point another block is going to get mined b someone else and as long as those two blocks aren't stuck in a serial pipeline then you know the problem kind of goes away.
Cory: 0:18:26.55,0:18:48.27
Are there any concerns with the propagation of those larger blocks? Because there's a lot of questions around you know what the practical size of scaling right now Bitcoin SV could do and the concerns around propagating those blocks across the whole network.
Steve 0:18:45.84,0:21:37.73
Yes, there have been concerns raised about it. I think what people forget is that compact blocks and xThin exist, so if a 32MB block is not send 32MB of data in most cases, almost all cases. The concern here that I think I do find legitimate is the Great Firewall of China. Very early on in Bitcoin SV we started talking with miners on the other side of the firewall and that was one of their primary concerns. We had anecdotal reports of people who were having trouble getting a stable connection any faster than 200 kilobits per second and even with compact blocks you still need to get the transactions across the firewall. So we've done a lot of research into that - we tested our own links across the firewall, rather CoinGeeks links across the firewall as they’ve given us access to some of their servers so that we can play around, and we were able to get sustained rates of 50 to 90 megabits per second which pushes that problem quite a long way down the road into the future. I don't know the maths off the top of my head, but the size of the blocks that can sustain is pretty large. So we're looking at a couple of options - it may well be the chattiness of the peer-to-peer protocol causes some of these issues with the Great Firewall, so we have someone building a bridge concept/tool where you basically just have one kind of TX vacuum on either side of the firewall that collects them all up and sends them off every one or two seconds as a single big chunk to eliminate some of that chattiness. The other is we're looking at building a multiplexer that will sit and send stuff up to the peer-to-peer network on one side and send it over splitters, to send it over multiple links, reassemble it on the other side so we can sort of transition the great Firewall without too much trouble, but I mean getting back to the core of your question - yes there is a theoretical limit to block size propagation time and that's kind of where Moore's Law comes in. Putting faster links and you kick that can further down the road and you just keep on putting in faster links. I don't think 128 main blocks are going to be an issue though with the speed of the internet that we have nowadays.
Connor: 0:21:34.99,0:22:17.84
One of the other changes that you guys are introducing is increasing the max script size so I think right now it’s going from 201 to 500 [opcodes]. So I guess a few of the questions we got was I guess #1 like why not uncap it entirely - I think you guys said you ran into some concerns while testing that - and then #2 also specifically we had a question about how certain are you that there are no remaining n squared bugs or vulnerabilities left in script execution?
Steve: 0:22:15.50,0:25:36.79
It's interesting the decision - we were initially planning on removing that cap altogether and the next cap that comes into play after that (next effective cap is a 10,000 byte limit on the size of the script). We took a more conservative route and decided to wind that back to 500 - it's interesting that we got some criticism for that when the primary criticism I think that was leveled against us was it’s dangerous to increase that limit to unlimited. We did that because we’re being conservative. We did some research into these log n squared bugs, sorry – attacks, that people have referred to. We identified a few of them and we had a hard think about it and thought - look if we can find this many in a short time we can fix them all (the whack-a-mole approach) but it does suggest that there may well be more unknown ones. So we thought about putting, you know, taking the whack-a-mole approach, but that doesn't really give us any certainty. We will fix all of those individually but a more global approach is to make sure that if anyone does discover one of these scripts it doesn't bring the node to a screaming halt, so the problem here is because the Bitcoin node is essentially single-threaded, if you get one of these scripts that locks up the script engine for a long time everything that's behind it in the queue has to stop and wait. So what we wanted to do, and this is something we've got an engineer actively working on right now, is once that script validation goad path is properly paralyzed (parts of it already are), then we’ll basically assign a few threads for well-known transaction templates, and a few threads for any any type of script. So if you get a few scripts that are nasty and lock up a thread for a while that's not going to stop the node from working because you've got these other kind of lanes of the highway that are exclusively reserved for well-known script templates and they'll just keep on passing through. Once you've got that in place, and I think we're in a much better position to get rid of that limit entirely because the worst that's going to happen is your non-standard script pipelines get clogged up but everything else will keep keep ticking along - there are other mitigations for this as well I mean I know you could always put a time limit on script execution if they wanted to, and that would be something that would be up to individual miners. Bitcoin SV's job I think is to provide the tools for the miners and the miners can then choose, you know, how to make use of them - if they want to set time limits on script execution then that's a choice for them.
