Bitcoin in a hyperbolic bubble

[Duke of Marmalade]

Everyone has been aware since day 1 that the bitcoin project is completely at odds with the doings of authoritarian governments.

A populist, Bukele has been criticized for governing in an authoritarian manner. In particular, he was denounced for sending soldiers into the Legislative Assembly to encourage the passage of a bill and allegedly to overthrow the Legislative Assembly of El Salvador. This action, his handling of endemic violence in El Salvador, and his strict response to the COVID-19 pandemic have led some academics to describe him as an autocrat or an authoritarian.

 

[tecate]

@Duke of Marmalade - All too predictable.


LINK

The bitcoin project I was referring to. Bitcoin itself is an open protocol - which can be utilised by anyone - even you, Dukey.

 

[Duke of Marmalade]

@Duke of Marmalade - All too predictable.


LINK

The bitcoin project I was referring to. Bitcoin itself is an open protocol - which can be utilised by anyone - even you, Dukey.

Sorry, that is too Jesuitical for me. I am not one to criticise bitcoin because of the company it keeps but how you can describe the "project" as totally at odds with the doings of authoritarian governments completely baffles me.

 

[tecate]

Sorry, that is too Jesuitical for me. I am not one to criticise bitcoin because of the company it keeps but how you can describe the "project" as totally at odds with the doings of authoritarian governments completely baffles me.

The project is - bitcoin itself as a protocol doesn't care. It's open to anyone to use. I know the lengths you will go to - to tar and feather Dukey - but there's nothing of substance for you to pursue here. Most in the bitcoin space are wary of any government or government official. That hasn't changed. Nobody is putting Bukele on a pedestal. It doesn't appear that way but lets assume that Bukele has ill intent here - well, what ill-intent will that be - as he's putting in place a currency he has no control over. In a recent interview, he was asked about exactly this - his answer, you don't have to trust me/us - I/we have no control over bitcoin.
As per Alex Gladstein's (Human Rights Foundation) tweet, celebrate that individual action - not the individual(s) behind it.

 

[DublinHead54]

Just to take that a step further Wolfie, there were previous discussions here in relation to two things relative to mining in China:
1. The possibility of a 51% attack
2. China implementing regulation - inclusive of a potential ban on mining/trading, etc.

In relation to the former, we've now seen that there was no earthly way that a 51% attack could have been carried out with a successful outcome for the CCP. If that were the case, there is no earthly way they would push miners out of China. That was pure FUD - and nothing more.
In relation to the latter, unless someone is telling me that bitcoin mining has been banned in the other 194 jurisdictions in the world, it's of no concern. It does provide short term upheaval - with miners moving abroad - and the costs associated with that (which would necessitate them to liquidate some btc from their treasuries).
Everyone has been aware since day 1 that the bitcoin project is completely at odds with the doings of authoritarian governments. China will always be concerned about anything that it can't control. That's why it tried to shut out the internet back in the day - and its why its shutting out bitcoin today. They're about to up the anti with their digital yuan project - something that will really allow them to have their citizenry by the short and curlies like never before. I'm sure they wouldn't want their minions being distracted by such a thing.

This is a stereotypical response on this thread of answering an unrelated point. You've just not addressed the point.

The Chinese government have shut down miners. Which is contrary to your early stance that the government could not shut down miners.

Or are you an Wolfetone now suggesting that the mainstream crypto news sources (of which you've used to suppor your arguments before) is now just reporting FUD?

 

[DublinHead54]

Mining farms are cast all over China - often in remote inaccessible locations. The Chinese can't move against these miners

There we have it. Black and white, the Chinese government can't move against the miners as said so by Tecate.

Now they've been proven wrong.

 

[tecate]

It's strange - some seem to be under the impression that the network has been attacked (with a view towards taking control of it) as opposed to regulation within one territory being applied and can't seem to be able to comprehend the difference between the two.

Asking miners to leave a territory is not an attack on the network. A 51% attack would involve much more than asking miners to leave a territory within a timeframe.

 

[presidenttttt]

But someone on twitter said it was going to the moon? I am going to stick to punting on horses for another while.

 

[tecate]

But someone on twitter said it was going to the moon? I am going to stick to punting on horses for another while.

I'm not sure what metrics you're using but as it stands today, it's 279% up on this day last year.

Meanwhile Andreesen Horowitz are tripling down, announcing a $2.2 billion crypto investment fund.

 

[WolfeTone]

Which is contrary to your early stance that the government could not shut down miners.

