bit¢oin$

some guy posted this morning on reddit that he would pay 90.5btc (about 38K USD) to anyone who played a very bad magic card (seance) at the next magic pro tour. hearing that the price is spiking makes me even more eager to snap that offer up

Hoping there will be a mad mad mad mad world style celebrity-studded race to find the secret location of Kleinman's bitcoin keys.

lmaoo xp

*Kleiman's

that M:TG story is nuts. as an aside the last time I won a big tournament (~40 people) was with a Stanard deck centered on Seance. it was INSANE - probably the most accidentally powerful deck I've ever built, with lots of cool unintended synergy. sadly major pieces rotated shortly after!

Lamp do you play magic professionally

would be fun to rank all the craziest Bitcoin stories - I'd rank it something like

1. Silk Road
2. CARL MARK FORCE IV (in conjunction with #1?)
3. Mt. Gox
4. Newsweek blowing their story by "discovering" a 60-something train enthusiast who was not in fact Satoshi Nakamoto, but instead just a dude looking for a free lunch

yeah i mean the world of bitcoin itself is an extremely crazy story but a couple reclusive lunatic geniuses with sophomoric opinions about government/economics create a gigantic fortune just from basically an idea, like its virtuoso computer programing but its also m/l a total failure for its stated use its estimated that ~25% of all bitcoins have been lost and a ton more stolen, but people are extremely attracted to the idea, almost everyone fucking w bitcoin is doing it for ideological reasons, the rest are in it to buy drugs online which is a bad idea btw, then there are a handful of thinkfluencers/investors w free associative dreams of the blockchain dancing in their heads (tho many of these ppl have moved on by now), and the creator(s) fortune or at least a good chuck of it is just sitting there untouched, of course if they did try to sell much of it it wld destroy the value of the rest, also they were anonymous and very secrative for years, just so hella crazy cyberpunk lol someone shd write a scifi book about it except all the main facts are true

― lag∞n, Wednesday, December 9, 2015 12:35 PM (13 minutes ago) Bookmark Flag Post Permalink

not sure i get this post aside from "lol at some people who talk about or use bitcoin"

the only thing i really know about bitcoin is from reading this http://dealbook.nytimes.com/2014/01/21/why-bitcoin-matters/ by a guy who on the one hand said "people will feel naked without google glass" but on the other hand invented the program we are all using to talk to each other on his website. the arguments in it are really cool and interesting though IMO

Bitcoin is the first practical solution to a longstanding problem in computer science called the Byzantine Generals Problem. To quote from the original paper defining the B.G.P.: “Imagine a group of generals of the Byzantine army camped with their troops around an enemy city. Communicating only by messenger, the generals must agree upon a common battle plan. However, one or more of them may be traitors who will try to confuse the others. The problem is to find an algorithm to ensure that the loyal generals will reach agreement.”

More generally, the B.G.P. poses the question of how to establish trust between otherwise unrelated parties over an untrusted network like the Internet.

The practical consequence of solving this problem is that Bitcoin gives us, for the first time, a way for one Internet user to transfer a unique piece of digital property to another Internet user, such that the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer. The consequences of this breakthrough are hard to overstate.

What kinds of digital property might be transferred in this way? Think about digital signatures, digital contracts, digital keys (to physical locks, or to online lockers), digital ownership of physical assets such as cars and houses, digital stocks and bonds … and digital money.

All these are exchanged through a distributed network of trust that does not require or rely upon a central intermediary like a bank or broker. And all in a way where only the owner of an asset can send it, only the intended recipient can receive it, the asset can only exist in one place at a time, and everyone can validate transactions and ownership of all assets anytime they want.

How does this work?

Bitcoin is an Internet-wide distributed ledger. You buy into the ledger by purchasing one of a fixed number of slots, either with cash or by selling a product and service for Bitcoin. You sell out of the ledger by trading your Bitcoin to someone else who wants to buy into the ledger. Anyone in the world can buy into or sell out of the ledger any time they want – with no approval needed, and with no or very low fees. The Bitcoin “coins” themselves are simply slots in the ledger, analogous in some ways to seats on a stock exchange, except much more broadly applicable to real world transactions.

The Bitcoin ledger is a new kind of payment system. Anyone in the world can pay anyone else in the world any amount of value of Bitcoin by simply transferring ownership of the corresponding slot in the ledger. Put value in, transfer it, the recipient gets value out, no authorization required, and in many cases, no fees.

