Tag: #Cryptography

Bitcoin Quotes

Bitcoin Quotes from around the World

“Bitcoin actually has the balance

and incentives right, and that is why

it is starting to take off. “

Julian Assange

Bitcoin has the balance and incentives right

” It isn’t obvious that the world had to work this way.

But somehow the universe smiles on encryption.”

Julian Assange

The universe smiles on encryption

” The innovation is that BTC is hard to shut down. […]

Designed from the ground up to survive under the most adversarial conditions. “

Hasu

Bitcoin is hard to shut down

” Bitcoin is the most successful privacy coin to date. “

Pierre Rochard

Most successful privacy coin to date

” Bitcoin is a mathematical miracle. “

Steve Wozniak (Apple Co-Founder)

Mathematical miracle

” Bitcoin is a technological innovation that happens once a species. “

Trace Mayer

Technological innovation that happens once in a species

” Bitcoin doesn’t care about who you are or what your feelings are.

Bitcoin represents equal opportunity

to participate in a system

not encumbered by

our legacy fiat structures. “

White Rabbit

Participate in a system not encumbered by FIAT

” We’re here to unfuck the money and there’s no stopping us.

Fix the money,

change the world. “

White Rabbit

Fix the Money, Change the World

” Hardly anybody actually

understands money. “

Nick Szabo

Nobody understands money

” When you have a disruptive technology,

they call it a category killer.

Bitcoin is a serial killer –

it’s going to go through

40 or 50 different industries. “

Dan Morehead

Bitcoin is a serial killer

” It’s 21 million or death.”

Robert Breedlove

21 million or death

” It might make sense just to get some in case it catches on. “

Satoshi Nakamoto

In case it catches on

” Trusted third parties

are security holes. “

Nick Szabo

Trusted third parties

” There are only going to be

21 million coins,

there are billions of people

in the world, some reasonable percentage of who might

find it interesting to

own a piece of Bitcoin.”

Adam Back

21 Million Coins

” I think it’s essential for a program of this nature to be open source. “

Satoshi Nakamoto

Open Source

” SHA-256 is very strong. It’s not like the incremental step from MD5 to SHA1.

It can last several decades unless there’s some massive breakthrough attack. “

Satoshi Nakamoto

Sha-256

” Code mixed with robust game theory is superior to hierarchical command and control. “

ℭoinsure

Code superior to hierarchical command and control

” Given that money is one half of every commercial transaction and that whole civilizations literally rise and fall based on the quality of their money, we are talking about an awesome power, one that flies under the cover of night. “

Ron Paul

Money… an awesome power

” The world has to adapt to bitcoin, not the other way round. “

Herzmeister

The world has to adapt to bitcoin

” When I first bought bitcoin it took me two years of speculation to understand what Bitcoin really was.

But once I fully had a grasp of it, it was life altering. “

Russell Okung

Bitcoin is life altering

” Many countries stand to gain from Bitcoin’s adoption as it would remove their dependence on the US dollar and provide them with a feasible alternative. “

Misir Mahmudov

Bitcoin a feasible alternative to the US $

” Bitcoin is a optimist bet on the future, a bet on human ingenuity.

Gold is a pessimist bet on the past and, often a bet the end of civilization. “

Rodolfo Novak

Bitcoin a bet on Human Ingenuity

” Everyone has got to believe in something.

Why not believe in something verifiable and unforgeable. “

Hass McCook

Believe in something verifiable and unforgeable

” Open source software is a meritocracy of ideas, not of people.

So people are always talking about “Who controls Bitcoin?”

Good ideas control Bitcoin.

Not people.”

Ben Prentice

Good ideeas control Bitcoin

“Bitcoin is a seed of hope in a society which lost vision years ago and perspective just recently. “

Kim Neunert

Bitcoin a seed of hope

” Bitcoin has an inescapable, unavoidable, and omnipotent magnetism for the brightest and most revolutionary minds on the planet.

I’ve never witnessed anything like it. “

Brandon Bridge

Bitcoin’s magnetism

” This is why proof of work needs to be expensive, if it is cheap you can roll back things easily.

You want it to be very difficult to change history.

The only way to make it difficult to change history is to make the process of writing the current history very expensive. “

Jimmy Song

Difficult to change history

” Bitcoin is like gold but with this magical ability that you

can teleport it.”

Vijay Boyapati

Bitcoin magical ability to teleport it

” Can Bitcoin be stopped?

“Not really, this thing is a beast.

As Mises wrote:

Ideas can only be overcome by other ideas. “

Trace Mayer

Bitcoin cannot be stopped

“I’m not here to fix Bitcoin.”

Michael Saylor

Fix bitcoin

” Buying bitcoin is the most powerful protest an individual can make against the current economic system. “

Luc Dossis

Buying bitcoin is the most powerful protest

” These numbers have nothing to do with the technology of the devices; they are the maximums that thermodynamics will allow.

And they strongly imply that brute-force attacks against 256-bit keys will be infeasible until computers are built from something other than matter and occupy something other than space. “

Bruce Schneier

Maximums that thermodynamics will allow

” Cryptocurrency is such a powerful concept that it can almost

overturn governments. “

Charles Lee

Cryptocurrency can almost overturn governments

” Bitcoin will do to banks what email did to the postal industry. “

Rick Falkvinge

Bitcoin is the email for the postal industry

” I do think Bitcoin is the first [encrypted money] that has the potential to do something like change the world. “

Peter Thiel

Bitcoin has the potential to change the world

” Bitcoin is the most important invention in the history of the world since the Internet. “

Roger Ver

Bitcoin the most important invention in the history since the Internet

” Gold is a great way to preserve wealth, but it is hard to move around. You do need some kind of alternative and Bitcoin fits the bill. “

Jim Rickards

Bitcoin fits the bill as a way to preserve wealth

” You can’t stop things like Bitcoin.

