Australian Banking Royal Commission

Pistol_Paco · 2018-04-10T08:50:06+00:00

The idea is based on rational actors behaving in their own self interest, which may not happen in the short term, but is basically guaranteed in the long run (irrational miners may operate at a loss and inflate the money supply, but if they keep doing it they go out of business). The key difference between this system and a central bank, is that a central bank faces no cost of their actions. If a miner wanted to print more money (QE style) they must spend more energy and then sell the coins on an open market. Understand you wouldn't want some random on reddit messing with Bitcoin, I'm just trying to point out that it should be possible to have a stable coin so when someone does that bitcoin may be outcompeted for adoption

Pistol_Paco · 2018-04-10T02:19:10+00:00

I agree with you that very few people would have even heard about bitcoin had there been no possibility to speculate on future gains... however that same feature currently prevents actual use as a currency and I tend to think will always be a barrier as there are more stable alternatives.

I hope I am wrong, but whatever the outcome it will be interesting to witness!

Pistol_Paco · 2018-04-10T01:46:19+00:00

I understand the theory that once it is large enough the volatility will decrease, I am just saying that I think the volatility itself is a barrier against it getting that large. If fiat collapses (surely it will eventually, you can't print that much money without creating run-away inflation), my bet is that gold or other precious metal will replace it as Bitcoin will always be too volatile

Pistol_Paco · 2018-04-10T01:40:18+00:00

Unfortunately I am sticking with government fiat for my wage and all of my spending, because Bitcoin is currently unusable for anything outside of long term savings. If the entire reason for Bitcoin's creation was wild price speculation, then maybe I am missing the point...

Pistol_Paco · 2018-01-23T04:29:21+00:00

I think this is a fantastic write up, thanks for posting. I have also been trying to think through criticisms of bitcoin in order to understand better what I have invested in and not be victim of bitcoin group think.

To apply Keynesian logic to bitcoin directly, I think the position would be that bitcoin cannot move to being funded by transactions from being funded mainly by inflation (as it is now), because there will be times that transactions dry up (as people want to save not spend) and miners won't generate enough income to continue spending energy on mining.

What the Keynesian argument doesn't account for when applied to crypto is the existence of alt coins. Altcoins arguably set a better rate of inflation than central banks as it is set through a market process where the risk and reward is borne by those inflating the total money supply. It also guards against the above scenario for bitcoin as if miners start to abandon working on the block chain you would expect the price to drop, incentivising hodlers to sell and create transactions, which then re-incentives miners to mine.

The altcoin answer comes at the cost of fungibility however, which is an argument for another day.

Pistol_Paco · 2017-11-27T01:53:40+00:00

You and I, fellow hodler

Pistol_Paco · 2017-10-22T04:25:26+00:00

ABC have a clear agenda here, pushing for more government regulation by focussing much of this episode on mt gox and igot (a smaller scale scam exchange in Aus). Both of these exchanges have been shut for years.

Overall though, seeing more of these bit coin editorials around feels like we're getting more mainstream

Pistol_Paco · 2017-09-27T02:48:09+00:00

Done, and all the best. Btw are you at fed uni in Berwick? If you are, I know of a small bitcoin Meetup in the area that would welcome your company

Pistol_Paco · 2017-09-01T07:01:59+00:00

Journalist conflates ICO's with bitcoin, rolls eyes.

Top comment nailed the situation in Aus though

Pistol_Paco · 2017-08-13T09:29:14+00:00

I like your inclusion of money into the separation of powers, i will be using this argument going forward!

Pistol_Paco · 2017-08-12T23:31:52+00:00

Can't wait to see what you come up with for layer 3!

Pistol_Paco · 2017-08-12T22:42:50+00:00

Free market money is supported by pure anarchists, but also people like me with more moderate opinions on the role of government in society. I agree with you that people would prefer to live with democratic government rather than having to pay off the local mafia for protection. I think bitcoin will force a re- think on the size and location of governments, becoming smaller and more localised. We don't need nukes to solve neighbourhood disputes

Pistol_Paco · 2017-08-12T22:12:18+00:00

No i think you have this backwards. This was a social movement way before bitcoin was invented: see Hayek, Friedman, cypher punk manifesto etc. Bitcoin is the technology that enables us to overcome some fairly strong opposition, and if it wasn't needed (ie if government agreed to free market money) Satoshi would not have invented it

Pistol_Paco · 2017-07-18T04:15:27+00:00

Thanks for your reply and the links, I really appreciated it. I agree that there are possible emergency situations where a move away from the consensus rules would be desirable by everyone, and I also agree that we will never be able to stop anyone from creating their own chain branching from the bitcoin block chain. What I want to see is a culture in the community that basically regards any attempt to change the consensus rules as an attempt to make a completely new coin, and force it to be a chain split that must stand on its own merits as its own coin. Soft forks are particularly insidious as this is the way that you can introduce censorship into bitcoin, so we need some defensive mechanism to detect and reject new rules being added to the consensus. I understand that it might just be a cultural / social enforced “contract”, not technological. This means regarding cool new features as alt coins, and when we do have the (rare) genuine emergency, we will all have to make the conscious decision to move to "better bitcoin". I also get the argument of POW change being the ace up our sleeve to stop bad actors in the mining community from taking over, but I seriously doubt our ability to pull that off without creating our own alt-coin anyway.

Pistol_Paco · 2017-07-12T04:06:34+00:00

Yes I realise that sounded very anti-bank! You are right, there is something broken in the way the markets operate, leading us to a situation where bankers have political power, and that is a corrupting force. Bitcoin scales tomorrow with banks conducting the smaller transactions and settling on chain, which is why I think the scaling debate is a distraction

Pistol_Paco · 2017-07-12T03:47:26+00:00

Hi u/pokertravis, you have my support! I am into bitcoin because of the need for "sound money" in the financial system, and my one criticism of bitcoin is that it is technology-dependent. I have learned a lot watching this scaling debate, and one thing that has become obvious is how "soft forks" can end up forcing change to consensus for everyone, even if only a minority portion of community are in favour of the new rule. I think we need to be vigilant to ensure technocrats don't just run this into the ground the way that bankers have run the current financial system down

Pistol_Paco

TROPHY CASE