Daniel: 0:25:34.82,0:26:15.85
Yeah, I'd like to point out that a node here, when it receives a transaction through the peer to peer network, it doesn't have to accept that transaction, you can reject it. If it looks suspicious to the node it can just say you know we're not going to deal with that, or if it takes more than five minutes to execute, or more than a minute even, it can just abort and discard that transaction, right. The only time we can’t do that is when it's in a block already, but then it could decide to reject the block as well. It's all possibilities there could be in the software.
Steve: 0:26:13.08,0:26:20.64
Yeah, and if it's in a block already it means someone else was able to validate it so…
Cory: 0,0:26:21.21,0:26:43.60
There’s a lot of discussions about the re-enabled opcodes coming – OP_MUL, OP_INVERT, OP_LSHIFT, and OP_RSHIFT up invert op l shift and op r shift you maybe explain the significance of those op codes being re-enabled?
Steve: 0:26:42.01,0:28:17.01
Well I mean one of one of the most significant things is other than two, which are minor variants of DUP and MUL, they represent almost the complete set of original op codes. I think that's not necessarily a technical issue, but it's an important milestone. MUL is one that's that I've heard some interesting comments about. People ask me why are you putting OP_MUL back in if you're planning on changing them to big number operations instead of the 32-bit limit that they're currently imposed upon. The simple answer to that question is that we currently have all of the other arithmetic operations except for OP_MUL. We’ve got add divide, subtract, modulo – it’s odd to have a script system that's got all the mathematical primitives except for multiplication. The other answer to that question is that they're useful - we've talked about a Rabin signature solution that basically replicates the function of DATASIGVERIFY. That's just one example of a use case for this - most cryptographic primitive operations require mathematical operations and bit shifts are useful for a whole ton of things. So it's really just about completing that work and completing the script engine, or rather not completing it, but putting it back the way that it was it was meant to be.
Connor 0:28:20.42,0:29:22.62
Big Num vs 32 Bit. I've seen Daniel - I think I saw you answer this on Reddit a little while ago, but the new op codes using logical shifts and Satoshi’s version use arithmetic shifts - the general question that I think a lot of people keep bringing up is, maybe in a rhetorical way but they say why not restore it back to the way Satoshi had it exactly - what are the benefits of changing it now to operate a little bit differently?
Daniel: 0:29:18.75,0:31:12.15
Yeah there's two parts there - the big number one and the L shift being a logical shift instead of arithmetic. so when we re-enabled these opcodes we've looked at them carefully and have adjusted them slightly as we did in the past with OP_SPLIT. So the new LSHIFT and RSHIFT are bitwise operators. They can be used to implement arithmetic based shifts - I think I've posted a short script that did that, but we can't do it the other way around, right. You couldn't use an arithmetic shift operator to implement a bitwise one. It's because of the ordering of the bytes in the arithmetic values, so the values that represent numbers. The little endian which means they're swapped around to what many other systems - what I've considered normal - or big-endian. And if you start shifting that properly as a number then then shifting sequence in the bytes is a bit strange, so it couldn't go the other way around - you couldn't implement bitwise shift with arithmetic, so we chose to make them bitwise operators - that's what we proposed.
Steve: 0:31:10.57,0:31:51.51
That was essentially a decision that was actually made in May, or rather a consequence of decisions that were made in May. So in May we reintroduced OP_AND, OP_OR, and OP_XOR, and that was also another decision to replace three different string operators with OP_SPLIT was also made. So that was not a decision that we've made unilaterally, it was a decision that was made collectively with all of the BCH developers - well not all of them were actually in all of the meetings, but they were all invited.