Can you provide a direct quote to support that?
I'm only reading the part about not being able to move against miners without letting the cat out of the bag. Counter measures would be taken (ie miners move elsewhere), the attack would fail, at worst temporary network disruption.

That does appear to be what has/is happening.

 

[WolfeTone]

There we have it. Black and white,

But you have edited his/her quote to present a different meaning, you have left out the rest of the comment that would , inconveniently for you, give a whole different context.
We can all do that, here is something you said earlier

It is simply fact [edit] to say that the Bitcoin code base cannot be changed.

 

[DublinHead54]

But you have edited his/her quote to present a different meaning, you have left out the rest of the comment that would , inconveniently for you, give a whole different context.
We can all do that, here is something you said earlier

I did not edit, I quoted directly. Sure go ahead and paste the entire quote, the interpretation is the same.

You've successfully changed the topic to the interpretation of a quote rather than the underlying point. Can we get back to it?

Are you disagreeing that the Chinese government can close down miners?

 

[DublinHead54]

For some the below article will present useful analysis, for others it will be decried as 'FUD'. I can bet who will do that.

Bitcoin hashrate drops by nearly 50% following China's mining crackdown

Bitcoin hashrate, or the total computational power to mine the cryptocurrency, has dropped by nearly 50% in over a month.

www.theblockcrypto.com

This is a great example of how central governments can impact the network. I for one think although this may cause a lot of short term volatility and slow the adoption of the network, it will be a long term benefit. Having a 'decentalized' network with a 65% mining concentration in a totalitarian Country was not sustainable.

Though as we have seen these private mining organizations are moving to countries like Kazakstan that will be favourable to their business model. I hope this reduces the mining concentration and the chance of a 51% attack.

I'm still bearish overall on BTC adoption as anything more than a store of value for a small minority. This is already seen by a few players getting a dominant stake in the share of supply. It will be interesting to see if MicroStrategy can maintain their strategy and pay their debts if BTC continues its downward trajectory. I found it interesting that Microstrategy had to turn to established financial markets and fiat currency to fund their Bitcoin purchases.

Lastly, ironically a system that was designed to remove the need for trusted third parties now entirely relies on trusted third parties. For the average joe or the unbanked market entry is via an exchange (third party). The network relies on private corporations (miners) to run rather than the peer to peer network first established. I will concede that due to the increasing power required to execute PoW that it was foreseen it would require large purpose-built mining operations.

However, for the average user there is trust required in using the BTC network, so the question becomes for the average person. Who do you trust more, the government or Coinbase?

(I fully expect @tecate to refuse to comment on this, as he knows it is a flaw in the adoption).

 

[WolfeTone]

@Dublinbay12 that is the point, the interpretation is NOT the same

Here is the full sentence

The Chinese can't move against these miners without letting the cat out of the bag that something is afoot

You deliberately left the second part of the sentence (in italics) out of your quote in order to portray an absolutist position, when in fact @tecate comment was conditional.

Of course governments can move against miners - cutting off electricity supplies one be one way. But the point being made as I understand it is that this would signal to the network to that an attack is underway and the network would respond in kind by mobilising miners elsewhere, El Salvador would seem like a mining friendly country for instance.
So the attack would fail. At most just network disruption for a period, as tecate went on to say.
Which appears to be exactly the case.

 

[DublinHead54]

@Dublinbay12 that is the point, the interpretation is NOT the same

Here is the full sentence


You deliberately left the second part of the sentence (in italics) out of your quote in order to portray an absolutist position, when in fact @tecate comment was conditional.

Of course governments can move against miners - cutting off electricity supplies one be one way. But the point being made as I understand it is that this would signal to the network to that an attack is underway and the network would respond in kind by mobilising miners elsewhere, El Salvador would seem like a mining friendly country for instance.
So the attack would fail. At most just network disruption for a period, as tecate went on to say.
Which appears to be exactly the case.

@WolfeTone please see post 994, in which I quoted in full at the start of this topic.

Just to clarify, you are agreeing with my original point in post 994 and that the evidence isn't FUD?

Based on your interpretation of Tecates stance, why have we seen an almost 50% decrease in the Hashrate? Surely per Tecates stance that chinese government movement to shutdown would fail, we wouldn't have seen this. The argument is a bit contradictory.

I've come to expect that at this point. There is always a point put in that is vague enough to allow a flip flop when things change.

 

[WolfeTone]

Just to clarify, you are agreeing with my original point in post 994 and that the evidence isn't FUD?

No I am not agreeing with your original point at all. You have interpreted a comment to mean something else that is different from my interpretation.
You are trying to portray a comment by another user as absolutist when clearly the comment, when read in its full context, was conditional.