It will be everywhere and the world will have to readjust.

World governments will have to readjust. “

John McAfee

Bitcoin will be everywhere and the world will have to readjust

” I think the fact that within the bitcoin universe an algorithm replaces the function of the government… is actually pretty cool. “

Al Gore

An algorithm replaces the function of government

“People have made fortunes off Bitcoin, some have lost money.

It is volatile, but people make money off of volatility too.”

Richard Branson

Some lost, some won with Bitcoin

” The ability to create something which is not duplicable in the digital world has enormous value…

Lot’s of people will build businesses on top of that. “

Eric Schmidt

Create something wich is not duplicable

“PayPal had these goals of creating a new currency.

We failed at that…

I think Bitcoin has succeeded on the level of a new currency, but the payment system is lacking.”

Peter Thiel

Bitcoin succeeded as a new currency

” As people move into Bitcoin for payments and receipts they stop using US Dollars, Euros and Chinese Yuan which in the long-term devalues these currencies. “

John McAfee

Bitcoin devalues $ € ¥

” Bitcoin is the Currency of Resistance…

If Satoshi had released Bitcoin 10 years earlier, 9/11 would

never have happened. “

Max Keiser

Bitcoin the currency of resistance

“At its core, bitcoin is a smart currency, designed by very forward-thinking engineers. “

Peter Diamandis

Bitcoin is a smart currency

“The internet is going to be one of

the major forces for reducing

the role of government.

One thing that’s missing but that

will soon be developed,

is a reliable  e-cash.”

Milton Friedman

E-Cash

” Bitcoin is a technological

tour de force. “

Bill Gates

Tour de force

” If you don’t believe it or don’t get it,

I don’t have the time

to try to convince you,

sorry. “

Satoshi Nakamoto

Don’t have the time

“WikiLeaks has kicked the hornet’s nest, and the swarm is headed towards us.”

Satoshi Nakamoto

WikiLeaks

” Lost coins only make everyone

else’s coins worth slightly more.

Think of it as a donation to everyone.”

Satoshi Nakamoto

Lost Coins

” In a few decades when the reward gets too small, the transaction fee

will become the main compensation

for [mining] nodes.

I’m sure that in 20 years there

will either be very large transaction volume or no volume.”

Satoshi Nakamoto

Transaction fee

” As computers get faster and the total computing power applied to creating bitcoins increases, the difficulty increases proportionally to keep the total new production constant.

Thus, it is known in advance how many new bitcoins will be created every year in the future.

Coins have to get initially distributed somehow, and a constant rate seems like the best formula.”

Satoshi Nakamoto

Coins distribution at a constant rate is the best formula

” Bitcoin is the beginning of something great: a currency without

a government, something

necessary and imperative. “

Nassim Taleb

Bitcoin a currency without a government

” Those who believe in Bitcoin also believe in cleverness. “

Arif Naseem

Believe in bitcoin believe in cleverness

” Bitcoin is the most stellar and

most useful system of

mutual trust ever devised. “

Arif Naseem

Bitcoin a system of mutual trust

Cryptocurrency is freedom,

Banking is slavery. “

Arif Naseem

Cryptocurrency is freedom

” Our basic thesis for bitcoin is

that it is better than gold. “

Tyler Winklevoss

Bitcoin better than gold

” I think the whole narrative

of blockchain without bitcoin

will amount to very little. “

Fred Ehrsam

Blockchain without bitcoin

” Every informed person needs to know about Bitcoin because it might be one of the world’s most important developments. “

Leon Louw

Bitcoin world’s most important developments

” Bitcoin is a very exciting development, it might lead to a world currency.

I think over the next decade it will grow to become one of the most important ways to pay for things and transfer assets. “

Kim Dotcom (CEO of MegaUpload) 

Bitcoin might lead to a world currency

” Bitcoin may be the TCP/IP of money. “

Paul Buchheit (Creator of Gmail)

Bitcoin the TCP/IP of money

” We have elected to put our money and faith in a mathematical framework that is free of politics and human error. “

Tyler Winklevoss (Co-inventor of Facebook)

Mathematical framework free of politics and human error

” I really like Bitcoin.

I own Bitcoins.

It’s a store of value, a distributed ledger.

It’s a great place to put assets, especially in places like Argentina with 40 percent inflation, where $1 today is worth 60 cents in a year, and a government’s currency does not hold value.

It’s also a good investment vehicle if you have an appetite for risk.

But it won’t be a currency until volatility slows down. “

David Marcus (CEO of Paypal)

Bitcoin a store of value

” [Virtual Currencies] may hold long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system. “

Ben Bernanke (Chairman of the Federal Reserve)

Bitcoin may hold long-term promise

“There are 3 eras of currency: Commodity based, politically based, and now, math based. “

Chris Dixon (Co-founder of Hunch now owned by Ebay, Co-founder of SiteAdvisor now owned by McAfee)

Math based currency

” Bitcoin is here to stay.

There would be a hacker uproar to anyone who attempted to take credit for the patent of cryptocurrency.

