You're gonna need a bigger block.
August 18, 2015 5:57 PM   Subscribe

Bitcoin's forked: chief scientist launches alternative proposal for the currency
The key difference between Bitcoin XT and the other version of bitcoin, known as Bitcoin Core, is size of the blocks into which transactions get grouped every 10 minutes. Core supports a maximum block size of 1mb, which XT increases to 8mb. Hearn, and the other supporters of XT, argue that that increase is necessary if the currency is to continue growing.

"As Bitcoin spreads via word of mouth, we will reach the limit of the current system some time next year, or by 2017 at the absolute latest," Hearn writes. "So it is now time to raise the limit, or remove it entirely."

Those who oppose the change do so for a variety of reasons. Some argue that it's a simple sticking-plaster solution, and that the actual fix should be far more wide-ranging (one such proposal being the "lightning network" upgrade); they worry that removing the most pressing need for an upgrade will also lessen he chance of that wide-ranging fix.

Others simply oppose changing anything from the initial bitcoin proposal presented by Satoshi Nakamoto in 2009, and argue that any major change should come in the form of a whole new currency, or "alt coin", rather than an update to bitcoin itself.
Additional coverage/discussion:
posted by tonycpsu (87 comments total) 7 users marked this as a favorite
 
So this group of developers who control the code of Bitcoin - aren't they basically like the Fed in the sense they can dictate how many bitcoin can be in existence, how fast it grows, etc.? How is that any different from fiat money?

If I upgrade to a bitcoin 2.0 does that mean I can accept payment from a bitcoin 1.0 person and that counts as bitcoin 2.0 money? Or do you have to "convert" your bitcoin 1.0s to bitcoin 2.0s and vice versa?
posted by pravit at 6:14 PM on August 18, 2015 [1 favorite]


So much energy expenditure to buy herbal ecstasy.
posted by Artw at 6:16 PM on August 18, 2015 [26 favorites]


See, this is why I stick with using shiny rocks to barter for things.
posted by SansPoint at 6:17 PM on August 18, 2015 [9 favorites]


Bitcoin: explicitly laying bare all of capitalism's inherent problems and failures.
posted by Aya Hirano on the Astral Plane at 6:25 PM on August 18, 2015 [8 favorites]


Wait, a theory based on an ever-inflationary valuing due to artificially scarce resources won't scale? Whoda thunk it!
posted by klangklangston at 6:27 PM on August 18, 2015 [15 favorites]


It is funny, because on the whole, it's not the small green pieces of paper blocks that are unhappy.
posted by Pogo_Fuzzybutt at 6:27 PM on August 18, 2015 [36 favorites]


I found this to be a most enlightening article on the topic:

Op-ed: Why is Bitcoin forking? (Or, why Bitcoin XT, as based on Satoshi Nakamoto's vision, should be welcomed)

posted by ArmandoAkimbo at 6:28 PM on August 18, 2015 [3 favorites]


The way Bitcoin works is that there's a long list of every transaction going back to the beginning of Bitcoin (the blockchain), and you make a new transaction by adding an entry to the end of the blockchain. So if there's a fork, it's a big mess -- one side of the fork will say that the blockchain goes like ABCDEF, the other will say it goes like ABCGHI. It's not like different currencies, it's like forking timelines -- in one history, you spent $20 on pizza, and in the other history, you still have the $20. Which is too bad for the pizza place, because depending on which timeline wins, they could be out $20.
posted by ectabo at 6:33 PM on August 18, 2015 [2 favorites]


ahhhhhhh our libertarian pseudocurrency is struck down in it's prime by disruptive currency entrepreneurs ahhhhhhhh hoist by our own petard ahhhhhhhhhhhh
posted by Avenger at 6:35 PM on August 18, 2015 [45 favorites]


See, this is why I stick with using shiny rocks to barter for things.

