Bitcoin discussion and news

[BigTom]

I can't quote this post properly apparently, I assume because the quoting is messed up in it so this snip isn't intended to cut out context or anything like that.

21 million bitcoins

Yeah, there's only 21m bitcoins, until the network gets forked and everyone gets their coins split and doubled.
I also don't understand why this is a good thing, it's just something that comes from the gold-standard ideology of the btc originators, along with the "mining" terminology. A fixed scarcity of supply is a good thing in an investment commodity, it doesn't seem like something that's especially valuable in a currency.

The amount of currency you need in an economy is massively dependent on the speed of circulation of that currency, looking at currency as a fixed/static entity just seems wrong to me, and btc has issues with varying transaction speeds (yes I know the lightning network is meant to resolve this). What if you need more than 21m coins to keep track of the transactions/wealth in an economy? Also, why 21m? What is it that has made that number the right number? What if it was 1m or 100m? Would that change things?

Also, what happens when all 21m coins are lost in dead hard drives and wallets locked behind forgotten passwords? It might take some time but eventually we'll get there. Do we reach a point where there aren't enough coins to make things workable? What happens when there is only 0.00000001 btc left in circulation?

Plus once there's no new coins to be mined the cost of transactions is going to shoot up because someone has to pay for the vast amounts of energy being used.

 

[kabbes]

^^That’s why it’s a shit currency but it doesn’t even begin to address the other gaps between currency and money, like what it needs in order to be a unit of account.

 

[kabbes]

Alright, let’s go through this again, q_w_e_r_t_y

Money has value because people decide it does. Why do they decide that £ has value?

Is it just inertia or tradition? No.

It’s fundamentally because the U.K. government insists as a condition of living in the U.K. that you pay up to 45% of your income to them in tax, you pay up to 20% of the cost of what you buy to them in tax, companies pay 10% of what they pay their employees in NI and companies pay up to 20% of their profits in tax. In £ terms, it adds up to the equivalent of about 100,000,000 hours of time at average wages every year. They then spend that tax on wages and infrastructure.

And they account for ALL of that in £. It doesn’t matter if you want to live your life in bitcoin. The U.K. government are still going to define your wages in £ and demand taxes in £. Companies are still going to have to produce accounts in £ and pay their taxes in £.

So £ has a tangible value, defined by the accounts of all the individuals and companies that are being forced to operate in it.

And then the people and companies the government employs are paid in £. This gives it tangible value too.

Since all aspects of our lives are governed in £, it make sense to stick with £ as our day to day unit of account too. Why don’t I use $ day to day? Because people don’t want to take it because the exchange rate risk would be a nightmare. And that’s for something stable and used globally for trillions of hours worth of work. What chance does bitcoin have of becoming the unit of account in the face of this? Why would I want to take on that exchange rate risk when my company pays me in £, I have to pay my taxes in £ and my goods are priced in £?

None of that equation is going to change so long as the state is the one providing the infrastructure and demanding payment for it. That’s why bitcoin is beloved of right-wing nut jobs — they don’t want to destroy capitalism, they want to destroy the state. They want uber-capitalism! And like the underpant gnomes, they think that through some magic undefined middle step, this medium of exchange will supplant all that accounting to get them there. Well it won’t, because it’s the state that makes money be money because the state IS the people. You can’t change that into some magic algorithm.

 

[littlebabyjesus]

Difference between symbolic thinking and magical thinking. Money symbolises the value of the work done by those paid in money. Nothing magical about that value. Bitcoin however does not symbolise the value of the mining in its price. The work done solving the algorithm has no value at all. It's a wholly boring uninteresting algorithm. This is where that 'turning energy into money' thing falls down. All you are doing is turning energy into heat.

It's only just really dawned on me that lots of people are making this false step, becoming actually convinced by this magical thinking.

 

[q_w_e_r_t_y]

Yeah, there's only 21m bitcoins, until the network gets forked and everyone gets their coins split and doubled.

Thats already happened multiple times, bitcoincash, bitcoin gold, bitcoin diamond are all forks from btc. There are still only 21m bitcoins running on the bitcoin chain.

The amount of currency you need in an economy is massively dependent on the speed of circulation of that currency.Also, what happens when all 21m coins are lost in dead hard drives and wallets locked behind forgotten passwords? It might take some time but eventually we'll get there. Do we reach a point where there aren't enough coins to make things workable? What happens when there is only 0.00000001 btc left in circulation?