And I wouldn’t want to be on the receiving end of hacker fury. “

Adam Draper

Bitcoin is here to stay

” It’s money 2.0, a huge hugehuge  deal. “

Chamath Palihapitiya (Previous head of AOL instant messenger)

Money 2.0

” If there is one positive takeaway from the collapse of Mt.Gox, it is the willingness of a new generation of Bitcoin companies to work together to ensure the future of Bitcoin and the security of customer funds. “

Brian Armstrong (CEO of Coinbase)

Future of bitcoin

” Bitcoin seems to be a very promising idea.

I like the idea of basing security on the assumption that the CPU power of honest participants outweighs that of the attacker.

It is a very modern notion that exploits the power of the long tail. “

Hal Finney

Bitcoin a very promising idea…

” Bitcoin enables certain uses that are very unique.

I think it offers possibilities that no other currency allows.

For example the ability to spend a coin that only occurs when two separate parties agree to spend the coin; with a third party that couldn’t run away with the coin itself. “

Pieter Wuille

Bitcoin enables uses that are very unique

” At its core, bitcoin is a smart currency, designed by very forward-thinking engineers.

It eliminates the need for banks, gets rid of credit cardfees, currency exchange fees, money transfer fees, and reduces the need for lawyers in transitions… all good things. “

Peter Diamandis

Good things

” There is so much potential…

I am just waiting for it to be a billion dollar industry.”

“ Wow, Silk Road actually works ”

Charlie Shrem

Silk Road actually works

Asic Miners Vendors List

ASIC MINERS VENDORS LIST – 2021

https://51asic.ru/ Russian

https://akminer.com/ Chinese

https://www.antminerdistribution.com/ – Holland

https://asicmarketplace.com/ – Hong Kong

https://asicminermarket.com/ – China

https://bitcoinmerch.com/ – USA

https://www.bitmart.co.za/ – Zanzibar

https://blokforge.com/ – USA

https://bt-miners.com/ – USA

https://casaminers.com/en – Italy

https://coinminer.com/ – USA

https://coinminingcentral.com/ – England

https://cryptosupply.de/ – Germany

https://cryptodrilling.com/

https://www.cryptouniverse.at/

https://www.eastshore.xyz/

https://itopshop.net/

https://www.cryptominerbros.com/

https://mineshop.eu/

https://miningwholesale.eu/

https://miningcave.com/

https://pangolinminer.com/

https://printcrypto.io/

https://mining.sesterce.com/

https://shop.unlimitedminer.com/en/home/

https://whatsminer.net/

Speculative Attack

Speculative Attack

Pierre Rochard

July 4, 2014

Introduction

Bitcoin naysayers1 wring their hands over how Bitcoin can’t go mainstream. They gleefully worry that Bitcoin will not make it across the innovation chasm:

  • It’s too complicated
  • It doesn’t have the right governance structure2
  • The security is too hard to get right
  • Existing and upcoming fiat payment systems are or will be superior
  • It’s too volatile
  • The government will ban it
  • It won’t scale

The response from the Bitcoin community is to either endlessly argue over the above points3 or to find their inner Bitcoin Jonah4 with platitudes like:

  • Bitcoin the currency doesn’t matter, it’s the block chain technology that matters
  • It would be better if the block chain technology were used by banks and governments
  • Bitcoin should continue to be a niche system for the bit-curious, it’s just an experiment
  • Fiat and Bitcoin will live side-by-side, happily ever after
  • Bitcoin is the Myspace of ‘virtual currency’

The above sophisms are each worth their own article, if just to analyze the psycho-social archetypes of the relevant parrots.

A few of the criticisms mentioned earlier are correct, yet they are complete non sequiturs. Bitcoin will not be eagerly adopted by the mainstream, it will be forced upon them. Forced, as in “compelled by economic reality“.

People will be forced to pay with bitcoins, not because of ‘the technology’, but because no one will accept their worthless fiat for payments.

Contrary to popular belief, good money drives out bad. This “driving out” has started as a small fiat bleed.

It will rapidly escalate into Class IV hemorrhaging due to speculative attacks on weak fiat currencies. The end result will be hyperbitcoinization, i.e. “your money is no good here”.

Thiers’ Law: Good Money Drives Out Bad

Historically, it has been good, strong currencies that have driven out bad, weak currencies.

Over the span of several millennia, strong currencies have dominated and driven out weak in international competition.

The Persian daric, the Greek tetradrachma, the Macedonian stater, and the Roman denarius did not become dominant currencies of the ancient world because they were “bad” or “weak.”

The florins, ducats and sequins of the Italian city-states did not become the “dollars of the Middle Ages” because they were bad coins; they were among the best coins ever made.

The pound sterling in the 19th century and the dollar in the 20th century did not become the dominant currencies of their time because they were weak.

Consistency, stability and high quality have been the attributes of great currencies that have won the competition for use as international money.

Robert Mundell, “Uses and Abuses of Gresham’s Law in the History of Money”

Bitcoins are not just good money, they are the best money.5 

The Bitcoin network has the best monetary policy6 and the best brand.7 

We should therefore expect that bitcoins will drive out bad, weak currencies.8 

By what process will bitcoins become the dominant currency? Which fiat currencies will be the first to disappear?

These are the interesting questions of the day, as the necessary premises for these questions are already established truths.9

1. Fiat Bleed

Bitcoin’s current trend is to increase in value on an exponential trend line as new users arrive in waves.

The good money is “slowly” driving out the bad.