Further, do you have a view on when the hash rate will return to the levels seen prior to the China shutdown? I would think it isn't as seamless as you portray?

If you think I am portraying it as "seamless" then that is another misinterpretation on your part.

The article you posted in #1013 is a good example of how the Chinese government move against miners is FUD by way of mining operations moving to more bitcoin friendly territory.

 

[DublinHead54]

No I am not agreeing with your original point at all. You have interpreted a comment to mean something else that is different from my interpretation.
You are trying to portray a comment by another user as absolutist when clearly the comment, when read in its full context, was conditional.

There we have it.....the arguments are always conditional. You clearly would rather debate interpretations rather than content, I've tried to engage with you multiple times on the topic at hand (China shutdown), and you keep bringing it back to an interpretation. By the way interpretations, are subject to a different opinion. For context, there were subsequent discussions with Tecate on Chinas ability to intefere with BTC. They firmly believed that China shutdown was FUD, and would not happen, but I digress.

If you still want to talk about interpretations rather than content, I won't engage with you. If you would like to discuss, please see below.



At the end of the day, an external party (China Government), has shut down a significant portion of the mining pool in the last month resulting in the hashrate dropping by ~50%. This poses a threat to the stability of the network and the underlying price. The news of the shutdown has been a clear factor in the downward price pressure.

The hypothesis presented by @WolfeTone is that a china shutdown constitutes an attack and this would fail because the miners would move to other geographies. This has not yet happened at scale, thus in my opinion the argument is too open ended. There should rather be a discussion on the short term impacts to BTC adoption and price because of this shutdown. The other aspect is that these private mining organizations rely on 'friendly' countries with cheap electricity, so what are the options.

Overall, I really fail to see how anybody with knowledge of BTC can simply brush this under the carpet by calling it FUD or assuming the miners can just move easily.

 

[WolfeTone]

You clearly would rather debate interpretations rather than content,

It's important that if you want to 'debate' content that you are then open to others having different interpretation of that content.

Clearly we interpret tecates post differently.

I also interpret the content you posted in #1013 differently to how you interpret it.

You seem upset

If you still want to talk about interpretations rather than content, I won't engage with you.

I really fail to see how anybody with knowledge of BTC can simply brush this under the carpet by calling it FUD or assuming the miners can just move easily.

I'm not brushing it under the carpet nor am I assuming miners can just move easily.
The FUD is with regard to some notions that what is occuring that it represents a 51% attack by Chinese authorities on the network. It does not. It is disruptive to the network for sure, and how long will it take for mining operations to come on scale I do not know.
In the long-run, what is happening in China is a good thing as I interpret it to mean that any prospective 51% attack by State agents is being significantly reduced, albeit in short to medium term, it is disruptive to the network.

 

[DublinHead54]

I'm not brushing it under the carpet nor am I assuming miners can just move easily.
The FUD is with regard to some notions that what is occuring that it represents a 51% attack by Chinese authorities on the network. It does not. It is disruptive to the network for sure, and how long will it take for mining operations to come on scale I do not know.
In the long-run, what is happening in China is a good thing as I interpret it to mean that any prospective 51% attack by State agents is being significantly reduced, albeit in short to medium term, it is disruptive to the network.

Where are these notions? Correct me if I am mistaken but it was you and Tecate who introduced a 51% attack in recent posts? Certainly none of the links or comments I have posted reference a 51% attack. A 51% attack of the Network is entirely different to what the Chinese government are doing lol. A state agent performing a 51% attack would require them to be running nodes themselves and trying to obtain 51% of the hashrate, and thus being able to force a new chain. Or taking over the mining operations and running them as state owned entities. I'm not sure if you fully understand the concept of a 51% attack an the difference to what China did?

But look this is an example where you/Tecate have introduced a different topic to detract from the point trying to be discussed.

Your last comment is a point I have made earlier, but again, it was not the point I was trying to engage with you on. I'll try again.....

What do you think the impact of this shutdown in China will have in the short term for the price and adoption?

 

[Duke of Marmalade]

The clamp down on Chinese miners is in my book a minor positive for bitcoin and possibly explains the dead cat bounce after the knee-jerk fall to below $30k.
@WolfeTone says "(it) is disruptive to the network for sure" . Not at all. The integrity of the blockchain is not in the hashrate but in the 10 minutes delay built into the protocol. The difficulty level in PoW had risen to 21trillion its original difficulty because of the increase in hashrate. The hashrate could further reduce immensely without compromising the blockchain one iota.