Only because you cant spend less than 1p, and you need a physical product to exchange. But bitcoin is infinitely divisible, at the moment the smallest exchangable usit is a satoshi (0.00000001btc) so there are actually 2100 trillion units, but if that was all that was left, you could start exchanging in subsatoshi units (0.0000000000000000000001btc say)

What if you need more than 21m coins to keep track of the transactions/wealth in an economy? Also, why 21m? What is it that has made that number the right number? What if it was 1m or 100m? Would that change things?

Lots of people have speculated about why 21m. But Nakomoto never explained why - here's a couple of ideas
- 2100 trillion (no of satoshis) is approx equal to global M1 meausred in dollars.
- 2100 trillion is the maximum number that can be safely represented in 64 bit decimals without risk of rounding errors.

Depends how clever you think she is, I guess.

You can't separate bitcoin from blockchain but you can separate blockchain from bitcoin. If bitcoin dies, will the other applications for blockchain also die? I highly doubt it. The other blockchains are all also cryptocurrencies right now but smart contracts / public p2p ledger supply chain tracking and whatever else is being looked at for applications of blockchain in particular industries has no dependency on bitcoin and no real reason to use it when those supply chains are going to be using the standard banking system already.

If Bitcoin dies completely the only reason would be a problem in the cryptography behind it, that would make the whole of blockchain technology worthless. Its possible tho that another blockchain could act as the reserve currency tho, but I am doubtful...there will always be "a" bitcoin.

Please can you expand on this, sticking to the example you started about warehousing/logistics chains and payments.

Because *all* the tasks in a warefhouse can be distinguished, robots can be paid per task, but if you introduced that kind of piecemeal work for warehouse staff you would have a strike on your hands.

And there's an abundance of drug dealers and money launderers in the bitcoin scheme, but can I pay someone to walk my dog with it? Can I fuck!

Timebank running on the Achain is essentially a LETS scheme run through crypto, dogwalking has a perennial attraction whether the scheme is run manually or through crypto.

 

[binka]

Because *all* the tasks in a warefhouse can be distinguished, robots can be paid per task, but if you introduced that kind of piecemeal work for warehouse staff you would have a strike on your hands.

Why does it have to be blockchain to do that? I'm not really following why blockchain is superior to other solutions

 

[q_w_e_r_t_y]

Alright, let’s go through this again, q_w_e_r_t_y

Money has value because people decide it does. Why do they decide that £ has value?

Because they can exchange it for goods and services that they want.

It’s fundamentally because the U.K. government insists as a condition of living in the U.K. that you pay up to 45% of your income to them in tax, you pay up to 20% of the cost of what you buy to them in tax, companies pay 10% of what they pay their employees in NI and companies pay up to 20% of their profits in tax. In £ terms, it adds up to the equivalent of about 100,000,000 hours of time at average wages every year. They then spend that tax on wages and infrastructure.

And they account for ALL of that in £. It doesn’t matter if you want to live your life in bitcoin. The U.K. government are still going to define your wages in £ and demand taxes in £. Companies are still going to have to produce accounts in £ and pay their taxes in £.

So £ has a tangible value, defined by the accounts of all the individuals and companies that are being forced to operate in it.

And then the people and companies the government employs are paid in £. This gives it tangible value too.

Yup, thats what gives fiat its ultimate value for citizens. For a state tho, the value of its currency is determined in what borrowing conditions they have, which is again ultimately based on how confident the consensus is that a state will be able to raise the necessary tax to pay for the debt and interest. And this is literally killing us, as growth and monetisation becomes a necessary goal to keep the show on the road.

Since all aspects of our lives are governed in £, it make sense to stick with £ as our day to day unit of account too. Why don’t I use $ day to day? Because people don’t want to take it because the exchange rate risk would be a nightmare. And that’s for something stable and used globally for trillions of hours worth of work. What chance does bitcoin have of becoming the unit of account in the face of this? Why would I want to take on that exchange rate risk when my company pays me in £, I have to pay my taxes in £ and my goods are priced in £? None of that equation is going to change so long as the state is the one providing the infrastructure and demanding payment for it.

Our government is stable (hmm, remembers Teresa May} and counterfeiting is low.. That isnt the case everywhere, btc is becoming a hedge when instability in a country is high, so I expect to see crypto radiate out from developing nations, its a global movement.

That’s why bitcoin is beloved of right-wing nut jobs — they don’t want to destroy capitalism, they want to destroy the state. They want uber-capitalism! And like the underpant gnomes, they think that through some magic undefined middle step, this medium of exchange will supplant all that accounting to get them there. Well it won’t, because it’s the state that makes money be money because the state IS the people. You can’t change that into some magic algorithm.