Two factors drive this:

  1. Reduction in information asymmetry – people are learning about Bitcoin and coming to the realization that bitcoins are indeed the best money. Possible overlapping motives:
    • ADHD – compulsive novelty fetichism induced by our post-war consumer culture and/or innate biological processes
    • FOMO – fear of missing out, see Regret Theory and ingroups, aka avarice and status-seeking
    • PISD – post-internet stress disorder, aka “disruption”, “next big thing”, “internet of money”
  2. Increasing liquidity – buying bitcoins is more convenient and has fewer fees attached today than a year ago. One can reasonably predict that this will also be the case a year from now. Why? Because selling bitcoins is a profitable and competitive business. Why? Because people want bitcoins, see above.

Due to group psychology, these newcomers arrive in waves.

The waves have a destabilizing effect on the exchange rate: speculators are unsure of the amplitude or wavelength of adoption, and amateurish punters let their excitement as well as subsequent fear overwhelm them.

Regardless, once the tide has pulled back and the weak hands have folded, the price is a few times higher than before the wave.

This ‘slow’ bleed is the current adoption model, and commentators generally assume one of the following:

  1. Slow bleed never occurred, it’s a fiction based on misleading data
  2. Slow bleed has stopped, the above motives only affect lolbertarians and angry teens
  3. The process will taper off now, as all the super tech-savvy people are already getting on board

My own prediction is that slow bleed has been accelerating and is only the first step.

The second step will be speculative attacks that use bitcoins as a platform.

The third and final step will be hyperbitcoinization.

2. Currency Crises

It might make sense just to get some in case it catches on.

If enough people think the same way, that becomes a self fulfilling prophecy.

” Once it gets bootstrapped, there are so many applications if you could effortlessly pay a few cents to a website as easily as dropping coins in a vending machine. “

Satoshi Nakamoto, 1/17/2009

Slow bleed leads to currency crisis as the expected value of bitcoins solidifies in people’s minds.

At first they are conservative, they invest “what they can afford to lose”.

After 12-18 months, their small stash of bitcoins has dramatically increased in value.

They see no reason why this long term trend should reverse: the fundamentals have improved and yet adoption remains low.

Their confidence increases. They buy more bitcoins. They rationalize: “well, it’s only [1-5%] of my investments”. They see the price crash a few times, due to bubbles bursting or just garden-variety panic sales – it entices them to buy more, “a bargain”. Bitcoin grows on the asset side of their balance sheet.

On the liability side of the Bitcoiner’s balance sheet there are mortgages, student loans, car loans, credit cards, etc.

Everyone admonishes people to not borrow in order to buy bitcoins.

The reality is that money is fungible: if you buy bitcoins instead of paying down your mortgage’s principal, you are a leveraged bitcoin investor.

Almost everyone is a leveraged bitcoin investor, because it makes economic sense (within reason).

The cost of borrowing (annualized interest rates ranging from 0% to 25%) is lower than the expected return of owning bitcoins.

How leveraged someone’s balance sheet is depends on the ratio between assets and liabilities.

The appeal of leveraging up increases if people believe that fiat-denominated liabilities are going to decrease in real terms, i.e. if they expect inflation to be greater than the interest rate they pay.

At that point it becomes a no-brainer to borrow the weak local currency using whatever collateral a bank will accept, invest in a strong foreign currency, and pay back the loan later with realized gains.

In this process, banks create more weak currency, amplifying the problem.

The effect of people, businesses, or financial institutions borrowing their local currency to buy bitcoins is that the bitcoin price in that currency would go up relative to other currencies.

To illustrate, let’s say that middle-class Indians trickle into bitcoin. Thousands of buyers turns into hundreds of thousands of buyers.

They borrow Indian Rupees using whatever unencumbered collateral they have – homes, businesses, gold jewelry, etc.

They use these Rupees to buy bitcoins. The price of bitcoins in Indian Rupees goes up, a premium develops relative to other currency pairs.

A bitcoin in India might be worth $600, while in the U.S. it trades at $500. Traders would buy bitcoins in the U.S. and sell them in India to net a $100 gain. They would then sell their Indian Rupees for dollars. This would weaken the Indian Rupee, causing import inflation and losses for foreign investors.

The Indian central bank would have to either increase interest rates to break the cycle, impose capital controls, or spend their foreign currency reserves trying to prop up the Rupee’s exchange rate.

Only raising interest rates would be a sustainable solution, though it would throw the country into a recession.

There’s a huge problem with the Indian central bank raising interest rates: bitcoin’s historical return is ~500% per year.

Even if investors expected future return is 1/10th of that, the central bank would have to increase interest rates to unconscionable levels to break the attack.

The result is evident: everyone would flee the Rupee and adopt bitcoins, due to economic duress rather than technological enlightenment.

This example is purely illustrative, it could happen in a small country at first, or it could happen simultaneously around the world.

Who leverages their balance sheet and how is impossible to predict, and it will be impossible to stop when the dam cracks.

Which countries are most vulnerable to a currency crisis?

Business Insider provides a helpful list here.

Bitcoins will have to reach certain threshold of liquidity, indicated by a solid exchange in every financial center and a real money supply – i.e. market cap – of at least $50 billion, before they can be used as an instrument in a speculative attack. This will either coincide with or cause a currency crisis.

3. Hyperbitcoinization

A speculative attack that seems isolated to one or a few weak currencies, but causes the purchasing power of bitcoins to go up dramatically, will rapidly turn into a contagion.

For example, the Swiss will see the price of bitcoins go up ten fold, and then a hundred fold.

At the margin they will buy bitcoins simply because they want to speculate on their value, not due to an inherent problem with the Swiss Franc.

