Re: Gold collapsing. Bitcoin UP.

If the notion is that: "Side Chains are great because people more foolish than I am will mistakenly trust some bad ones, and use them, and lose some of their coins making mine more valuable."
Than this isn't particularly good for Bitcoin if people lose confidence in it, so whether it may or may not be good for one's own bitcoin value is questionable.

Here is one scenario where BTCs may be lost to MC in this way, essentially rendered unspendable through an economic activity.

1) Some BTC is SPV'd to scBTC₁.
2) Some scBTC₁ is SPV'd to scBTC₂.
3) scBTC₁ is discovered to be a scam (or just a bad implementation) whereas scBTC₁coin massively inflates so that no one on scBTC₂ has any incentive to SPV back from scBTC₂ to scBTC₁ and so no way to return to MC.

(Yes, you can create a side chain from a side chain.)
complexity risks...

Edit: Is there a way to have such an event without sidechains, or is this a "new" risk?

well essentially you're suggesting the coins were initially transferred to a non-secure scheme without proper due diligence from the owner so my answer is no, this is not a "new" risk.

Can you help me understand how do we do this without the side chains?
For example, using an alt coin does something quite different:
If I sell bitcoin for an alt coin which turns out to be a long con scam, but before the scam was sprung, I had traded them to a different alt coin, I could still trade that second alt coin for BTC, and the BTC I initially traded away are not essentially "burned" they are still being exchanged on MC by whomever got them from me.

It doesn't matter if you transfer it to a second, third or fourth sidechain. The onus of your decision is in validating the security of your initial transfer off the Bitcoin mainchain.

Either you keep your Bitcoin on chain or you take the risk of trusting some other scheme with your coins. What is the incentive? What are the risks? Any ensuing event will be a consequence of that decision. Once you leave the mainchain you forego your position in the only established trustless crypto environment.

we're worried about ordinary ppl who in the future might want to get into Bitcoin. they won't have the technical expertise or knowledge to know what's going on. as we've seen from altcoins, they can always attract a crowd be it with deception or true value. to think that SC's changes this is to be determined. you did see my post from earlier today?

Quote from: cypherdoc on November 07, 2014, 03:39:07 PM

it's starting already.

Truthcoin, enabled by SC's!

http://www.truthcoin.info/

So do I understand that you agree with me that a new risk is not introduced? There is always an inherent risk when trusting your Bitcoins to be somewhere else than on the blockchain.

Now to be completely fair, does Sidechain offer new schemes that could potentially abuse and profit from this risk? Probably. But from my point of view this is the nature of the beast : as the technology evolves so does the potential for more elaborate scams.

no i don't agree. i think NL's example is a good one showing increased risk.

ordinary ppl won't necessarily understand the bolded statement as you presume.