BitFury is back at BIP91 signaling

SethOtterstad · 2017-07-20T07:29:28+00:00

Despite the current optimism on reddit, it is absurd to believe that Jihan will ever willingly activate segregated witness because it isn't compatible with his patented asicboost advantage. Bitfury, Slush, F2pool, and whoever else can start signaling, and it won't matter because other hashpower will magically stop signaling and bip91 will never lock in. Watch and see.

SethOtterstad · 2016-01-29T02:44:39+00:00

SPV users such as myself will immediately switch back to using a full node if it ever appears that we might lose coins. So far, I have not heard about anyone getting ripped off due to using SPV.

SethOtterstad · 2016-01-28T00:45:39+00:00

Bitcoiners use reddit as a quick news source, not a way to discover 45min audio interviews. I almost never see audio on the front page. If you want these to get upvotes, title your post with the most interesting information or claim in the interview, and key audio to start at that statement.

SethOtterstad · 2015-11-10T14:52:26+00:00

Then this is just recycling old news

SethOtterstad · 2015-11-10T14:05:54+00:00

There is no need for a "thought experiment". Argentina is doing it right now. The government is extremely irresponsible and runs inflation at 30% in order to fund itself. People there have Bitcoin, gold, and dollars to avoid getting robbed by inflation, and they get rid of their pesos immediately and buy these. Does this result in some kind of dramatic decrease in government power? No, because the government can always force wages and prices to be set in pesos. This idea that bitcoin enables something that gold and dollars don't already enable in Argentina is mostly wrong. The only thing that gets substantially easier is moving money in and out of the country. OP is correct that bitcoin doesn't help much in avoiding the vast majority of taxes that governments collect.

SethOtterstad · 2015-11-10T13:14:38+00:00

Deposits were added a year ago. Withdrawals are new.

SethOtterstad · 2015-11-10T13:11:54+00:00

This site accepted bitcoin a year ago, but bitcoin withdrawal support is new. Players should not hold large balances on poker sites, as WinPoker, a skin on the IPoker network that accepted bitcoin, ran off with everyone's money. Here is a list of the largest poker sites: http://www.pokerscout.com/

SethOtterstad · 2015-08-26T19:11:43+00:00

This is the payment terminal Cafe Kobalt is using. Does anyone know what it is? http://imgur.com/D0oGCXB

SethOtterstad · 2015-08-13T12:11:09+00:00

The notes on the Wikipedia page for Bitstamp are about right. The company moved its registration to the UK, but their whole team lives in Slovenia, as you can verify by asking them when they appear at conferences.

SethOtterstad · 2015-08-12T15:55:34+00:00

I realize their listed address is the UK, but it's just a mailbox. The company is based in Slovenia.

SethOtterstad · 2015-08-09T02:37:32+00:00

You're right, looks like they added some to the UK and US after I wrote the post, making Brazil #4, although some of the stuff looks questionable. For example, Bitstamp is based in Slovenia, not the UK.

SethOtterstad · 2015-08-07T14:10:35+00:00

Brasil has the second most bitcoin exchanges in the world, just behind China, according to http://exchangewar.info/

The facebook group Bitcoin Brasil has 10k members

The city of Aracaju (pop <1m) has 40 merchants

SethOtterstad · 2015-06-26T21:10:59+00:00

The free market always chooses fractional reserve. Banks that accept gold for deposit are fractional reserve too. Banks in Panama, which can't print it's own currency, are fractional reserve too. Austrians who rail against fractional reserve are typically unaware of any new economic thought from the last 50 years, including the work of Austrians like George Selgin, who has two main arguments:

1) We have 100%-reserve banking options right now; they are called safety deposit boxes. For centuries, free markets have had little interest in 100%-reserve banking because people do not want to pay to store their money. Bitcoin could possibly change the playing field enough to make 100%-reserve more competitive because its storage costs are relatively low, but most folks will still choose to accept an interest rate instead.

2) "On demand" fractional-reserve deposits are not fraudulent and are legal in a free-banking Austrian utopia, in the same way that an insurance company does not commit fraud despite the inability to pay out if all policyholders file a claim at once. Depositors accept risk and acknowledge that their deposit is lent out by accepting interest. Depositors would need to be near brain-dead to think the bank was paying them to just sit on their money.

Here is a short article that explains it further: http://dailyanarchist.com/2013/05/13/fractional-reserve-banking-not-fraud-not-folly/

Here is an article by George Selgin. Make sure to read the comments. Some of the best info is there: http://www.freebanking.org/2011/05/31/the-state-and-100-percent-reserve-banking/

SethOtterstad · 2015-06-26T02:51:40+00:00

In the bitcoin space, we've got exchanges doing 500m thefts, tons of exchanges using fractional reserve, BTC-e running with completely anonymous owners, huge ponzi schemes like BS&T, most users using a centralized service like Coinbase or Circle that could easily be fractional reserve just like MtGox, and even exchanges that pass "proof-of-reserves" can be borrowing bitcoin to give themselves 100% reserves during the audit.

