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It's not just that. By accepting bitcoin, even if you change them to USD right away, you run a currency risk if BTC suddenly loses value. Also, when is a BTC tr

by Kenji 11y ago

It's not just that. By accepting bitcoin, even if you change them to USD right away, you run a currency risk if BTC suddenly loses value. Also, when is a BTC transaction validated? Yeah, they have eventual consistency, but doublespending is actually possible. How long must the chain be after a transaction for it to be valid? These are nontrivial questions and tradeoffs that the store owner has to do about risks.

jsprogrammer 11y ago
Transactions are valid only when you trust you have the longest chain. If a longer chain comes along, you may abandon the shorter chain and believe the longer chain.
- Kenji 11y ago
  Exactly. But when do you trust you have the longest chain? It could be that by some stroke of misfortune or malicious manipulation, a shorter chain suddenly catches up. Is a chain that is 10 links longer safe? As I said - eventual consistency. But when is eventually? This is a real issue for BTC transaction validation.
  - jcoffland 11y ago
    If the senaro you describe were remotely possible BitCoin would not exist. A chain more than a couple of blocks behind has almost no chance of catching up unless over 50% of the hashing power consolidated on the shorter chain. Since miners automatically abandon short chains and it is in their best interest to do so this is extremely unlikely.
    - the_mitsuhiko 11y ago
      What if mining pools would deliberately hold back mint blocks until they find more? That way they could invalidate transactions if they like.
      - jsprogrammer 11y ago
        You can only hold a mint block until right before another block arrives. Once another block is known your mint block is garbage.
        the_mitsuhiko 11y ago
        > You can only hold a mint block until right before another block arrives. Once another block is known your mint block is garbage. What controls this?
        jsprogrammer 11y ago
        Each block must incorporate the hash from the previous block.
        the_mitsuhiko 11y ago
        So what stops you from mining ahead secretly?
        colejohnson66 11y ago
        My guess is the difficulty of making a block means it would take too long
        jsprogrammer 11y ago
        As colejohnson said, the difficulty. The network, as a whole, expects to generate 1 block approximately every 10 minutes. Someone with less than 50% of the network power will never be able to sustainably mint a longer chain of 'fake' blocks before someone else mints a legit one.
        the_mitsuhiko 11y ago
        > As colejohnson said, the difficulty. The network, as a whole, expects to generate 1 block approximately every 10 minutes. Someone with less than 50% of the network power will never be able to sustainably mint a longer chain of 'fake' blocks before someone else mints a legit one. If you look at the blocks mined you can see that there are plenty of mining groups that manage to mine consecutive blocks: https://blockchain.info/blocks https://blockchain.info/blocks
  - droffel 11y ago
    Usually, 1 confirmation is enough. 6 confirmations is considered enough for any amount. Most exchanges are comfortable with letting you use your coins in 2-3 confirmations, and they tend to be very high risk businesses in the space.

by Kenji 11y ago

jsprogrammer 11y ago

Transactions are valid only when you trust you have the longest chain. If a longer chain comes along, you may abandon the shorter chain and believe the longer chain.

Kenji 11y ago
Exactly. But when do you trust you have the longest chain? It could be that by some stroke of misfortune or malicious manipulation, a shorter chain suddenly catches up. Is a chain that is 10 links longer safe? As I said - eventual consistency. But when is eventually? This is a real issue for BTC transaction validation.
- jcoffland 11y ago
  If the senaro you describe were remotely possible BitCoin would not exist. A chain more than a couple of blocks behind has almost no chance of catching up unless over 50% of the hashing power consolidated on the shorter chain. Since miners automatically abandon short chains and it is in their best interest to do so this is extremely unlikely.
  - the_mitsuhiko 11y ago
    What if mining pools would deliberately hold back mint blocks until they find more? That way they could invalidate transactions if they like.
    - jsprogrammer 11y ago
      You can only hold a mint block until right before another block arrives. Once another block is known your mint block is garbage.
      - the_mitsuhiko 11y ago
        > You can only hold a mint block until right before another block arrives. Once another block is known your mint block is garbage. What controls this?
        jsprogrammer 11y ago
        Each block must incorporate the hash from the previous block.
        the_mitsuhiko 11y ago
        So what stops you from mining ahead secretly?
        colejohnson66 11y ago
        My guess is the difficulty of making a block means it would take too long
        jsprogrammer 11y ago
        As colejohnson said, the difficulty. The network, as a whole, expects to generate 1 block approximately every 10 minutes. Someone with less than 50% of the network power will never be able to sustainably mint a longer chain of 'fake' blocks before someone else mints a legit one.
        the_mitsuhiko 11y ago
        > As colejohnson said, the difficulty. The network, as a whole, expects to generate 1 block approximately every 10 minutes. Someone with less than 50% of the network power will never be able to sustainably mint a longer chain of 'fake' blocks before someone else mints a legit one. If you look at the blocks mined you can see that there are plenty of mining groups that manage to mine consecutive blocks: https://blockchain.info/blocks https://blockchain.info/blocks
- droffel 11y ago
  Usually, 1 confirmation is enough. 6 confirmations is considered enough for any amount. Most exchanges are comfortable with letting you use your coins in 2-3 confirmations, and they tend to be very high risk businesses in the space.