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bene313 said..
But we've got all these companies raising all this capital through ICO and some of them will be successful. Some will end up being giants.

I would just treat ETH as ...hmmmmm.

There is no real world use case for smart contracts/coloured coins that is going to make a tech. giant. So far the only actual, real use case of Ethereum is making ICOs.

Both the market cap and the price are completely artificial.

Allow me to demonstrate: I have this great idea for an ethereum app called "PlayTime". It allows parents to allocate "play hours" to their children for time on video games, which can then be traded. Not only will it be able to manage and enforce how many hours children are allowed to play video games it will introduce them to the wonderful world of trading virtual currency (I emphasise 'virtual').

I've got a couple of star developers who are going to 'contribute' by being 'advisors' (for a cut).

I'm going to do an ICO with 30,000 tokens at 1ETH each. Now, I'm only going to release 1,000 in the first tranch and those that are lucky enough to purchase will receive a gilded poster of me, signed by me. Those that do not sell their tokens by the end of this year will receive a bonus 50% tokens as a token (pun intended) of our appreciation.

I have just created a market cap for a piece of **** of $10m. And pushed the price of ETH up as a result. And created artificial stability and price for my tokens.

Do you see what is going on here?

And that is the only use case so far for Ethereum; creating tokens for ICOs to artificially pump up the price. Eventually something is going to give: a bug in the framework, a company being the first to blink and cash in, a company crashing, something that will trigger the call of "bull****!" that everyone that's in on it is bursting to keep inside.

And that's why I hate Ethereum; it paints all the other cryptos in the same bad light (some fairly).

I have to admit it's an incredible, applaudable idea. But unproven.

I'll just leave this here: www.newsbtc.com/2016/08/17/gregory-maxwell-vitalik-buterin-ran-quantum-computer-scam/

ICOs do seem to favour ETH. But I have seen other currencies accepted, bitcoin, litecoin, ripple. So what you wrote about ICOs pumping the price of ETH applies to those other currencies too right?

The biggest ICO so far, Tezos, raised:

- 66,000 BTC or 223,500,000 USD
- 361,000 ETH or 113,000,000 USD

(At current exchange rates - was only 200m at the time of ICO)

Without these new start-ups, their ICOs and their blockchain applications, what exactly is the point of Bitcoin? Strip all that away and you've got two uses for Bitcoin:

1. International money transfers
2. Illegal activities online

And we'll see companies like IBM developing their own platforms where cryptocurrencies are not required. www.ibm.com/blockchain/hyperledger

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bene313 said..
ICOs do seem to favour ETH. But I have seen other currencies accepted, bitcoin, litecoin, ripple. So what you wrote about ICOs pumping the price of ETH applies to those other currencies too right?

And if $USD are used to buy the BTC that is used to buy the ICOs does that pump the $USD too?

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Without these new start-ups, their ICOs and their blockchain applications, what exactly is the point of Bitcoin?

It's an experimental currency.

Note that you can build smart contracts on Bitcoin, but nowhere near as easily as on Ethereum. Smart contracts will, as far as I can understand, be used as a part of the upcoming Lightning thingy for example. Bitcoin didn't go in the direction of Ethereum because simplicity = stability and security. Ethereum blockchain has a different purpose to the Bitcoin blockchain. Apples and Oranges.

If 99% of ICOs fail then you'll need to invest in 100 to find 1 that is successful. It will have to give you a 10,000% return to break even.
That's not impossible. Not at all. It'd be interesting to just put $1 on all of them.

Apologies everyone about carrying this topic on and on. It's all a bit dry and technical, and not fun at all. I hope you've enjoyed the funny images thread and the windsurfing caption competition ; )

****ing Ethereum...

From github.com/ethereum/wiki/wiki/Ethereum-Development-Tutorial

Gas

One important aspect of the way the EVM works is that every single operation that is executed inside the EVM is actually simultaneously executed by every full node. This is a necessary component of the Ethereum 1.0 consensus model, and has the benefit that any contract on the EVM can call any other contract at almost zero cost, but also has the drawback that computational steps on the EVM are very expensive. Roughly, a good heuristic to use is that you will not be able to do anything on the EVM that you cannot do on a smartphone from 1999.

