7 ms·

- meaningless as currency: I am actually not sure how elegance plays into that at all, so I have no cute analogy to rpg's Unix/ITS system calls. The wasted comp

by kiba 15y ago

- meaningless as currency: I am actually not sure how elegance plays into that at all, so I have no cute analogy to rpg's Unix/ITS system calls. The wasted computing power is inherent to the system of avoiding double-spending (I also spent some time discussing this), but that's not related to Bitcoin being worthless or not as a currency. Any damn thing can be currency, after all; currencies are as currencies do. It would be great if tptacek actually explained what he means. It seems to be a muddled economic argument. I do not understand "meaningless as currencies goes".

tptacek 15y ago
In this comment I would like to propose "Flitcoin". Flitcoin is nearly identical to bitcoin, with exactly one difference. In Flitcoin, instead of brute forcing a nonce through SHA-256(x) to find hashes with a suitable prefix of 0's, Flitcoin brute forces a nonce through HMAC-SHA256("bananas", x) to find hashes with a suitable suffix of 1's. Please explain to me why my Flitcoin is inferior to your Bitcoin. As you do so, note that all the world's Bitcoin software is trivially upgradable to Flitcoin; in fact, it requires less than 10 lines of code to do so.
- icebraining 15y ago
  Bitcoin already has users and Flitcoin doesn't?
  - tptacek 15y ago
    So, marketing? Ok! I'll just run a 2-for-1 sale on Flitcoin. Less snarkily: why are people using Bitcoin? What's the intrinsic value they see in Bitcoin? Based on what evidence can they predict that Bitcoins purchased today will be convertible to gold, dollars, or even toenails at any valuation? You've begged the question.
    - browep 15y ago
      Here's a nice concrete example. You start a content/news blog/site. Instead of selling adspace you charge for your content by the pageview. Now how much are people willing to spend per pageview ? Probably not very much. Let's say < 1 cent. You start looking around for ways to charge people < 1 cent. Turns out it's ridiculous idea, no credit/online banking proposition is interested in < 1 cent transactions, it just doenst exist because of transactions costs. Hola Bitcoin. I can send you < 1 cent for every pageview I consume with 0 transaction costs. The tools to do this are currently in the pipeline or are really not that hard to devise. This is what bitcoin offers that others don't. Forget anonymity or libertarian arguments, 0 transaction costs are extremely disruptive.
      - tptacek 15y ago
        This is an application of Bitcoin. It says, "well, people want something that promises what Bitcoin promises; therefore, Bitcoin must be intrinsically valuable". But it's obvious why that isn't true. Flitcoin promises precisely the same things.
        browep 15y ago
        i'm not really worried about the intrinsic value of bitcoin, it goes up, it goes down, it doesn't matter. You don't have to store your wealth in bitcoin, USD goes in USD goes out when you want it to at usually 0.5% transaction cost ( or less some places ). And there's no reason Flitcoin can't succeed in the same places. I'm not sure why that would have anything to do with intrinsic value or why intrinsic value is of paramount importance.
        tptacek 15y ago
        In other words, you're content to ride out the "greater fool" theory, confident that you'll be able to jump out before the market spirals down to zero. And that's fine, but it doesn't address the question that roots this thread.
        browep 15y ago
    - icebraining 15y ago
      >You've begged the question. No, you just asked a different question. >What's the intrinsic value they see in Bitcoin? Well, free transfers, for one, and not being subject to having your money frozen by online payment companies (e.g. Paypal).
      - tptacek 15y ago
        "Free transfers" isn't an intrinsic value of Bitcoin. It's a benefit you get by supposing that Bitcoin has some intrinsic value. What's the intrinsic value? Why is Bitcoin unlikely to be worth $0 in 10 years? Because it is spectacularly unlikely that gold will be worth $0 in 10 years, and similarly unlikely that a dollar will be. Virtually any trader in the world would take the other side of that bet.
        icebraining 15y ago
        Let me preface this by saying that I'm very ignorant about this subject. >What's the intrinsic value? Why is Bitcoin unlikely to be worth $0 in 10 years? Why does a currency require a value as anything other than a currency to be expect to have value? Bitcoin offers a useful service. There's is no reason to believe this service will stop being useful in 10 years. Therefore, it's reasonable to expect a demand for Bitcoin in 10 years, making it worth more than $0. >Because it is spectacularly unlikely that gold will be worth $0 in 10 years Isn't most of gold's value based on its demand as a currency? If people stopped buying gold just to trade and store value, wouldn't current gold owners lose immensely?
    - intellection 15y ago
      Why are people using BitCoin? Language-seeking behavior, maybe. Conceptually understandable and highly desirable. BitCoin is in mind as word is bond|currency|techlogically valuable. An alternative value. People beg and question $, and given alternative, goldmind rush wins. Alternative values are worth risks. A bit of sense.
- nrp 15y ago
  Bitcoin has a long hash chain already in existence and a large amount of computing power currently lengthening it. Bitcoin may or may not be valuable, but the amount of total CPU time invested into it and the current rate of CPU use are criteria one can use to decide if one proof of work network is superior to another.
- a3_nm 15y ago
  In this comment I would like to propose "PTTH". PTTH is nearly identical to HTTP, except you replace all occurrences of "HTTP" in the protocol by "PTTH". Why is this inferior to HTTP? Why are people investing time and money to provide HTTP service and not PTTH service? You are right when you say that the artificially imposed scarcity on Bitcoins does not entail a scarcity on digital currencies in general, but, as it stands, your argument seems weird. Actually, I believe that Bitcoin's (possibly short-lived) fame has created some sort of value in the sense that there would probably be, for quite some time, people interested in hoarding Bitcoins just as a kind of souvenir ("hey, remember, people used to get excited over this"); not so with Flitcoin. I am not saying that this is something reasonable to base a currency on, just that it is wrong to assume that Bitcoin and Flitcoin are strictly equivalent.