Daniel: 0:31:48.24,0:32:23.13
Another example of that is that we originally proposed OP_2DIV and OP_2MUL was it, I think, and this is a single operator that multiplies the value by two, right, but it was pointed out that that can very easily be achieved by just doing multiply by two instead of having a separate operator for it, so we scrapped those, we took them back out, because we wanted to keep the number of operators minimum yeah.
Steve: 0:32:17.59,0:33:47.20
There was an appetite around for keeping the operators minimal. I mean the decision about the idea to replace OP_SUBSTR, OP_LEFT, OP_RIGHT with OP_SPLIT operator actually came from Gavin Andresen. He made a brief appearance in the Telegram workgroups while we were working out what to do with May opcodes and obviously Gavin's word kind of carries a lot of weight and we listen to him. But because we had chosen to implement the May opcodes (the bitwise opcodes) and treat the data as big-endian data streams (well, sorry big-endian not really applicable just plain data strings) it would have been completely inconsistent to implement LSHIFT and RSHIFT as integer operators because then you would have had a set of bitwise operators that operated on two different kinds of data, which would have just been nonsensical and very difficult for anyone to work with, so yeah. I mean it's a bit like P2SH - it wasn't a part of the original Satoshi protocol that once some things are done they're done and you know if you want to want to make forward progress you've got to work within that that framework that exists.
Daniel: 0:33:45.85,0:34:48.97
When we get to the big number ones then it gets really complicated, you know, number implementations because then you can't change the behavior of the existing opcodes, and I don't mean OP_MUL, I mean the other ones that have been there for a while. You can't suddenly make them big number ones without seriously looking at what scripts there might be out there and the impact of that change on those existing scripts, right. The other the other point is you don't know what scripts are out there because of P2SH - there could be scripts that you don't know the content of and you don't know what effect changing the behavior of these operators would mean. The big number thing is tricky, so another option might be, yeah, I don't know what the options for though it needs some serious thought.
Steve: 0:34:43.27,0:35:24.23
That’s something we've reached out to the other implementation teams about - actually really would like their input on the best ways to go about restoring big number operations. It has to be done extremely carefully and I don't know if we'll get there by May next year, or when, but we’re certainly willing to put a lot of resources into it and we're more than happy to work with BU or XT or whoever wants to work with us on getting that done and getting it done safely.
Connor: 0:35:19.30,0:35:57.49
Kind of along this similar vein, you know, Bitcoin Core introduced this concept of standard scripts, right - standard and non-standard scripts. I had pretty interesting conversation with Clemens Ley about use cases for “non-standard scripts” as they're called. I know at least one developer on Bitcoin ABC is very hesitant, or kind of pushed back on him about doing that and so what are your thoughts about non-standard scripts and the entirety of like an IsStandard check?
Steve: 0:35:58.31,0:37:35.73
I’d actually like to repurpose the concept. I think I mentioned before multi-threaded script validation and having some dedicated well-known script templates - when you say the word well-known script template there’s already a check in Bitcoin that kind of tells you if it's well-known or not and that's IsStandard. I'm generally in favor of getting rid of the notion of standard transactions, but it's actually a decision for miners, and it's really more of a behavioral change than it is a technical change. There's a whole bunch of configuration options that miners can set that affect what they do what they consider to be standard and not standard, but the reality is not too many miners are using those configuration options. So I mean standard transactions as a concept is meaningful to an arbitrary degree I suppose, but yeah I would like to make it easier for people to get non-standard scripts into Bitcoin so that they can experiment, and from discussions of I’ve had with CoinGeek they’re quite keen on making their miners accept, you know, at least initially a wider variety of transactions eventually.
Daniel: 0:37:32.85,0:38:07.95
So I think IsStandard will remain important within the implementation itself for efficiency purposes, right - you want to streamline base use case of cash payments through them and prioritizing. That's where it will remain important but on the interfaces from the node to the rest of the network, yeah I could easily see it being removed.
Cory: 0,0:38:06.24,0:38:35.46
*Connor mentioned that there's some people that disagree with Bitcoin SV and what they're doing - a lot of questions around, you know, why November? Why implement these changes in November - they think that maybe the six-month delay might not cause a split. Well, first off what do you think about the ideas of a potential split and I guess what is the urgency for November?