Yes, right wing libertarians are all over this shit, so are the get rich quick crowd and the creepy nasty shadow elements of our society.

But I've lost faith in the state, and I think its part of the problem.[/quote]

 

[q_w_e_r_t_y]

Why does it have to be blockchain to do that? I'm not really following why blockchain is superior to other solutions

Because crypto is infinately divisible and transactions are virtually free.

 

[kabbes]

Sort your quote tags out, q_w_e_r_t_y

ETA: cheers

 

[binka]

Because crypto is infinately divisible and transactions are virtually free.

You haven't really explained why it has to be blockchain? Are you saying tasks in a logistics chain cannot be automated without blockchain? I'm trying to understand why it has to be blockchain, saying its infinitely divisible doesn't explain anything to me

 

[q_w_e_r_t_y]

You haven't really explained why it has to be blockchain? Are you saying tasks in a logistics chain cannot be automated without blockchain? I'm trying to understand why it has to be blockchain, saying its infinitely divisible doesn't explain anything to me

A company now, has to hire "large chunks" - a whole person, a whole machine, a whole warehouse. These can be semi-split down (part-time working, temp machine hire, shared space in a warehouse), but there is a limit to how much you can break that down. With crypto tiny micro level interactions are possible. So a warehouse robot can put things on the shelves for multiple companies who can expand and contract their storage space to react to the changing demand in real time, and be appropriately compensated at an agreed micro-piecemeal rate, through smart contracts it can also trigger additional piecemeal tasks, such as cleaning/repairs etc who can then be automatically commissioned and paid.

That's not possible when your smallest unit is 1p, service contracts have to be manually tracked and there is manual intervention required in accounting for transactions.

 

[binka]

A company now, has to hire "large chunks" - a whole person, a whole machine, a whole warehouse. These can be semi-split down (part-time working, temp machine hire, shared space in a warehouse), but there is a limit to how much you can break that down. With crypto tiny micro level interactions are possible. So a warehouse robot can put things on the shelves for multiple companies who can expand and contract their storage space to react to the changing demand in real time, and be appropriately compensated at an agreed micro-piecemeal rate, through smart contracts it can also trigger additional piecemeal tasks, such as cleaning/repairs etc who can then be automatically commissioned and paid.

That's not possible when your smallest unit is 1p, service contracts have to be manually tracked and there is manual intervention required in accounting for transactions.

Do you work in logistics?

 

[BigTom]

Thats already happened multiple times, bitcoincash, bitcoin gold, bitcoin diamond are all forks from btc. There are still only 21m bitcoins running on the bitcoin chain.


Only because you cant spend less than 1p, and you need a physical product to exchange. But bitcoin is infinitely divisible, at the moment the smallest exchangable usit is a satoshi (0.00000001btc) so there are actually 2100 trillion units, but if that was all that was left, you could start exchanging in subsatoshi units (0.0000000000000000000001btc say)


Lots of people have speculated about why 21m. But Nakomoto never explained why - here's a couple of ideas
- 2100 trillion (no of satoshis) is approx equal to global M1 meausred in dollars.
- 2100 trillion is the maximum number that can be safely represented in 64 bit decimals without risk of rounding errors.

Depends how clever you think she is, I guess.

So when you said:

Its money, and money is a special kind of commodity. Bitcoin "price" goes up and down relative to other types of money, but fiat is inflationary by design. Fiat money is created, loaned and interest charged, the money supply needs to expand to encompass that interest or there is default. Under bitcoin, money is created and paid for in energy (via mining rigs) with a supply where the increase exponentially declines to reach a final supply of 21 million.

I don't see how both can be true. If btc is infinitely divisible, there is no final supply of 21m because when you need some more, you just divide it to create more currency units. Which means it's not deflationary by virtue of having a fixed amount.

Of the explanations why, I find the second one most convincing, which begs the question - should we let the amount of money in our economy be defined by the current existing capabilities of our computing systems? Why is this seen as a virtue? It seems like a stupid thing to do to me.
And if the amount isn't really fixed because it's infinitely divisible, then why do people make a big thing out of it being fixed?

If Bitcoin dies completely the only reason would be a problem in the cryptography behind it, that would make the whole of blockchain technology worthless. Its possible tho that another blockchain could act as the reserve currency tho, but I am doubtful...there will always be "a" bitcoin.

Nah, the ongoing exit scams and similar can kill bitcoin. The currency is only secure against counterfeiting, not other scams. So if confidence goes, so will btc. In 2017 it was almost killed by the long transaction times and the fluctuation in price of btc is a real problem.
That you say there will always be a bitcoin says to me that you have bought into this ideologically, that the idea that it could fail because people don't want it is just not a possibility in your mind says a lot to me about how you are thinking about this.