The reflexivity here entails that the reduction in demand for Swiss Francs would actually cause higher than expected inflation and thus an inherent problem with the Swiss Franc.

The feedback loop between fiat inflation and bitcoin deflation will throw the world into full hyperbitcoinization, explained by Daniel here.

Conclusion

Bitcoin will become mainstream.

The Bitcoin skeptics don’t understand this due to their biases and lack of financial knowledge.

First, they are in as strong an echo chamber as Bitcoin skeptics.10 

They rabidly search for evidence that confirms their view of Bitcoin.

Second, they misunderstand how strong currencies like bitcoin overtake weak currencies like the dollar: it is through speculative attacks and currency crises caused by investors, not through the careful evaluation of tech journalists and ‘mainstream consumers’.

To honor these soon to be extinct skeptics, the Nakamoto Institute has launched A Tribute to Bold Assertions.

  1. No, seriously, there are people on the Internet spending a non-trivial amount of time writing about a currency they think is going to fail yet continues to succeed beyond anyone’s expectations. I get schadenfreude from their lack of schadenfreude. Granted, a few of them are being paid to write controversial click bait and/or just concern trolling – both activities that I respect and understand.
  2. This is generally stated by people who are in the ‘out-group’ and fantasize about being in the ‘in-group’ through politics/pedigree rather than economic/meritocratic processes. Demographically, they probably overlap with fans of The Secret. Economically, they are without exception bezzlers. 
  3. Bitcoin has entered its Eternal September, where every person new to Bitcoin thinks they have a unique understanding of Bitcoin and everyone ought to hear about it. There’s an endless flood of newbies ‘concerned’ about such and such ‘problem’ with Bitcoin. The Bitcoin community does these arrivistes a real disservice by taking them seriously instead of just telling them ‘read more’. 
  4. The opposite of Bitcoin Jesus. Bitcoin Jonah is a defeatist, self-sabotaging, and timid ‘man’ who is on a permanent quest to confirm Bitcoin’s weakness. 
  5. Bitcoin is the Best Unit of Account by Daniel Krawisz 
  6. The Bitcoin Central Bank’s Perfect Monetary Policy by Pierre Rochard 
  7. Bitcoin Has No Image Problem by Daniel Krawisz 
  8. Hyperbitcoinization by Daniel Krawisz
  9. If you disagree then either you have not been learning or you have not been engaging in the debate, go back to square one. 
  10. ‘I live in a rather special world. I only know one person who voted for Nixon. Where they are I don’t know. They’re outside my ken. But sometimes when I’m in a theater I can feel them.’ – Pauline Kael

Source:

https://nakamotoinstitute.org/mempool/speculative-attack/

Bitcoin’s Shroud of Subtlety and Allure

A new banner of freedom

Bitcoin’s Shroud of Subtlety and Allure

Daniel Krawisz

June 29, 2014

Attacks on Bitcoin

A successful attack on Bitcoin means attacking Bitcoin’s value.

There might well be a bug that could be exploited to put the network out of commission temporarily, but would soon be fixed and then the network would be up and running shortly thereafter.

To destroy Bitcoin permanently means to end the profit opportunities available with it, and that means either a malicious hashing attack on the network that makes mining impossible or such a malevolent policy against Bitcoin trade that even the black market abandons it.

Both of these require spending resources in proportion to the profits that Bitcoin enables.

In this article, I will discuss three reasons why such an attack is unlikely to succeed: antifragility, subtlety, and attacker defection.

The interplay of these three defenses makes Bitcoin into a kind of wave that rewards those who ride it and drowns those who resist it.

The first of these, antifragility, is exemplified in the fact that malicious hashing is impossible up to a certain fraction of the network.

Below the point that selfish mining becomes possible1 additional hashes per second are almost certainly beneficial because they increase the security of the network.

Any potential attacker, therefore, must weigh in the possibility that he may end up benefiting the network instead of destroying it.

A similar risk accompanies a legal attack on Bitcoin. Bitcoin can adapt to half-hearted attacks. It would move deeper into the black market where it would become permanently strengthened.

Furthermore, a legal attack could be easily corrupted into one that brings as many bitcoins as possible to the government agents instead of one that destroys it (see below).

Bitcoin’s Subtlety

Bitcoin adoption happens one person at a time, and this is true for potential attackers as well as the rest of us.

It takes an entrepreneurial mindset to be able to imagine what Bitcoin could become, given how comparatively small it is now.

It takes time and meditation for people to take Bitcoin seriously because most of its value is in the future.

By the time this happens, Bitcoin has become much more expensive than when they first learned of it.

Thus, Bitcoin is protected from attackers by being initially beyond their understanding.

When Bitcoin was very small, it was very stealthy and was completely unknown to the establishment.

Now they laugh at it, just as it has begun to grow bold.

Of course, we don’t know who really dismisses it and who is deliberately trying to draw attention away from it.

Bitcoin’s Allure

Furthermore, potential attackers are at a disadvantage for another reason.

Bitcoin tends to oppose organizations rather than people.

Even someone who stands to lose from Bitcoin by not reacting to it, such as a banker or government agent, stands to gain a great deal by buying now.

Only the very wealthiest people might reasonably expect to be worse off attempting to buy up as much as possible now than if it were gone. (This could happen if their attempt to buy caused the price to rise too fast relative to their ability to acquire additional bitcoins, to the point that they ultimately had less influence over the future Bitcoin economy than they have over the economy of today.)