Steve: 0:38:33.30,0:40:42.42
Well in November there's going to be a divergence of consensus rules regardless of whether we implement these new op codes or not. Bitcoin ABC released their spec for the November Hard fork change I think on August 16th or 17th something like that and their client as well and it included CTOR and it included DSV. Now for the miners that commissioned the SV project, CTOR and DSV are controversial changes and once they're in they're in. They can't be reversed - I mean CTOR maybe you could reverse it at a later date, but DSV once someone's put a P2SH transaction into the project or even a non P2SH transaction in the blockchain using that opcode it's irreversible. So it's interesting that some people refer to the Bitcoin SV project as causing a split - we're not proposing to do anything that anyone disagrees with - there might be some contention about changing the opcode limit but what we're doing, I mean Bitcoin ABC already published their spec for May and it is our spec for the new opcodes, so in terms of urgency - should we wait? Well the fact is that we can't - come November you know it's bit like Segwit - once Segwit was in, yes you arguably could get it out by spending everyone's anyone can spend transactions but in reality it's never going to be that easy and it's going to cause a lot of economic disruption, so yeah that's it. We're putting out changes in because it's not gonna make a difference either way in terms of whether there's going to be a divergence of consensus rules - there's going to be a divergence whether whatever our changes are. Our changes are not controversial at all.
Daniel: 0:40:39.79,0:41:03.08
If we didn't include these changes in the November upgrade we'd be pushing ahead with a no-change, right, but the November upgrade is there so we should use it while we can. Adding these non-controversial changes to it.
Connor: 0:41:01.55,0:41:35.61
Can you talk about DATASIGVERIFY? What are your concerns with it? The general concept that's been kind of floated around because of Ryan Charles is the idea that it's a subsidy, right - that it takes a whole megabyte and kind of crunches that down and the computation time stays the same but maybe the cost is lesser - do you kind of share his view on that or what are your concerns with it?
Daniel: 0:41:34.01,0:43:38.41
Can I say one or two things about this – there’s different ways to look at that, right. I'm an engineer - my specialization is software, so the economics of it I hear different opinions. I trust some more than others but I am NOT an economist. I kind of agree with the ones with my limited expertise on that it's a subsidy it looks very much like it to me, but yeah that's not my area. What I can talk about is the software - so adding DSV adds really quite a lot of complexity to the code right, and it's a big change to add that. And what are we going to do - every time someone comes up with an idea we’re going to add a new opcode? How many opcodes are we going to add? I saw reports that Jihan was talking about hundreds of opcodes or something like that and it's like how big is this client going to become - how big is this node - is it going to have to handle every kind of weird opcode that that's out there? The software is just going to get unmanageable and DSV - that was my main consideration at the beginning was the, you know, if you can implement it in script you should do it, because that way it keeps the node software simple, it keeps it stable, and you know it's easier to test that it works properly and correctly. It's almost like adding (?) code from a microprocessor you know why would you do that if you can if you can implement it already in the script that is there.
Steve: 0:43:36.16,0:46:09.71
It’s actually an interesting inconsistency because when we were talking about adding the opcodes in May, the philosophy that seemed to drive the decisions that we were able to form a consensus around was to simplify and keep the opcodes as minimal as possible (ie where you could replicate a function by using a couple of primitive opcodes in combination, that was preferable to adding a new opcode that replaced) OP_SUBSTR is an interesting example - it's a combination of SPLIT, and SWAP and DROP opcodes to achieve it. So at really primitive script level we've got this philosophy of let's keep it minimal and at this sort of (?) philosophy it’s all let's just add a new opcode for every primitive function and Daniel's right - it's a question of opening the floodgates. Where does it end? If we're just going to go down this road, it almost opens up the argument why have a scripting language at all? Why not just add a hard code all of these functions in one at a time? You know, pay to public key hash is a well-known construct (?) and not bother executing a script at all but once we've done that we take away with all of the flexibility for people to innovate, so it's a philosophical difference, I think, but I think it's one where the position of keeping it simple does make sense. All of the primitives are there to do what people need to do. The things that people don't feel like they can't do are because of the limits that exist. If we had no opcode limit at all, if you could make a gigabyte transaction so a gigabyte script, then you can do any kind of crypto that you wanted even with 32-bit integer operations, Once you get rid of the 32-bit limit of course, a lot of those a lot of those scripts come up a lot smaller, so a Rabin signature script shrinks from 100MB to a couple hundred bytes.
