mfioretti: bitcoin*

Bookmarks on this page are managed by an admin user.

87 bookmark(s) - Sort by: Date ↓ / Title / Voting / - Bookmarks from other users for this tag

  1. The distributed, decentralized, public and open design of blockchains are inherently anti-authoritarian; espousing protopian dreams of a free and decentralized society. But we’ve been here before with the cyber-utopian idealists of the early internet and world wide web.
    https://medium.com/peerism/blockchain...orporate-business-models-3178998148ba
    Tags: , , by M. Fioretti (2018-03-28)
    Voting 0
  2. Regardless of the model, my point is that blockchain technologies cannot escape the problem of governance. Whether they recognize it or not, they face the same governance issues as conventional third-party enforcers. You can use technologies to potentially enhance the processes of governance (eg. transparency, online deliberation, e-voting), but you can’t engineer away governance as such. All this leads me to wonder how revolutionary blockchain technologies really are. If you still rely on a Board of Directors or similar body to make it work, how much has economic organization really changed?

    And this leads me to my final point, a provocation: once you address the problem of governance, you no longer need blockchain; you can just as well use conventional technology that assumes a trusted central party to enforce the rules, because you’re already trusting somebody (or some organization/process) to make the rules. I call this blockchain’s ‘governance paradox’: once you master it, you no longer need it. Indeed, R3’s design seems to have something called “uniqueness services”, which look a lot like trusted third-party enforcers (though this isn’t clear from the white paper). RSCoin likewise relies entirely on trusted third parties. The differences to conventional technology are no longer that apparent.

    Perhaps blockchain technologies can still deliver better technical performance, like better availability and data integrity. But it’s not clear to me what real changes to economic organization and power relations they could bring about. I’m very happy to be challenged on this, if you can point out a place in my reasoning where I’ve made an error. Understanding grows via debate. But for the time being, I can’t help but be very skeptical of the claims that blockchain will fundamentally transform the economy or government.

    The governance of DLTs is also examined in this report chapter that I coauthored earlier this year:
    https://www.oii.ox.ac.uk/blog/the-blo...ay-do-little-to-transform-the-economy
    Voting 0
  3. In short: there’s a lot of noise. But there is also signal. To find it, we need to start by defining cryptocurrency.

    Without a working definition we are lost. Most people arguing about cryptocurrencies are talking past each other because they don’t stop to ask the other side what they think cryptocurrencies are for.

    Here’s my definition: cryptocurrencies are a new asset class that enable decentralized applications.
    https://blog.chain.com/a-letter-to-jamie-dimon-de89d417cb80
    Voting 0
  4. The entire point of money is that it allows parties to transact without having to barter. But for money to have value, and to generate economies of scale, only so many currencies can operate at the same time.

    In the US, the reason we do not use euros or yen in addition to dollars is obvious: doing so would be pointless, and it would make the economy far less efficient. The idea that hundreds of cryptocurrencies could viably operate together not only contradicts the very concept of money; it is utterly idiotic.

    But so, too, is the idea that even a single cryptocurrency could substitute for fiat money. Cryptocurrencies have no intrinsic value, whereas fiat currencies certainly do, because they can be used to pay taxes. Fiat currencies are also protected from value debasement by central banks committed to price stability; and if a fiat currency loses credibility, as in some weak monetary systems with high inflation, it will be swapped out for more stable foreign fiat currencies or real assets.

    As it happens, Bitcoin’s supposed advantage is also its Achilles’s heel, because even if it actually did have a steady-state supply of 21 million units, that would disqualify it as a viable currency. Unless the supply of a currency tracks potential nominal GDP, prices will undergo deflation.

    That means if a steady-state supply of Bitcoin really did gradually replace a fiat currency, the price index of all goods and services would continuously fall. By extension, any nominal debt contract denominated in Bitcoin would rise in real value over time, leading to the kind of debt deflation that economist Irving Fisher believed precipitated the Great Depression. At the same time, nominal wages in Bitcoin would increase forever in real terms, regardless of productivity growth, adding further to the likelihood of an economic disaster.
    https://www.project-syndicate.org/com...s-a-bubble-by-nouriel-roubini-2018-01
    Voting 0
  5. A recent report suggests that at current prices, Bitcoin miners will consume an estimated 8.27 terawatt-hours per year. That might sound like a lot, but it’s actually less than an eighth of what U.S. data centers use, 1 and only about 0.21 percent of total U.S. consumption. It also compares favorably to the currencies and commodities that bitcoin could help replace: Global production of cash and coins consumes an estimated 11 terawatt-hours per year, while gold mining burns the equivalent of 132 terawatt-hours. And that doesn’t include armored trucks, bank vaults, security systems and such. So in the right context, bitcoin is positively green.
    https://www.bloomberg.com/view/articl...oin-is-greener-than-its-critics-think
    Voting 0
  6. L’indovinello ha le sue regole. Ogni blocco viene formato da un’insieme di informazioni che vengono scritte come puro testo, secondo un ordine e regole di composizione determinate. Una di queste informazioni è un insieme di caratteri che identifica univocamente il blocco precedente, calcolato matematicamente secondo una funzione precisa che si chiama “hash”. Questa funzione è particolare: restituisce sempre per ciascun blocco (può essere un file, ma non necessariamente) una e una sola “impronta”, una stringa di caratteri esadecimali (da zero a nove e da a ad f) di lunghezza predeterminata, qualunque sia la dimensione del file. Non solo. Qualsiasi modifica, anche infinitesimale al file, genera un’impronta completamente diversa.

