Quote from: brg444 on October 30, 2014, 09:22:36 PM

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The result is lower block rewards, and less incentive to mine, all the while bitcoin holders can exchange into the new network further reducing Bitcoins value.

How do you explain lower block reward? My understanding is block reward remains the same no matter the size of the mining infrastructure.

Bitcoin block rewards shrink as we know, but soon like 6 years it would be feasible to consider the transaction fee making up a significant part of the block reward. moving those fees to a SC would degrade Bitcoin.

Quote from: brg444 on October 30, 2014, 09:22:36 PM

Also, I don't see how 1:1 peg drains the ~~lift~~ life out of the host. Think of the main chain as a reserve account and sidechains as checking account. A well designed, 1:1 peg of Bitcoin that works in synergy with the main chain does not diminish the network IMO. These chains are effectively sub-chains.

at the moment you are growing the network if you invest in Alts, here is one eg. during the peek of DarkCoin, i was looking to see what the fuss was about and checking for an exit point. The biggest stall to the exponential growth was the KYC rules in place with Bitcoin gate keepers, manly it was diffident to buy Dark because people interested couldn't be hassled with going through BTC.

BTC may always be a bit geeky and not suitable for the masses, (still suitable for a reserve currency though) but imagine we do through a crises and you can transfer from your bank account directly into a SC and you can avoid the whole bitcoin exchange experiences with all the benefits of a 1:1 backing. you would use the better option, in that scenario the SC has a hider demand than bitcoin and speculators take advantage of arbitration. and bitcoins move into the side chain, and the Bitcoin network shrivels, and stop growing because miners cant make a profit from the transaction fees.

your vision of bitcoin being the backing for all of chain growth is only viable so long as Bitcoin is the MC, when it stops being the MC due to the Metacafe's law the SC will absorb and shake themselves of it, the SC may have an inflation sachem that rewards miners in a more favorably, be better amalgamated with the Banking carrells and it is not a stretch to see bitcoin being abandoned, or even needed.

SC that take improve on bitcoins utility do it by inflating value off chain, and bitcoin dosn't grow the SC grows.

Quote from: brg444 on October 30, 2014, 09:22:36 PM

Here is a rational proposition :

You have the Bitcoin main-chain and two sidechains : one for privacy and one for micro-transactions. Do you not agree that these can work in synergy and ultimately add value to the network by being supported by the same underlying currency (or technically BTC and BTC-peg). In fact, there is more incentives more miners to mine considering the expected increase in transactions and effective use of the network.

From my point of view it certainly is more beneficial to BTC than having Bitcoin and two other alt-coins that serve these features. I also fail to understand your arguments that these chains (in my example) would work as "for-profit" ideas.

micro-transactions are mute, Ive seen trust free technical solutions for this innovation with micro payment channels and potential with OT.

its not so much that the user case for SC to enable anonymity is not beneficial, the issue is you get the value leaking problem if the SC are beneficial. anonymity isn't so great when you want to prove you made a payment. at this point in time it is the No. 1 Killer app as there are lots of stolen coins wanting to come out, and it would help Bitcoin grow like in silk road commerce.

but ultimately Bitcoins Pseudonymity is forcing decentralized trust free serves like OpenBazaar and OT exchanges where your identity is never revealed, or if it is you chose which one. Decentralized and trust free everything is much more valuable then anonymous BTC, in a decentralized trust free world Pseudonymity is anonymity