Daniel: 0:46:06.77,0:47:36.65
I lost a good six months of my life diving into script, right. Once you start getting into the language and what it can do, it is really pretty impressive how much you can achieve within script. Bitcoin was designed, was released originally, with script. I mean it didn't have to be – it could just be instead of having a transaction with script you could have accounts and you could say trust, you know, so many BTC from this public key to this one - but that's not the way it was done. It was done using script, and script provides so many capabilities if you start exploring it properly. If you start really digging into what it can do, yeah, it's really amazing what you can do with script. I'm really looking forward to seeing some some very interesting applications from that. I mean it was Awemany his zero-conf script was really interesting, right. I mean it relies on DSV which is a problem (and some other things that I don't like about it), but him diving in and using script to solve this problem was really cool, it was really good to see that.
Steve: 0:47:32.78,0:48:16.44
I asked a question to a couple of people in our research team that have been working on the Rabin signature stuff this morning actually and I wasn't sure where they are up to with this, but they're actually working on a proof of concept (which I believe is pretty close to done) which is a Rabin signature script - it will use smaller signatures so that it can fit within the current limits, but it will be, you know, effectively the same algorithm (as DSV) so I can't give you an exact date on when that will happen, but it looks like we'll have a Rabin signature in the blockchain soon (a mini-Rabin signature).
Cory: 0:48:13.61,0:48:57.63
Based on your responses I think I kinda already know the answer to this question, but there's a lot of questions about ending experimentation on Bitcoin. I was gonna kind of turn that into – with the plan that Bitcoin SV is on do you guys see like a potential one final release, you know that there's gonna be no new opcodes ever released (like maybe five years down the road we just solidify the base protocol and move forward with that) or are you guys more on the idea of being open-ended with appropriate testing that we can introduce new opcodes under appropriate testing.
Steve: 0:48:55.80,0:49:47.43
I think you've got a factor in what I said before about the philosophical differences. I think new functionality can be introduced just fine. Having said that - yes there is a place for new opcodes but it's probably a limited place and in my opinion the cryptographic primitive functions for example CHECKSIG uses ECDSA with a specific elliptic curve, hash 256 uses SHA256 - at some point in the future those are going to no longer be as secure as we would like them to be and we'll replace them with different hash functions, verification functions, at some point, but I think that's a long way down the track.
Daniel: 0:49:42.47,0:50:30.3
I'd like to see more data too. I'd like to see evidence that these things are needed, and the way I could imagine that happening is that, you know, that with the full scripting language some solution is implemented and we discover that this is really useful, and over a period of, like, you know measured in years not days, we find a lot of transactions are using this feature, then maybe, you know, maybe we should look at introducing an opcode to optimize it, but optimizing before we even know if it's going to be useful, yeah, that's the wrong approach.
Steve: 0:50:28.19,0:51:45.29
I think that optimization is actually going to become an economic decision for the miners. From the miner’s point of view is if it'll make more sense for them to be able to optimize a particular process - does it reduce costs for them such that they can offer a better service to everyone else? Yeah, so ultimately these decisions are going to be miner’s main decisions, not developer decisions. Developers of course can offer their input - I wouldn't expect every miner to be an expert on script, but as we're already seeing miners are actually starting to employ their own developers. I’m not just talking about us - there are other miners in China that I know have got some really bright people on their staff that question and challenge all of the changes - study them and produce their own reports. We've been lucky with actually being able to talk to some of those people and have some really fascinating technical discussions with them.
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