Blockchain update

[Southernguy]

Re: Blockchain update

Thanks a lot, Adeptus. Your insight very appreciated always. Do hardware wallets support Monero, Eos, Cardamo or Tezos?

[Adeptus]

Re: Blockchain update

Thanks a lot, Adeptus. Your insight very appreciated always. Do hardware wallets support Monero, Eos, Cardamo or Tezos?

Some yes, some not yet as they are too new.

1.Monero has a windows graphical and text base wallet. They are a bit clunky but work. ledger hardware wallet has stated they are working on Monero integration but i am not aware of ETA.

2. EOS the official blockchain wont launch until around june/july 2018, so at the moment the EOS tokens are just a futures token on top of the Ethereum network and once the official EOS blockchain goes live you have to go through some convergance process to claim your EOS tokens on the official blockchain. So the tokens you are buying now can be stored on a hardware wallet with the help of MEW (MyEtherWallet.com). I am on my cell texting this right now so cant go into details but easentialy MEW works with the hardware wallet as a sort of extensionnof it but your private keys are always safe in your hardware wallet.

3. Tezos did a presale and gave every contributer private keys that most people are storing as paper wallets until the main blockchain launches around end of Feb or March 2018. So the XTZ tokens being traded on exchanges now are just derivatives that I believe ( dont quote me on this) those exchanges consider IOUs that the exchanges will credit you for real XTZ tokens once the main blockchain launches. In other words, those exchanges likely bought some tezos during the ICO and are offering them as IOUs. I am not up to speed on which hardware wallets will support tezos yet. I linked two above so try to find on their websites if there is anroadmap integration for Tezos. I would expect at minimum there will be a linux and windows wallet and MEW will also add Tezos and then eventually we will see native support on the hardware walets.


My advice is to order the hardware wallets ASAP, it can take 1 to 2 months to receive one of these as the user adoption is exploding by millions of new people per month and these wallet manufacturers were not prepared for this. I can tell you i recenty waited almost 4 months for my ledger blue wallet! My trezor arrived after about 1.5 months and this was before the mad rush in the past 2 months. If you plan to invest any significant money in this space then why not get a couple of each wallet?

Also understand that each hardware wallet vendor will only support between 5 to 8 crypto currency types per wallet due to some space and integration limitations , but by using the hardware wallet in combination with MEW, you can have access to store many more dozens and includes 100% of Ethereum ERC20 tokens which covers about 80% of the entire ICO space (icoalerts.com).

In all honesty the price speculation of blockchains is way ahead of the infrastructure and even for IT folks it can be challenging at times. It's like price wise we are in 1999 but infrastructure wise we are still in like 1992 and user adoption wise probably around 1996.

4. Cardano has a windows wallet that you install but havent checked if its on MEW or not and its probably not going to have native hardware wallet integration until much later in 2018 if i had to guess.


Lastly, word of warning... Https://MyEtherWallet.com is used by hundreds of thousands of crypto enthusiasts and so already there have been copy/cat fake sites with slight mispellings trying to get people to send their coins to them. Once you get to the real site, bookmark it so you dont have to type it manually each time, also read all their warnings on there.

[touchring]

Re: Blockchain update

Why isn't it possible for someone to print bitcoins? I mean, it can be printed on some special security paper?

[jk]

Re: Blockchain update

Bitcoin - gold 1980 redux?

One of my favourite trader war stories comes from Jim Rogers. In the late 1970’s, Jimmy was long gold (I know, shock!) In the early months of 1980, gold went parabolic. Traders were scrambling to buy their inflation hedge, and just-get-me-in orders were flooding the exchanges. Well, sensing the mania was getting out of hand, Rogers pulled out some pink tickets. He was within two days of the high. Problem was, he was 60% early in terms of price…
This week’s Bitcoin rally reminds me of that period.

The trouble with my analogy? The moment you translate the chart to a percentage return scale, you realize we are talking about two very different magnitudes of rallies.

Boys and girls, timestamp this moment in your mind. This Bitcoin rally is truly historic.
An interesting part of this phenomenon? As Bitcoin has rallied, more people believe it to be undervalued and less claim it’s a bubble....