That last part is enormously important. Bitcoin is the first Internetwide payment system where transactions either happen with no fees or very low fees (down to fractions of pennies). Existing payment systems charge fees of about 2 to 3 percent – and that’s in the developed world. In lots of other places, there either are no modern payment systems or the rates are significantly higher. We’ll come back to that.

Bitcoin is a digital bearer instrument. It is a way to exchange money or assets between parties with no pre-existing trust: A string of numbers is sent over email or text message in the simplest case. The sender doesn’t need to know or trust the receiver or vice versa. Related, there are no chargebacks – this is the part that is literally like cash – if you have the money or the asset, you can pay with it; if you don’t, you can’t. This is brand new. This has never existed in digital form before.

Bitcoin is a digital currency, whose value is based directly on two things: use of the payment system today – volume and velocity of payments running through the ledger – and speculation on future use of the payment system. This is one part that is confusing people. It’s not as much that the Bitcoin currency has some arbitrary value and then people are trading with it; it’s more that people can trade with Bitcoin (anywhere, everywhere, with no fraud and no or very low fees) and as a result it has value.

It is perhaps true right at this moment that the value of Bitcoin currency is based more on speculation than actual payment volume, but it is equally true that that speculation is establishing a sufficiently high price for the currency that payments have become practically possible. The Bitcoin currency had to be worth something before it could bear any amount of real-world payment volume. This is the classic “chicken and egg” problem with new technology: new technology is not worth much until it’s worth a lot. And so the fact that Bitcoin has risen in value in part because of speculation is making the reality of its usefulness arrive much faster than it would have otherwise.

Critics of Bitcoin point to limited usage by ordinary consumers and merchants, but that same criticism was leveled against PCs and the Internet at the same stage. Every day, more and more consumers and merchants are buying, using and selling Bitcoin, all around the world. The overall numbers are still small, but they are growing quickly. And ease of use for all participants is rapidly increasing as Bitcoin tools and technologies are improved. Remember, it used to be technically challenging to even get on the Internet. Now it’s not.

The criticism that merchants will not accept Bitcoin because of its volatility is also incorrect. Bitcoin can be used entirely as a payment system; merchants do not need to hold any Bitcoin currency or be exposed to Bitcoin volatility at any time. Any consumer or merchant can trade in and out of Bitcoin and other currencies any time they want.

Why would any merchant – online or in the real world – want to accept Bitcoin as payment, given the currently small number of consumers who want to pay with it? My partner Chris Dixon recently gave this example:

“Let’s say you sell electronics online. Profit margins in those businesses are usually under 5 percent, which means conventional 2.5 percent payment fees consume half the margin. That’s money that could be reinvested in the business, passed back to consumers or taxed by the government. Of all of those choices, handing 2.5 percent to banks to move bits around the Internet is the worst possible choice. Another challenge merchants have with payments is accepting international payments. If you are wondering why your favorite product or service isn’t available in your country, the answer is often payments.”

I was about to say "Tim Berners-Lee?" but no it's good ol' egghead

not sure i get this post aside from "lol at some people who talk about or use bitcoin"

the only thing i really know about bitcoin is from reading this http://dealbook.nytimes

― flopson, Wednesday, December 9, 2015 1:01 PM (3 minutes ago) Bookmark Flag Post Permalink

these two events cld be... connected

The criticism that merchants will not accept Bitcoin because of its volatility is also incorrect. Bitcoin can be used entirely as a payment system; merchants do not need to hold any Bitcoin currency or be exposed to Bitcoin volatility at any time. Any consumer or merchant can trade in and out of Bitcoin and other currencies any time they want.

There has to be a very highly liquid market for bitcoin for this to work on a large scale though. If everyone just wants to use it as a payment system and no one as an actual currency, that's not gonna happen. Someone has to be left holding the bitcoin.

I mean, let's be real, egghead and his fellow student made a _better_ web browser, on time paid by federal funds, and his financial success was based on licensing that work and partnering with old Silicon Valley dudes.