Thus, the agency problem with Bitcoin affects bitcoin competitors as well as Bitcoin holders.

Nearly any government agent who begins to see bitcoin as a potential threat must also simultaneously see it as an opportunity.

He, too, can invest in Bitcoin. And why shouldn’t he?

Bitcoin may be a threat to his livelihood, but it may well be making him an offer he can’t refuse.

How can an organization that stands to lose by the adoption of Bitcoin provide its members with a better opportunity for staying loyal than Bitcoin provides for defection?

Even those who might resist the temptation to defect would have to think about the defection of his fellows.

How quickly is adoption happening? Is there time to mount an attack before Bitcoin becomes too powerful? How easily could the resources for such an attack be amassed, given both the ignorance and treachery of the other agents.

If such an attack would be unlikely to succeed, then buying now would be the only intelligent action.

Regardless of whether he liked Bitcoin, it would be futile to continue pursuing a doomed cause.

Potential Bitcoin attackers are in a Prisoner’s Dilemma.

In the same way that the people cannot easily rebel against the king owing to a lack of coordination on their part, governments cannot rebel against Bitcoin for the same reason.

The government puts the people in a Prisoner’s Dilemma against one another, and Bitcoin does the same to government agents.

Bitcoin is like Invasion of the Body Snatchers.

Bitcoin attracts inside men to act as covert saboteurs. There have long been predictions from both bitcoiners and naysayers of impending government attacks, but I think there is a possibility that Bitcoin could win without suffering much resistance.

Moreover, although I said above only that any legal bitcoin attack could be perverted, the considerations discussed in this section tend to make such diffusion very likely.

Bitcoin defends itself by being obscure, but once it has attracted someone’s attention, its best interest is for that person to understand the logic presented here. For then he will also understand that his best course is to deny Bitcoin’s threat to his superiors and quietly to become its willing slave.

  1. Right now Bitcoin Core does not follow the proper strategy to protect against selfish mining even at very low hashing rates, but the fix would be extremely easy to implement and would make selfish mining impossible up to 25% of the hash rate. ↩

Source:

https://nakamotoinstitute.org/mempool/bitcoins-shroud-of-subtlety-and-allure/

Hal Finney

” Bitcoin and me (Hal Finney)

March 19, 2013, 08:40:02 PM
Last edit: March 25, 2013, 08:37:28 PM by Hal

 #1

I thought I’d write about the last four years, an eventful time for Bitcoin and me.

For those who don’t know me, I’m Hal Finney. I got my start in crypto working on an early version of PGP, working closely with Phil Zimmermann. When Phil decided to start PGP Corporation, I was one of the first hires. I would work on PGP until my retirement.

At the same time, I got involved with the Cypherpunks. I ran the first cryptographically based anonymous remailer, among other activities.

Fast forward to late 2008 and the announcement of Bitcoin.

I’ve noticed that cryptographic graybeards (I was in my mid 50’s) tend to get cynical. I was more idealistic; I have always loved crypto, the mystery and the paradox of it.

When Satoshi announced Bitcoin on the cryptography mailing list, he got a skeptical reception at best. Cryptographers have seen too many grand schemes by clueless noobs. They tend to have a knee jerk reaction.

I was more positive. I had long been interested in cryptographic payment schemes.

Plus I was lucky enough to meet and extensively correspond with both Wei Dai and Nick Szabo, generally acknowledged to have created ideas that would be realized with Bitcoin.

I had made an attempt to create my own proof of work based currency, called RPOW. So I found Bitcoin facinating.

When Satoshi announced the first release of the software, I grabbed it right away.

I think I was the first person besides Satoshi to run bitcoin.

I mined block 70-something, and I was the recipient of the first bitcoin transaction, when Satoshi sent ten coins to me as a test.

I carried on an email conversation with Satoshi over the next few days, mostly me reporting bugs and him fixing them.

Today, Satoshi’s true identity has become a mystery. But at the time, I thought I was dealing with a young man of Japanese ancestry who was very smart and sincere.

I’ve had the good fortune to know many brilliant people over the course of my life, so I recognize the signs.

After a few days, bitcoin was running pretty stably, so I left it running.

Those were the days when difficulty was 1, and you could find blocks with a CPU, not even a GPU.

I mined several blocks over the next days. But I turned it off because it made my computer run hot, and the fan noise bothered me.

In retrospect, I wish I had kept it up longer, but on the other hand I was extraordinarily lucky to be there at the beginning.

It’s one of those glass half full half empty things.

The next I heard of Bitcoin was late 2010, when I was surprised to find that it was not only still going, bitcoins actually had monetary value.

I dusted off my old wallet, and was relieved to discover that my bitcoins were still there.

As the price climbed up to real money, I transferred the coins into an offline wallet, where hopefully they’ll be worth something to my heirs.

Speaking of heirs, I got a surprise in 2009, when I was suddenly diagnosed with a fatal disease. I was in the best shape of my life at the start of that year, I’d lost a lot of weight and taken up distance running. I’d run several half marathons, and I was starting to train for a full marathon. I worked my way up to 20+ mile runs, and I thought I was all set. That’s when everything went wrong.

My body began to fail. I slurred my speech, lost strength in my hands, and my legs were slow to recover.

In August, 2009, I was given the diagnosis of ALS, also called Lou Gehrig’s disease, after the famous baseball player who got it.

ALS is a disease that kills moter neurons, which carry signals from the brain to the muscles. It causes first weakness, then gradually increasing paralysis. It is usually fatal in 2 to 5 years.