Well, I guess you can count me in the old-school non-believers. The other day I was listening to Bill Fleckenstein on Jim Grant’s podcast, and as usual, Fleck articulated my concerns much better than I ever could:

…if you can overcome the intellectual hurdle of the fact that the amount of bitcoins is supposed to be limited, yet the number of potential forks is unlimited, and the fact that the number of potential alternative crypto currencies is infinite and oh by the way, the block chain is what most people yap about, yet you don’t own it. I submit if you can overlook all of those things, and ignore that it has gone from 28 cents to [16,000] dollars, then [yeah, it’s great…]

Yet all of these concerns are currently moot. Full blown mania has enveloped the public. And although I was not nearly smart enough to be long, I am enjoying watching the madness of crowds. As a student of the markets, this is one for the history books.
https://us5.campaign-archive.com/?e=...&id=14bb4c70c8

[Adeptus]

Re: Blockchain update

Bitcoin - gold 1980 redux?
Well, I guess you can count me in the old-school non-believers. The other day I was listening to Bill Fleckenstein on Jim Grant’s podcast, and as usual, Fleck articulated my concerns much better than I ever could:
…if you can overcome the intellectual hurdle of the fact that the amount of bitcoins is supposed to be limited, yet the number of potential forks is unlimited, and the fact that the number of potential alternative crypto currencies is infinite and oh by the way, the block chain is what most people yap about, yet you don’t own it. I submit if you can overlook all of those things, and ignore that it has gone from 28 cents to [16,000] dollars, then [yeah, it’s great…]
Yet all of these concerns are currently moot. Full blown mania has enveloped the public. And although I was not nearly smart enough to be long, I am enjoying watching the madness of crowds. As a student of the markets, this is one for the history books.
https://us5.campaign-archive.com/?e=...&id=14bb4c70c8

Love that chart!


So let me explain a couple of things:
* Number of potential forks is unlimited - true; however, that's like saying, hey the number of different versions of Linux is unlimited, because it's all open source. You can just copy it, change the name, the logo, change a few parameters here and there and Voila! In reality, only 4 or 5 versions of Linux dominate the market. What is not always understood is that, like in Venture Capital analysis of startups, the #1 thing that matters is the team. So if you are a team of 1 or 5 or 10 (i.e. ETC - Ethereum Classic), vs a team of 500+ developers (ETH - Ethereum). That makes a difference ($22 vs $440 valuation per token). If your team has no genius devs & leaders, if your roadmap has nothing substantially better, the success of your blockchain (and thus its valuation) is written on the wall. Sure there are 1000+ blockchains now, but the top 10 or so have 98% of the valuation market share. There are a few legit reasons to create forks. Most considered ones are philosophical disagreements in direction, like Bitcoin vs Bitcoin Cash, where how to scale the blockchain was a 2+ year long feud. Or Ethereum vs Ethereum Classic where "immutability" was sacro sanct for some. But without needing to go into a lot of detail, just pay attention to what will happen with: Bitcoin Gold, Bitcoin Rhodium, Bitcoin Silver, Bitcoin Platinum, etc... these won't survive long, or if they do it will be at very very low valuations.


* Blockchain is what most people yap about - only if you are getting your info from mainstream media. There's 2 main types of blockchains:


1. Public blockchains (i.e. Bitcoin, Ethereum, Monero, Tezos, EOS, etc) and Private Blockchains . The 1000+ blockchains we can clearly see the valuation for, these are public blockchains. They are open source, they are boarderless, their intention use cases are global - for all users, they are permissionless (you can innovate without permission), they have huge competition and only the best will survive. They also have 90% of the developers out there.


2. Private Blockchains (i.e. HyperLedger - IBM, Corda, Ripple Labs, etc) - These are blockchains developed by private Enterprises or consortiums. Their source code is NOT open source, their use cases are very narrow and specific, you cannot buy them (except through owning shares in the companies), they are going to be highly succeptible to security issues down the road because there are far less eyes examining the code base, they also strip out the consensus algorythms (i.e. mining) which also reduces security, in its place they use permision based ledgers - which means, the blockchains will serve to operate between 5 or 10 or 100 companies within 1 industry for a specific use case (i.e. end to end logistics tracking of food items) and only those companies can append to the blockchain ledger, nobody else will care about them.