Because *all* the tasks in a warefhouse can be distinguished, robots can be paid per task, but if you introduced that kind of piecemeal work for warehouse staff you would have a strike on your hands.

I might leave this bit of conversation to someone else but as has been said by other people, what about blockchain makes this special? You can keep track of all these things, stack them in a database. If for some reason you want units less than 1p you can do this, adding up all the tasks until you have something worth charging. I'd be extremely shocked if any company had business that was worth doing for less than 1p. How much warehouse space would that buy? How much electricity does the robot use to pick and pack, plus the capital and maintenance costs? Probably more than 1p to take anything on or off a shelf. The situation you are describing, I just can't see it in the real world - we've gradually been losing smaller units of currency because they aren't wanted. We lost the 1/2p a few decades back because it just wasn't useful enough to keep. I don't see the real world case for sub 1p transactions being needed, and if they are tracked like that, they'll be aggregated for charging purposes.

How much are transactions going to cost once the 21m btc are mined and everyone is paying the full cost of the energy use needed to process the transactions? Talk of virtually free is all well and good but right now it's being covered by the new coins being generated. That ends sometime. Also nobody seems to mention the fees you pay to turn £ into btc (and potentially back again).

 

[newbie]

Because crypto is infinately divisible and transactions are virtually free.

There's no fundamental reason why ordinary currency isn't divisible during electronic transactions. Never has been, when I was a kid you could get 4 chews for a penny in a sweet shop. Now you can buy 100 washers for 40p: each washer is worth rather less than a penny and could be accounted for using perfectly ordinary money, if anyone thought it worthwhile to do so. Fact is that currently a penny has such low purchasing power it wouldn't make any sense except in very limited circumstances. In the real world, micropayments of some tiny fraction of a penny would be absurd whether paid in sterling or btc.

But btc transactions are currently costing 405kWh each. That's about what my household uses in 3 months. So micropayments have a huge overhead if made with btc, and a much, much lower one if made using boring old mainstream tech that no-one claims is revolutionary.

I'm sure you've seen this before.

 

[kabbes]

Because they can exchange it for goods and services that they want.

They *know* they can exchange it and they know they will be able to do so tomorrow too

They know this because £ is the unit of account for the state. This is what gives it tangible value, not just symbolic value. It’s value is the value of the national output.

Bitcoin has none of this. It’s a symbol and that’s it. That’s why it can go from $20000 to $4000 in the blink of an eye (and how’s that for inflation?!)

Yup, thats what gives fiat its ultimate value for citizens. For a state tho, the value of its currency is determined in what borrowing conditions they have, which is again ultimately based on how confident the consensus is that a state will be able to raise the necessary tax to pay for the debt and interest. And this is literally killing us, as growth and monetisation becomes a necessary goal to keep the show on the road.

It’s not literally killing us.

In fact, state debt is a necessary feature for the stability of all kinds of financial services, such as pensions and insurance. The state mostly owes money to itself, in other words.

It’s also what provides a peg of risk-free rates against which other investment is assessed. It’s the lever used to be able to invest in physical capital now to pay off later.

Government debt is not a bad thing, in other words, and the belief that it is comes from a long misinformation exercise by the right wing

Our government is stable (hmm, remembers Teresa May} and counterfeiting is low.. That isnt the case everywhere, btc is becoming a hedge when instability in a country is high, so I expect to see crypto radiate out from developing nations, its a global movement.

When you’re expecting developing nations to lead the way in global finance, you know you’re on to a loser!

Yes, right wing libertarians are all over this shit, so are the get rich quick crowd and the creepy nasty shadow elements of our society.

But I've lost faith in the state, and I think its part of the problem.

Only the rightest of right wing think the answer is to privatise everything.

 

[q_w_e_r_t_y]

I don't see how both can be true. If btc is infinitely divisible, there is no final supply of 21m because when you need some more, you just divide it to create more currency units. Which means it's not deflationary by virtue of having a fixed amount.

Dividing something finite doesnt make more of it. If I have a block of cheese, I could go and buy another block of cheese and I would have 2 blocks of cheese, or I could divide it into two and I would still have the same amount of cheese. Thats how the supply is fixed, it can be divided infinately, but there can never be more.

Nah, the ongoing exit scams and similar can kill bitcoin. The currency is only secure against counterfeiting, not other scams. So if confidence goes, so will btc. In 2017 it was almost killed by the long transaction times and the fluctuation in price of btc is a real problem.
That you say there will always be a bitcoin says to me that you have bought into this ideologically, that the idea that it could fail because people don't want it is just not a possibility in your mind says a lot to me about how you are thinking about this.