My symptoms were mild at first and I continued to work, but fatigue and voice problems forced me to retire in early 2011. Since then the disease has continued its inexorable progression.

Today, I am essentially paralyzed. I am fed through a tube, and my breathing is assisted through another tube. I operate the computer using a commercial eyetracker system. It also has a speech synthesizer, so this is my voice now. I spend all day in my power wheelchair. I worked up an interface using an arduino so that I can adjust my wheelchair’s position using my eyes.

It has been an adjustment, but my life is not too bad. I can still read, listen to music, and watch TV and movies. I recently discovered that I can even write code. It’s very slow, probably 50 times slower than I was before. But I still love programming and it gives me goals.

Currently I’m working on something Mike Hearn suggested, using the security features of modern processors, designed to support “Trusted Computing”, to harden Bitcoin wallets. It’s almost ready to release. I just have to do the documentation.

And of course the price gyrations of bitcoins are entertaining to me. I have skin in the game. But I came by my bitcoins through luck, with little credit to me. I lived through the crash of 2011. So I’ve seen it before. Easy come, easy go.

That’s my story. I’m pretty lucky overall. Even with the ALS, my life is very satisfying. But my life expectancy is limited. Those discussions about inheriting your bitcoins are of more than academic interest.

My bitcoins are stored in our safe deposit box, and my son and daughter are tech savvy. I think they’re safe enough. I’m comfortable with my legacy.
[edited slightly] “

Cypherpunk’s Manifesto

A Cypherpunk’s Manifesto

Eric Hughes

by Eric Hughes

” Privacy is necessary for an open society in the electronic age.

Privacy is not secrecy.

A private matter is something one doesn’t want the whole world to know, but a secret matter is something one doesn’t want anybody to know.

Privacy is the power to selectively reveal oneself to the world.

If two parties have some sort of dealings, then each has a memory of their interaction.

Each party can speak about their own memory of this; how could anyone prevent it?

One could pass laws against it, but the freedom of speech, even more than privacy, is fundamental to an open society; we seek not to restrict any speech at all.

If many parties speak together in the same forum, each can speak to all the others and aggregate together knowledge about individuals and other parties.

The power of electronic communications has enabled such group speech, and it will not go away merely because we might want it to.

Since we desire privacy, we must ensure that each party to a transaction have knowledge only of that which is directly necessary for that transaction.

Since any information can be spoken of, we must ensure that we reveal as little as possible.

In most cases personal identity is not salient. When I purchase a magazine at a store and hand cash to the clerk, there is no need to know who I am.

When I ask my electronic mail provider to send and receive messages, my provider need not know to whom I am speaking or what I am saying or what others are saying to me; my provider only need know how to get the message there and how much I owe them in fees.

When my identity is revealed by the underlying mechanism of the transaction, I have no privacy. I cannot here selectively reveal myself; I must always reveal myself.

Therefore, privacy in an open society requires anonymous transaction systems.

Until now, cash has been the primary such system.

An anonymous transaction system is not a secret transaction system.

An anonymous system empowers individuals to reveal their identity when desired and only when desired; this is the essence of privacy.

Privacy in an open society also requires cryptography.

If I say something, I want it heard only by those for whom I intend it.

If the content of my speech is available to the world, I have no privacy.

To encrypt is to indicate the desire for privacy, and to encrypt with weak cryptography is to indicate not too much desire for privacy.

Furthermore, to reveal one’s identity with assurance when the default is anonymity requires the cryptographic signature.

We cannot expect governments, corporations, or other large, faceless organizations to grant us privacy out of their beneficence.

It is to their advantage to speak of us, and we should expect that they will speak.

To try to prevent their speech is to fight against the realities of information.

Information does not just want to be free, it longs to be free.

Information expands to fill the available storage space.

Information is Rumor’s younger, stronger cousin;

Information is fleeter of foot, has more eyes, knows more, and understands less than Rumor.

We must defend our own privacy if we expect to have any.

We must come together and create systems which allow anonymous transactions to take place.

People have been defending their own privacy for centuries with whispers, darkness, envelopes, closed doors, secret handshakes, and couriers.

The technologies of the past did not allow for strong privacy, but electronic technologies do.

We the Cypherpunks are dedicated to building anonymous systems.

We are defending our privacy with cryptography, with anonymous mail forwarding systems, with digital signatures, and with electronic money.

Cypherpunks write code.

We know that someone has to write software to defend privacy, and since we can’t get privacy unless we all do, we’re going to write it.

We publish our code so that our fellow Cypherpunks may practice and play with it. Our code is free for all to use, worldwide.

We don’t much care if you don’t approve of the software we write.

We know that software can’t be destroyed and that a widely dispersed system can’t be shut down.

Cypherpunks deplore regulations on cryptography, for encryption is fundamentally a private act.

The act of encryption, in fact, removes information from the public realm.

Even laws against cryptography reach only so far as a nation’s border and the arm of its violence.

Cryptography will ineluctably spread over the whole globe, and with it the anonymous transactions systems that it makes possible.

For privacy to be widespread it must be part of a social contract.

People must come and together deploy these systems for the common good. Privacy only extends so far as the cooperation of one’s fellows in society.

We the Cypherpunks seek your questions and your concerns and hope we may engage you so that we do not deceive ourselves.

We will not, however, be moved out of our course because some may disagree with our goals.

The Cypherpunks are actively engaged in making the networks safer for privacy. Let us proceed together apace.

Onward.