    Un esempio chiarirà visivamente di cosa si tratta. Ad esempio, usando l’algoritmo SHA256, la frase:

    tanto va la gatta al lardo che ci lascia lo zampino

    genera un’impronta di hash (o semplicemente “hash”)

    7f14c0f5a28d9f014c8a4c69735ed27abe7f3b28af887367afade4e7138154fc

    Se uso la maiuscola all’inizio, e dunque

    Tanto va la gatta al lardo che ci lascia lo zampino

    ottengo:

    c61431b3b579ae2d97106ff8f7ab6aa46f9f4a41262da9c6c7fbfea7221e288a

    Predire come sarà un hash è dunque praticamente impossibile, perché ogni minima modifica del blocco originario genererà un hash completamente diverso. L’hash, in sé, non ci dà nessuna informazione su come sia il file che lo genera, né quanto è grande, né cosa contiene.

    Qui viene il puzzle. Come detto, non posso prevedere né forzare in maniera calcolabile come sarà l’impronta hash. Se chiedo che qualcuno mi dia un testo la cui impronta di hash contenga in qualsiasi posto due “a” consecutive, lui probabilmente prenderà blocchi arbitrari di testo fino a che non ne troverà per caso uno con due “a” consecutive: nell’esempio di sopra ci sono arrivato al secondo tentativo. Allora complico il problema: chiedo di trovare un blocco che abbia due “a” all’inizio dell’hash. Magari il candidato ne troverà uno dopo cento tentativi (16 al quadrato=256 combinazioni possibili). Se gli impongo di trovare un blocco che abbia sedici zeri (16 alla sedicesima = 1,844*10 alla diciannovesima combinazioni, ovvero circa diciottomila milioni di miliardi di combinazioni) ci metterà ben più di una vita. Anzi no, lo fa fare a computer superpotenti che lo faranno per lui, suddividendosi i compiti.

    Questo è in pratica l’indovinello: trovare un blocco che generi un hash che abbia un certo numero di zeri all’inizio e che contenga tra le altre cose l’impronta hash del blocco precedente. Una di queste informazioni è dunque disponibile solo a partire da un certo momento. Lo sparo dello starter può avvenire solo quando uno dei nodi ha immesso in rete la sua soluzione, e questa soluzione è accettabile. Da lì posso partire.

    Siccome l’algoritmo è fatto per generare un blocco in media ogni dieci minuti, ho solo dieci minuti per risolvere l’indovinello, il quale è già oggi estremamente difficile. E diventa sempre più difficile con l’aumentare della potenza di calcolo totale impiegata per risolverlo: se l’indovinello si dimostra troppo facile, automaticamente la difficoltà viene fatta aumentare (1).
    http://www.econopoly.ilsole24ore.com/2017/12/17/bitcoin-bolla-o-souffle
    Tags: , by M. Fioretti (2017-12-27)
    Voting 0
  7. Yaroufakis agrees that there are numerous design flaws with the currency. Not least, he adds, “the fact that there are no controls, no democratic checks and balances of a bit issue and no way of back-stopping financial transactions by means of some kind of insurance policy for those that get defrauded.” Yet his central criticism focuses upon what he refers to as “the fantasy of apolitical money.”

    To Varoufakis, money is inherently political. The decisions regarding whether money is produced or not, how it is distributed and who receives it, all have significant political consequences, benefiting certain social groups over others. Bitcoin’s central design feature, that it is not governed by a central bank or decision-making authority, means that responsibility for its distribution is forfeited. This can have profound social and political implications in times of crisis.

