With bitcoin, you are paying for security. I know if I send you a bitcoin transaction there is a high probability it won't be reverted in our lifetime, possibly ever. I'm not a maxi but these new projects don't have that guarantee yet; likely they never will.
Like really - did your friend owe you $200 and you wanted to make sure he couldn't pay you something over square and then call his credit company and say his card was lost?
Like are you a shop online and you wanted to make sure ALL of your customers are paying in Bitcoin so they can't claim someone stole their card?
Are you a party to a lawsuit and the judge decided to oversee the other party pay you (the fictitious plaintiff in this scenario) $50000 with a check and you're worried he's calling his bank afterward and cancel the check?
None of these scenarios would be made better with Bitcoin:
Transaction costs
Some online stores ARE scams and it's better to have a real money trail - especially the ones involving bitcoin
The last scenario is easily solved because the judge would be able to provide much harsher realities for the check canceller.
From a practicality standpoint every time someone talks about irreversible transactions I just eyeroll at the actual logistics of that working in our world of 7B people.
The fundamental purpose stated in the bitcoin whitepaper is to provide an electronic equivalent to physical cash.
The first line of the whitepaper[0] is "A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another"
In practice some "third" party (bank, paypal, square, venmo, etc) will still be involved in most transactions because of the scenarios you have described. But this would be because they are helpful and add value not because they are necessary.
Security is not usually the main use case of a service, but a necessary feature of one. Bitcoin can do many things, and its main use case right now is store of wealth, so with your examples you've demonstrated you don't understand its most basic function.
When you notice that multi billion dollar transactions of Bitcoin are made every blue moon you might not be scoffing at what its security protocol is providing it.
Do you mean to tell me you just cannot understand why some people want money with total finality to use with anonymous people across a network? I mean, at this point I have no argument with you I just can't understand your line of thinking. Cryptocurrency, or digital cash, digital money was an idea for a decade+ before Bitcoin finally solved the problem. It's an obvious money with many obvious use cases. Many thousands of folks around the world are using Bitcoin on a daily basis. It's like the phony fees story people spread about Bitcoin, while those of us using Bitcoin daily can send any amounts of money we like for payments to folks around the internet for a couple dollars.
Let me be totally blunt with you since you are acting clueless as to how people use money on the internets.
I pay people ALL THE TIME, in Bitcoin, for codebase work that they perform. I do not want banks involved, I do not want to know their real life identity, I do not want them to know my identity, etc. Therefore, do the work, I pay you. We have a Web-of-Trust (Something folks here in general just seem ENTIRELY clueless about) and we trust eachother just as far as the Web of Trust and our online chat history and trust level allows. Do people get ripped off at times with payments? Sure. You lost $50 bucks, or whatever. Maybe you'll learn not to trust that party again. It's very simple. You don't need to act clueless. It's money, and if you use it correctly it just works. It's not reversible. If I were paying someone who ran off with my cash, it's the same shit.
The only reason proof of work is working for Bitcoin is because of the amount of hashing power put into it.
Nearly every other bitcoin fork can suffer a 50% attack because the network is sufficiently small that one can rent enough hashing power to attack it (see Bitcoin Gold).
Alternate coins absolutely need some other mechanism to secure their chain that doesn't require a critical mass.
This is precisely why those other chains are only imitators with no true value. The longest chain is bitcoin, and all the forks thereof are imitations that hold no value or network effect. This will always be the case when someone tries to fork Bitcoin rather than actually do some new cryptographic work.
The reality is that consensus only requires people to agree on something. It does not require burning tons of energy or military action.
Prisoner's dilemma is only a thing if you consider finite games, ie. played for your immediate benefit. If you consider an infinite game (for example the good and survival of humanity in perpetuity), it can be clearly shown that there is better solution and it is for people to grow up and just agree on a protocol that does not require burning energy or military action.
Do you think people will cheat each other given chance? That may be true when there is good chance of not getting punished for it. But if you ever lived in a small community where people rely on each other for survival (ie. infinite game), you would notice people will not cheat each other when they know they will have to rely on the community until death.
People will ALWAYS cheat others given the chance, and especially when facing very little online repercussions. I am not sure who you were replying to here. I do live in a small community, I have relied on a few others for survival, and I have been both stolen from, and price gouged due to others who would try to make skin off my back. I assume you've got less real life experience in these matters. I live on the basis of trusting nobody else but a very select few and being very self sufficient and reliant. I grow hundreds of pounds of my own vegetables, for instance, and I would seldom ever buy vegetables from a store throughout the season. Least of all, my trust in government. Most who initially got into bitcoin very early on did so for libertarian values towards government and monetary systems. I can really assure you that most of us who got into Bitcoin in 2010 did NOT do so because we initially thought we were getting lucratively rich or having thoughts we were selling assets to folks for a higher price just to get out. No, we got into Bitcoin because we see USD fiat paper as trash cash that is ever losing value and is backed by nothing but a phony government system. Used to keep people poor, used for financial control.
Think why you decided to write you only trust "select few"? Aren't these the people you plan on interacting with for a long time like family, friends or coworkers?