Private blockchains aim to improve specific inneficiencies in specific corporations (i.e. faster and cheaper remittances for banks with Ripple or Corda), whereas; Public blockchains aim to disrupt EVERY industry.


One analogy I've seen used which works well is Internet vs IntrAnet (corporate internal websites that only employees can access for private company info). When you go home at night after work, what do you do? Do you VPN back to your coporate network and surf the IntrAnet all night? No! Why? Because it sucks. You can't do anything YOU want on it. There is no Netflix, no Youtube, No Social media, No games, No newsfeeds, No interaction with the rest of the world. What good is a network that only has a half dozen websites you can use?




What makes the Internet amazing is not TCP/IP (how data gets transfered) or HTTP (web protocol) - because those protocols also exist in private company IntrAnets. What makes the Internet Amazing is that it is: Open, Permissionless, Boarderless and Censorship resistant!


Another analogy: Private Blockchains vs Public Blockchains is like comparing monks who hand wrote bibles and whose content was extremely controlled, whose access was limited, whose content was extremely limited... vs the printing press revolution - where access to create your own machine became open, where permission to write whatever was not highly constrained, where printing presses became a global phenomenon, and anonymous texts could be written and distributed.


So yeah, when you hear the word blockchain, understand which type of blockchain they are talking about. Both have uses, but public blockchains is where the action will be and not all of them will survive or become big.

[Adeptus]

Re: Blockchain update

Here's a handy chart related to the above:

[akkibaba]

Re: Blockchain update

Adeptus
PS. Thanks to Crypto Currencies, I am going to officially quit my job in January and retire decades ahead of time!

Congratulations Adeptus!!!!

[Adeptus]

Re: Blockchain update

Why isn't it possible for someone to print bitcoins? I mean, it can be printed on some special security paper?

I think you are probably thinking of these guys:
source: https://bitcoinpaperwallet.com/

Note, I have never used these or others, so I am not endorsing them, but I have read about people using such services. The problem with paper wallets is that the papers can be damaged with water or burn. So I've seen people double zip lock bag them, then put them inside a fire proof safe to mitigate that risk, then put that small safe inside a bank vault for physical security, but I still think metal plate wallets cut in half and geographically dispersed is a superior backup solution.

A few examples:
https://www.youtube.com/results?sear...metal+stamping

[DSpencer]

Re: Blockchain update

Bitcoin - gold 1980 redux?

Boys and girls, timestamp this moment in your mind. This Bitcoin rally is truly historic.
An interesting part of this phenomenon? As Bitcoin has rallied, more people believe it to be undervalued and less claim it’s a bubble....


Well, I guess you can count me in the old-school non-believers. The other day I was listening to Bill Fleckenstein on Jim Grant’s podcast, and as usual, Fleck articulated my concerns much better than I ever could:

…if you can overcome the intellectual hurdle of the fact that the amount of bitcoins is supposed to be limited, yet the number of potential forks is unlimited, and the fact that the number of potential alternative crypto currencies is infinite and oh by the way, the block chain is what most people yap about, yet you don’t own it. I submit if you can overlook all of those things, and ignore that it has gone from 28 cents to [16,000] dollars, then [yeah, it’s great…]

Yet all of these concerns are currently moot. Full blown mania has enveloped the public. And although I was not nearly smart enough to be long, I am enjoying watching the madness of crowds. As a student of the markets, this is one for the history books.
https://us5.campaign-archive.com/?e=...&id=14bb4c70c8

It really is just fascinating to watch as a bystander. I've always been intrigued and at times seriously considered buying some as a fun speculation, but never did. I just can't imagine buying in now. I guess people probably said that at $1000 and $5000 too. The fact that there is nothing tangible to connect the valuation seems to make any support or criticism of its value seem arbitrary. Doesn't this volatility undermine its value as a currency though?

The technology has lots of interesting applications, but I'm struggling to understand why that means any particular coin should be worth a huge amount of money. This rally seems almost entirely fueled by speculation rather than widespread adoption or technology breakthroughs of any particular coin. Maybe adoption in countries with inflating currencies is driving the price more than I realize? Otherwise it seems like when it's realized that everyone can't get rich by pumping up the price of cryptocurrencies the valuations will fall back to earth.