Eric Hughes

 <hughes@soda.berkeley.edu>

9 March 1993

☆ Long Live the CypherPunks ☆

The world is in debt for your bright minds, even if it doesn’t know…

It’s minds like yours that always have changed the face of the earth for a better brighter future !

KUDOS TO YOU ALL !!!

BitHouse LLC

Strenght in Numbers

BitHouse LLC is a client – focused and result driven CryptoCurrency Consulting and Mining Company that provides broad – based services at an affordable fee to our clients .

We will ensure that we work hard to meet and surpass our Clients’ expectations whenever they hire our services for Consulting or mine bitcoin.

At BitHouse LLC, our Client’s best interest always come first and foremost, and everything we do is guided by our high values and professional ethics.

Services

Cryptocurrency Consulting

General cryptocurrency advice, reviews and due diligence on tokens, blockchain projects, general investment advice and trading strategy.

Security and putting processes in place to backup your crypto.

Cryptocurrency Mining & Staking

Setup and advice on Cryptocurrency mining rigs. Mining does not just include Bitcoin, there are numerous other options to mine, including other tokens, rigs that provide processing power and storage.

Masternodes

Nodes are a great way to generate cryptocurrency, similar to mining just without the expensive hardware.

Setting up and running a node is not straight forward, we can help.

Proof of Stake / Staking Wallets

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Bitcoin – People’s Money

“Better a diamond with a flaw than a pebble without.”

Confucius

Diamond with a flaw

“Try not to become a man of success. Rather become a man of value.”

Albert Einstein

Man of Value

“If you don’t know what you want, you’ll never find it.

If you don’t know what you deserve, you’ll always settle for less.

You will wander aimlessly, uncomfortably numb in your comfort zone, wondering how life has ended up here.

Life starts now, live, love, laugh and let your light shine!”

Rob Liano

Let your light shine

“A person’s worth is measured by the worth of what he values.”

Marcus Aurelius, “Meditations”

Values

“Mathematics expresses values that reflect the cosmos, including orderliness, balance, harmony, logic, and abstract beauty.”

Deepak Chopra

Mathematics

“Every job from the heart is, ultimately, of equal value.

The nurse injects the syringe; the writer slides the pen; the farmer plows the dirt; the comedian draws the laughter.

Monetary income is the perfect deceiver of a man’s true worth.”

Criss Jami, “Killosophy”

Job from the Heart

“A person that does not value your time will not value your advice.”

Orrin Woodward

Value your time

“Once you embrace your value, talents and strengths, it neutralizes when others think less of you.”

Rob Liano

Embrace your Values

“Bad times have a scientific value. These are occasions a good learner would not miss.”

Ralph Waldo Emerson

Bad times

“I say no wealth is worth my life.”

Homer, “The Iliad”

Life

“But what’s worth more than gold?

Practically everything.

You, for example.

Gold is heavy.

Your weight in gold is not very much gold at all.

Aren’t you worth more than that?”

Terry Pratchett, “Making Money” 

You are worth more than gold

“Knowledge is like money: To be of value it must circulate, and in circulating it can increase in quantity and, hopefully, in value.”

Louis L’Amour, “Education of a Wandering Man”

Knowledge

“Ô, Sunlight! The most precious gold to be found on Earth.”

Roman Payne

Sunlight

“Knowledge is like money: To be of value it must circulate, and in circulating it can increase in quantity and, hopefully, in value.”

Louis L’Amour, “Education of a Wandering Man”

Knowledge

“If life — the craving for which is the very essence of our being — were possessed of any positive intrinsic value, there would be no such thing as boredom at all: mere existence would satisfy us in itself, and we should want for nothing.”

Arthur Schopenhauer, “The Vanity of Existence”

Existence

“Our sole purpose on this earth is to add value to others.

It doesn’t make sense to just exist in people’s lives or to be a drain on them, does it?”

Rob Liano

Sole purpose

“Value judgments are destructive to our proper business, which is curiosity and awareness.”

John Cage

Curiosity & Awareness

“We set no special value on the possession of a virtue until we percieve that it is entirely lacking in our adversary.”

Friedrich Nietzsche, “Human, All Too Human: A Book for Free Spirits”

Virtue

“Maybe you had to come close to losing something before you could remember its value.

Maybe we enjoy the last minute struggle as it slips through our hands.”

Suraj Sani

Struggle

“Always remember that the minority dictates the prices, and the majority governs the value.”

Naved Abdali

Minority vs. Majority

“It is impossible to say whether an asset class valuation is cheap or expensive in isolation.

The valuation of an asset is relative to the valuations of all other assets.”

Naved Abdali

Valuation of an Asset

“Market quotes change every second, but business evolves steadily.

You have ample time to evaluate a business to buy or not to buy.

There is no rush.”

Naved Abdali

Evaluate

“The number one reason people lose money in investing is because they buy assets without giving any thought whatsoever to the fair value.”

Naved Abdali

Fair Value

“If investors do not know or never attempt to know the fair value, they can pay any price.

More often, the price they pay is far greater than the actual value.”

Naved Abdali

Actual Value

“Watching every tick up and every tick down is just wasting your valuable time.

Do yourself a favor, and pick up a book or two about investing each month.”

Naved Abdali

Pick up a book

“An ounce of gold will always be an ounce of gold regardless of the length of possession.

The short-term value will go up or down, but gold prices will follow the general inflation rate in the long run.”

Naved Abdali

General Inflation Rate

“A Collectible’s value is primarily based on the emotions and the perception of potential buyers.”

Naved Abdali

Emotions & Perception