That's because when you plan to work with somebody for a long time, your game changes from finite to infinite. It suddenly makes other than altruistic sense to invest actual resources into fostering the relationship and avoid damaging this relationship by cheating.
This is neither projection, nor a deflection due to myself not being trustworthy and I find it strange that one would jump first to this. No, it's situational due to life experience lived. People can and do take advantage of systems, which is more to the point of what drew libertarians to Bitcoin. Now move along.
Security perhaps (if you're sufficiently careful how you use it), but I would have thought stability was also pretty important if you're thinking in terms of lifetimes. Bitcoin doesn't show much sign of offering that.
Ethereum and Litecoin for example are far, far less secure than Bitcoin. The centralization of ETH will continue to increase, and mining hardware for Scrypt for Litecoin is nearly non existent in comparison.
Additionally, PoS attackers can have their stake slashed, so they may never attack again. However, you can't slash PoW attackers, once attacked, they will just keep on coming back (no matter how many times you change the hashing algorithm)
And you need to bootstrap your PoS system by enriching a bunch of insiders so that they can validate your transactions. PoS systems are unfit for being the decentralized digital store of value. Bitcoin has the most fair launch any cryptocurrency can ever have. There is no alternative for Bitcoin's use case.
PoS systems can be bootstraped by PoW, so no problem there.
Bitcoin did not have a fair launch either, there was a lot of information asymmetry between the project insiders and the public. Satoshi's stealth-mine of ~1 million BTC for example.
No, if Bitcoin was PoS, Mt Gox would bail themselves out and govern Bitcoin to this day. Early on, Mt Gox was responsible for over 80% of all economic activity on the Bitcoin network, and was by far the dominant holder of coins.
This is silly. Consensus (probably, I am doubtful of PoS) isn't free. You get a choice between bitcoin mining and military force. Which do you find less harmful?
Edit: I should clarify. I am saying that the status of the USD as a reserve currency has led to lots of US military action.
No one here is arguing for replacement of military force, your brain got stuck by a common fallacy it seems.
Notice how displacing some military force usage by changing the motivation or capability for intervention (for example to maintain a currency advantage) might be in itself a Good Thing (tm) and how it does not require replacing armed forces entirely.
Not sure what you are going for here. Indeed, reading a single sentence without considering context typically leads one to faulty conclusions. Note that the previous sentence in the parent post is "Consensus (probably, I am doubtful of PoS) isn't free."
Military force and law enforcement provide solutions for consensus across great many domains, so they're marginally near-free to use for consensus in any single area of interest. You could say, they are consensus factored out and made incarnate.
Conversely, if all money suddenly become Bitcoin, military force and police would still be needed, in mostly the same amount they are today.
It's odd to me that people think Bitcoin can be free of "force" long term. Bad guys can point a gun at your head and demand you login into Coinbase to transfer coins to them. What happens if the government makes Microsoft give them admin accounts to the Bitcoin repo? What happens if there is a fork and China doesn't like it and prohibits miners from adopting it? BTC is way more susceptible to traditional military and government might then people make it out to be.
I don't think it will eliminate the need for the military or police force entirely. I have seen a lot of bold bitcoin claims but I don't think anyone really does.
My post was referring to how the US has killed lots of people to keep strong dollar. I think its feasible that a true global currency (possibly bitcoin) could prevent violence like this.
Exactly. Fossil fuels and rare earth metals are already considered to be a national security risks. Depending on a currency with huge energy requirements only multiplies this risk, which further incentivizes war.
Energy scarcity is a thing of the past for anyone who wants it to be. Between solar and nuclear, it's a helluva lot easier to get basically unlimited renewable energy than it is to go to war. Malthus hasn't been right about the way the world works in 200 years
I doubt they would just roll over yeah. If you consider the dollar as a weapon/tool for US hegemony, bitcoin functions as almost like a terrorist entity. Not clear what to do with this information
It's just a risk that the value of it drops to near zero if it's outlawed.
Or it could become highly regulated and be much less useful for trade due to onerous compliance requirements. For example, how do you prove that wallet X that one is sending money to isn't going to someone who's in an embargoed country?
It's a big risk. But, to answer your second question, its a public ledger. Its significantly more conducive to surveillance than cash. Just punish people if they send money to an unverified address.
I think that's a gross possibility, and I hope no governments take this measure, but I don't think it would be difficult.
I don't disagree with you, I just don't personally believe that it will become a major instrument of trade due to it removing a major component of economic policy. I believe that most countries would rather have their citizens use their national currency as opposed to a foreign or electronic one, since that allows them a lot more control on inflation.
From that perspective, it seems to follow that most governments would want to regulate cryptocurrencies, and probably not in the way that Bitcoin bulls would like it to be.
I could definitely be wrong on this though. I thought in the past that the ad model of Facebook and Google would go nowhere, and look where they're at now.
I don't really know either. Maybe you're right, but as a (maybe ridiculous) counterpoint, what benefit does it give a government to have their own currency? I think the main benefit is not having to rely on another government to keep it stable... or to avoid the subservience that follows from having to rely on acquiring said currency from another government. For most countries now practically I think this means 'not giving the US complete control over our politics and not having to buy USD from them'.
