An insight on Bitcoin

[hellhamster]

tell me the uses?
standard databases will still always be better.

Standard databases have the problem of being centralised. They are exploitable and always leave openings for hacks, because simply put, they are not read-only. Plus, they can be as secure as the entity controlling them. This requires trust. Cryptocurrencies use a trustless, read-only ledger that can validate exchanges and movements of its assets through complex math problems. The only way to hack a cryptocurrency network is a 51% attack, which costs almost half a trillion dollars for bitcoin (for example) to execute. The only other method for crypto to be hacked is through the double spend problem, but so far it's been impossible to replicate.

The crypto hacks people are talking about here are merely exchange hacks, people putting their crypto in an exchange that uses SQL databases to store information.

Also, how many times have databases gone down due to power outages or whatever? How many times were you disconnected off Netflix because in Malaysia or wherever, the servers lost power. If outages take down a portion of bitcoin's hash rate because an area in Timbuktu went without power, the other 99% of the networked computers can take the load.

Cryptography is one of the most important sciences of the 21st century, cryptocurrencies are pioneers in that regard. The only way to break their cryptography through a blockchain is through a quantum computer, but by then the entire world would be fucked.

The next step is a decentralised internet. No more servers, just ledgers that use a portion of the computing power of your microchip devices. No more reliance on google and facebook, no more monopoly on information provided.

The future is now, old man.

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Wouldn't crypto have to scale up to handle those level of transactions that the "current system" processes on a daily basis? In the end if they had to handle the same number of transactions and associated data handling, they would then be using the same amount of electricity on top of mining that the "current system" does not utilize.

Bitcoin or any crypto is not more efficient at handling the transactions or data requirements that financial transactions require.

Bitcoin's network, which is the worst network out of all crypto's if you rate them by efficiency, is still scalable through the Lightning Network:

https://www.investopedia.com/terms/l...ng-network.asp

[Zan15]

Bitcoin's network, which is the worst network out of all crypto's if you rate them by efficiency, is still scalable through the Lightning Network:

https://www.investopedia.com/terms/l...ng-network.asp

Again, once you scaled up to the size of the current financial network needs would they not be using the same level of power on top of the power mining requires and the current financial system does not?

It's not like any of these crypto's figured out how to move less data and require less use have they? A transaction is a transaction?

Isn't it just replacing the millions of servers of the "current system" with millions of servers of cryptocurrency servers?

[hellhamster]

Again, once you scaled up to the size of the current financial network needs would they not be using the same level of power on top of the power mining requires and the current financial system does not?

It's not like any of these crypto's figured out how to move less data and require less use have they? A transaction is a transaction?

Isn't it just replacing the millions of servers of the "current system" with millions of servers of cryptocurrency servers?

I linked an article on the Lightning Network, maybe read into that.

"How the Lightning Network Works

Say Alice opens a channel with her favorite coffee shop and deposits $100 worth of bitcoin in it. Her transactions with the coffee shop are instant because she has a direct channel with it.

Bob, who has another channel open with the grocery store he visits most frequently, also buys coffee from Alice’s shop. The connection between Alice, the coffee shop, and Bob ensures that Alice can use funds from her balance with the coffee shop to buy groceries from Bob’s store. Similarly, Bob can use his grocery store balance to conduct transactions with businesses in Alice’s network.

If Bob closes his channel with the grocery store (and there are no other customers in common between the coffee shop and grocery store), then Alice will have to open another channel with the grocery store to make purchases there. In this way, a web of transactions is created and routed between multiple lightning nodes in a decentralized fashion.

On a more technical level, the lightning network uses smart contracts and multi-signature scripts to implement its vision. An initial transaction, called the funding transaction, is created when one or both parties fund a channel. In a typical multi-signature environment, two master keys (one public and another private) are initially exchanged. The exchange facilitates access and spending of funds.

In the case of a lightning node, however, the signatures are not exchanged. This is done to prevent the funding transactions’ spend from being recognized by the main blockchain. Instead, the two parties exchange a single key that is used to validate spending transactions (also called commitment transactions) between themselves.

The two parties can conduct endless commitment transactions between themselves and other nodes on a lightning network. They exchange their master keys only when the channel between them is closed."

Tldr, it scales.

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7% CPI for 2021. Not great, but certainly not terrible. Rate hike averted for now. Printer stays on so everything goes up.

[jonnysensible]

Heres another few points about the LN that people might want to know, how it going in el salvador?

1.No one knows how to make it scale well enough. For one thing, every significant payment must be broadcast to a large piece of the network.

2.Channel payments can be reversed. To prevent that, they put settlements (channel closures) on hold for a couple of days, during which time the other party can issue a "punishment transaction" that frustrates the fraud. But you must then sync and check the blockchain at least once a day; or pay a fee to a Watcher and tell him every payment that you do.

3. No one wants to guess what the network's topology will be. If it will be random, payment paths will need too many hops. If it will have a few large hubs, they will have incentives to centralize.

