You think destroying bank records will remove the power inequality from the system? Good luck with that, kid.
Power has money, but money isn't power. It's the table scraps the rest of us chase after. It's also why you can tax the rich all you want and it won't take their power away. The transactions that truly matter to them aren't usually denominated in dollars. Cash is Plan B at best.
Don't believe me? Look at stories about nouveau rich not being taken seriously. You have to work your butts off to get your kids taken seriously (if you aren't lucky or fast enough, your grandkids, assuming your kids haven't blown their inheritance by then). You don't know anybody, and you don't have anything they need. All you have is money.
Trump talked about this every time he filed for bankruptcy. I'm sure his buddies would have preferred he kept his big mouth shut.
Yeah because there are actual differences between new rich and the old rich.
I always considered two datapoints to be fulcral A) ease of use, which Bitcoin has never had and B) potential to be overtaken by an actual bank and twisted into whatever purposes it wanted due to the 51% error. That is, how hard would be it for JPMorgan or Deustche Bank to just buy 51% of Bitcoin and make it do whatever they wanted? I could never see the potential for either fact to be avoided, as much as the frothing Bitcoin-enthusiasts would like it to.
The reason I stayed in is because Bitcoin solved a seemingly intractable problem, it works in the real world, and it's survived and even thrived in the face of fierce attacks for a decade.
Yes, there are many shills who are delusional and ignorant. Yes, speculators and fraudsters are running wild.
None of that changes the fundamental characteristics that make this a fascinating and promising technology, network and social movement.
What fierce attacks has bitcoin faced?
Sure, lots of people mock and criticize it, but no real action has been taken. The people criticizing it have just as much influence (or maybe even less) than the delusional and ignorant true believers.
To me, a fierce attack would be regulatory action taken by various world governments, but that hasn't happened. To the contrary, even countries that probably should care (e.g. China, with its capital controls, and bitcoin mining seemingly used to evade them) appear not to. If anything, that shows just how insignificant bitcoin is.
My vague impression (I don't follow this closely) of US regulators is that they have given bitcoin reasonable or even slightly favorable treatment.
Bitcoin and crypto only survive because of trust. There was a time, especially on Bloomberg, when the news was constantly criticising it and sowing mistrust. "It's only used by hackers" or "hit men are murdering people for crypto on the dark web" or "terrorist are funding operations with crypto.". So there have been countless efforts to break the core of what makes a currency valuable.
Additionally, Bitcoin specifically is illegal in several countries, China being one of them. The US has also seized several piles of bitcoin and like they do with other seized assets they put it up for auction. These guys buy the stuff up cheap and immediately sell it. Now that's not a specific attack but it is damaging to prices. Lastly exchanges are requiring photo id to buy things now because of regulation which makes it even harder for people to get into. I can buy bullets and in some cases guns more easily.
So there is actually plenty, not to mention numerous attacks on the network in the early days. Who knows who was behind those.
At the end of that struggle, you still have a government in control of its financing, but the shape of it, borne through so many battles, is likely to be more efficient.
Bitcoin doesn't care how much of it you have, as it uses Proof-of-Work not Proof-of-Stake. The only thing that matters is you computational power. Now it is true that large banks could just buy lots of ASICs and try to beat the network, but that would mean a continued investment: As soon as they stop mining, the network would return to normal.
They can hurt bitcoin (not that cheap anymore) by making it unusable for a period of time, but unless they are willing to keep mining until everybody else stops, they won't be able to kill it.
As far as usability goes i don't think bitcoin is that hard: Download an app, scan a QR-code, send money. Not that complicated. The transaction rate is a problem, though.
I agree that some people are too enthusiastic about crypto, but I think it still has its place. It doesn't have to kill banks.
[1] https://www.theguardian.com/world/2005/feb/01/iraq.suzannego...
There is another possibility on Xaya and I believe Ethereum has implemented as well now. On Xaya they are called game channels. The idea is that you allow a side branching chain to develop between an arbitrary number of people, then when a game is over you inject the end of the side chain back into the main chain and verify it. They invented it for near realtime verification between consenting parties, then you only pay the main transaction fee when you get back on the main block instead of very every action. But that type of system doesn't have to be only done with games obviously, that could be applied to anything.
If you are interested more in it, you can check this video out. They have lots of documentation and tutorials for the network as well.
I don't think you understand bitcoin as well as you think you do. 51% attacks do not work like this.