You're still doing shiny rocks? We're using ShinyRoxx192, a better method of bartering which allows the bartering process move faster since more "Roxx" are involved in each transaction, allowing easier transactions through fractional currency. Plus, such a small number of people own shiny rocks, they control the value of the currency, and that's not what shiny rocks are all about, man.
posted by AzraelBrown at 6:38 PM on August 18, 2015 [3 favorites]


I found this to be a most enlightening article on the topic:

Yeah, I left that one out of the FPP because it's got a distinct pro-XT editorial slant to it, complete with the evidence-free assertion that the XT solution conforms more to Satoshi's "vision" when it's precisely his lack of vision that led to this scalability problem.
posted by tonycpsu at 6:39 PM on August 18, 2015 [2 favorites]


So, you're saying he'll pay the price for his lack of vision?
posted by Chrysostom at 6:56 PM on August 18, 2015 [2 favorites]


So, you're saying BitCoin is forked?
posted by eriko at 6:57 PM on August 18, 2015 [3 favorites]


Does XT have a provision to scale beyond 8M? It's unbelievably short sighted if not...
posted by schmod at 6:58 PM on August 18, 2015 [2 favorites]


An untraceable digital currency I call Kriegerands!
posted by T.D. Strange at 6:59 PM on August 18, 2015 [16 favorites]


So delicious it must be fattening.
posted by benito.strauss at 7:01 PM on August 18, 2015 [3 favorites]


Yeah, I left that one out of the FPP because it's got a distinct pro-XT editorial slant to it, complete with the evidence-free assertion that the XT solution conforms more to Satoshi's "vision" when it's precisely his lack of vision that led to this scalability problem.
It's clearly labelled as an op-ed. As for evidence and vision, the article (1) links to several posts showing that Satoshi clearly understood that this would be an issue, and that (2) a low maximum blocksize was a purposeful, short-term compromise:
The eventual solution will be to not care how big it gets. But for now, while it's still small, it's nice to keep it small so new users can get going faster.
As "a product guy", I can tell you that the alternate "oh, we'll just completely change how everything works" solution is simply naive and will fail if attempted. (And they should, if they actually believe their own bullshit. Let the market decide, as they say.)

The solution to a flat tire is not to build a new car — change the tire, then build the new car if that's still necessary.
posted by ArmandoAkimbo at 7:07 PM on August 18, 2015 [3 favorites]


What, you mean all that greedily anticipated rent seeking may have been for nothing?
posted by oceanjesse at 7:09 PM on August 18, 2015 [3 favorites]


Does XT have a provision to scale beyond 8M? It's unbelievably short sighted if not...
The maximum block size would automatically double every other year for 20 years, until it reaches 8 GB per block in 2036 (at the soonest).
posted by ArmandoAkimbo at 7:12 PM on August 18, 2015 [2 favorites]


The (shortfall_resource*8) and fork solution makes me want to do drugs and kill someone. Maybe in a single transaction.
posted by mrdaneri at 7:12 PM on August 18, 2015 [3 favorites]


This will make everything much clearer and those neoliberal dreams will all come true.
posted by clvrmnky at 7:12 PM on August 18, 2015 [1 favorite]


Well, I guess you're all just forked.
posted by TheWhiteSkull at 7:16 PM on August 18, 2015


Zombies are everywhere, do you have your bitcoins.
posted by clavdivs at 7:26 PM on August 18, 2015 [1 favorite]




The solution to a flat tire is not to build a new car — change the tire, then build the new car if that's still necessary.

No, the solution to a bad alternator is to change the tires until the car starts, then buy a new car because the car is too slow, but hey, you can cluster the new car with the old car!

What, you haven't dealt with DEC field support?


Yes, this is an old joke. I am an old person. My jokes are old. BUT THEY'RE STILL VALID, UNLIKE BITCOIN!

posted by eriko at 7:56 PM on August 18, 2015 [22 favorites]


It's clearly labelled as an op-ed.

And, as a rule, op-eds tend to make bad FPP fodder.

As for evidence and vision, the article (1) links to several posts showing that Satoshi clearly understood that this would be an issue, and that (2) a low maximum blocksize was a purposeful, short-term compromise:

Yes, I saw that, but the fact that he considered it and decided to punt the decision into the future doesn't make it any better of an idea. The failure of vision I'm talking about is not the failure to see that the block size would be a problem, but that getting fewer than three answers from more than two or more programmers as to how to resolve the problem in the future would be possible.
posted by tonycpsu at 7:57 PM on August 18, 2015


You know, I wouldn't care one whippet about this if it weren't for the vast, seemingly inexhaustible arrogance of some people using the currency and who had nothing to do with its actual creation.
posted by newdaddy at 7:59 PM on August 18, 2015 [4 favorites]


An untraceable digital currency I call Kriegerands!