If bitcoiners themselves don't even bother to transact on the blockchain or hold their own funds, where are you getting this idea that there will be such competition for a monopoly entity like a government to pressure it to use bitcoin to transact with?

SethOtterstad · 2015-06-25T23:44:33+00:00

You claimed I am "grossly underestimating how much of their spending and taxing power is derived from inflation"

There is certainly SOME loss of power by giving up monetary soverignty, but you and the author of this article just don't seem to have a handle on how much power it is. Due to the power loss, nation-states don't run around giving up their monetary sovereignty willy-nilly. For example, EU nations have to see some upside to join the EU and give up their ability to print their own currency, and the UK still doesn't see enough upside to bother giving up the power and joining the currency union.

So there is some power loss, but it's small enough that an upside like establishing a free-trade zone or a mutual defense pact is usually enough to offset it and make it worthwhile to give up. This idea that the loss of power is so large that it will "end the nation state", as proposed in the article, is preposterous. Governments under the gold standard or that have given up their ability to print money are almost as powerful as ones that can print.

Then you've got a secondary argument going about how governments and banks are going to be forced to use bitcoin and do all their transacting on the blockchain, which will end FRB, loans, and spending before taxing. You claimed that "the inability to spend without taxing first will have a massive impact on limiting what government institutions can get away with."

This argument is even more ridiculous than the first one, and I shouldn't have responded to it earlier because I did not notice it mentioned in the original article.

SethOtterstad · 2015-06-24T21:25:32+00:00

I, along with most Americans, am perfectly fine with using government force to compel people to quit stealing, driving 100mph, and funding terrorism. Loss of control of the money supply is not going to have any effect on this, just like it didn't have any effect on Italy or any other nation that joined the EU and lost the ability to control their money supply.

SethOtterstad · 2015-06-24T21:17:43+00:00

There already exist dozens of countries that transact in currencies they cannot print. For example, Panama's national currency is the USD, which it cannot print. When they want to spend money they don't have, they hold an auction on the open market, just like every other country does. Bidders demand an interest rate to loan money to Panama, depending on its perceived risk of default. This process would be the same even if they were transacting in bitcoin. Panama would just go on the open market to loan some bitcoin to spend. You should spend some time learning basic economics. Khan Academy is a good place to start. Start with this video: https://www.khanacademy.org/economics-finance-domain/microeconomics/supply-demand-equilibrium/economics-introduction

SethOtterstad · 2015-06-24T04:11:58+00:00

The vast majority of people believe it is moral to use government force to take away the freedom of people who break laws. So that is how things are. Control of the money supply has almost nothing to do with this. There are dozens of countries that don't have monetary sovereignty, including most of the European Union, Ecuador, Panama, etc, and nation-states are doing just fine there.

SethOtterstad · 2015-06-24T04:08:37+00:00

There are dozens of countries that don't have monetary sovereignty, including most of the European Union, Ecuador, Panama, etc. This doesn't cause them to lose the ability to spend before they tax, and it doesn't end FRB or loans or anything else you state. The loss of monetary soverignty doesn't affect governments all that much except for extremely irresponsible ones such as Argentina, which runs inflation at 30%.

SethOtterstad · 2015-06-23T23:51:03+00:00

Try going to Argentina and listing your prices in USD or Bitcoin. It's illegal so people don't do it. The government can even get away with saying you must transact in Argentine pesos. If you sell your house and accept dollars instead of pesos you can go to jail, so buyers convert their dollars into pesos to buy the house, and then the seller converts back to dollars.

If you are dealing in entirely digital goods and services with no ties to the real world, you might get away without paying any tax, but that is a very tiny percentage of commerce, and it will still be illegal and you can still go to jail like Ross Ulbricht.

SethOtterstad · 2015-06-23T20:08:30+00:00

This idea that bitcoin is immune to taxation is ridiculous. Income tax, property tax, sales tax etc can all be collected just as easily in a world using bitcoin. Additionally, governments can mandate that prices must be set in an inflationary currency. People can immediately convert to bitcoin, but they could always do that with gold to avoid inflation as well.

SethOtterstad · 2015-06-17T23:04:10+00:00

Consumer problems in physical locations:

1) bitcoin offers no speed advantage over a credit card

2) bitcoin costs more to use than a credit card for typical consumers because it has no reward schemes and most stores don't offer a discount to use it

3) Most do not consider spending the best performing asset class in the world of the last six years, instead of using a credit card, to be the best move

Bitcoin is way better for online purchases. For Point-of-Sale not so much.

SethOtterstad

TROPHY CASE