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(I can't log into my venaoy HN account at the moment) > Spinning a lack of reversible transactions as being a "Benefit" is disingenuous I argue, through my ex

by venaoy_ 12y ago

(I can't log into my venaoy HN account at the moment) > Spinning a lack of reversible transactions as being a "Benefit" is disingenuous I argue, through my examples, that reversibility is often not as important as you may think. Another data point: I am a typical American consumer and in 20 years doing probably 5,000+ credit card transactions I have never had to issue a single chargeback at all. So I know for a fact that I would be willing to use Bitcoin for its advantages. Hell, credit card fees which are passed to customers by inflating prices by ~2% probably indirectly cost me north of $20,000 over my 20 years of use. I could have saved $20,000 and I would have been totally fine with the lack of reversibility of Bitcoin. Even if I end up being scammed one day by a non-reversible $1000 Bitcoin transaction, I would still be $19,000 financially ahead with Bitcoin. > I'm glad you found my story cute, but fail to see how pointing out imperfections in credit card insurance policies is supporting bitcoin, because bitcoin doesn't fill those imperfections I point out imperfections to show you that even an imperfect system such as credit cards manage to be reasonably successful. So Bitcoin is not perfect either but, similarly, this should not prevent it from being reasonably successful. > getting my account hacked on a bitcoin exchange Bitcoin hardware wallets have a huge potential to significantly increase security for consumers. > The entire world's supply of bitcoin is limited to 2.7 transactions a second Why do you present this as being a sort of fatal flaw? It's not. A block size increase will solve this. It was not done yet because it's not a problem yet: the average block size is currently still far below the 1MB limit. > I'm not even going to go into why you would compare Mt. Gox to Madoff. Madoff is an uninsured investor and in prison, Mt. Gox is an exchange and the thieves are where? I compare the two because both cases are a result of fraud and both cases were/are being investigated by authorities. (MtGox was not robbed, Mark Karpeles committed fraud -- see the willy report -- as a result Karpeles is currently under investigation by the Japanese authorities). You seem to be under the impression the government and authorities are ignoring Bitcoin fraud. They are not. In the US for example the S.E.C. recently prosecuted a Bitcoin ponzi scheme operator: http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370539730583#.VObB8k338yg http://www.sec.gov/News/PressRelease/Detail/PressRelease/137...

bduerst 12y ago
Those aren't examples, they're hypothetical stories created purposefully to support bitcoin, and border on No-True-Scotsman (A "true" payment system doesn't need dispute handling, so bitcoin is a true payment system). Pointing out imperfections in credit card insurance doesn't mean bitcoin will work. I'm sorry but even you have to realize this is not even a logical point you're making. Again, you completely missed the purpose of insurance. If your bitcoin hardware wallet is stolen, does it have insurance? Was any of the 4 exchanges hacked last week or Mt. Gox insured as your bank and payment processors are? Mt. Gox was not a ponzi scheme because it is not an investor - stop comparing it to one. >Why do you present 2.7 transactions a second as being a sort of fatal flaw? Because it is? Block size can't be increased because bitcoin is decentralized. Each miner, merchant, etc. are rational actors looking out for their own profit, and can't come to the required consensus on any changes (hence how centralized agnostic monetary controls work). It's one of the reasons other cryptocurrencies, with higher xfer rates, have a competitive edge on bitcoin. Bitcoin can not support more than a couple million users. Is this really news to you? Full disclaimer please: How much have you invested into bitcoin?
- venaoy_ 12y ago
  Coinbase's bitcoins are insured. And Coinbase's dollars are FDIC-insured. There is nothing inherent to Bitcoin that prevents an exchange from being operated responsibly and covered/insured just as well as traditional financial institutions. > Block size can't be increased because bitcoin is decentralized. It is not trivial, but it can be increased. What you don't understand is that all the merchants all the institutions all the individuals utilizing Bitcoins rely on its proper operation to benefit from it. If they more or less all agree that raising the block size is the obvious way to scale up, then they will agree to raise it. > Bitcoin can not support more than a couple million users. False. If the block size is increased, it can scale: https://en.bitcoin.it/wiki/Scalability https://en.bitcoin.it/wiki/Scalability I invested $0 in Bitcoin. But a coworker gave me 500 BTC for free in 2010 (I never sold any).
  - bduerst 12y ago
    Coinbase is insured by Aon for only if their entire site is hacked, and is not insured for individual accounts as the FDIC does, because it's too expensive (there's you're explanation on why). Because it's decentralized, Bitcoin suffers from Tragedy of the Commons. The miners, merchants, etc. are all rational actors looking to profit for themselves, even at each other's expense, which is why bitcoin can't get a census to upgrade. You may wish that they will come together under the banner of bitcoin benevolence, but they can't because they're too busy trying to make money off of each other and have competitive alternatives available. You can't hand wave and say at some point in the far future someone will solve these very real problems for bitcoin, because some very basic economic principles are stopping it right now. Considering you haven't even made a single bitcoin transaction, and didn't even know about the limits until today, you're not really qualified to comment on it. It's not a technical problem, but a problem with the design and the users - which was exactly what OP's point was to begin with.