4. Like debit cards, users must lock bitcoins in advance in each channel, and then can spend only up to that amount before receiving payments back through that channel. Unlike debit cards, channels cannot be "topped up"; if one needs more funding, one must open a new channel.

5. Each channel costs two BTC confirmation fees (one to open, one to close). Gurus have been predicting fees up to $50 per transaction on the BTC network (as we saw during some backlogs). To make a good network, each user woudl need three channels on average. That is $300 fee (non-refundable) just to enter the system.

6. If you have $100 left in each of your three outgoing channels, you cannot make an LN payment for $101. You may be able to shift credit from one channel to another, but only up to the original funding.

7. In particular, large hubs will need to lock up lots of bitcoins of their own in their outgoing channels. For example, if a hub sits between 1000 consumers and 10 merchants, and each consumer locks $1000 in his channel to the hub, the hub may have to lock several million $ of its own in the channels to the merchants.

8. The LN assumes that the "LN economy" will be balanced at node level: namely, each user must spend through the LN precisely what it receives through the LN, over a sufficiently short time scale. In particular, if you earn $5000 every month through the LN, but only spend $2000 every month through it, your incoming channels will saturate after a couple of months.

9. The LN depends on users informing their state truthfully to many other users. It is not known how it will react to malicious or faulty nodes lying or failing to report about their status.

10. Payment paths are expected to have at least half a dozen hops in a modest-size network. Each intermediate node will charge a fee. The more hops a path has, the longer the payment will take, and the greater will be the chance that it will fail.

11, Largish hubs (processing tens of thousands of $ per month) will probably be considered money trnsmitting services. In that case they will need to comply with KYC/AML rules,

i dont know how i forgot about web3 which is the next grift after nfts.

[Edge-]

i dont know how i forgot about web3 which is the next grift after nfts.

I'm still trying to figure out what the fuck this even means since it seems like the folks talking about it keep saying different things and relying on a lotta buzzwords.

[kail]

But haven't exchanges and folks wallets and shit gotten cleaned out via hacks too? Like, isn't that part of what contributed to Mt. Gox declaring bankruptcy and shutting down and shit?

How would health records benefit from a blockchain though? Because everything you're showing as examples seems to work fine now without the need for costly, time consuming, wasteful blockchain validation which seems to offer little benefit beyond what we use now.

Are there issues with land deeds and birth certificates, in the US at least, getting forged left and right or altered without the owners knowledge or something? Seems like a lot of "solutions" to problems that don't really exist.

Someone's coinbase account can very well be hacked. Use 2FA, secure passwords, etc. or go hold the crypto offline. The actual ledger has no practical means of being "hacked" or manipulated.

[Zan15]

I linked an article on the Lightning Network, maybe read into that.

"How the Lightning Network Works

Say Alice opens a channel with her favorite coffee shop and deposits $100 worth of bitcoin in it. Her transactions with the coffee shop are instant because she has a direct channel with it.

Bob, who has another channel open with the grocery store he visits most frequently, also buys coffee from Alice’s shop. The connection between Alice, the coffee shop, and Bob ensures that Alice can use funds from her balance with the coffee shop to buy groceries from Bob’s store. Similarly, Bob can use his grocery store balance to conduct transactions with businesses in Alice’s network.

If Bob closes his channel with the grocery store (and there are no other customers in common between the coffee shop and grocery store), then Alice will have to open another channel with the grocery store to make purchases there. In this way, a web of transactions is created and routed between multiple lightning nodes in a decentralized fashion.

On a more technical level, the lightning network uses smart contracts and multi-signature scripts to implement its vision. An initial transaction, called the funding transaction, is created when one or both parties fund a channel. In a typical multi-signature environment, two master keys (one public and another private) are initially exchanged. The exchange facilitates access and spending of funds.

In the case of a lightning node, however, the signatures are not exchanged. This is done to prevent the funding transactions’ spend from being recognized by the main blockchain. Instead, the two parties exchange a single key that is used to validate spending transactions (also called commitment transactions) between themselves.

The two parties can conduct endless commitment transactions between themselves and other nodes on a lightning network. They exchange their master keys only when the channel between them is closed."

Tldr, it scales.



.

i read it and it still seems like you are just replacing one transaction system with another. Its just a fancier transaction system but it seems to use the same resources and will have the same reporting requirements as the current system. all this on top of mining power usage that the current transaction system does not have make it less efficient in the end.

i am not arguing it will not be able to scale up i am arguing the fact that it will be either equal in total consumption or greater than the current syste,

7% CPI for 2021. Not great, but certainly not terrible. Rate hike averted for now. Printer stays on so everything goes up.

7% is expected when you have 4.8% wage growth.

it really makes inflation not as big of a deal when you factor in the enormous wage growth.


Also what do we expect when you have this:

https://www.cnbc.com/2022/01/13/prof...ates-show.html

Profits for S&P 500 companies rose 22% in the fourth quarter and nearly 50% in 2021, estimates show\

Gee i wonder why inflation is so bad...while everyone is busy blaming Biden and Low wage workers asking for more money.

