On 11/25/2013 4:26 AM, Lodewijk andré de la porte wrote:

Why suddenly all this attention for yet another assassination market? Because it's more "hit them and earn the bounty", like at a fair, style?

It's just another something that has to exist if everything is free to exist. The wait is on for the "Rape her and earn a bounty" kind of.... waiittttttt... that might work....

I wonder what would happen if multiple people claimed the same date for the death of a celebrity.

How do you think something like that could be managed? Bitcoin is only deflationary because the number of people who use it is growing faster than the number of coins in circulation. But how can you measure the number of people who are using it, and how can you measure how much they are using it? (IE are they speculating, are they actually using it to hide money from their government, are they buying needs like food+water?). Any cryptocurrency hoping to 'appreciate by at most 5%' has to have some reliable metric for measuring it's value in the real world. Otherwise coin generation algorithms are just a shot in the dark, hoping to mimic the expected growth of the coin or having some authority that can provide input about it's real dollar value. And anything that tries to get insider metrics will need some defence against liars and sybil attacks. On Mon, Nov 25, 2013 at 5:07 PM, Jim Bell wrote:

------------------------------ *From:* Kelly John Rose *To:* cypherpunks@cpunks.org *Sent:* Monday, November 25, 2013 8:00 AM *Subject:* Re: Interesting take on Sanjuro's Assassination Market

On 11/25/2013 4:26 AM, Lodewijk andré de la porte wrote:

...

...

Why suddenly all this attention for yet another assassination market? Because it's more "hit them and earn the bounty", like at a fair, style?

...

I wonder what would happen if multiple people claimed the same date for the death of a celebrity.

I haven't read enough of the 'AM' system to know what that system would do, but it seems to me that a logical outcome would be to split the reward based on the size of the contribution included with each prediction. For instance, if Person A correctly predicted with 1 BTC, and Person B correctly predicted with 9 BTC, Person 1 should get 10% of the reward, while Person B should get 90%.

Incidentally, one problem I see with Sanjuro's 'AM' (Assassination Market) system (at least, so far) is the setting of a minimum bet at 1.0 BTC, which is about $800 when I checked a few seconds ago. In writing my AP essay, I anticipated that very small bets (say, 10 cents US) would be allowed. Except in unusual situations, few people would want to donate $800 (USD) to see somebody dead; Far more would be willing to donate $1 (USD) for that.

I don't know if the current minimum bid in 'AM' has something to do with the granularity of 1.0 BTC, but the existence of digits to the right of the decimal point in the prediction totalizations suggests that this is not the case. If the problem is that the prediction totalization is currently being done manually, rather than automatically, that is a limitation that I think must be fixed in order for 'AM' to operate well. And with a minimum bet of 1.0 BTC, it might be portrayed as if 'AM' is a tool of the wealthy, rather than that of the average person.

To the extent that this is a problem now, it will be worse as Bitcoin continues to deflate (increase in value) as it was no doubt intended to do. What happens when 1 BTC = $10,000? I consider that one of the few disadvantages or problems with Bitcoin is its hyper-deflationary nature: How can a currency function as a currency, if it is 'scheduled' (by algorithm) to appreciate in value far faster than any commodity? Another related problem is that Bitcoin is effectively programmed to excessively reward early-adopters. While I feel that the inventor of Bitcoin should be richly rewarded for doing the work necessary to give us such a beneficial addition to society, the limit of my generosity is about $1 billion (USD). Ultimately, I think that a replacement for Bitcoin ("Bitcoin 2.0"?) is necessary, one that won't appreciate in value more than, say, 5% per year. Jim Bell

Disclaimer: I am not associated with Sanjuro's 'Assassination Market' in any way.