I was going to make a joke to the effect that Bitcoin is a Dunning-Krugerrand: a currency that's only fully embraced by people who don't understand it as well as they think they do. But on googling it looks like the term, if not that precise definition, has been out there for a while.
posted by George_Spiggott at 8:14 PM on August 18, 2015 [12 favorites]


In all seriousness.

Who do I trust?

Okay, there's this proposal for a modification for a change to the protocol. Until they hit 1MB blocks, everything's dandy, so if everybody agrees before that time, it's all gravy.

What's the process? How do we do this?

Answer?

There is no process. There is no authority. Everybody gets to pretend they're the sole authority for BitCoin. Reddit thinks they can Up/Down vote this. I'm sure dozens of other forums are doing that as well. None of them are truly authoritative.

Which is why anybody with a clue stays the hell away from BitCoin. There's one organization that declares that *that* is a Pound Sterling of the United Kingdom, or a Rouble of the Russian Federation or a Dollar of the United States or a Yen of the Empire of Japan. We know from them that that is the Currency. There is no other organization that declares a change in those currencies, large or small. Even when those countries undergo massive change -- such as Japan and Russia did -- there is a clear chain of change that lets us know either there is a chain of validity of the currency, or the currency has gone invalid.

Not with BitCoin. You can have one group swearing that This BitCoin is Valid, and that BitCoin is not, and another swearing the Opposite. How am I, the vendor, supposed to deal with a coin that has been spent and not spent? A coin that is Valid and Not Valid?

The answer is *you don't deal with noise like that.*

BitCoin either *forms a real process that has a real central authority that declares validity* or it is a joke that we ignore.

Translation: It is a joke that we ignore.
posted by eriko at 8:15 PM on August 18, 2015 [19 favorites]


"If we built this large wooden badger..."
posted by Novus at 8:16 PM on August 18, 2015 [13 favorites]


The failure of vision I'm talking about is not the failure to see that the block size would be a problem, but that getting fewer than three answers from more than two or more programmers as to how to resolve the problem in the future would be possible.

They're don't seem to be set up to undertake a computer science/engineering research program, which indeed is what would be extremely helpful towards these kinds of issues that are now coming up. For example, the Lightning Network proposal is interesting, but all the technical detail inside that paper is no substitute for the ideas that a community doing fundamental, cross-disciplinary research could be producing.
posted by polymodus at 8:17 PM on August 18, 2015


How am I, the vendor, supposed to deal with a coin that has been spent and not spent? A coin that is Valid and Not Valid?

The Market deals with all that stuff, man.
posted by Ray Walston, Luck Dragon at 8:22 PM on August 18, 2015 [3 favorites]


George_Spiggot, I think MeFi's Own Charles Stross came up with that neologism.
posted by infinitewindow at 8:24 PM on August 18, 2015 [1 favorite]


Schrödinger's BitCoin?
posted by Multicellular Exothermic at 8:26 PM on August 18, 2015 [3 favorites]


BitCoin either *forms a real process that has a real central authority that declares validity* or it is a joke that we ignore.

This argument is refuted by an MIT professor in an article in one of last year's issue of Communications of the Association for Computing Machinery.
posted by polymodus at 8:35 PM on August 18, 2015 [3 favorites]


... makes me want to do drugs and kill someone. Maybe in a single transaction.

Kill a junkie with a straw, and drink their blood.
posted by Greg_Ace at 8:40 PM on August 18, 2015 [3 favorites]


So, this is the thing Ron Paul's been trying to scare my aunt and uncle into with those TV commercials!
posted by Thorzdad at 8:43 PM on August 18, 2015


I think MeFi's Own Charles Stross came up with that neologism.

I suspect this is one of those cstross/jscalzi confusions, which probably annoy them both. A search for both the term and cstross' name returns only one result for me, and that's this long discussion, which attributes it variously to William Gibson, "someone on cstross's blog", someone on Something Awful or Fark, and also references a Metafilter discussion which traces it to a commenter on JScalzi's blog, though not in reference to bitcoin.
posted by George_Spiggott at 8:46 PM on August 18, 2015


So, in layperson's terms, the problem is this: Bitcoins are no earthly good to anyone and producing them consumes vast amounts of electricty. The CO2 generated by this will undoubtedly destroy our civilisation, and perhaps human life. Also, a hard-coded 1MB block size limits the number of bitcoins that can be traded per day, which means that the potential profit from ending billions of human lives will be constrained in two years or less.