I dont think it can fail anymore, it could once, but now crypto is far too widespread. People are scammed all the time in fiat currency, usually quite legally as well. Cashpoint charges, bank overdraft fees, checking charges, identity theft, financial abuse are all rife.

I might leave this bit of conversation to someone else but as has been said by other people, what about blockchain makes this special? You can keep track of all these things, stack them in a database. If for some reason you want units less than 1p you can do this, adding up all the tasks until you have something worth charging. I'd be extremely shocked if any company had business that was worth doing for less than 1p. How much warehouse space would that buy? How much electricity does the robot use to pick and pack, plus the capital and maintenance costs? Probably more than 1p to take anything on or off a shelf. The situation you are describing, I just can't see it in the real world - we've gradually been losing smaller units of currency because they aren't wanted. We lost the 1/2p a few decades back because it just wasn't useful enough to keep. I don't see the real world case for sub 1p transactions being needed, and if they are tracked like that, they'll be aggregated for charging purposes.

The 1/2p was discontinued because cost more to produce and handle than it was worth, that isnt the case in btc. Loads of companies have business worth doing for less than 1p, but it cant be tracked, so it is aggregated, handling spoilt oranges rather than fresh ones for example might take 0.0005p more in maintainance cost per orange, If a robot handles 10k oranges of which 300 are spoilt, it can receive an additional 15p for the labour. That seems ridiculous, because who would care about 15p in the grand scheme of things, but crypto breaks down that "grand scheme" into tiny micro interactions.

How much are transactions going to cost once the 21m btc are mined and everyone is paying the full cost of the energy use needed to process the transactions? Talk of virtually free is all well and good but right now it's being covered by the new coins being generated. That ends sometime. Also nobody seems to mention the fees you pay to turn £ into btc (and potentially back again).

Well, The way I see btc developing is as a settlement layer, with other cryptos having value against it. So you would only transact in bitcoin for the transactions that you needed to be super secure about, while with transactions you can take a level of risk with you would use an alt-coin, which would ultimately be measured against btc.

The fees for turning £ to btc is only relevant if you think £ have value and want £, if you want to transact purely through crypto, thats irrelevant. At the moment crypto is not widespread enough to go full crypto, but imho people will start to run duel economies, with pounds and crypto existing side by side for a while. Its a classic example of dual power and building the new society in the shell of the old.

There's no fundamental reason why ordinary currency isn't divisible during electronic transactions. Never has been, when I was a kid you could get 4 chews for a penny in a sweet shop. Now you can buy 100 washers for 40p: each washer is worth rather less than a penny and could be accounted for using perfectly ordinary money, if anyone thought it worthwhile to do so.

So I need a washer, I go to a hardware shop and there are 100 washers for 40p, but I only want one. Shopkeeper offers to sell me 10 for 4p, but I only want 1. Either he just tells me to take the washer, or he charges me 1p for it, or he could charge me 0.000001btc and get exactly the same rate for my washer than if he had sold me 40.

But btc transactions are currently costing 405kWh each. That's about what my household uses in 3 months. So micropayments have a huge overhead if made with btc, and a much, much lower one if made using boring old mainstream tech that no-one claims is revolutionary.

I

Not all transactions have to be on-chain, instead you can use the lightening network for extablished supply channels, or you can use alt-coins which have a proportionate transaction cost, some of which dont use Proof of Work mining (and therefore energy) at all, and exchange for BTC.

 

[littlebabyjesus]

Not got the energy to address all of this so I'll just take one issue - the one to do with endless growth.

In a system with loans at interest plus inflation, the money supply has to grow to keep overall value represented by it at the same level, but this is not the same thing as endless growth in real activity/consumption. That mistakes the symbol for that which is symbolised.

We actually see crises happening when returns drop and incentive to invest falls to a level where private businesses won't/can't borrow. This is an opportunity - an opportunity for the state to step in and borrow for investment and direct that investment to social good without a need for endless real growth to give profits - massive renewable energy infrastructure for instance. Where private won't borrow, public must, otherwise money is destroyed, deflation hits and an economy tanks. So much preferable that borrowing and the risks and stresses it involves should be done at the collective state level rather than the individual level. We've been moving away from that in the UK, saddling students with debts, increasing the size of mortgages etc, but it doesn't have to be that way.

It is interesting to me here to think about alternatives to monetisation. Communist command economies were one. No taxes as such, no personal debts, limited private property, no savings, wages representing only a small fraction of the real value of work and spent pretty much straight away, but various services either free or charged at a fraction of their real cost, little or no inflation in such a situation.