Are there any other benefits? If not, wouldn't adopting bitcoin be an easy solution to monetary policy while avoiding this issue? Or am I missing something?
This would be a pretty long topic to discuss, but in general monetary policy is something that governments really do want to control. If a national economy is not doing well or there is little demand for their goods or currency, the value of their currency is lower, making their exports cheaper and allowing them to participate in the global markets.
One example of having monetary policy out of a country's control is the EU, which has both strong economies (eg. Germany) and weaker ones (eg. Greece). A strong Euro works well for Germany, since they get more effective purchasing power out of their trade surplus. For Greece, a strong Euro means that their exports are probably not competitive price wise.
If these countries had their own currency, the Deutsche Mark would be a strong currency (making their exports relatively more expensive) and the Greek Drachma a weaker currency (making their exports relatively less expensive), giving them a push towards a more even trade balance. As citizens tend to transact in local currency, this also encourages Greek citizens to seek more local goods (eg. Greek tomatoes grown on Greek soil with Greek labor) as foreign goods are more expensive, hence further stimulating their economy.
I grant the other points, but if the government took over the bitcoin repo and changed it, why wouldn't people just keep using the old version of the software?
How so? Seems correct to me. Just this morning I had the choice of paying for groceries either with Bitcoin or by launching a violent invasion of the store.
/u/nindalf this honestly made me laugh out loud and spill my drink. The next time I am trying to explain the concept of a false dichotomy, I am absolutely using this example. XD
If surveillance is increased a bit more, the government won't need to use force to get your money.. they'll just use some rootkit chip on whatever device to get your private key.
I am also doubtful of PoS but perhaps there's a way to make a greener coin using some amount of trust and regulation?
Well, technically you only need the threat of violence. Potential-but-unrealized violence is arguably much better for humanity than proof-of-ever-escalating wasted energy.
Maybe true depending on the energy source. I've heard it argued also that bitcoin will become the 'purchaser of last resort' for energy. For example, fracking companies often just burn off natural gas they find while looking for oil... instead, this gas could be used to mine btc. Also well documented that a lot of bitcoin operations in china are fueled by hydroelectric sources.
The promise of violence is free until realized though.
Hydroelectric sources that could be best used on homes, businesses, etc. Anything but Bitcoin, really.
Did everyone forget that the best goal we can achieve with power usage is by reducing consumption outright? Just because some of the mining is done on greener solutions doesn't mean it's a net positive.
Global warming isn't exactly going away if we keep this experiment up.
Yeah but good luck convincing people to move next to sources of energy so cheap it would be wasted otherwise (rural west texas, rural china). If bitcoin becomes the dominant global financial system, securing it will be a worthy use of energy.
I really hope you're wrong about that. Bitcoin becoming something like a world reserve currency will only make the problems infinitely worse. Be careful what you wish for, because future generations are going to be left holding the bag.
Because this rich tech billionaire brought about humanity-changing innovations so maybe what he says deserves some attention? Why does _your_ opinion matter?
His status as rich tech billionaire doesn't make a difference unless he is making arguments that are new or interesting. And he isn't. We've all been hearing the environment argument for years now.
Plus, there is obviously an argument to be made that he has had a negative overall influence on the world & therefore shouldn't be trusted.
I don't want to hash them out, plenty of arguments from the leftists or linux people for example. Free software, exploitation of workers. Whatever. The argument itself is arbitrary, I'm just saying that he's a controversial figure
No, just because he's a billionaire doesn't mean any of those things.
It's just that Bill Gates is legendary for the amounts he reads and his recall ability, and his contributions to many topics outside of just managing MS (state of the art algorithms, erradictinc malaria, nuclear energy etc). I thought everyone knew this, but apparently not. So you can see how funny it is when a random guy on HN says "just because he's a billionaire" :D
Fair enough. But for every bill gates we can find a mark cuban, michael saylor etc who are extremely excited about bitcoin. So I still think it is uninteresting.
First you said "Just because Bill Gates is a billionaire, doesn't mean he knows what he's talking about"
Now that you've learned that most likely he DOES know what he's talking about, you changed your argument to "Other people think other things, so it's uninteresting" (What? WE're not talking about random people here.)
Lets just say it: you already arrived at the conclusion you want, now you're grasping for arguments to support it.
I conceded the point that he hasn't looked into it with 'fair enough' lol. Regardless, informed is relative. I don't think Bill Gates knows more on bitcoin than I do. His status as an authority figure is uninteresting, because we can find many authority figures that disagree with him.
Well i’d say the inability to understand probability is a harmful trait but you’re clearly still here and might even have kids. And everyone with asthma, type 1 diabetes, and a tiny dick would like a word with you. Idiot
I'm sorry, it must be tough having those three conditions, but unfortunately that has little to do with what we're discussing.
With 6 billion people in the world today, even if our nefarious post-doc somehow gene-spliced 100 people with a 100% probability transmit of a "bad" recessive gene, it would take so many generations for any effect to be felt.
By then, we can assume, it would be trivial to reverse the "damage" caused. Hence the eye-rolling at the idea that one post-doc could be any serious threat.