Really a tough problem there.
posted by Joe in Australia at 8:49 PM on August 18, 2015 [8 favorites]


Wasn't... wasn't one of the premises of bitcoin that it would eventually run out and no more would be created?

So... is it just because it's earlier than they thought it would happen? Or is it a different digital currency that had that as a premise, and I'm confusing it with bitcoin?
posted by symbioid at 8:53 PM on August 18, 2015


symbiod:
It's two different problems.

Problem A is the finite number of bitcoins that will be produced. Many people who love bitcoin claim this isn't a problem, and it's not what people are worried about here.

Problem B is the quantity of transactions that Bitcoin can handle in a given ten-minute window; the volume that the system can handle. This was chosen as a low number for convenience when bitcoin was created, but it's turning into a bottleneck now, and people want to increase the volume.
posted by kaibutsu at 9:03 PM on August 18, 2015 [4 favorites]


BitCoin either *forms a real process that has a real central authority that declares validity* or it is a joke that we ignore.
This argument is refuted by an MIT professor in an article in one of last year's issue of Communications of the Association for Computing Machinery.


Not particularly. He recognizes that BitCoin only has value because people agree it has value, and the point being made here is that without someone to officially arbitrate which fork is valid people will stop treating BitCoin as valuable.

BitCoin has been and is continuing to be a hard sell for the average consumer. Situations like this do not improve things.
posted by Tell Me No Lies at 9:06 PM on August 18, 2015 [5 favorites]


Time to link to my very favorite anti-Bitcoin rant, which, while dating back a few months, addresses the question of exactly how "decentralized" the network is (not very).
posted by bbuda at 9:14 PM on August 18, 2015 [5 favorites]


This argument is refuted by an MIT professor in an article in one of last year's issue of Communications of the Association for Computing Machinery.

Where? The bit about the Iroquois federation uses the fact that the federation didn't collect taxes as a means to dismiss the notion that it was a central authority at all, even though it obviously was seen as such by tribal members despite the lack of tax collection.
posted by tonycpsu at 9:15 PM on August 18, 2015 [1 favorite]


The "average consumer" does not care if bitcoin forks. Does not want to know. Does not care about technical details like that. The average consumer is perfectly happy using credit cards.

They might care that its exchange rate is down from $800 where it probably was when they first heard about it to $230 today.
posted by sfenders at 9:25 PM on August 18, 2015


This is actually good for BitCoin.
posted by TrialByMedia at 9:29 PM on August 18, 2015 [2 favorites]


Kill a junkie with a straw, and drink their blood.

Thanks, now I'm sitting here wondering if that was in "Fear and Loathing in Las Vegas" or due to the lacquer thinner I was working with earlier.
posted by Kid Charlemagne at 9:43 PM on August 18, 2015 [1 favorite]


oh no guise this time bitcoin will work
posted by feckless fecal fear mongering at 9:44 PM on August 18, 2015 [1 favorite]


Awwww man, this is like Everquest 2.0 all over again.
posted by fullerine at 9:53 PM on August 18, 2015 [1 favorite]


BitFinngggah!
He controls the code based on fiat called gold, he feels so old. Digifinger, in from the cold with krugerrand, he seems so bland.

Ah-wah-wah.
posted by clavdivs at 10:09 PM on August 18, 2015 [6 favorites]


So, anywhere selling short calls on bitcoin?
posted by klangklangston at 10:29 PM on August 18, 2015


The "average consumer" does not care if bitcoin forks. Does not want to know. Does not care about technical details like that.

I agree they don't care much about the details, but if I tell them that sometimes the money is retroactively invalidated because a couple of geeks got in a pissing match they'll pay attention enough to laugh at, not value, the currency.
posted by Tell Me No Lies at 10:34 PM on August 18, 2015 [2 favorites]


T.D. Strange: "An untraceable digital currency I call Kriegerands!"

Or, in the case of Bitcoins, Dunning-Krugerrands.

e:f;b
posted by Samizdata at 10:40 PM on August 18, 2015 [3 favorites]


I thought the second pope was Doge Coin...

Seriously... we need another form of cryptocurrency already?