by kiba 15y ago

tptacek 15y ago

In this comment I would like to propose "Flitcoin". Flitcoin is nearly identical to bitcoin, with exactly one difference. In Flitcoin, instead of brute forcing a nonce through SHA-256(x) to find hashes with a suitable prefix of 0's, Flitcoin brute forces a nonce through HMAC-SHA256("bananas", x) to find hashes with a suitable suffix of 1's. Please explain to me why my Flitcoin is inferior to your Bitcoin. As you do so, note that all the world's Bitcoin software is trivially upgradable to Flitcoin; in fact, it requires less than 10 lines of code to do so.

icebraining 15y ago
Bitcoin already has users and Flitcoin doesn't?
- tptacek 15y ago
  So, marketing? Ok! I'll just run a 2-for-1 sale on Flitcoin. Less snarkily: why are people using Bitcoin? What's the intrinsic value they see in Bitcoin? Based on what evidence can they predict that Bitcoins purchased today will be convertible to gold, dollars, or even toenails at any valuation? You've begged the question.
  - browep 15y ago
    Here's a nice concrete example. You start a content/news blog/site. Instead of selling adspace you charge for your content by the pageview. Now how much are people willing to spend per pageview ? Probably not very much. Let's say < 1 cent. You start looking around for ways to charge people < 1 cent. Turns out it's ridiculous idea, no credit/online banking proposition is interested in < 1 cent transactions, it just doenst exist because of transactions costs. Hola Bitcoin. I can send you < 1 cent for every pageview I consume with 0 transaction costs. The tools to do this are currently in the pipeline or are really not that hard to devise. This is what bitcoin offers that others don't. Forget anonymity or libertarian arguments, 0 transaction costs are extremely disruptive.
    - tptacek 15y ago
      This is an application of Bitcoin. It says, "well, people want something that promises what Bitcoin promises; therefore, Bitcoin must be intrinsically valuable". But it's obvious why that isn't true. Flitcoin promises precisely the same things.
      - browep 15y ago
        i'm not really worried about the intrinsic value of bitcoin, it goes up, it goes down, it doesn't matter. You don't have to store your wealth in bitcoin, USD goes in USD goes out when you want it to at usually 0.5% transaction cost ( or less some places ). And there's no reason Flitcoin can't succeed in the same places. I'm not sure why that would have anything to do with intrinsic value or why intrinsic value is of paramount importance.
        tptacek 15y ago
        In other words, you're content to ride out the "greater fool" theory, confident that you'll be able to jump out before the market spirals down to zero. And that's fine, but it doesn't address the question that roots this thread.
        browep 15y ago
  - icebraining 15y ago
    >You've begged the question. No, you just asked a different question. >What's the intrinsic value they see in Bitcoin? Well, free transfers, for one, and not being subject to having your money frozen by online payment companies (e.g. Paypal).
    - tptacek 15y ago
      "Free transfers" isn't an intrinsic value of Bitcoin. It's a benefit you get by supposing that Bitcoin has some intrinsic value. What's the intrinsic value? Why is Bitcoin unlikely to be worth $0 in 10 years? Because it is spectacularly unlikely that gold will be worth $0 in 10 years, and similarly unlikely that a dollar will be. Virtually any trader in the world would take the other side of that bet.
      - icebraining 15y ago
        Let me preface this by saying that I'm very ignorant about this subject. >What's the intrinsic value? Why is Bitcoin unlikely to be worth $0 in 10 years? Why does a currency require a value as anything other than a currency to be expect to have value? Bitcoin offers a useful service. There's is no reason to believe this service will stop being useful in 10 years. Therefore, it's reasonable to expect a demand for Bitcoin in 10 years, making it worth more than $0. >Because it is spectacularly unlikely that gold will be worth $0 in 10 years Isn't most of gold's value based on its demand as a currency? If people stopped buying gold just to trade and store value, wouldn't current gold owners lose immensely?
  - intellection 15y ago
    Why are people using BitCoin? Language-seeking behavior, maybe. Conceptually understandable and highly desirable. BitCoin is in mind as word is bond|currency|techlogically valuable. An alternative value. People beg and question $, and given alternative, goldmind rush wins. Alternative values are worth risks. A bit of sense.
nrp 15y ago
Bitcoin has a long hash chain already in existence and a large amount of computing power currently lengthening it. Bitcoin may or may not be valuable, but the amount of total CPU time invested into it and the current rate of CPU use are criteria one can use to decide if one proof of work network is superior to another.
a3_nm 15y ago
In this comment I would like to propose "PTTH". PTTH is nearly identical to HTTP, except you replace all occurrences of "HTTP" in the protocol by "PTTH". Why is this inferior to HTTP? Why are people investing time and money to provide HTTP service and not PTTH service? You are right when you say that the artificially imposed scarcity on Bitcoins does not entail a scarcity on digital currencies in general, but, as it stands, your argument seems weird. Actually, I believe that Bitcoin's (possibly short-lived) fame has created some sort of value in the sense that there would probably be, for quite some time, people interested in hoarding Bitcoins just as a kind of souvenir ("hey, remember, people used to get excited over this"); not so with Flitcoin. I am not saying that this is something reasonable to base a currency on, just that it is wrong to assume that Bitcoin and Flitcoin are strictly equivalent.