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Tim Frazier

Cryptocurrency

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frak

The idea behind bitcoin and blockchain is how do we maintain assignment of property rights when we have zero trust in social institutions?  Can we substitute computing power and an algorithm for institutional trust?  If so, how?

 

So so I see bitcoin as a proof-of-concept.    The original paper is very readable and fascinating.  

 

Btw, I don’t “invest” in cryptos.

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1971snipe
3 hours ago, frak said:

The idea behind bitcoin and blockchain is how do we maintain assignment of property rights when we have zero trust in social institutions?  Can we substitute computing power and an algorithm for institutional trust?  If so, how?

 

So so I see bitcoin as a proof-of-concept.    The original paper is very readable and fascinating.  

 

Btw, I don’t “invest” in cryptos.

This is very likely a stupid question, but what exactly is being sold by Bitcoin?  Which social institution will we have zero trust in, and why will we trust Bitcoin instead?  

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SelbyLowndes

Crypto and blockchain connote crime and tax evasion for me.  Nothing behind it at all and no honor among thieves...SelbyLowndes 

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Longrifle
15 hours ago, 1971snipe said:

This is very likely a stupid question, but what exactly is being sold by Bitcoin?  Which social institution will we have zero trust in, and why will we trust Bitcoin instead?  

No expert here, but so far what I have learned evaluating this space is that they are not "selling" anything,  Bitcoin, and other digital currencies are a method of exchange.  The coins and the technology they transact across exist in a network of computers,  and can transmit data and store data, make and receive payments through digital contracts, in a distributed application.  Security depends on the ecoin and the exchange, but the best are very good.  Bitcoin itself only has value based on the adoption and use, trust and acceptance, i.e. the velocity of the currency.  Much like the value of the dollar can be measured in what other currency holders will exchange for it, so goes Bitcoin.  The use of the distributed technology and the applications of that are of great interest to me, the coin not so much. Technologies already exist to send data, store data, verify transactions, encrypt transactions, track transactions, verify customers and sellers, butto my knowledge, to date they are all separate systems, a stick of champagne glasses.  A Blockchain network does all that, in it's own mathematically backed currency. 

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Lurch

This whole thread reminds me of the Far Side cartoon showing what we say to dogs ("good girl, ginger, good dog!") and what dogs actually hear (" blah blah blah Ginger blah blah blah blah")

 

Not saying all your explainations aren't good, just that, well, I still don't get it - "it's not you, it's me"

 

And what's with the folks putting tons of servers in warehouses in rural america for "Bitcoin Mining"... if this stuff isn't real and doesn't exist, what are they mining with all this computing power?

 

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Speaks

I toyed with the idea but have not wanted to watch the markets close enough to get a good enough chance at a return. I feel I gamble less and will likely do better selling puts which is risky enough. That said I know some guys who accidentally made a bunch of money on it. If you buy at the right time and sell at the right time it can pay off much much higher than blue chip stocks, you pay for that potential return with risk. 

 

All that said some types of new investments can pay off, our current concept of common stock was created because Bell telephone could not raise sufficient capital through means available in the day so invented an entire new type of security and market for it. Those early stocks were the crazy new thing back then....

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Tim Frazier

So my take on this is that all currency is only worth what you can get for it.  It's no longer backed by gold or anything you can put your hands on.  So if I and a hundred friends decided we would use marbles to buy hunting gear from each other after assigning a value to the marbles than we would have currency, you could save marbles to buy nice guns and use fewer marbles for say shoes.  As long as everyone agreed it would be easy.

 

What Ripple has focused on (read this is my understanding) is the transfer of currency which is currently very slow.  Ripple would be a way to move money with the click of the keyboard, anywhere in the world and instantly.  It could then be saved by the end-user or cashed in for what ever currency was desired but the transaction itself would be seamless and instant.

 

So we will see.  I've lost 67 bucks so far...

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Longrifle
3 hours ago, Lurch said:

This whole thread reminds me of the Far Side cartoon showing what we say to dogs ("good girl, ginger, good dog!") and what dogs actually hear (" blah blah blah Ginger blah blah blah blah")

 

Not saying all your explainations aren't good, just that, well, I still don't get it - "it's not you, it's me"

 

And what's with the folks putting tons of servers in warehouses in rural america for "Bitcoin Mining"... if this stuff isn't real and doesn't exist, what are they mining with all this computing power?