You've validated my statement. Your problem is if bitcoin becomes a world economy. That means bitcoins usage grows by something like 2 orders of magnitude. Except that bitcoins are already halfway mined, which means that the circulation will not keep up. That is what drives the price up. If you want a currency that will scale with it's global usage (IE when the market cap hits $21 trillion, there are 21 trillion in circulation), you need some mechanism that knows how to equate 1 bitcoin to 1 dollar, that way more bitcoins can be printed as the market cap goes up. On Mon, Nov 25, 2013 at 6:17 PM, Jim Bell wrote:

I don't agree with your statement, "Bitcoin is only deflationary because the number of people who use it is growing faster than the number of coins in circulation.". To the contrary, my understanding is that a number of factors have combined with the net result that Bitcoin is hyper-deflationary. One major factor has been the shift of bitcoin 'mining' from computer CPUs, to video graphics processors (GPU's), to FPGA (Field Programmable Gate Arrays), and ultimately ASICs (literally, "application-specific integrated circuits"; what used to be called 'custom' IC's decades ago.) While I don't have a specific number, I would not be surprised to hear that an ASIC miner is 1000x faster than even the fastest x86 CPU. If that were the only factor, it would appear that new bitcoins should be 1000x more available than in, say, 2009. However, I also understand that the 'difficulty' of mining bitcoin has been algorithmically increased regularly, in order to make it more difficult to compute to find individual bitcoins. This is programmed into the entire bitcoin system. In fact, it is to the point where the limiting factor to the cost of 'mining' bitcoin is the electricity cost of running the machines, not the cost of the machines themselves. The bitcoin system 'programs' the appreciation of bitcoin by gradually increasing the difficulty of that mining operation. This translates into an increase in the market value of bitcoin. In fact, this is essential to the (theoretical) outcome of bitcoin. I think of it this way: The system is programmed to only allow the generation of 21 million bitcoins. If bitcoin is ultimately to be used to run the entire world economy (why not?) there should be at least one million times more. (Say, 21 TRILLION; 21,000,000,000,000 bitcoins, if we think of the ultimate value of a bitcoin as being roughly equal to the current value of the US dollar, the Euro, the British Pound, etc.) But since they are limited to 21 million, by algorithm, the value of a 2013 bitcoin will have to be increased by a factor of 1000 to stretch to the task of funding a world's market. And that means that the 2 million BTC currently in the wallet most likely owned by Satoshi will presumably increase in value to $2 trillion (USD). "Nice work if you can get it". Is this a problem? Who, instead, would claim that it ISN'T a problem! Bitcoin has many great features, its possibility (through Zerocoin) of being anonymous one of the most intriguing, but there is nothing about a digital currency that requires that it deflates at the rate historically associated with bitcoin. I view this deflation as being arbitrary and capricious, and wildly too large. Like I've said, I don't begrudge Satoshi $1 billion (USD), but I DO begrudge him $2 trillion. If Satoshi's bitcoin rescues us from all governments (enabling 'AM'), perhaps he should be entitled to $10 billion (USD), but not $2 trillion (USC). Jim Bell

------------------------------ *From:* David Vorick *To:* Jim Bell *Cc:* Kelly John Rose ; "cypherpunks@cpunks.org" < cypherpunks@cpunks.org> *Sent:* Monday, November 25, 2013 2:20 PM

*Subject:* Re: Interesting take on Sanjuro's Assassination Market

How do you think something like that could be managed?

Bitcoin is only deflationary because the number of people who use it is growing faster than the number of coins in circulation. But how can you measure the number of people who are using it, and how can you measure how much they are using it? (IE are they speculating, are they actually using it to hide money from their government, are they buying needs like food+water?).

Any cryptocurrency hoping to 'appreciate by at most 5%' has to have some reliable metric for measuring it's value in the real world. Otherwise coin generation algorithms are just a shot in the dark, hoping to mimic the expected growth of the coin or having some authority that can provide input about it's real dollar value. And anything that tries to get insider metrics will need some defence against liars and sybil attacks.

On Mon, Nov 25, 2013 at 5:07 PM, Jim Bell wrote:

------------------------------ *From:* Kelly John Rose *To:* cypherpunks@cpunks.org *Sent:* Monday, November 25, 2013 8:00 AM *Subject:* Re: Interesting take on Sanjuro's Assassination Market

On 11/25/2013 4:26 AM, Lodewijk andré de la porte wrote:

...

