Posted on 12/29/2017 5:28:20 AM PST by Kaslin
And if you believe that I have some prime real estate in Florida I want to sell you.
Blockchain isn't going away, or the currencies based on it.
Blockchain is basically an accounting system that is completely transparent and (almost) impossible to forge because is it based on hashing (one-way encryption) and distributed across thousands of servers.
It could make government completely accountable. Anybody could audit it and trace where every penny came from and went to.
That's a game-changer when it comes to government ethics, which is an oxymoron.
It is proof-of-work. If there were not 8400 million trillion SHA256 hashes to be completed before the correct hash result is found, there would be no proof-of-work. You can do the hashes on paper, at approximately 0.67 hashes per day. Then it would take you only 12,000 million trillion days before you get the correct hash result. So instead they use highly parallel hardware hashing. When the correct hash is found, they do it all over again, from scratch. That happens every 10 minutes by design.
The reason there is such difficult proof-of-work is to prevent inflation. Because Bitcoin can't be arbitrarily inflated it has shot up in value. Some call it a bubble, but I'm not sure it is. It is artificially scarce, but mathematically designed to be artificially scarce unlike beanie babies. There is simply no way to produce extra to satisfy even a very weak demand.
Looking at the thin trading volume, one can only conclude there is weak demand. Why is the price so high? No supply. None of the dweebs who bought at $50 have any interest in selling. They don't need the money.
So tell me about your blockchain experience, since you seem to know everything about it.
That Bitcoin isn’t material is one of its best attributes. Millions in Bitcoin can walk through any metal detector. They can be sent to anywhere on the globe and it doesn’t ask for anybody’s permission. They’re impervious to flood or fire damage. Loomis isn’t needed nor are vaults. You can be rich in secret. And if you must have gold, BTC is becoming the most favored payment method.
Your Bitcoins Open to CIA and Criminals, Heed Wikileaks’ Warning
Sorry, I don't believe blockchain is by passing any Government entities, in fact quite the opposite, I believe they welcome the new set of spy glasses.
Think of Bitcoin as not only a currency, but also a way of processing financial transactions in a secure manner. When you do a financial transfer at the bank, it goes through a network of employees who earn a salary and computers owned by their respective banks. When you make a bitcoin transaction, the people aren’t necessary, but lots of computing power is. Instead of having centralized banks running that, the code is all open source and anyone with a computer can participate. ‘Mining’ is how they are paid for the use of their processor cycles in doing the necessary math to process each secure transaction.
I don’t think the article, the critics above, nor the fans quite get where there is value in bitcoin or crypto currency generally.
Let’s start with the math? The ‘point’ of the bitcoin is the block chain. The block chain is basically a big electronic ledger of transactions, same as a bank might keep for money or a company could keep for its inventory.
Two differences, both important:
1. The ledger (block chain) is centrally maintained (by bank, company in the above examples) but for crypto coins is not only decentralized but distributed.
This means that everyone has a copy so it’s very difficult to forge crypto coins; an attacker might spoof a record, or attack a node, but you’d need to attack *all* of them to change the record (or most of them, you get the idea).
2. We place a lot of responsibility and thus power centrally with banks to be able to track who gave what to whom and when. In cryptocoins, cryptography does this. Everyone on this thing has a private and a public key. If A sends to B, A encodes the send with his ‘private’ key; B knows it’s from A because he can verify using A’s public key. The big ledger keeps track, and so no one big authority is in charge, which means there isn’t a big boss to be corrupted.
The value is created because to do the transaction, a bunch of (integer) math needs to happen for all this sending and verifying and record keeping; and that value add is rewarded in the system by awarding (‘mining’) coins.
The thread correctly calls out that the diminishing returns are an issue, although not really yet as there’s plenty ‘left’ to ‘mine’ and computing power continues to grow.
The downsides, to me, are two:
1. Like what are called ‘fiat currencies’ bitcoins aren’t backed by anything; the ‘responsible neck’ can be a good thing, even if it’s not gold or silver but just the good faith and capability of a country. This makes the bitcoins inherently even more volatile than currencies.