    To understand what Varoufakis means by the political nature of money, consider how governments respond to financial crises. When a major financial crisis occurs, it is usually caused by the failure of widespread and interconnected debts. Once these debts fail, what happens is that a large part of the money supply effectively disappears. With this money gone, governments have a choice whether to replace it or not. Choosing not to replace it through the creation of new money (inflation) becomes a political decision with political repercussions. As Varoufakis suggests, “effectively you are choosing to shift the burden of a crisis onto the debtors and usually the weakest and poorest of debtors. So effectively you are redistributing power and wealth against the weaker members of society.”

    If the decision is made to replenish the money supply, like it was in 2008 through Quantitative Easing (QE), then how this money is channeled through the economy will also influence the political economy. In Varoufakis’ opinion, QE was engineered in a way to benefit large corporations.
    https://www.wired.co.uk/article/yanis-varoufakis-bitcoin-bubble-interview
    Voting 0
  8. Right now BTC works like a foreign currency. The enormous sell off of dollars to buy BTC is best understood as a currency bubble. It’s not shares in a company: companies make things. As I’ve said before, the future is a foreign country, and it is also our largest trading partner. BTC is the national currency of The Future, and people are shorting the Present to buy the FutureCoin. (Throughout I’ll refer to BTC. I really mean “and all the other currencies.) People buying bitcoin are shorting status quo.

    But The Future shares a geography with The Present. The governments own The Present, and you can’t just open “The Future” right in the middle of their turf without a dialogue. But a lot of people with a lot of money are performing a great hedge against a dollar price collapse brought on by political factors — you can imagine what a Trump impeachment followed by insurrection in the South would do to bitcoin prices, can’t you? Well, so can other people: that’s part of the risk everybody is hedging by buying Bitcoin. But, right now, nothing is for sale in BTC other than other currencies, and a few share-like instruments in companies that aren’t actually doing any real trade yet. We have a huge slab of unhedged political risk tied up in our Future Coin holdings.
    https://medium.com/humanizing-the-sin...future-of-cryptocurrency-b99110480ff0
    Tags: by M. Fioretti (2017-12-16)
    Voting 0
  9. It’s a grassroots revolution led by people who want to take charge of their own financial future, people who know that lotteries and casinos are hopeless but didn’t had nowhere to go because they were too “small” for mainstream investment opportunities.
    https://decentralize.today/cryptocurr...are-not-the-real-problem-ccf4bf8da637
    Voting 0
  10. In a report last week, the cryptocurrency website Digiconomics said that worldwide bitcoin mining was using more electricity than Serbia. The country. Writing for Grist, Eric Holthaus calculated that by July 2019, the Bitcoin peer-to-peer network—remember BitTorrent? Like that—would require more electricity than all of the United States. And by November of 2020, it’d use more electricity than the entire world does today.

    That’s bad. It means Bitcoin emits the equivalent of 17.7 million tons of carbon dioxide every year, a big middle finger to Earth’s climate and anyone who enjoys things like coastlines, forests, and not dying of mosquito-borne diseases. Refracted through a different metaphor, the Bitcoin P2P network is essentially a distributed superintelligence utterly dedicated to generating bitcoins, so of course it wants to convert all the energy (and therefore matter) in the universe into bitcoin. That is literally its job. And if it has to recruit greedy nerds by paying them phantom value, well, OK. Unleash the hypnocurrency!

    The idea of bitcoin still has the whiff of genius—a digital currency as untraceable and trustworthy as cash, unfettered from nationality and physicality, with egalitarianism and access built into its philosophical and technical firmware. But the reality, exposed by bitcoin’s remarkable run-up in value over the last three months, is that the science may not hold together. Which isn’t to say people aren’t trying to fix it.

    The thing that makes Bitcoin bitcoiny is the blockchain, the secure ledger of all payments and trades. The point of the P2P bitcoin network is the generation and maintenance of that ledger, and technically anyone can contribute updates—those recordings of transactions are blocks in the chain. But there’s a catch. (This was the bit of genius in bitcoin inventor Satoshi Nakamoto’s pitch, whoever the almost certainly psuedonymous “Satoshi Nakamoto” is or are.) In order to contribute a block, you also have to solve some really hard math, a “hashing algorithm” called SHA-256.1

    Validate a bunch of transactions and do the math, and the system might choose your block to add to the chain; if it does, you win some bitcoin. That’s called mining, and the idea of imposing a cost to enter—that hashing math—is “proof of work.”
    https://www.wired.com/story/bitcoin-global-warming/?mbid=social_twitter
    Tags: , by M. Fioretti (2017-12-16)
    Voting 0

Top of the page

First / Previous / Next / Last / Page 1 of 9 Online Bookmarks of M. Fioretti: Tags: bitcoin

About - Propulsed by SemanticScuttle