Blocks. So small. Want All. plz.
posted by Nanukthedog at 11:05 PM on August 18, 2015


Imagine a new ButtCoin with not two, but three cheeks.
posted by a lungful of dragon at 11:21 PM on August 18, 2015 [6 favorites]


Does three cheeks mean two exits?
posted by Ray Walston, Luck Dragon at 11:27 PM on August 18, 2015 [1 favorite]


So without reading a whole lot, this is a bit tough to understand, but if I'm reading correctly, the proposal is to increase the size of the blocks, but not the computational difficulty of mining them. So power consumption shouldn't be significantly impacted.
posted by ssg at 11:37 PM on August 18, 2015


So it'll still be hilariously inefficient?
posted by fullerine at 11:43 PM on August 18, 2015 [2 favorites]


gentlemen i envision a fedora-based currency that is powered by pure austrian school economics and the non-aggression principle
posted by Avenger at 11:55 PM on August 18, 2015 [11 favorites]


Isn't the bigger problem that once there are no more Bitcoin to be mined, there are still going to be a whole lot of miners. Sure, they could all switch to charging higher transaction fees, but as mining is currently creating roughly $850,000 USD per day, there would either have to be a whole more transactions or a whole lot higher fees (or both). There are currently about 100,000 transactions per day, so even if there are a few times that many transactions, fees would have to be multiple dollars per transaction. Otherwise, aren't all those miners going to quit because they can't pay their electrical bills?

So, say a whole lot of miners drop out because transaction fees can't support the energy requirements, and eventually only some small percentage of the mining fleet is running and transaction fees are bearable. But there are plenty of people out there with piles of idle, expensive mining rigs. Surely one of those guys is going to get together with his buddies and start a cabal to suddenly turn on enough mining power to make up 51% of available hashing power and then bend bend the blockchain however they fancy, making off with plenty of Bitcoin (and/or crashing the whole currency, depending on how subtle they are). Or someone could buy up a whole lot of this surplus mining hardware on the used market and do the same thing. What's to prevent that kind of situation?

It seems like a tragedy of the commons situation. It would be in everyone's interest to have transaction fees high enough to keep lots of hashing power in use, but for any particular transaction, the individual's incentive is to pay as low a fee as possible. Seems like a race to the bottom, with predictably nasty consequences.

So it'll still be hilariously inefficient?

Oh yes! I just feared they would be promoting a solution that would make things even worse in the short term.
posted by ssg at 12:19 AM on August 19, 2015 [1 favorite]


even though it obviously was seen as such by tribal members

What? No. Nothing is obvious. Especially given these contexts. But that article's sub argument is laid out explicitly in a couple of paragraphs.
posted by polymodus at 12:27 AM on August 19, 2015


Satoshi Nakamoto's vision

Yes, we must follow the years-old posts by a mysterious cabal/entity/agency/deep one whose identity has never been proven and whom no one has ever met in person. He/it/them are good guys.
posted by benzenedream at 1:29 AM on August 19, 2015 [15 favorites]


Hmmm. A real pickle. A conundrum. Do I put my money through a shredder, or throw it on a raging fire? Such a tough one...
posted by zardoz at 1:54 AM on August 19, 2015 [2 favorites]


So this group of developers who control the code of Bitcoin - aren't they basically like the Fed in the sense they can dictate how many bitcoin can be in existence, how fast it grows, etc.? How is that any different from fiat money?

The developers don’t control Bitcoin - the miners who choose which Bitcoin blockchain to extend do that. More Bitcoins are generated as the blockchain is extended according to a particular formula, but there’s nothing stopping a majority of miners collaborating to switch to a different algorithm which generates more Bitcoin for themselves IIRC.

(Bitcoin has been described as digital gold for good reasons, but this aspect, where a majority of miners could in principle fork the blockchain and reward themselves with more Bitcoin is one of the places where it’s nothing like gold at all - there’s no way that a bunch of gold mines could collaborate to suddenly start mining more gold out of the ground for the same amount of effort simply by deciding to do so.)

Back in the day, when there were many independent miners, this seemed very unlikely. But now that Bitcoin mining has collapsed to a few cartel-like groups, it’s much more likely that the miners would get together to do something like this. The only thing really stopping them is the effect it would have on the perception of Bitcoin itself - just like the central bank in a fiat currency as you point out.

(Various reporters in the financial world have been pointing out that Bitcoin is nothing new in a monetary sense for a long time now, but Bitcoin devotees have been studiously ignoring them & insisted on rediscovering all the problems that the fiat currency world went through in the C19th {and earlier} instead.)
posted by pharm at 2:29 AM on August 19, 2015 [7 favorites]


(I feel an incipient BitCoin rant / essay coming on again. Will have to go lie down in a darkened room until it goes away.)
posted by pharm at 2:38 AM on August 19, 2015 [1 favorite]


From reading one (1) blog post about XT, I was all convinced. Then I read this seemingly-good argument against XT, and I was all convinced.