[touchring]

Re: Blockchain update

It really is just fascinating to watch as a bystander. I've always been intrigued and at times seriously considered buying some as a fun speculation, but never did. I just can't imagine buying in now. I guess people probably said that at $1000 and $5000 too. The fact that there is nothing tangible to connect the valuation seems to make any support or criticism of its value seem arbitrary. Doesn't this volatility undermine its value as a currency though?

The technology has lots of interesting applications, but I'm struggling to understand why that means any particular coin should be worth a huge amount of money. This rally seems almost entirely fueled by speculation rather than widespread adoption or technology breakthroughs of any particular coin. Maybe adoption in countries with inflating currencies is driving the price more than I realize? Otherwise it seems like when it's realized that everyone can't get rich by pumping up the price of cryptocurrencies the valuations will fall back to earth.

It's fun to watch the coin bubble grows until news that North Korea or ISIS has broken into and gotten away with a couple hundred millions in coins.

[jk]

Re: Blockchain update

http://jessescrossroadscafe.blogspot...f-bitcoin.html

[Adeptus]

Re: Blockchain update

"The fact that there is nothing tangible to connect the valuation seems to make any support or criticism of its value seem arbitrary."

I don't see what tangible has anything to do with valuation. What's tangible about Facebook? Twitter? Snapchat? Google Search?
Let's take it one level lower... what's tangible about Internet packets? Because ultimately that's what blockchain is... a unique network of packets flying around, as a 2nd layer on top of the Internet.

If by tangible value you mean to narrow down the use cases from which value can be derived, here's 19 disruptive use cases for blockchains... some of these will be public ones, some private ones.

"Doesn't this volatility undermine its value as a currency though?"

Absolutely. The main purpose of a central bank, their main mandate is price stability. You can't properly run a business by any measure when the valuation of your inventory has to be adjusted every other hour. how can you pay your employees? project future costs? Bitcoin will offer no price stability. Bitcoiners until recently were still claiming Bitcoin to be a currency suggesting that when there's sufficient liquidity, the price would stabilize. This has now been proven wrong. It's market cap is over $250B, bigger than the total currency of dozens of countries - those countries have price stability... bitcoin, is the anti-theses of price stability. Ironically, you can use it as a currency to buy stuff. Now the narrative is being altered as "gold 2.0". It's better than gold, they say. It's infinitely divisible, can't be faked, has near zero storage costs, and you can send it over the Internet in any denomination you want - $20 worth or $200 Million, and perhaps until tomorrow (CBOE futures for BTC) , you can't naked short sell it.

My favorite new Bitcoin meme I heard over the past few days as it exploded to $19,000 / coin was this... "Bitcoin is not a bubble... it is pin that will pop the global fiat bubble"

Perhaps I'm still riding on the adrenaline of the price explosion, but I kind of believe in that possibility. We hit $450B market cap for all crypto currencies yesterday. Let's round that up to $500B. This is now the 5th wave since 2009 of a parabolic rise, with each rise being much greater than the previous. So why would there not be a 6th or 7th wave?

On average, each wave was well over 1000%. So let's extrapolate... Wave 6 = $5 Trillion... Wave 7 = $50 Trillion

Impossible you say? It does sound ridiculous of course, because somewhere between $10 Trillion and $50 Trillion or perhaps surpassing it, we're basically talking about things like the last nail in the coffin of the USD as the reserve currency, in fact, it would likely collapse the global economy as everyone dumps all their national currencies for deflationary digital ones not controlled by government. It would represent the largest transfer of wealth in I don't know how many centuries. This hypothesis and its various counter points are probably worthy of a well contemplated EJ commentary.

But how could this possibly happen? Well, let's face it Bitcoin has the characteristics of Ponzi Scheme. Initial buyers who hold the coins and don't sell them, see their paper profits appreciate as a result of new buyers entering the market and buying scrapts of what's left at higher valuations. Except it's not really a ponzi scheme, it could end up being worse than one, as per above, if the entire globe starts buying Bitcoin because of FOMO (Fear of Missing Out).

You want to see something crazy? I just saw this video today of an exchange in India which claims they are signing up 500,000 new users per month ! You think even 80% of those 500,000 of users know wtf a Bitcoin or a blockchain is? Nope, they are signing up because their cousin just trippled their money in a few days, and it just keeps going up! It's a total mania. So yeah the price will crash, but there will be another mania next year or the year after. Eventually everyone on the planet is going to hear that Bitcoin is something you buy low and wait a year or two and then make a million bucks by selling high. At that point we enter into the greater fool theory territory and the last wave will crash the global economy (if not before then).