 

The computer power is actually proofing the network, in transaction support, and being rewarded for renting said computing power. Being part of a blockchain network means you are allowing storage, flow and activity by outside trusted sources verified by the network.  If I allow my server farm to be utilized by the network, I get rewarded as the network "produces" or better said, unlocks the next block of coins.  The company I am working with sees the uses of the technology to put encrypted data on distributed applications (D-Apps) on patient's phones, and gather, transmit, store data, plus have the ability to transact across the network.  It's not new functionality, but new technology.

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Lurch

I'm nodding my head knownigly, but inside my brain is saying "Squirrel!!"

 

Guess I'll stick with something I understand better.... like women:(

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frak

I agree with LongRifle's discussion.

 

In the most extreme case, where everyone has read & write capabilities (and can, if they want to try) add fraudulent transactions (usually the so-called double-spend problem) the  blockchain architecture is the way of keeping this from happening. 

 

In high-trust networks, we don't need blockchains because institutions (e.g., government, banks, etc) sort out the good transactions from fraudulent.  In the no-trust blockchain world with no one to act as a gate-keeper to read & write privilege, security is provided by asking those who would add transaction records (and everyone gets the same stack of new records, with the fraudster trying to slip in his own transaction) to solve a difficult riddle (called the hash) is the way they randomize the winner to put a new block on the chain.  Since there is no way of predicting you will win, and since the riddle, by design, takes enough computing power for it to take time to solve, there will always be intermediate,newly-added transactions that you (the fraudster) would have to reverse out before adding the fraudulent transaction.  The bitcoin in this scenario compensates "miners" (those who would add new transaction blocks) for their computing power in solving the hash.  

 

A lot of institutions are interested in block chain in an intermediate world, such as a consortium.  Membership would be controlled, and this would get rid of universal read-write privileges.  Therefore you don't really need an overly-complex hashing problem or an incentive system (the bitcoin).  But you can use the blockchain so that everyone knows what is being transacted.  It may be useful in a lot of back-office consortium situations.  The jury is out on that, like a lot of things about crypto.

 

To my knowledge, there have been no successful attacks on blockchain, although there have been several notable attacks on the "wallets" that catalog transaction holdings.  The original paper recognized that (1) fraudulent transactions can be added if someone controls 51% of the hash-computing power; and (2) there are substantial scale economies to mining, which could lead to 51% consolidation.  So there is some long-run instability in the system that the big brains need to resolve.

 

Man, I can't believe i'm on UJ!  

 

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Clueless1
23 hours ago, Tim Frazier said:

So my take on this is that all currency is only worth what you can get for it.  It's no longer backed by gold or anything you can put your hands on.  So if I and a hundred friends decided we would use marbles to buy hunting gear from each other after assigning a value to the marbles than we would have currency, you could save marbles to buy nice guns and use fewer marbles for say shoes.  As long as everyone agreed it would be easy.

 

What Ripple has focused on (read this is my understanding) is the transfer of currency which is currently very slow.  Ripple would be a way to move money with the click of the keyboard, anywhere in the world and instantly.  It could then be saved by the end-user or cashed in for what ever currency was desired but the transaction itself would be seamless and instant.

 

So we will see.  I've lost 67 bucks so far...

 

Don't know much about this Bitcoin-y stuff but I have long since decided that Ripple is never a good idea for me. 

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Tim Frazier
35 minutes ago, Clueless1 said:

 

Don't know much about this Bitcoin-y stuff but I have long since decided that Ripple is never a good idea for me. 

Explain?  

 

I won't lie, not sure it was a good gamble but it is what it is.  From all I have read the volatility of it is probably it's undoing.  Other concerns seem less clear to me.

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Clueless1
42 minutes ago, Tim Frazier said:

Explain?  

 

I won't lie, not sure it was a good gamble but it is what it is.  From all I have read the volatility of it is probably it's undoing.  Other concerns seem less clear to me.

 

Was a cheap wine, easy to get for teenagers where I lived.

 

index.jpg

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Tim Frazier
10 minutes ago, Clueless1 said:

 

Was a cheap wine, easy to get for teenagers where I lived.

 

index.jpg

To funny...Boones Farm for me!

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1971snipe
On 10/1/2019 at 1:28 PM, Tim Frazier said:

Explain?  

 

I won't lie, not sure it was a good gamble but it is what it is.  From all I have read the volatility of it is probably it's undoing.  Other concerns seem less clear to me.

So, did you double your money this week?  I read that it took off again.   

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