EVM is the Ethereum Virtual Machine. Just like Java or VMWare or VirtualBox the EVM is apparently (even this is in doubt) a real, turing-complete virtual machine. A computer inside a computer. A software computer. Hardware written in software.

The difference with the Ethereum VM is that every node on the Ethereum executes the code; simultaneously; a distributed virtual machine.

Note that each step in logic is a transaction (bob pays alice) and comes with a transaction cost. You pay for computation using gas. While this encourages efficient code it still comes with a price for every computation. It's a rather unique model to say the least. Untested of course.

I have to admit this is ****ing mind-blowing. Really. It's ambitious to a level never seen before. It reads like a sci-fi creation. It's quite possibly genius.

But man oh man is it inefficient ("every single operation that is executed inside the EVM is actually simultaneously executed by every full node"), unproven, and quite possibly completely useless.

That said, as an investment and/or trade, you might do very, very well riding the hype bubble. But it is, mostly, a hype bubble.

Haha... like just ... tell me I'm not going mad here. Is this a joke?




This is DNT to BTC the last few days.

BTC is bitcoin. DNT is districtOx. "A network of decentralized markets and communities. Create, operate, and govern. Powered by Ethereum, Aragon, and IPFS." district0x.io

DNT has gone up 300% against BTC in the last 12 hours or so. So I had to find out what it actually was.

Here's the current (and only) feature community on districtOx; Ethlance. ethlance.com
It's a freelance job site. 1) We don't need another one, 2) you can get paid in ether on any job site if you want, 3) who want to pay or get paid in ether it being so ****ing volatile? By the time you finish the task it may have dropped or climbed 50% or more.

Here's where I lost it:

memefactory.io
"Coming soon to the district0x Network. Create and trade provably rare digital assets on the Ethereum blockchain."

Provably rare digital assets? Memes?

It gets worse:
"DNT is a staking token, used by holders to join districts and participate in their governance. Basically, you become a "shareholder" of the district if you stake your DNT in it.Once you stake your DNT in a district, you receive voting shares in that district's Aragon entity, which are used to determine everything from a district's branding and design, to the way in which they choose to attempt to monetize, to how any revenue generated is distributed or utilized.Hence, token holders can share the profits generated by the districts that they have stake in."

So you don't even get a share in the overall profitability of the company, you get a profit of whatever district you have a stake in.

Maximum Market cap at ICO = $83m

Man, Ethereum is going to give all cryptos a bad, bad name. I mean how many cryptocurrencies do we even need? Answer: one. The obvious choice is Bitcoin. Everything else is a copy.

Bitcoin (BTC) price against $USD since this thread started on 31 May:


$2191 to $3717 = +70%

Or you could look at it as the $USD crashing.

It's just begun to go mainstream. Goldman Sachs has been reporting technical analysis for a while (and been pretty damn accurate I might add; if this run stops at 3600 they'll be right again). Alphabet (Google) have an options market opening next month.

There is a wall of respectable money heading at this thing.

CNBC are starting to discuss it often
www.cnbc.com/video/2017/08/09/this-is-why-bitcoin-could-be-the-new-gold-tom-lee.html

Its going beserk evil panda there are some real winners amongst it however there are also a couple sliding down the chart into oblivion......

I have been reading clif high reports he is somewhere between a genius and a lunatic..

Looking at just bitcoin (as I do) the recent "bubble" isn't nearly as "bad" when you look at it using a logarithmic scale:

www.blockchain.com/charts/market-price?timespan=all&scale=1

Logarithmic makes more sense; between dates A and B it went up 10x, between dates C and D it went up 10X.
It is compounding.

vs linear scale, which is how it is commonly shown:

blockchain.info/charts/market-price?timespan=all

You could very well argue bitcoin is only "chugging along", historically speaking.