It's a big fucking deal but most of his insights these days are pondering the decisions of other people and lecturing on twitter about how he's right about business ideas

I still think it's possible that the blockchain technology (or similar) will prove useful. Bitcoin as a widely used currency though, no way.

xp- but do u have an argument against it that isn't "ew people i don't like on twitter"? i can usually read your posts but i didn't get much from that one besides a vibe that it is uncool, and some of it got lost and stolen (i've heard this happens to money too), and someone owns a lot of it and if he sold it its value would go down. i demand quality blogging

I think bitcoin is very useful for ppl who need to do money laundering

let's not forget that egghead's company also gave millions of dollars to rap genius

to solve the byzantine generals annotation problem

Lamp do you play magic professionally

lol no but i do play tournament magic regularly

i love bitcoins, the whole weirdo culture of it, white nerds who moved to east asian after 9.11, all their battles with the us gov't. kinda love unregulated spaces tbh even though they mostly end up dominated by poorly socialzed white bros

i'm aware that marc and everything related to sillicon valley is uncool on twitter. i'm just curious to what yalls other arguments against bitcoins are cause i find that one boring and unconvincing. also i just looked up its volatility it's looking kinda stable now https://www.cbix.ca/volatility

xp yeah i totally love the mythos of it

but do u have an argument against it that isn't "ew people i don't like on twitter"?

― flopson, Wednesday, December 9, 2015 1:14 PM (1 minute ago) Bookmark Flag Post Permalink

that post is mostly about how the story is crazy and its underlying libertarian ideology with passing reference to more technical reasons how bitcion is bad tho it does contain a lot more substance on that level than u r giving it credit for, i have written a lot itt and the other thread abt why i think bitcoin is bad u cn read if u want, and i guarantee u if 25% of all government backed money was stolen it wld represent a global crisis and likely collapse of our monetary systems, on top of which bitcion has no insurance mechanisms in place to protect ppl from theft like if yr bank account gets hacked the bank will refund the money or if yr cc gets stolen u dont pay for that which allows ppl to have confidence in using our banking system, the fact that bitcion doesnt have these mechanisms in place is actually one of its big selling points particularly amongst the entrepreneurial segment who often make a cutting out the middle man argument for why bitcoin/blockchain can be more efficient, but of course the middlemen while charging a fee are also providing a service

ok i will read this thread i'm sorry

let's not forget that egghead's company also gave millions of dollars to rap genius

― iatee, Wednesday, December 9, 2015 1:21 PM (3 minutes ago) Bookmark Flag Post Permalink

as corny as the annotations are and as hateable as the founders are, genius is, kind of a good website?? *ducks under wall as brick flies over head* partic from a norm-internet perspective

I think bitcoin is very useful for ppl who need to do money laundering

― μpright mammal (mh), Wednesday, 9 December 2015 18:15 (14 minutes ago) Permalink

yeah or move money across borders, avoid taxes, etc. It's like diamonds you don't have to put in a suitcase.

flopson I usually appreciate your ilx contrarianism but I think you may have crossed a line

wld argue its not one of the better money laundering services considering every transaction is by nature public, the authorities just need to match a name to an account and theyve got u

ya i googled bitcoin laundering and it looks like lots of people got arrested for that

theres already a lot of great money laundering systems in place folks!

Andressen has two main points, which I think are strung together for terms of convenience.

The first is the idea that a secure, trust-oriented system of exchange is valuable for its lack of reliance on a "trusted authority" is useful -- no fees because it's a system of trust exchange, which I can in no way argue against. Ignore the "low fees" part though:

It’s not as much that the Bitcoin currency has some arbitrary value and then people are trading with it; it’s more that people can trade with Bitcoin (anywhere, everywhere, with no fraud and no or very low fees) and as a result it has value.

The second point is that fees and the lack of an international currency or unit of value is a hindrance to transactions. This is also very true! Our current banking transfer system is very broken, and relies on a bunch of outdated technology with limited trust and delays that are meant to somewhat mitigate that, but you still end up with tons of issues of liability, faked checks, transaction fees for payment processing, international trade fees.

Banks and credit card companies are finally getting around to addressing that issue through single-use codes generate by cards with chips in them, new financial companies that alleviate bank transfers by being trust providers (I have a few friends who work in that space), and bringing the infrastructure of financial trade up to modern-day standards instead of using hand-written slips of paper with magic ink on them.

At some point you need a trusted way to secure your things that are worth money. If you believe bitcoin has monetary value, the guy with the USB drive on him at all times is basically the equivalent of carrying all your savings around in a duffel bag wherever you go, with the caveat that all that value could disappear if you die and no one else has access to your encrypted files.

So you end up needing a trusted second party to do escrow for you, or set up a bitcoin payment terminal, or hold on to your keys in some way to ensure continuity of savings if anything happens to you. And we're back to having payment processors and banks.

