Blockchain, Bitcoin, and other cryptocurrencies

[Idolater]

Wut

 

[Clete]

I've casually followed Bitcoin but recently I've tried to learn more about it. The current issue of Scientific American has a piece on it with some good information and decided to start a thread.

I have no desire to invest in Bitcoin at the moment because it's so unstable but it sounds like blockchain tech could have a major impact on the future of currency. One article I read said that MIT is working on a blockchain-based currency called Tradecoin. One key difference between it and Bitcoin is that it will be tied to real-world things which makes its value more stable. They envision it could be used by alliances of small countries, businesses, farmers, etc. I wonder if nations will begin converting their currency into crytpo-versions. Tunisia did it but they may be the only one so far. Governments are using blockchain tech for other purposes. Other governments are fighting against it, like China. They banned cryptocurrencies a few years ago and shut down all exchanges. It says the US is moving to regulate exchanges and initial offerings like they would a stock but I don't remembering hearing about that in the news.

A couple benefits are transparency and analysis. One author made the argument that a blockchain system would have allowed us to see early warnings signs much easier preceding the mortgage crisis a decade ago.

One concern is how opening identity is tied to the transactions. Right now cash is a way to still get some anonymity but an easy connection between your identity and your transactions could make you vulnerable.

Another thing I had never heard is that Bitcoin has a fixed supply. 21 million coins. I'd like to know more about that. How did it come to be fixed at that amount? Will it ever change?


So, what are your thoughts on this stuff? Do you own any Bitcoin? Are you considering investing? :greedy:

Is this the future of money?

Bitcoin and other "blockchain tech" is definitely not going to last. Certainly not in its current form anyway.

There was a NFT piece of art that sold for $69,000,000 that I have right now on my hard drive without having to pay a penny for it. All I did was download it. I'm talking about the full resolution image that I downloaded directly off the internet where it lives as an NFT, otherwise know as the "token URI". Downloading it wasn't illegal either! It not even encrypted! It lives on the public internet!

Put the following token URI into a browser that support the IPFS protocol and you can have it too!

ipfs://ipfs/QmPAg1mjxcEQPPtqsLoEcauVedaeMH81WXDPvPx3VC5zUz

Where did I get the token URI for a 69 million dollar piece of NFT art?

Off YouTube!

 

[annabenedetti]

Bitcoin 'rarely' used for legal transactions, on 'road to irrelevance', say European Central Bank​

The central bankers argue that bitcoin’s conceptual design and “technological shortcomings” make it “questionable” as a means of payment. “Real bitcoin transactions are cumbersome, slow and expensive. Bitcoin has never been used to any significant extent for legal real-world transactions,” they wrote.

Bitcoin also “does not generate cash flow (like real estate) or dividends (like equities), cannot be used productively (like commodities) or provide social benefits (like gold). The market valuation of bitcoin is therefore based purely on speculation,” they wrote.

 

[Idolater]

... conceptual design and “technological shortcomings” make it “questionable” as a means of payment.

How about as a means of voting? Does anybody know? Can blockchain tech be used to fight election fraud, stealing and irregularities? It's a public ledger, can a blockchain preserve everybody's vote perfectly, so there's never against ([sic]; "again") any disputes?

“Real bitcoin transactions are cumbersome, slow and expensive. Bitcoin has never been used to any significant extent for legal real-world transactions,” they wrote.

How about voting?

Bitcoin also “does not generate cash flow (like real estate) or dividends (like equities), cannot be used productively (like commodities) or provide social benefits (like gold). The market valuation of bitcoin is therefore based purely on speculation,” they wrote.

How about for voting?

 

[Clete]

How about as a means of voting? Does anybody know? Can blockchain tech be used to fight election fraud, stealing and irregularities? It's a public ledger, can a blockchain preserve everybody's vote perfectly, so there's never against any disputes?

How about voting?

How about for voting?

That's an interesting thought! The answer is that it very likely could do exactly that. The block chain system is quite good at ensuring that a particular digital item, whether it be a digital coin, piece of art work, or a vote, is completely unique and the fact that votes are counted very shortly after they're cast, there'd likely be insufficient time to "hack" the system in some way, assuming that such hacking was even possible in the first place.

However, such a system would only solve the issue of adding fake votes to the elections. I don't see how it could be used, by itself, to ensure that votes aren't cast for dead people, for non-citizens and others who are ineligible or that someone couldn't figure out a way to vote more than once. So it wouldn't be a magic bullet.

 

[annabenedetti]

How about as a means of voting? How about voting? How about for voting?

Apparently, no. No. No.

 

[Idolater]

Apparently, no. No. No.

Obviously blockchain tech's inventors knew plenty of computer science. They really could have used some political science though, because that tech if useless for currency and if useless for voting, is just, useless. It's sad, really. The whole world could stand some poli-sci /civics education. It would prevent huge embarrassing disasters from ever occurring.

 

[Clete]

Apparently, no. No. No.

“Best practices for internet voting are like best practices for drunk driving” – there’s no safe way to do either one."

I do not disagree with that point. I recant my earlier post.

 

[Idolater]

Obviously blockchain tech's inventors knew plenty of computer science. They really could have used some political science though, because that tech if useless for currency and if useless for voting, is just, useless. It's sad, really. The whole world could stand some poli-sci /civics education. It would prevent huge embarrassing disasters from ever occurring.

How about medical records? It's a much humbler application than money or voting, but maybe it's the right tech so you and all your doctors always know your record, and when it was changed, by whom, and for what reason? And it's only your property, not your doctors. The weaknesses in blockchain for elections and currency might not be as big a deal in personal medical records. [shrug]

 

[Clete]

How about medical records? It's a much humbler application than money or voting, but maybe it's the right tech so you and all your doctors always know your record, and when it was changed, by whom, and for what reason? And it's only your property, not your doctors. The weaknesses in blockchain for elections and currency might not be as big a deal in personal medical records. [shrug]

I don't think that block chain tech is nearly secure enough for people to be comfortable with it being used for personal information.

Remember that I have on my hard drive right now a piece of "art" that some idiot paid several million dollars for and I downloaded it entirely legally and without any "hacking" or anything else of the sort. It's just sitting there on the open web for anyone who knows how to find it to download for themselves.

 

[eider]

There are also some technological concerns. Obviously hacking, though Bitcoin has not been a victim to that yet.
Another concern is growing size. The way blockchain works requires each transaction to carry with it a copy of all that preceded it. Bitcoin is currently 130gbs. The idea behind blockchain is a distributed network but if the size becomes unmanageable then only supercomputers would be able to handle it. Some blockchains are doing a different method of validation that requires less computing power.

A very interesting OP. Thank you.
You are talking about big big value here, with huge investment, it seems.
Have you got advice for the small investor? I noticed that you haven't mentioned gold as an investment. In the UK there is no capital gains tax on gold British coins because these are still Brit currency. A £50 sovereign in 1999 is now worth about £400.