It’s really hard to get your ID through tech ways.
But… if they flip one trading partner, and they ID you, the entire ledger on you is laid bare.
But they might offer you a deal if you ID your trading partners…
(And any legit place is going to turn over records at the first subpoena.)
I don’t know if creating new public keys would help or not because there has to be some way on the public ledger to associate that with your prime account otherwise you could just create new coins…
Lets be honest: it’s for shady shit like paying off politicians or avoiding being #cancelled by a bank or payment processor because you’re a fascist or supporting fascists. Occasionally, people buy drugs, and that’s the least controversial or problematic example.
So block chain is probably responsible for laundering huge amounts of money for criminals. Maybe it’s even to blame for DJT being where he is today?
Out of curiosity I looked it up.
One bitcoin costs 215 kilowatt hours of energy.
So if I built a human powered generator, producing about 500 watts (best case) then 18 days of generating would give me one bitcoin or about ten thousand bucks.
Double the time for breaks.
Right now it does (well, approximately, whatever). The thing about the bitcoin algorithm is that the rate of new coin drops is time-based, not computation-based. The more people that mine bitcoin simultaneously, the more energy it takes to generate one bitcoin – exactly as much energy has been expended on mining in ~10 minutes. This has some interesting side effects.
We can think of the “intrinsic” value of a single bitcoin as being the value of the energy that was consumed in mining it. So the value of a bitcoin is directly proportional to the current interest in bitcoin. If tons of people are mining bitcoin, then the incremental value of the next bitcoin mined is equal to the cost of a lot of energy – for instance, 215kwh. But if everyone gives up except for one person, and their one lonely computer is mining bitcoin and consumes 10 watt-hours between the last coin drop and this one, then that bitcoin has an incremental value equivalent to 10 watt-hours.
So to the extent that we can directly attribute Bitcoin’s value to the “intrinsic” commodity value that goes into mining it (maybe a tall order), Bitcoin is literally a hype machine: it is worth exactly as much attention as it receives. The easiest way to increase Bitcoin’s intrinsic value is to get more computers mining; the easiest way to reduce it is to reduce the number of computers mining it.
Combine that with the way that the coin drops taper over time, and it starts to look a lot like a pyramid scheme. I think a lot of us know this already but if you look at it in terms of commodity consumption and valuation it really gives it some teeth.
I’m not a game theorist or an economist (or a bitcoin expert) so I don’t really know how this plays out after coin drops end. Once the number of coins is no longer growing, then any transaction that happens will necessarily increase the intrinsic value of the bitcoin in circulation (more kwh spent but no more bitcoins produced). I need a behavioral economist to help me think through the implications of this…
Distributed hash tables would be more fun, and with practical uses.
I watched it happen but I still refuse to believe that’s real.
Having thought about this for a few minutes, this puts us in an interesting game theory situation that I think incentivizes us not to spend. Assume that the current value of your bitcoin is 1. If you spend it, you can exchange it for a commodity worth 1, and you no longer have bitcoin. If you keep it, you continue to have bitcoin, and if someone else spends their bitcoin the value of yours increases. Then:
| They Spend | They Keep | |
|---|---|---|
| I Spend | 1 | 1 |
| I Keep | 1 + delta | 1 |
If I spend my bitcoin, I always get commodity worth its current value. If I keep my bitcoin, the value is unchanged unless someone else spends their bitcoin, in which case my bitcoin’s value goes up.
Then the optimal strategy in this game is not to spend your bitcoin, hoping that someone else spends it to increase its value – since there isn’t a risk to not spending it.
If everyone in the game is a rational actor, transactions would stop.
There’s one minor note: presumably you’d trade your bitcoin for a commodity as long as the value of that commodity increases faster than the value of bitcoin. Of course, spending that bitcoin then increases the value of bitcoin. Hmm… I wonder if that would result in some sort of self-regulating system where bitcoin ends up increasing in value at the same rate as the “average” commodity.
[Once again, I Am Not A Game Theorist, so feel free to correct / challenge this line of thinking.]
That’s the genius of optimizing it for people who want to buy drugs. I might be a rational actor, but my heroin addiction isn’t!
just kidding fellas
It seems so many of these buzzwords of the past few years, (Blockchain, RPA, Machine Learning, AI, etc.) are good technology solutions for certain niche use cases, in desperate need of broad use cases that never materialize. I’m in IT, but when I hear my clients or counterparts in sales or operations talk about these things, I always ask “What, exactly, is the use case you are trying to solve and why would X be better than more conventional process and technology improvements?” I have yet to get a good answer (it’s usually that I need to come up with the answer to justify the hype they bought into). I usually have to assure them that “we’ll use X, but in a more economical and risk-averse way”…meaning, we’ll just fix the issue conventionally.
It’s solutionism at its most glorious. Solutions in search of a problem.
Once I had to review a grant proposal that was basically “Let’s use blockchain technology in [setting]!”. It was absolutely absurd. You could literally have done a search-and-replace on the proposal document to swap “blockchain” out for any other buzzy technology (“AI”, “Wearables”, “The Horseless Carriage”, “Archimedes’ Screw”) and the proposal would have made just as much sense. There were no actual applications alluded to in the document, just “Let’s play with this new technology because it sounds cool”.
One of the strengths/selling points of blockchain is that the entire transaction history is encoded in the logs; no transaction can be forged, and no transaction can be denied.
But someday that encryption will get broken, and then every single child sex slave and drug purchase will be laid bare for everyone to see…
There’s not a risk, but there is an opportunity cost. That capital is doing nothing - not even gaining interest - unless other people are spending their bitcoins.
Ha, funny. When I first started hearing about blockchain, one of my first thoughts (which has continued through today) was, couldn’t you kind of do this with… a database?
This… kind of makes me extra-think it was invented by, oh I dunno, say some sharp folks in the government who wanted to be able to track online black markets, and simultaneously profit from them to fund, hmm, like black projects or something? Or their own bank accounts (probably not all in bitcoin I imagine)? Or both? Naaaah…
How do you reliably validate transactions on the database? With a blockchain obviously.
I suppose that would, technically, be one way to do it…
How else would you do it? The ledger can be a text file in a git repository, or a stream of records in a database, validated with a chain of hashes. Either way you are using a blockchain to validate the transactions.
Doesn’t blockchain imply a widely-distributed shared-ledger, with somewhat complex hashing occurring for each transaction? I’m not a coder and don’t actually have a lot of in-depth knowledge of “blockchain” but that was my impression.
Using Git to track changes is was what I was thinking of as a more “banal” way of achieving at least some of the functionality. I didn’t know that was considered “blockchain.” I’ve never heard Git refer to themselves in such a way, I don’t think?
Thank goodness for Google:
Yeah I had a read through and for me its the fact that git (and other distributed version control systems) and bitcoin both use merkel chains which makes them essentially the same.
A git repository can have multiple heads (like twigs on the tree) while bitcoin has infrastructure outside the chain to ensure that this can’t happen. Multiple heads would mean that the same bitcoin had been sold twice.