Bitcoin is worth something as a unit of trust so its monetary value is based on:
- The idea that such a thing has an inherit worth due to scarcity and your ability to hold on to it
- Continuing real-life transactions where it's proven you can trade bitcoin for money, goods, or services

A handful of people tipping each other for witty comments on reddit or buying a few pieces of computer hardware isn't going to keep that second case going. But there are people who don't like traditional financial institutions who want to avoid traditional payment infrastructures who are willing to gamble in high-value transactions. And it's not because they want to avoid fees, it's because they want to stay under the radar.

the tension btw trying to prove yr some kind of new-millenium übermensch and build the infrastructure necessary for something like a widely usable currency is so fascinating. i think these ppl are too obsessed with autonomy to build things other than self-serving consumer products and all the failings of bitcoin uphold that. liberation through technology is some facile garbage really

otm

So you end up needing a trusted second party to do escrow for you, or set up a bitcoin payment terminal, or hold on to your keys in some way to ensure continuity of savings if anything happens to you. And we're back to having payment processors and banks.

otm

technology has probably already done 90% of the liberating it will do for us (until it annihilates us) whether or not bitcoin is part of the remaining 10%

proving ownership of large value assets right now is largely down to reliance on government and private infrastructure having electronic records, or in many places, a paper trail in a courthouse somewhere showing the chain of ownership of a house or business. having an actual key showing history and provenance would be good, but again, the authority to make such transfers would not be something your average homebuyer is going to do.

bitcoin is kind of silly as a day-to-day instrument of transaction because of its inherent scarcity, ensuring a constant rate of inflation even if it's used by the same people continuously

tl;dr if you thought the gold standard was bad, bitcoin is backed on the ability for it to be used for illegal commerce

one thing that interesting is bitcion is an open standard that the creators have actually managed to get directly rich off of

"the first practical solution to a longstanding problem in computer science called the Byzantine Generals Problem"

so much wrong with this sentence, from a technical standpoint.

explain?

one thing that interesting is bitcion is an open standard that the creators have actually managed to get directly rich off of

yeah but that one guy died w/ poop and bulletholes everywhere, seemingly in poverty, and the other one just got raided so who knows. it will be interesting to learn why they didn't actually seem to take/use the money.

brings us back to my original point: what a crazy story!

the one guy did use some of the money to found bitbusinesses fwiw

this is also why the idea of a "partial bitcoin" is completely bogus to me. you either have a bitcoin, or you don't. if you give someone a "partial bitcoin" you are relying on a second party, who actually holds a place in the blockchain, to reallocate value between you and someone else. there is absolutely nothing to stop them from saying "you never had anything" to you! you're putting your complete trust in that authority. and some of those authorities have had names like "magic the gathering online exchange"

the creators _may_ have gotten rich or will get rich, but again, it's predicated on an ability to trade bitcoin for cash or other things of value. remember:
- it's a "currency" based on scarcity
- your ownership is completely predicated on keeping some pieces of data safe

if they cashed out to someone else who is going to sit on it, then it probably wouldn't be a big hit to the system. if they cashed out by selling to a large number of people, then you'd have a huge deflation wave as there's no stabilizing force. i might be botching my economics there, but the ability to cash out is only possible if you can get someone to pay you the market rate.

fwiw i dont think bitcoins are bad, just a dead end.

technology has probably already done 90% of the liberating it will do for us

i mean... this is making me think abt zuckerbro proudly telling everyone he is donating his fortune to making humans better or w/e. the myth of man as autonomous actor in history &c &c. if anyone is writing abt this stuff srsly i wld like to read it - i feel like most takes on techbro culture are routinely dismissive or reductive or overly focused on technical stuff rather than like a big picture take

the two main cases for a large-scale cashout would be someone with a ton of cash who wants to set up a bitcoin bank (Marc Andreessen this is your big chance buddy!), or someone who wants to transfer a loooot of money under the radar, regularly, who also wants to keep the value afloat (do you like drugs?)

one wld think they cld cash out single digits millions a year w/o driving the price down too far

except that everyone is watching that one wallet and there might be some bizarre bitculture panic lol

technology has probably already done 90% of the liberating it will do for us

idk man I work in a field where scientific work that formerly took a ton of land and a bunch of seasonal workers (and was 60% effective) now takes a 40'x40' plot and a handful of employees and is over 90% effective, lots of gains yet to be made

yeah i personally think technology prob still has a ways to go

now if we cld just get to work on distributing the liberation a little a little more equitably

those seasonal workers need a universal basic income imo

yup

My favorite Krugman bitcoin takedown

http://krugman.blogs.nytimes.com/2013/04/12/adam-smith-hates-bitcoin/