Not that such command economies didn't have their own drivers to excess and waste. They did - e.g. subsidised or free heating gives no incentive to do so efficiently.

As noted by previous posters, bitcoin represents the extreme polar opposite of the above situation. Everything is fully monetised as every transaction is fully privatised. It's crazy to think of that as solving the excesses of capitalism. It maximises those excesses.

 

[BigTom]

Dividing something finite doesnt make more of it. If I have a block of cheese, I could go and buy another block of cheese and I would have 2 blocks of cheese, or I could divide it into two and I would still have the same amount of cheese. Thats how the supply is fixed, it can be divided infinately, but there can never be more.

So what happens when all but 0.000000001 btc is lost in dead hard drives and lost wallets? You said more can be created by continually dividing it, but now you are saying there can't be more? I don't think it matters which way you do this. Before you had one unit of currency, but now you've split it and are using the split as the base unit, now you have two units of currency.
So the answer is the value of btc rises to account for the division but that means you have a layoff currency, which itself has to grow to match the increased value of btc. I don't think you can divorce btc from the system as a whole which may require increased amounts of currency if only to account for a growing population.

I dont think it can fail anymore, it could once, but now crypto is far too widespread. People are scammed all the time in fiat currency, usually quite legally as well. Cashpoint charges, bank overdraft fees, checking charges, identity theft, financial abuse are all rife.

I think this is the blindness of the true believer. Anything can fail. Crypto is far from widespread, there are a tiny number of actual transactions and loads of them may be totally fake by big holders playing the market. Everything other than identity theft and financial abuse is not the same kind of thing as exit scams we've seen from markets - ponzi schemes would be a better analogy.

The 1/2p was discontinued because cost more to produce and handle than it was worth, that isnt the case in btc. Loads of companies have business worth doing for less than 1p, but it cant be tracked, so it is aggregated, handling spoilt oranges rather than fresh ones for example might take 0.0005p more in maintainance cost per orange, If a robot handles 10k oranges of which 300 are spoilt, it can receive an additional 15p for the labour. That seems ridiculous, because who would care about 15p in the grand scheme of things, but crypto breaks down that "grand scheme" into tiny micro interactions.

Sorry but you'll need to explain your orange example to me - are you talking about a sorting robot clearing out spoilt oranges? You know they already do this with ripe/unripe tomatoes?
I dunno if spoilt oranges can be visually sorted in the same way but then I don't really know what your example is about. You've aggregated up to 15p in your example which can be handled with current, automatable, payment systems so why would a company setup a dual bitcoin payment system to do this?

Well, The way I see btc developing is as a settlement layer, with other cryptos having value against it. So you would only transact in bitcoin for the transactions that you needed to be super secure about, while with transactions you can take a level of risk with you would use an alt-coin, which would ultimately be measured against btc.

The fees for turning £ to btc is only relevant if you think £ have value and want £, if you want to transact purely through crypto, thats irrelevant. At the moment crypto is not widespread enough to go full crypto, but imho people will start to run duel economies, with pounds and crypto existing side by side for a while. Its a classic example of dual power and building the new society in the shell of the old.

So when you run out of enough btc to fund an economy, just add more currency in by creating new coins? How is this really different to adding in more of a government money? Like you continue to get transactions paid for from mining the new coin but now you are adding a load more currency into the economy? If the full environment of btc requires other currencies, crypto or not, then you can't consider it on its own, and in the full environment, the amount of currency is not fixed but grows by nature.

So I need a washer, I go to a hardware shop and there are 100 washers for 40p, but I only want one. Shopkeeper offers to sell me 10 for 4p, but I only want 1. Either he just tells me to take the washer, or he charges me 1p for it, or he could charge me 0.000001btc and get exactly the same rate for my washer than if he had sold me 40.

Except that it's not worth the cost in the shopkeeper's time to sell you one washer. It costs them more than the transaction makes so they won't make it. I mean the individual shopkeeper with a customer in front of them might but thinking about this in terms of large scale corporate logistics or other situations? No - it doesn't make sense, they would lose money on transactions that small jsut on the upkeep of the automated systems to run those things.[/quote]

 

[littlebabyjesus]

Even if it could work as a currency, which it can't, btc is an awful idea. And that's even before you consider the criminal energy waste. It has to rank among the very worst things ever invented.