[hellhamster]

An excellent article on the stuff I've been ranting about for half a year about manipulated liquidation cascades that causes every single pump and dump/crash. This is more in depth and shows exactly how and why bitcoin price moves with such volatility.

https://www.singlelunch.com/2022/01/...-manipulation/

I might have gotten the Wyckoff timeframe wrong, a pump can now only occur when shorts are at a leveraged high. Can go either way if longs are highly leveraged, price will go down if that's the case. Right now they are pretty even.

Until one of them wins, I sleep. Ι still believe BTC will get nuked in the coming weeks, but everything just moves so slow.

[Edge-]

manipulated liquidation cascades

I swear, I've heard more jargon/buzzwords and phrases around crypto than I have any other newer industry/sector in recent years. But at least they're cool sounding.

[hellhamster]

I swear, I've heard more jargon/buzzwords and phrases around crypto than I have any other newer industry/sector in recent years. But at least they're cool sounding.

You don't know pipin'.

[Edge-]

You don't know pipin'.

My distaste for industry lingo is universal, especially for my own industry. It's almost all garbage gatekeeping that only makes any lick of sense when talking with others who are in the same industry and on the same page, and it just pointless nonsense outside those circles.

[gondrin]

i read it and it still seems like you are just replacing one transaction system with another. Its just a fancier transaction system but it seems to use the same resources and will have the same reporting requirements as the current system. all this on top of mining power usage that the current transaction system does not have make it less efficient in the end.

i am not arguing it will not be able to scale up i am arguing the fact that it will be either equal in total consumption or greater than the current syste,

Worse is the one they are proposing is literally more expensive than the ones the current processors use outside of some very large transactions. Worse is, at least for businesses, they have to pre-fund any transaction they anticipate they will have. I know of no businesses that can accurately predict even closely what their expenditures are outside of some static ones. I know of no business that will want to tie up that much currency in an account that they cannot use for anything else.

However, if you buy and sell goods, it is nearly impossible to predict how much inventory you will need to meet demand as those changes constantly.

[hellhamster]

All markets are taking a beating. Major players have started derisking, slowly at first, but will accelerate harshly once momentum of fearfulness increases. Unless the FED comes forward soon with assurances of not raising rates in 2022, prepare for a massive liquidity scare in the coming weeks or months. All on-risk assets like crypto will get absolutely obliterated. Not even gold and other precious metals will be safe. Crypto has become institution-driven in the last 2 years, which means price is not driven by fundamentals such as stock to flow anymore, but follows on-risk assets to the millimeter. It is still hugely driven by leveraged perpetuals, and it is still massively long despite 3 months of heavy downtrend. It is going to get very scary very quickly once real liquidations are starting to happen.

I predicted back in November this to be a FED power move to alleviate overheated markets with talks of rate hikes and tapering, so I anticipated this happening by Q3 2022 or later in a previous post, but I'm not so sure anymore. Job numbers right now are not great as they used to a few months ago, inflation is not moving parallel to wage growth, and the FED is now forced to do something to strengthen the dollar, which will decimate risky asset classes.

I can no longer predict what will happen, but I do know for sure to get the fuck out if you're relying on credit. Maybe this will be a 2020 COVID market crash followed by a quick bounce, maybe it will be a 3 to 10 year deflationary bear market a la Japan, maybe it will all blow over and the FED scared the market successfully by doing nothing. All scenarios are bad, but the hope for people still holding risky assets is the FED going for the lesser evil by putting the money printer back on and pumping inflation back up. However, the fear of a sell-off is already here among the big boys, and if they can't cheat or be the smartest boy in the room, they can absolutely make sure they are the first.

[ranzino]

BTC is below 40k now

[Grimbold21]

January sales

[Zan15]

BTC is below 40k now

still holding out for those 6 figure calls!!



A lot of the stupid money is now rushing to the next great grift.

[Forogil]

A lot of the stupid money is now rushing to the next great grift.

Is the next thing still NFTs, or is there something newer?

[Zan15]

Is the next thing still NFTs, or is there something newer?

i heard its selling farts in a jar.

https://www.rollingstone.com/culture...rview-1280395/

and fart in jar nft

https://gizmodo.com/tiktok-star-who-...ing-1848305521

[Edge-]

i heard its selling farts in a jar.

https://www.rollingstone.com/culture...rview-1280395/

and fart in jar nft

https://gizmodo.com/tiktok-star-who-...ing-1848305521

OH FUCK YES, GO GIRL! I've been hoping she'd figure out how to make a NFT off this for her own health.

But while Matto has semi-retired from the real-world fart jar business, she’s still pursuing the world of NFTs, where she sells cartoon images of her fart jars.

Too bad it sounds boring as hell : (

[Shadowferal]

Bit coin and farts...yeah, sounds about right.