So yes, 51% control could be usurped by a dedicated attacker - but the resources are no longer trivial. And as noted, this "control" doesn't buy you a great deal unless you keep it going for eternity, and for the time period you do have control all you can do is basically stop it working properly by preventing new transactions - rewriting history is exponentially more expensive the farther back you try to go.
If this were a big transaction, I might choose to wait for more than one confirmation before completing my end of the transaction. The longer I wait, the more expensive it becomes for you to conduct your 51% attack.
It really is prohibitively expensive, to conduct such an attack, when you consider a few other factors. I could double spend the money to myself, but after news of such an attack came out, the price likely could crash, reducing the prize.
Not to mention opportunity cost. If you have the means to conduct a 51% attack it means you have a lot of capital and expertise. You could put those two together to make a giant pile of money through legitimate means, like operating a hedge fund. The risk is a lot less.
The only group that would be motivated enough and capable enough to perpetrate such an attack would be a state, and why would they bother when, like was mentioned elsewhere, they could attack bitcoin with the stroke of a pen, via regulation etc. It's waaay less effort.
Also, would like to note that Bitcoin can also function as store of value just like Gold.
Any news about Lightning? Is that running live now?
For sure these banks wouldn't use their own hardware, but hire a new team, new hardware etc.
Completely wrong. There is a set of rules which define whether a Bitcoin block is valid or not, things like "the block's hash has this many zero bits" (simplifying a bit here, the actual rule is a bit more complex), "all transactions have a valid signature" (simplifying a lot here, it actually runs a sort of a small program) and "no transaction spends outputs which have already been spent". It doesn't matter how much Bitcoin you have or how much hash power you have, even if you have 100% of all Bitcoin and 100% of all hash power, if the block doesn't follow the rules it will be ignored by all validating Bitcoin nodes.
What having 51% or more of the Bitcoin hash power gains you is only that you can rewrite history. You can present a chain of blocks to other nodes, and later present a different "longer" chain of blocks to the same nodes, and they'll accept the "longer" chain and discard the older one. All these blocks, however, still have to be valid to be accepted.
You're being overly reductionist.
The functions of banks are great and valuable but they are disproportionately so. Why? Because they get free money from the Fed and are using fractional reserves.
Do you think the Bank's services would be as pervasive if the working class had a stable store of value for their work? I don't. Banks need competition and with Bitcoin and the crypto space, they finally got some serious competition.
Also, there are plenty of startups in the cryptocurrency space that ARE doing functions that banks offer. SALT is one that comes to mind quickly but there are plenty of others.
But you didn't actually tell the reader what banks _are_.
Care to elaborate?
There's some irony here.
Why do you believe this has any relevance at all? People want to buy stuff, not exchange bill with serial number #abcxyz with stuff.
And from my example you can easily understand why your assertion is quite wrong to begin with.
Because it solves the double spend problem [0] associated with digital currency without use of a centralized database.
I think that matters to people trying to avoid onerous capital controls or a government printing 31% of the money supply in a week [1]
[0]: https://en.wikipedia.org/wiki/Double-spending
[1]: https://www.bloomberg.com/news/articles/2019-02-05/venezuela...
I check for cool serial numbers fairly frequently but I couldn’t say I care about the exact bills. A five’s a five. That’s why currency is great.
That's been the elephant in the room ever since Satoshi published its paper more than a decade ago. When I discuss with cryptocurrency enthusiasts I often get the impression that they think that banks are this kind of useless parasite body that somehow appears like mosquitoes around a pond in summer. That they only serve to basically operate ATMs, send you your Visa card and crash the market every other decade or so.
This is of course a gross misunderstanding of what banks are, what they do, why they do it and where they come from. In particular the idea that "bitcoin is going to kill banks" (a very common sentiment in my experience in cryptocurrency circles) is about as meaningful as "this new type of snowboard is going to kill ski resorts!". No it won't, it might change some things about how they operate but after the transition period it'll be business as usual. Cryptocurrencies don't come even close to replacing most of the services offered by banks. Actually, they don't even come close to replacing most of the services offered by actual currency.
It's this weird cognitive dissonance that you encounter in conspiracy theory circles: the banking system is this hellish beast that steals money from the honest middle-class worker, operated from a global circle of elites acting from the shadows and that must be destroyed at all cost to save humanity. How do you do that? By replacing their currency by your own, they'll never see that coming, those idiots.