Quote from: adam3us on January 03, 2015, 11:33:56 PM

About cypherdoc particularly he said this:

Quote from: cypherdoc link=https://bitcointalk.org/index.php?topic=68655.msg9989162#msg9989162

Quote from: adam3us

I am not sure if you are aware sidechains are nearly possible with zero changes to bitcoin. Its already programable via the script language. It may even be doable with zero changes with some chained contorted big script to validate compact SPV proofs.

great, then do it if it doesn't involve a source code change. i have no problem with that.

So that seems a little inconsistent to me. ie if this is really a bad idea why would cypherdoc not have a problem with it regardless of whether it required changes or not. I mean if its a principle you'd be arguing to please not do it even though its possible. Or to remove something from the language to prevent it, or put a technical defense preventing it if such a thing existed (seems unlikely but I havent explored it much). Not saying "I have no problem with that."

This is an interesting point, Sidechains appear to represent a form of competition with Bitcoin as a distributed consensus mechanism or transaction system. The question is should Bitcoin try to defend against this competition or recognize that competition is a good thing and try to encourage it by making changes which could make Sidechains possible, as this type of competition is unlikely to be prevented in the long run anyway and if Bitcoin is to succeed it should do so because it is the best system. I am genuinely undecided as to what the best or most logical response from Bitcoin is. Bitcoin already has a lot of competition and I have tried to analyze the competitive landscape below:

Analysis of Bitcoin's Competitive Landscape - (For Financial Transactions)

System	Examples	bitcoin unit	Chances of success	If Bitcoin losses in the long term

Traditional Systems	Paypal, Credit Cards, SWIFT, CHAPS	No	These systems are already dominant	No significant impact, Bitcoin could continue as a niche system

Off Chain transactions	Coinbase, Changetip, MT Gox, Circle	Yes	Unlikely to offer significant advantages over Traditional Systems in the long run	Potentially catastrophic for both Bitcoin and Off Chain Transaction companies. Security on Bitcoin could fall as mining incentives could be low, whilst the incentive to attack could increase. At the same time off chain credit expansion could occur, undermining the monetary policy of Bitcoin.

Alt Coins - Bitcoin clones	Litecoin, Dogecoin	No	Unlikely to offer significant advantages over Bitcoin in the long run	No significant impact, Bitcoin could continue as a niche system

Alternative consensus mechanisms	Peercoin (Proof of Stake), BitShares (Delegated Proof of Stake), Tendermint	No	Competition is interesting and these type of alternatives could eventually succeed	No significant impact, Bitcoin could continue as a niche system

Sidechains	Blockstream	Yes	Unlikely to offer significant advantages over alternative consensus mechanisms in the long run, except the use of bitcoin the currency could be an advantage in obtaining users and providing an early incentive to hack/test the system	Potentially catastrophic for both Bitcoin and Sidechains. Security on Bitcoin could fall as mining incentives could be low, whilst the incentive to attack Bitcoin could increase. The inherent value of bitcoin could be under threat, as one could do trust-less financial transactions in bitcoin without needing to spend bitcoin in fees

Layers on top of Bitcoin	Counterparty, Colored Coins, Mastercoin	No	Success likely to depend on Bitcoin's success	Bitcoin the system and bitcoin the currency cannot lose in this scenario. The success of these systems imply high transaction volume and high demand for bitcoin to be used as transaction fees. Bitcoin wins in this scenario

Quote from: adam3us on January 03, 2015, 11:33:56 PM

CP = CounterParty. That doesnt bring anything to the chain, other than bloat, its a layered consensus system with its own alt-coin. If you valued the price of bitcoin, probably you'd be better pushing for sidechains than CP because its bitcoin denominated and increases demand and features for bitcoin.

Counterparty transactions are just as valid or invalid as any other transactions. Proof of existence transactions, drug deal transactions, gambling transactions, Counterparty transactions, transactions containing a Times Newspaper headline from 2009, "genuine" online shopping transactions or "fake" transactions created to increase transaction volume and dishonestly attract Venture Capital funding for a project are all just transactions. Once people start to evaluate the merit of the data and say they are just bloat, the validity of the system begins to break down. This is analogous to the Net Neutrality debate. Counterparty pay the fee just like anyone else. The success of Counterparty will create demand for bitcoin, which is required for every single action in Counterparty to pay transaction fees for miners. Systems like Counterparty therefore add value to the Bitcoin ecosystem and bitcoin the currency.