by venaoy_ 12y ago

bduerst 12y ago

Those aren't examples, they're hypothetical stories created purposefully to support bitcoin, and border on No-True-Scotsman (A "true" payment system doesn't need dispute handling, so bitcoin is a true payment system). Pointing out imperfections in credit card insurance doesn't mean bitcoin will work. I'm sorry but even you have to realize this is not even a logical point you're making. Again, you completely missed the purpose of insurance. If your bitcoin hardware wallet is stolen, does it have insurance? Was any of the 4 exchanges hacked last week or Mt. Gox insured as your bank and payment processors are? Mt. Gox was not a ponzi scheme because it is not an investor - stop comparing it to one. >Why do you present 2.7 transactions a second as being a sort of fatal flaw? Because it is? Block size can't be increased because bitcoin is decentralized. Each miner, merchant, etc. are rational actors looking out for their own profit, and can't come to the required consensus on any changes (hence how centralized agnostic monetary controls work). It's one of the reasons other cryptocurrencies, with higher xfer rates, have a competitive edge on bitcoin. Bitcoin can not support more than a couple million users. Is this really news to you? Full disclaimer please: How much have you invested into bitcoin?

venaoy_ 12y ago
Coinbase's bitcoins are insured. And Coinbase's dollars are FDIC-insured. There is nothing inherent to Bitcoin that prevents an exchange from being operated responsibly and covered/insured just as well as traditional financial institutions. > Block size can't be increased because bitcoin is decentralized. It is not trivial, but it can be increased. What you don't understand is that all the merchants all the institutions all the individuals utilizing Bitcoins rely on its proper operation to benefit from it. If they more or less all agree that raising the block size is the obvious way to scale up, then they will agree to raise it. > Bitcoin can not support more than a couple million users. False. If the block size is increased, it can scale: https://en.bitcoin.it/wiki/Scalability https://en.bitcoin.it/wiki/Scalability I invested $0 in Bitcoin. But a coworker gave me 500 BTC for free in 2010 (I never sold any).
- bduerst 12y ago
  Coinbase is insured by Aon for only if their entire site is hacked, and is not insured for individual accounts as the FDIC does, because it's too expensive (there's you're explanation on why). Because it's decentralized, Bitcoin suffers from Tragedy of the Commons. The miners, merchants, etc. are all rational actors looking to profit for themselves, even at each other's expense, which is why bitcoin can't get a census to upgrade. You may wish that they will come together under the banner of bitcoin benevolence, but they can't because they're too busy trying to make money off of each other and have competitive alternatives available. You can't hand wave and say at some point in the far future someone will solve these very real problems for bitcoin, because some very basic economic principles are stopping it right now. Considering you haven't even made a single bitcoin transaction, and didn't even know about the limits until today, you're not really qualified to comment on it. It's not a technical problem, but a problem with the design and the users - which was exactly what OP's point was to begin with.