12486 is the one in pink.

Could ASIC Miner be mining in Discus Fish?  It is now ~25% and has grown a lot in the last couple of months.

That doesn't make much sense.  It's up to the market to price the shares, which will determine their yield percentage.  Targeting a particular rate of yield is not something FC can control unless he can set the share price.

In general, yield will be high when there is not much expected future growth.  Yield will be low when the market is expecting future growth in dividends.

OP likes authority and censorship.  OP wants to centralize bitcoin and have man-made decisions to control bitcoin's store of value and ability to transact.

OP, get the fuck out of bitcoin and go back to federal reserve notes.  Sounds like a perfect currency for you.  Maybe you should join the government too and try to assert more control over other people's lives.

My understanding from the paper is that they were able to collect thousands of IP address of "clients" who were doing outbound connections only (apparently 90% of peers).  Is this because those client's don't have listen=0 set?

What about SPV nodes on peoples phones - I'm assuming they wouldn't / shouldn't advertise their addresses?

So to rephrase my question - why are so many nodes advertising their IP addresses if they can't accept incoming connections?

Why do addr messages propagate for nodes who don't accept incoming connections?  If you know you're outgoing-only, you should be able to indicate so in your version message, so that the peer doesn't share any information about your IP address to others.

A company's valuation is based on discounted expected future earnings.  With bitpay you have to look at how much will they be earning next year, then the next, then the next?  We already know that their revenues grew 10x last year.  We've also heard that BitPay is presently making buckets of profit.  Bitcoin hasn't even began to hit consumer adoption yet, so if the trend continues then there should be many years worth of exponential growth with a high profit margin.

It's a peer-to-peer mesh network.  Peers relay information to each other.  For example, if you create a transaction to spend your coins, you will broadcast that to your peers, and they will first validate it and then relay it to their peers, and this process repeats until all nodes in the network have your transaction in their memory pool.  Note that being in the memory pool does NOT make your transaction confirmed.  It needs to be mined to be confirmed.

A confirmation is when a miner finds a block.  A block is broadcast in the same way as transactions are.  The miner who discovered the block sends it to his/her peers, then those peers first validate it and then forward it, until everyone sees the new block.


So to mine, you first construct a candidate block for the next block in the chain.  This will consist of a block header including a reference to the previous block, a timestamp, plus a merkle root referring to the transactions you include in the block.   You can read more about the specific data structure here: https://en.bitcoin.it/wiki/Blocks

You can include whatever transactions you want in the block (eg. the unconfirmed ones taken from your memory pool) so long as they are valid.  You also include a coinbase transaction to pay yourself the 25 BTC reward.

In order to make the block valid and accepted by the rest of the network, you need to satisfy the proof-of-work criteria.  That is, the block header, when double-sha256-hashed, must result in a number below the current target.  In order to keep attempting new hashes, you have to slightly vary the block header, which is why there is a nonce field.  When the none field overflows, you can try vary the merkle root by changing the coinbase transaction.

So, to answer your question, you know you've found a valid block when you find one that hashes to a low enough number.  Everyone knows what the target is because it's derived directly from the chain you are working on.

Take a look at the latest block hashes on blockchain.info, eg: http://blockchain.info/block-index/404079/00000000000000006fae4d3d108cfdbb0d29f3e1e611061e40e267a6f7d1607e

As you can see, the block's hash is a *very* low number relative to the 256-bit hashing space (lots of leading zeros).  You can verify it for yourself by hashing the block header (80 bytes) twice and confirming that you get the same number.  The fact that the miner produced that block with such a low hash, proves that they put a lot of work into finding it.

Many of them marketing themselves as ultra-secure storage where the wallet provider can't steal your coins.  This is a myth though, since the service controls both your wallet code and co-signature, they could easily obtain a 2nd key and take your money.

I think cryptocorp has the right idea.  They are advocating for separation of wallet and oracle.  They might lose out though - the market will probably go towards all-in-one solutions under the false belief that they can never steal your coins, until the next goxing happens.

Hi Mike,

Thanks for the link to those design notes.  I see your point and agree that it makes more sense to provide a plugin interface for oracles and leave the wire protocols to be bespoke until the whole space matures.