I am now educated and will have opinions on this in internet forums.
posted by bonaldi at 2:52 AM on August 19, 2015 [7 favorites]


This argument is refuted by an MIT professor in an article in one of last year's issue of Communications of the Association for Computing Machinery.

This would be the article that ends with the author stating, "The question is whether the efficiencies of a cyber-currency like Bitcoin can be merged with the certainties of an honest central bank. I believe they can and will."

This sounds rather like "form[ing] a real process that has a real central authority that declares validity" to me.

By the by, Van Alstyne's position at MIT is that of a research associate at their Initiative on the Digital Economy, which is almost entirely funded by private industry. His professorship is at Boston University.

Beyond that, the linked article is rather poorly argued and weakly supported. His big counterexample to fiat currency, for instance, is a startup he worked at that set up a market allowing people to buy things like gift cards or lunch with the CIO using what amounted to monetized brownie points.

And then we get this:

And then there's this sterling example of argument:
Bitcoin has ingeniously engineered non-government control by expanding its supply only at a rate proportional to the technological discovery of prime numbers. It also promises that the total supply will never exceed 21 million bitcoins, though it can be subdivided arbitrarily.13 This promise of stable supply is stronger than any promise a government has made when it comes to currency targets. As Weimar Germany showed, politicians can manipulate their currencies during a crisis. Citizens of Zimbabwe and Ecuador use U.S. dollars as their national currencies precisely to reign in such irresponsible behavior.
So the argument in this portion is that Bitcoin is a stronger promise of stable supply than that of any government because there have been two notorious instances of hyperinflation, while Bitcoin is theoretically immune to hyperinflation itself. (Never mind that the most severe crises have been deflationary; never mind that Bitcoin is absurdly volatile. Van Alstyne actually argues that the volatility criticism means that Bictoin can't reliably hyperinflate, which is a bit like promoting mercury poisoning on the grounds that it kills off the bacteria that cause influenza.) Now, this assumes that the preeminent feature one should seek in a currency is "stable supply" -- most economists would strongly contest that point -- but it also seems to assume that two notorious edge cases should be treated as typical. Perhaps the author might investigate why absurd hyperinflation is relatively rare among government-backed currencies.

Later, when discussing the great Mt. Gox ripoff, the author notes that this is no big deal because there have always been bank robberies. There would seem to me to be a crucial distinction here, since banks do not collapse when robbed these days. The author might wish to consider why that is so.

A lot of this makes more sense when you look at his CV: a lot of work for startups and tech companies, some material examining the economic drawbacks of immortality via transhumanism, a lot of work arguing that we shouldn't just filter all spam, and some work on how to set up business models for successful MOOCs. There's a strong strain of belief that things will all work out because!information markets in his work, and the linked article seems no exception.

For the curious, here is the proposal for dealing with spam that Van Alstyne co-authored:
[W]e advocate a hybrid system that would allow email users to choose their preferred email system. Those who want anonymity and no incremental cost for email can continue to send emails under the current system, without authentication and without sender bonds. Those who want the lowest costs and don't care about anonymity (most legitimate businesses would likely fall into this category) can send email that is user authenticated, but not bonded. People who want anonymity but are willing to pay to demonstrate the value they place on the recipient's attention can post a bond. Payment could be made anonymously via a clearinghouse, using the electronic equivalent of a tiny traveler's check bundled with each message. Those with especially high-value messages can make them both authenticated and bonded.

Email recipients would then choose which types of email they want to receive (as well as the monetary threshold at which they would accept bonded email). Our own choice would be to only receive email that is either authenticated or bonded (or both), and we suspect most others would quickly opt for this choice as well.
I wonder why this plan for everyone to pay for spam-free or low-spam e-mail never took off?
posted by kewb at 3:52 AM on August 19, 2015 [17 favorites]


Bitcoinz... Gotta catch 'em all!
posted by krinklyfig at 4:44 AM on August 19, 2015 [2 favorites]


If I upgrade to a bitcoin 2.0 does that mean I can accept payment from a bitcoin 1.0 person