It's still early days. Mainstream is just catching on. Deflation hasn't even started (~16m of total 21m coins mined).

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evlPanda said..
Looking at just bitcoin (as I do) the recent "bubble" isn't nearly as "bad" when you look at it using a logarithmic scale:

www.blockchain.com/charts/market-price?timespan=all&scale=1

Logarithmic makes more sense; between dates A and B it went up 10x, between dates C and D it went up 10X.
It is compounding.

vs linear scale, which is how it is commonly shown:

blockchain.info/charts/market-price?timespan=all

You could very well argue bitcoin is only "chugging along", historically speaking.

It's still early days. Mainstream is just catching on. Deflation hasn't even started (~16m of total 21m coins mined).

Haha. Change the scale. Change the story. Confirmation bias at its finest.

If you put anything that is growing on a linear scale it will eventually become infinitely steep (what's the word?) exponential. Anything. More so if you are looking at it from the beginning of (its) time.

These charts are from 1950 - 2016.

S&P500 Linear:



S&P500 logarithmic:



Logarithmic shows percentage changes much better than linear. This is why most traders use logarithmic, much more so for something that has increased in value a lot over time. Linear is more useful for something that has been stable over a period of time.

Using the above examples the recent spikes look terrifying in the linear version, but looking at the logarithmic version you can see that historically they are quite normal.

It's more often about percentages, not raw value.

Is the Dow Jones in a worse bubble than bitcoin? Aaaaargh! Everything is in a bubble!!!!



Of course not. Linear is the wrong chart to use.

Wikipedia gets it right: en.wikipedia.org/wiki/Dow_Jones_Industrial_Average

Bummer; it hasn't even gone up 10% today

Blockstream in Space:
blockstream.com/2017/08/15/announcing-blockstream-satellite/

Use case:
Downloading blockchain to sign offline transactions.

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evlPanda said..
Logarithmic shows percentage changes much better than linear. This is why most traders use logarithmic, much more so for something that has increased in value a lot over time. Linear is more useful for something that has been stable over a period of time.

Totally agree evlPanda - this has absolutely nothing to do with confirmation bias.

If you double 100, you get 200, and increase of 100
If you double 1000, you get 2000, and increase of 1000
Both examples of doubling end up with 10 fold ratio in absolute change.
The "semi-log plot" removes this aberration.

Firstly pod charts and a useful bit of information, epic...

second the total market is over 140 billion which is double from start of this thread.....

This is crazy right now.

What to make of the oscillations that are going to happen between mining bitcoin (btc) and bitcoin cash (bcc) as the difficulty and profitability keeps adjusting?

I don't think anyone knows, nor possibly could know.

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evlPanda said..

This is crazy right now.

What to make of the oscillations that are going to happen between mining bitcoin (btc) and bitcoin cash (bcc) as the difficulty and profitability keeps adjusting?

I don't think anyone knows, nor possibly could know.

I just hope you are not that character in that free-falling truck ?

That's my bitcoin.

Depending on how you look at it either 1 btc still equals 1 btc, or the $AUD has lost about 45% of its value since this thread started; from 0.00035 btc to 0.00019 btc. Thankfully mine is mostly debt.

$AUD now @ 0.00017.

Hey buster I agree but now all the bankers are jumping in and either starting up or advising or buying in.
there are also now "portfolio" teams where you buy in and it's across the top 20.
Oh and you think ya super funds are safe.........google it ..
im in and riding the wave

Awsome razz .....Send us enough of your money and ill send you my new web address. That bubble gota burst.
The original bitcoin?

SMSF and bitcoin. How would you prove ownership to your auditor?