One thing that I didn't understand from your document was this line:


How does BIP 70 prevent the need for multisig addresses?  My understanding was that BIP 70 operates at a higher level on top of the blockchain, by simplifying the workflows involving payments and address management.  But we would still need P2SH multisig scripts in order to provide blockchain-level security involving risk analysis services / oracles.

I am interested in building a RA service as you call it, so would be keen to know when bitcoinj has this implemented.  Even if you had just a basic sketch of the plugin API so that I know what type of calls would need to be implemented, that would be great for me to get started on trying to build something.

Thanks.

Hi,

Has there been any discussion/effort around planning for a standard interface for wallets to integrate with multisig oracles?

There's a company building their own API who have also developed an integration for Electrum and Brainwallet, but I don't think this is using any form of standard API.

https://cryptocorp.co/technology.htm
https://cryptocorp.co/api/

I think it's going to be super important to have this functionality in wallets, *especially* ones on your phone.  I can think of so many good use cases but I won't get into them here.  I just hope that rather than having bespoke point-to-point integrations between certain wallets and oracles, we could instead have a standardised API so that a wallet user could browse a list of oracles and choose which one they want to use.

Also I would be interested in working on an open source oracle server implementation.

That's in the "how does it work" section.  That's more targeted at more tech savvy people who actually want to try to understand a bit more about what's going on behind the scenes.  For most people, they would only read the first part.

I think most computer users below the age of 30 would have no problem understanding those 2 lines though.

Hi,

I have written up a description of "What is Bitcoin?" and "How does it work?", which I am hoping will make sense to lay people.  Initially I wrote this as an entry for a writing contest on another subforum, but I thought it would be better to keep this in the public domain in case anyone else wants to make use of it.

=========

What is Bitcoin?

Bitcoin is online cash.  Unlike traditional cash which must be passed around physically in the form of notes and coins, bitcoin is purely digital and is passed around by users over the internet between their “digital wallets”.  A digital wallet is simply an application running on a smartphone, laptop, tablet or other internet-connected device, which behaves like a wallet by storing bitcoins and allowing the user to send and receive bitcoins to other users.

Bitcoins themselves are a new form of digital content.  Most people who have used the internet will already understand that digital files can be copied and shared (eg. pictures, music, videos).  This ability to make new copies of files means that we could never use files as currency since there is no true scarcity to anything digital.  The major breakthrough behind bitcoin is that it has done what was previously thought to be impossible, by creating digital “coins” which, like files, can be sent directly from person to person, but unlike ordinary files, they cannot be duplicated.  The act of sending a bitcoin to someone else means that the sender no longer possesses it.  Like passing a physical coin, it leaves your wallet and enters the wallet of the new owner.  In this sense, bitcoin is the invention of truly scarce digital property.  This scarcity allows bitcoin to function as a currency, as well as holding promise for many other innovative applications.

Just like physical property, bitcoins can be lost, misplaced, or stolen.  However, properly secured bitcoins are, theoretically, impossible to steal, and a properly backed up bitcoin wallet will be protected from accidental loss.

The combination of being scarce, freely globally tradeable, secure, and impossible to counterfeit, make bitcoins highly valued.

The bitcoin system has been designed to have a limited supply of 21 million bitcoins.  However, individual bitcoins are divisible into tiny pieces, even millionths of a coin can be transferred, so there is more than enough bitcoin to function as a full scale currency.  Users are not restricted to trading whole bitcoins at a time.


How does it work?

Bitcoin is based on a “mesh network”.  Rather than having a central server that all bitcoin wallets connect to, the wallets all connect to eachother.  This is known as “peer-to-peer” networking and resembles a similar architecture to file sharing technologies such as BitTorrent.  Peer-to-peer networking is highly resilient against censorship and control, since it has no single point of failure.

Bitcoin transactions and balances are derived from a shared global database called the “blockchain”.  The blockchain is built and maintained collectively by all bitcoin participants.  No single person, organization, or government can control this database.  Instead, everyone collectively administers it under a pre-agreed set of rules which ensure fair and honest transactions.  Any attempts to break these rules will be ignored by honest participants in the bitcoin network.  So long as the honest participants collectively control more than 50% of the network, bitcoin payments will remain irreversible.  When we refer to “control” of the network, this refers to computational power, which can be voluntarily contributed by anyone willing to do so.  This contribution of computing power is called “mining”.  Miners are rewarded for their contributions by sharing in the newly mined bitcoins.  Miners are also paid voluntary transaction fees that other bitcoin users may attach to their transactions.