2. Bitcoins are really only pseudo-anonymous. If I give you a dollar in person, unless someone’s diligently writing down the serial # of every bill and the name/ssn/dob of each of us (not), or there’s a video record, the transaction is anonymous. The ‘person’ or account of bitcoins is not uniquely associated with an individual, but the ID can be traced, and I’m sure people are diligently watching the flow of these transactions and working hard to find a way to tie accounts to people.
Maybe 2a: Perhaps ironically, the pseudo-anonymity is a lot stronger than moving regular money electronically, so a lot of use of bitcoin particularly is done by shady people in addition to lots of regular people.
Personally, as much as I wish I’d bought tons at 4 cents so I could sell now at ‘only’ $12k or whatever, I am not diving into BTC now, and I think it’ll crash. As a currency, it’s lacking, although I like it challenging the banisters so they will be forced to compete and reform.
However the use of block chain to provide decentralized, secure transmission of information has long-lasting promise. I can think of dozens of uses that aren’t money where I want to say something or send something and have have the recipient(s) know it’s from me, have a clear record that can’t be ruined, and not have to disclose a real space person or be doxxed (think of all the nice things that happen to vocal people in China, or even Google engineers that dare identify themselves with their thought)
Right, it's all based on faith, just like the fiat dollars people buy it with.
Millions in Bitcoin can walk through any metal detector.
Of course it can, any imaginary object can pass though a metal detector.
They can be sent to anywhere on the globe and it doesn’t ask for anybody’s permission
Unless the exchange shuts down. Which by coincidence when one exchange shuts down, they all shut down at the same time.
You can be rich in secret.
Bitcoin investors beware: The IRS wants its cut and you may not know it
Are people really comparing crypto-currency to gold? I guess it’s better than comparing it to tulips. Ok, then...gold hit $1,895 an oz. in 2011. Right now it’s $1,300. Also, how many people use gold as a currency? Financial institutions make enormous profits by electronically moving currencies. The future of financial transactions is being built on blockchain technology. Nobody knows for sure exactly where it will lead, but it certainly wont lead to people making billions of daily transactions with gold to buy tulips.
Crypto-currency I still have some poker chips left for sale reduced down to only $10,000 each get them while supply lasts.
No need to spread FUD. Some exchanges got slow in the large upticks, but they are stable most of the time now. But exchanges are for cashing out. The mining network never got slow, just expensive. So if you wanted to send Bitcoin to someone you always could and always will be able to.
Bitcoin investors beware: The IRS wants its cut and you may not know it
Yes, I know. I am paying long term capital gains to the IRS, but it is less than 1/4 of the profits. Not a bad problem to have.
Just looked it up. It appears that my long term cap gains rate is 15%. That would be awesome because I will get a big refund based on extra charitable donations I made anticipating a big capital gain.
Orly?
Because there's lots of prime real estate in Florida. It's a real thing with real value.
Now if you're offering to sell me a bridge, not so much...
It’s so funny that you say that, cuz that’s exactly what I did! On the good side, I got extremely lucky and bought across the board literally the same week that the DOW hit the bottom in 2009. I made $150k profit (which is actually not that good compared to where the market is now.)
actually the land I have in mind, contains neighbours with big teeth and powerful jaws.
I bought some BAC at 2 and change for myself, my wife and my brother. Sold mine and my wife’s at around eight. Let my brother’s shares ride!
I'm not convinced of that at all.
Yes, I know. I am paying long term capital gains to the IRS
Well, so much for getting rich in secret with bitcoin, that's all I was pointing out.
I am rich in secret. But when I want to cash in, it’s not going to be a secret. Either an exchange will probably report my sale into dollars, or a retailer that accepts bitcoin might. Either way I am better off reporting any realized profits. The long term cap gains tax is pretty low.
Bigger fool investing... sooner or later the bigger fool stops showing up.
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