 

[binka]

Loads of companies have business worth doing for less than 1p, but it cant be tracked, so it is aggregated, handling spoilt oranges rather than fresh ones for example might take 0.0005p more in maintainance cost per orange, If a robot handles 10k oranges of which 300 are spoilt, it can receive an additional 15p for the labour. That seems ridiculous, because who would care about 15p in the grand scheme of things, but crypto breaks down that "grand scheme" into tiny micro interactions.

Why do you need block chain for this? Why can't you aggregate 10,000 micro interactions and invoice them in one lot at the end of the month? I'm struggling to understand how this will revolutionise logistics

 

[newbie]

So I need a washer, I go to a hardware shop and there are 100 washers for 40p, but I only want one. Shopkeeper offers to sell me 10 for 4p, but I only want 1. Either he just tells me to take the washer, or he charges me 1p for it, or he could charge me 0.000001btc and get exactly the same rate for my washer than if he had sold me 40.

Don't be daft. No shopkeeper will make a profit selling without markup for a start but even then, National Minimum Wage is £7.83 per hour, 13.05p per minute, 0.2175p per second. So one washer costs (in bulk) less that 2 seconds of NMW time. It would be utterly absurd to trade over the counter like that. If your shopkeeper offers you 1 washer for less than, say, 20p they're not likely to be a shopkeeper for long.

If it's to be properly accounted for the 405kWh the bitcoin transaction costs will be charged at 12.37p per kWh or £50.1795. For one washer!

Slightly more plausibly your 3D print and assemble on demand facility might (possibly) consider it worthwhile to separately charge for each component. How invoicing for 0.4p would make any sense anywhere in the known universe is beyond me, but they might. And they can do so just as easily using conventional payments, and with far lower transaction cost overheads. The only difference is that the final bill will be rounded to the nearest penny rather than the nearest sartoshi. Big deal, so what, they're going to put 40% markup on anyway, and the rounding will still amount to trivia.

Just as the occasional petrol station that sells at 116.93 rather than everywhere else at 116.99 rounds the final result and nobody cares.

 

[newbie]

So I need a washer, I go to a hardware shop and there are 100 washers for 40p, but I only want one. Shopkeeper offers to sell me 10 for 4p, but I only want 1. Either he just tells me to take the washer, or he charges me 1p for it, or he could charge me 0.000001btc and get exactly the same rate for my washer than if he had sold me 40.

Don't be daft. Leaving aside markup, profitability and clear common sense all of which conspire to that washer costing 20p when you try to buy it individually, the bulk price 0.4p washer is worth less than 2 seconds of National Minimum Wage time. No-one will separately invoice for that, nor account for it through their system.

The nearest realworld use case is petrol stations charging 116.49 rather than 116.99 elsewhere. That ha'penny, that almost no-one cares about or is particularly influenced by (or more places would do it), adds up, of course for a full tank. But one litre in a can (as with one washer) will make such a trivial difference literally no-one will care.

Paid for by bitcoin the petrol or the single washer will both cost 405kWh at 12.39p per kWh or £50.1795. Note the 0.95 of a penny. You're wanting the 0.05p change and ignoring the fifty quid cost.

 

[binka]

Fwiw my previous job was as a logistics clerk in a warehouse for a third party logistics provider. We did warehousing for 7 different companies for products that came into us in bulk and went out either in bulk or individual drop ship orders. One of my jobs was to do the monthly invoice for our biggest customer where I charged them line by line for everything from checking goods in, putting away, picking and packing, despatching - probably about 20 diferrent charges in total some by piece rate, some by man hours, some fixed costs some variable etc. etc. So I was trying to understand how blockchain would fundamentaly change this and all I can see is that instead of 1 invoice per month there would be tens of thousands or millions of individual transactions... and that's progress is it?

 

[q_w_e_r_t_y]

I still think I'm talking at cross purposes here.

- human labour is becoming obsolete, there are very little tasks that a robot couldn't do better than an average human, that number is getting smaller by the day, and the technology cost of providing it lowering. Humans want things like breaks, workplace rights, they gossip, they shag their co-workers, they steal and they whistleblow. Robots do none of that.

- robots dont have a minimum wage. Yes, Mr Jenkins at your local hardware store isnt going to sell you a washer, but a vending machine could and blockchain means that resources - as represented by cryptocurrencies, can move in real time. No waiting to the end of the month to invoice, and invoice can be created as soon as consumption occurs to a very precise figure. As soon as that washer is sold from a vending machine, the materials and resources to create the next one can be procured, allowing a level of supply chain provision that makes JIT can only dream of.