You have to store it off line and keep transaction records

Seems to me like clever marketing of the bitcoin seem to be creating a demand. Mabe jumping on the band wagon might work;-) But id place it in the category of "HIGH RISK" Feed your family first and pay of your mortgage!

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busterwa said..
Seems to me like clever marketing of the bitcoin seem to be creating a demand. Mabe jumping on the band wagon might work;-) But id place it in the category of "HIGH RISK" Feed your family first and pay of your mortgage!

Def HIGH RISK...

I've been playing with crytos since reading this thread a few months ago.
It's become a bit of a hobby/addiction, turned 2K into 5 - quite fun especially when your up.

I personally don't think blockchains are going to go away - any time soon.

so get your 2k back and run the 3k as milk money ? Play the game .\don't let it play you. Your money is an expendable bag of peanuts. Good luck to you anyways its not for me! NO_CONVERSATON_EXISTS

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bene313 said..
SMSF and bitcoin. How would you prove ownership to your auditor?

Sign a message from the address.
Electrum (or any decent wallet) > Tools > Sign/verify Message...

Message: Hi bene313. This is one of my addresses but I do not live here.
Address: 14kY5Satp64CvBgfPzkH5s4KpMtw3KXpFo
Signature: H0q/3h6ymBoG3lvnamuAst77K2Xw232cajEPR6n6WB3dAMhO+f9/mMiqdetM6U8llaXEZSlUEPTO23A6cxbCvo8=

You verify the same way. Here's an online verifier:
www.hugedomains.com/domain_profile.cfm?d=coinig&e=com

As for SMSFs: Do not invest more than you are willing to lose. All manner of things could happen to what is still an experimental currency. There could be a technical issue such as a security hole. There could be political pressures to restrict or completely halt all the exchanges. Or something completely unexpected.

i.e. Only put in what you are willing to completely lose.

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toppleover said..

It's become a bit of a hobby/addiction...

Doesn't it? Been into it since about the start of this thread too, and right now I'm downloading the bitcoin chain preparing for a miner I bought : \

It's just a USB miner; a toy. I've calculated I'll lose $8/year on it. (better than lotto)

But running a full node gives me all the security and all the rights that come with that.

So yeah, it gets addictive. All the drama is pretty interesting too; the recent fork for bitcoin cash; sheesh!

^^ apparently lot of people in Russia got sucked into the mining for cryptos scam..
When I was in Moscow last Jan, saw the billboards like this one


"Don't Mine, Dad"

Actually Russia is one of few places where the electricity is cheap enough that you could turn a profit; about $AU0.07/kWh, often less. The cost of electricity is the main factor in mining profitability, you could never do it here.

How would a mining scam even work? Dad buys a miner, sets it up, and ...what? I'm genuinely curious. Please tell me.

Mining is using cryptography to encrypt a block of transactions, which then get added to the blockchain. It's relatively simple mathematics. It can be done with pencil and paper, albeit very slowly.

www.righto.com/2014/09/mining-bitcoin-with-pencil-and-paper.html < the video fast forwards many times, so is watchable.

It takes a few seconds to calculate if you will be profitable or not. It's no secret.
There are hundreds of these: www.coinwarz.com/mining/bitcoin/calculator

----------------

...It's no secret.

I wonder if that is what people are not understanding. It's ALL open source. Everything. All of the code for Bitcoin, the wallets, whatever is all open source. That means you can read, copy, modify all the code, do whatever you want with it. (your copy of it)

Here is, literally, Bitcoin: github.com/bitcoin/bitcoin

A decade or more ago open source was written off, now it powers almost everything. The internet. Your phone. Microsoft, Oracle et al have all embraced it. It is, paradoxically, much safer.

More open source empowering the future: www.emojicode.org

"How would a mining scam even work? Dad buys a miner, sets it up, and ...what? I'm genuinely curious. Please tell me."

The mining rigs sellers promise 350% return..
Dad (usually poor) needs about1,3M rubles to buy..he borrows or sells his parents home or sells his kidney etc..