Sure, there's no rule against interacting with 1.0 people. I've probably done it myself by accident, like wandering into coach from the first class section on the plane- you can hang out there, I guess, if you want. I'm not sure why anyone would want to, however, since 1.0 people aren't walking around with pockets full of diamonds or putting diamonds in their breakfast cereal like it was nothing. Only 2.0 people who are filthy rich because of the upgrade are so obscenely rich and careless with their wealth that they would put diamonds on cereal and maybe donuts too. Because you see they have so much bitcoins they just don't care! yes, put diamonds on my cornflakes! here, have a bitcoin 2.0, oh see now you're rich too. Have some diamonds my pockets are too full.
posted by krinklyfig at 5:08 AM on August 19, 2015 [1 favorite]


If there is a bit of luck with the schedule, 2016 could theoretically have both the reward halving and the blocksize doubling within months of one another. What this would do to the ecosystem I can't but guess, but I'm sure it'll be suitably dramatic.
posted by Kikujiro's Summer at 5:20 AM on August 19, 2015


Citizens of Zimbabwe and Ecuador use U.S. dollars as their national currencies precisely to reign in such irresponsible behavior.

Must not teach spelling at MIT.
posted by Chrysostom at 5:27 AM on August 19, 2015


such fork

very blocksize

so argument

wow
posted by flabdablet at 5:32 AM on August 19, 2015 [4 favorites]


Satoshi Nakamoto's vision

Yes, we must follow the years-old posts by a mysterious cabal/entity/agency/deep one whose identity has never been proven and whom no one has ever met in person. He/it/them are good guys.

and from the reddit sticky banning XT discussion:

/r/Bitcoin[6] exists to serve Bitcoin. XT will, if/when its hardfork is activated, diverge from Bitcoin and create a separate network/currency. Therefore, it and services that support it should not be allowed on /r/Bitcoin[7] . In the extremely unlikely event that the vast majority of the Bitcoin economy switches to XT and there is a strong perception that XT is the true Bitcoin, then the situation will flip and we should allow only submissions related to XT. In that case, the definition of "Bitcoin" will have changed. It doesn't make sense to support two incompatible networks/currencies -- there's only one Bitcoin, and /r/Bitcoin[8] serves only Bitcoin.

This all reads less like a "constitutional crisis" to me and more like a "East-West Schism" to me. The parallels of bitcoin's development with religion cannot be overlooked.
posted by Karaage at 5:55 AM on August 19, 2015 [12 favorites]


Especially since as infighting over Bitcoin increases over time, the probability of someone getting nailed to something increases to 1.
posted by delfin at 6:11 AM on August 19, 2015 [3 favorites]


The "average consumer" does not care if bitcoin forks. Does not want to know. Does not care about technical details like that.

No, but they get very annoyed when they find out that "this" BitCoin is not good anymore, they need "that" BitCoin.

This, in fact, happens in the real world now. But at least with banknotes, you can take those banknotes to the central bank that declared that five pound note withdrawn and swap it for the new five pound notes, and you're only out the time it took to take the tube to Bank.

Which isn't that long if you're in Central London when that happens to you, like it did to me. Sucks if you're in Brighton, though.

It's even worse, though, when people *don't agree* which one is valid, because then you get the situation where you sell something for a BitCoin, and you have a possibly valid BitCoin to spend. Doubly so when bad actors realize this and start deliberately trying to spend BitCoins with multiple people, because if that works....whoo boy.
posted by eriko at 6:35 AM on August 19, 2015 [1 favorite]


Various reporters in the financial world have been pointing out that Bitcoin is nothing new in a monetary sense for a long time now, but Bitcoin devotees have been studiously ignoring them

I have heard, on good authority, that Bitcoin XTL is solving the trust problem by liinking cryptographically-signed transactions to actual pieces of valuable metal, stored at secure locations throughout the world. Breathtaking in vision and scope, a Brave New World. Trust problem solved.
posted by mrdaneri at 6:50 AM on August 19, 2015 [3 favorites]


fedora-based currency

Euphoricoin.
posted by Mr. Bad Example at 8:34 AM on August 19, 2015 [1 favorite]


"fedora-based currency"

really its about ethics in bitcoin mining
posted by klangklangston at 8:56 AM on August 19, 2015 [6 favorites]


Yes, we must follow the years-old posts by a mysterious cabal/entity/agency/deep one whose identity has never been proven and whom no one has ever met in person. He/it/them are good guys.