- The command economy example is based on labour being divorced from survival. Basic needs are met, and labour is extracted through social and penal pressure. This will eventually have to happen with AI, because humans are becoming increasingly inefficient actors, but when labour can be completed by robots then the human's task is to create the value system that the robots operate on, and this is what cryptocurrencies are really about. What tasks do we - as a global society - wish to allocate resources to, and in which proportion.

- As for the whole deflation thing, I really dont know how to explain this further. There are, can and will only ever be 21m bitcoins. Just because it can be subdivided doesnt mean that it can be increased. If I have a £10 note in my wallet, I can swap that for 2 fivers or 1000x1p. But if I turn it into 1ps, the actual money hasnt increased, its still £10. If someone makes duplicates of all of my 1p coins, there is still only £10, if someone decides that each of the fake 1ps worth 0.1p, and I have a fiver, 400 1p and 1000 duplicate 1p coins, I still have £10.

 

[kabbes]

What you are talking about with AI is still a long, long way away. AI lacks intentionality, which limits it in so many ways compared with a human (such as being able to invent truly novel solutions), and it lacks an embodied self, which limits it in a bunch of other ways (such as understanding its place in the world). Its potential in automation is vast but it isn’t replacing humans any time soon, any more than calculators or desktops did.

 

[butchersapron]

The only amount of money that can ever exist in the world is that amount. You can divide it but it can only ever be that amount divided. Literally volume divided - no matter what nominal terms that you use to describe it. It can't be increased - because, guess what - it's all the same thing and doesn't exist anyway.

This is utterly bizarre stuff from someone who i last saw was a socialist.

 

[kabbes]

The existence of a Bitcoin is created by bitcoin miners, q_w_e_r_t_y

Who creates the existence of a £?

 

[q_w_e_r_t_y]

The only amount of money that can ever exist in the world is that amount. You can divide it but it can only ever be that amount divided. Literally volume divided - no matter what nominal terms that you use to describe it. It can't be increased - because, guess what - it's all the same thing and doesn't exist anyway.

Thats resources tho, not money. Because something can be monitised or not. Two mothers looking after their own children involves no money, two mothers working as a childminder where each of their children goes to the other is monetized. So money is increased as things are monetized, the way to increase money is to draw more activities into the money system, and this is economic growth, economic growth is A. Good. Thing...only its not because it creates all kinds of externalities, under crypto if you draw more activities into the money system, you are necessarily devaluing other activities, because the money is finite.

This is utterly bizarre stuff from someone who i last saw was a socialist.

Yes. I know, and its something that I;ve struggled with. I've read more marx in the last few years tho than I had in a decade, I still value him immensely, but he only had half the picture. Feminists have filled in the gaps around reproductive labour, and I've become a massive fan of Podolinsky.

I know I'm making a break from the traditional left, but what left is there these days?

Social democratic Keynesian economics, because in the long run we're all dead...only that long run isnt so far away now, we are facing the wipeout of humanity within the lifetimes of people who are alive today. I've hit serious climate grief over the past few years. Its really hit me that the world is actually dying and there is literally zero chance that we can stop with without radical change: legislation, regulations, state intervention are all toothless.

What you are talking about with AI is still a long, long way away. AI lacks intentionality, which limits it in so many ways compared with a human (such as being able to invent truly novel solutions), and it lacks an embodied self, which limits it in a bunch of other ways (such as understanding its place in the world). Its potential in automation is vast but it isn’t replacing humans any time soon, any more than calculators or desktops did.

I agree its not here yet, but I dont think its far away. Algorithms are taking over everywhere and thats only going to increase, of course there will still be some human intervention, but large industries can be automated in one fell swoop with tens of thousands of redundancies. Last year the WEF jobs report found that companies estimate that 71 percent of the total task hours are performed by humans and 29 percent are performed by machines. By 2022, companies predicted that humans would complete only 58 percent of total task hours and machines would complete 42 percent.[/quote][/QUOTE]

 

[binka]

- robots dont have a minimum wage. Yes, Mr Jenkins at your local hardware store isnt going to sell you a washer, but a vending machine could and blockchain means that resources - as represented by cryptocurrencies, can move in real time. No waiting to the end of the month to invoice, and invoice can be created as soon as consumption occurs to a very precise figure. As soon as that washer is sold from a vending machine, the materials and resources to create the next one can be procured, allowing a level of supply chain provision that makes JIT can only dream of.

But isn't one of the major problems with bitcoin the energy cost of processing each transaction?

And I'm still not sure why all this needs blockchain? Payments can be made virtually instantaneously already without blockchain. Many companies have integrated supply chains which shares information up and downstream for enterprise resource planning purposes without blockchain. None of this seems particularly revolutionary to me

 

[joustmaster]

On the way up

For now