So, wouldnt goverments see this and outlaw it somehow? Sure, entirely possible... but let's face it, governments are slow to act, and it's a lot of old folks in there who have no idea WTF a Bitcoin is, even if they are intelligent on average. But there's 200+ countries out there. If you ban it in one country, well guess what? The innovation benefits of Blockchains are going to develop in all the other countries that don't ban it. And if this is like an Internet 2.0 in terms of impact, even if just 25% of that impact, we're still talking potentially trillions of dollars of new business, or business efficiencies and new jobs etc... So that might prevent governments from banning it. Or what if the mania gets completely crazy and safe guarding the economy outweighs its beneficial use cases? Then sure you can ban it, but when was the last time 20 or 50 countries agreed to ban something at the same time? The G20 can't agree on fuck all most of the time, or if they do, it takes them YEARS. Lastly, even if you ban Bitcoin, sure, it may crash the price for a while, but guess what, a black market will evolve, one where X nation will lose the opportunity to colllect on capital gains taxes.

I'd have to really put more thought into this at some point to try to anticipate how this could evolve, but it's not my area of expertise, more like EJ's.

[Southernguy]

Re: Blockchain update

How many folks have mortgaged their house to invest in crypto?

[patrikkorda]

Re: Blockchain update

This is now the 5th wave since 2009 of a parabolic rise, with each rise being much greater than the previous. So why would there not be a 6th or 7th wave?

There are a number of reasons why future uptrends are not guaranteed. Today, there are 1337 digital currencies out there as of this writing per coinmarketcap. Five years ago, there were only a handful of digital currencies out there. Moreover, not only is the space being hyperinflated externally, it is being hyperinflated internally. While most people know that Bitcoin Cash is a hard fork of Bitcoin, they are not aware that so are Bitcoin Gold, Dash, and Zcash.

Five years ago, the rebuttal that bitcoin bugs would throw out there is the "network effect" argument, i.e., bitcoin will remain dominant because it had the first mover advantage and would thus solidify itself as a standard much like the QWERTY keyboard format (even if there were technologically superior digital currencies in the future). Today, this type of rebuttal is no longer as persuasive as it used to be. Five years ago, bitcoin had nearly 100% market share - today it is closer to 50%. I would argue that the digital currency space was destined to be hyperinflated due to the tremendous built-in financial incentives to do so. From a purely speculative perspective (and let's face it - most people in the digital currency space are speculating), altcoins promise far greater potential returns since it is easier for a $1B altcoin to double in value versus one that is $100B. Thus, even if we were to assume zero technological progress (in terms of transaction speeds, anonymity, scalability, energy consumption, etc.), there still exists a strong financial incentive for the space to be hyperinflated with altcoins (and for speculators to participate in altcoins).

While my position has always been (and continues to be) that digital currencies are here to stay, I believe bitcoin is a dinosaur on the verge of extinction. As you rightly point out, bitcoin bugs used to shed crocodile tears over poor immigrants not being able to send money abroad without incurring large fees. With the 1MB blocksize limit and $10+ transaction fees, bitcoin bugs have no choice but to admit it is an inferior form of digital cash that cannot scale - hence the gold 2.0 meme. The reason I bought XRP in 2013 (my address is ~TBE) is because I knew the scaling debate would eventually occur. There is no question in my mind that the explosive rise in XRP this year (~40X) and the Bitcoin Cash fork happened because of the scaling debate.

I'm a big fan of narrative economics. I believe the next narrative will be around fungibility. As for the long-term, eventually someone will create a digital currency that will actually function as a currency, i.e., the supply will increase/decrease lockstep with the CPI (or another price index like the MIT BPP) in order to prevent the malinvestments that occur due to general price inflation and price deflation. For example, if the BPP is down 2% this year, the supply of this digital currency (in my wallet and everyone else's) will increase by 2% in real-time in order to maintain stability.

[jk]

Re: Blockchain update

fwiw:

The most expensive Beanie Baby of all time, Princess the Bear, went for $500,000 in 1997 ...retail value now: $29.90