Never underestimate people's need to have a definitive central authority in order to feel they're starting from solid ground.

Unless of course you are the Bitcoin system itself, in which case feel free to assume that people will be perfectly comfortable with something that has no definitive central authority.

It is the yin and yang of digital currency.
posted by Tell Me No Lies at 9:38 AM on August 19, 2015


"From reading one (1) blog post about XT, I was all convinced. Then I read this seemingly-good argument against XT, and I was all convinced.

I am now educated and will have opinions on this in internet forums.
"

I have no dog in this hunt (aside from my nebulous goal to one day own one of each unit of cryptocurrency because I think they're neat) but that "argument against XT" is deeply flawed in dumb ways.

1) It uses a combination of slippery slope and straw man in pointing out that bitcoin protocol couldn't support all of the transactions of VISA — XT isn't trying to send the tb that VISA would need; the argument doesn't address the current proposal.

2) The idea that adding excess capacity could lead to more control by bad actors is nonsense when you think it through — the exact same arguments about caballing and barrier to entry apply to Bitcoin Classic too. (It's like arguing that printing money is bad because bad people could use the new dollars for bad things.) What it really reads as is someone who has made significant investment in current architecture trying to preserve their first-mover advantage to the detriment of expanding the system (big fish in a small pool).

3) The "lightning network" solution is vaporware.

Like I said, I think the whole thing is pretty silly. My hunch is that in five years or so, we'll see an entirely different cryptocurrency protocol that addresses a lot of these shortcomings.
posted by klangklangston at 9:45 AM on August 19, 2015 [1 favorite]


I think what we'll see within 5 years is a forward thinking central bank (Japan? Estonia?) integrate cryptocurrrency-like functionality (because all the fuss all along was really about customer service) and then there will be a radiant flash of white hot light, and every other cryptocurrency will instantly devalue to $0.00 (lacking nation-state backing).

In the end, the consumers win, we all get some better money, and I throw my BTC on the pile with my pets.com t-shirts. Life goes on.
posted by mrdaneri at 12:04 PM on August 19, 2015 [1 favorite]


Has anyone tried a renewable energy mining operation yet?
Or would they make more money by simply selling the energy they generate?
posted by fullerine at 1:54 PM on August 19, 2015 [1 favorite]


Oh and for more bitcoin lulz check out this article about a guy traveling around the world paying only in bitcoin, via the always excellent Matt Levine. The cringe is strong with this one.

Often three or four people gather to listen as he — usually — convinces someone to accept it as payment. Then he pulls out a selfie stick.
posted by pravit at 2:48 PM on August 19, 2015


Has anyone tried a renewable energy mining operation yet?
Or would they make more money by simply selling the energy they generate?


My solar array nets me 12.7cents per KW/h in offset electrical consumption, and only 3cents per KW/h for excess.

So, it would actually make far more sense to add panels to power a bitcoin mining array than it would to add panels to sell the excess.

It makes even more sense to add panels to power the hot tub, but we haven't got that installed. Yet.
posted by Pogo_Fuzzybutt at 2:59 PM on August 19, 2015 [1 favorite]


Having read Neal Stephenson I'm here to tell you that Bitcoin will not fail for any of your stated reasons, it will fail because it is not backed by a literal mountain full of gold in the Philippines.

(O hai is this the thread where people who don't normally discuss these topics show up and think we're the first ones to make jokes that any idiot could guess have already been made a thousand times in forums where they do always discuss them? Cause if it is I am so here.)
posted by George_Spiggott at 4:43 PM on August 19, 2015 [1 favorite]


You know, I wouldn't care one whippet about this if it weren't for the vast, seemingly inexhaustible arrogance of some people using the currency and who had nothing to do with its actual creation.
posted by newdaddy at 10:59 PM on August 18


You care about bitcoin because arrogant people use it? Wait until you hear about Saabs and coffee afficianados. You're going to have a meltdown.
posted by IAmBroom at 10:45 AM on August 20, 2015



So, anywhere selling short calls on bitcoin?
posted by klangklangston at 1:29 AM on August 19


Anyone selling, but not buying, is effectively making short calls. But if you're serious ... BitFinex does.

Be aware that this industry is more like the Wild Wild West than the NYSE, of course.

This article lists 5 ways to effectively short bitcoins.
posted by IAmBroom at 10:51 AM on August 20, 2015


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