The first bitcoins were created by miners at a rate of 50 every 10 minutes.  This initial period lasted from 2009 until late 2013.  From 2014 through 2017 the reward is halved to 25 bitcoins every 10 minutes.  The mining rewards will continue to be halved every 4 years until approximately the year 2140 when the last of the 21 million bitcoins is mined.  Beyond this point, miners will continue to be funded by transaction fees paid by other bitcoin users.


=========

I haven't yet tested this on lay people to see if it makes sense to them and answers their questions.  I'm not a professional writer, so this could probably be tidied up to be a bit easier to read.  I'd greatly welcome any revisions and feedback.  Thanks!

Just wanted to share my observation regarding the way the altcoin scene has been shaping and evolving.  I started watching altcoins around early 2013 when I got into Bitcoin, so there's probably some history before that which I'm missing.  I've divided the evolution up into some distinct phases.

Stage 1: Technical differentiation

The first wave of altcoins attempted to stand out through their technical differences.  The most common selling point was the block interval, which progressively became faster and faster until it hit the limits of practicality (eg. 30 second coins).  Other common tweaks were: different proof-of-work algorithms, different inflation schedules / block reward schemes, and proof-of-stake.

By the end of this phase, there were hundreds coins with different combinations of technical parameters.  It was becoming increasingly hard for any new coin to attract a following based on technical parameters alone.

Stage 2: Popular appeal
This phase kicked off with Dogecoin.  Dogecoin rose out of the sea of hundreds of altcoins and obtained a mass following and significant market value within weeks.  This was all on the back of a popular joke.  Dogecoin proved that marketing and popular appeal was key to building a successful coin.  Following dogecoin, many new popular coins emerged with professional-looking websites & logos, and funny themes (eg. Kanye Coin, Kitteh Coin, Bro Coin, Ron Paul Coin etc).  By the end of this phase, there was a coin for so many different memes/animals/people, it again became difficult for any new coin to stand out.

Stage 3: Airdrop Coins
This began with Auroracoin which, like Dogecoin, proved a new formula for success and caused many to try to emulate it.  This time the formula was to associate the coin with a specific nation or community, premine a large portion of the coins, and announce a date when the coins would be "airdropped" or distributed for free to all members of the target community.  Following the surge in value of Auroracoin, many other coins have replicated this same pattern, such as Spaincoin, Aphroditecoin, and Silicon Valley Coin.

Anyone got any thoughts/comments on this observation of the three trends?  Maybe there were other phases that I'm missing.  What's next after we get saturated with too many airdrop coins?

"Milli" implies it is a fraction (1/1000th).  So moving to milli's doesn't totally solve that psychological problem.  That's why I think counting up from satoshis is better.

It's not a millibit, it's 100 kilotoshis!

10 "millibits" = 1 megatoshi

This is why I think a 3-tiered architecture should exist for cold storage.

1) Key generation device: Simple device which takes some entropy and generates a private key / HD wallet.  This could do it using coin flips, or with a tamper proof, trusted RNG.  It doesn't have to be a full fledged computer with OS.
2) Offline signing device: Used for storing the private keys and signing transactions.  This could run on any pre-bitcoin OS as suggested by someone else on this thread, or a modern OS image that you trust.  So long as it is airgapped, the keys shouldn't ever be compromised.
3) Blockchain management device for generating unsigned transactions and transmitting signed transaction to the bitcoin network.

The tricky part is making sure that the signed transaction from device 2 does not contain some kind of hidden encoding of your private key.  But that should be unlikely if device 2 isn't compromised with malware.

Thanks.  Those threads are definitely of interest.

Reading them made me realise that a really good application of this idea would be to build a distributed altcoin exchange.  Altcoin exchanges are essential because trading from BTC into an altcoin and back is almost like the zerocoin concept, so long as the exchanges are black boxes.  Imagine a distributed exchange that replicated itself with the profit!

The obvious weakness here is that people with physical access to the hardware can steal its wallet or manipulate the software, and it would be easy to trick an autonomous agent into purchasing a VPS from you for this purpose.