...

Why suddenly all this attention for yet another assassination market? Because it's more "hit them and earn the bounty", like at a fair, style?

...

I wonder what would happen if multiple people claimed the same date for the death of a celebrity.

I haven't read enough of the 'AM' system to know what that system would do, but it seems to me that a logical outcome would be to split the reward based on the size of the contribution included with each prediction. For instance, if Person A correctly predicted with 1 BTC, and Person B correctly predicted with 9 BTC, Person 1 should get 10% of the reward, while Person B should get 90%.

Incidentally, one problem I see with Sanjuro's 'AM' (Assassination Market) system (at least, so far) is the setting of a minimum bet at 1.0 BTC, which is about $800 when I checked a few seconds ago. In writing my AP essay, I anticipated that very small bets (say, 10 cents US) would be allowed. Except in unusual situations, few people would want to donate $800 (USD) to see somebody dead; Far more would be willing to donate $1 (USD) for that.

I don't know if the current minimum bid in 'AM' has something to do with the granularity of 1.0 BTC, but the existence of digits to the right of the decimal point in the prediction totalizations suggests that this is not the case. If the problem is that the prediction totalization is currently being done manually, rather than automatically, that is a limitation that I think must be fixed in order for 'AM' to operate well. And with a minimum bet of 1.0 BTC, it might be portrayed as if 'AM' is a tool of the wealthy, rather than that of the average person.

To the extent that this is a problem now, it will be worse as Bitcoin continues to deflate (increase in value) as it was no doubt intended to do. What happens when 1 BTC = $10,000? I consider that one of the few disadvantages or problems with Bitcoin is its hyper-deflationary nature: How can a currency function as a currency, if it is 'scheduled' (by algorithm) to appreciate in value far faster than any commodity? Another related problem is that Bitcoin is effectively programmed to excessively reward early-adopters. While I feel that the inventor of Bitcoin should be richly rewarded for doing the work necessary to give us such a beneficial addition to society, the limit of my generosity is about $1 billion (USD). Ultimately, I think that a replacement for Bitcoin ("Bitcoin 2.0"?) is necessary, one that won't appreciate in value more than, say, 5% per year. Jim Bell

Disclaimer: I am not associated with Sanjuro's 'Assassination Market' in any way.

isn't the real problem with bitcoin becoming a global currency an issue of how to best manage the potential exponential growth in size of the blockchain? i know this is cypherpunks but please explain like i'm five... regards, javier On Mon, Nov 25, 2013 at 6:32 PM, Andy Isaacson wrote:

...

Your problem is if bitcoin becomes a world economy. That means bitcoins usage grows by something like 2 orders of magnitude. Except that bitcoins are already halfway mined, which means that the circulation will not keep up. That is what drives the price up.

If you want a currency that will scale with it's global usage (IE when

On Mon, Nov 25, 2013 at 07:04:51PM -0500, David Vorick wrote: the

...

market cap hits $21 trillion, there are 21 trillion in circulation), you need some mechanism that knows how to equate 1 bitcoin to 1 dollar, that way more bitcoins can be printed as the market cap goes up.

Fractional bitcoins work just fine (down to 1/100,000,000, per https://en.bitcoin.it/wiki/Satoshi ). If BTC goes to 100,000 USD we'll just start pricing things in "thous" or "mils" or something similar.

In other words, there are already 12 quadrillion Satoshis in circulation, plenty to absorb any further deflation.

-andy

On Mon, Nov 25, 2013 at 5:43 PM, David Vorick wrote:

... How do you prevent the early adopters from becoming stupid wealthy if the currency takes off?

high risk, high reward. why should early adoption with high risk not pay more than late adoption with significantly less risk? i agree that the externals affecting BTC exchange rate are volatile and annoying, but this hardly seems like bitcoin's fault. do you fight tulpenmanie with currency controls? good luck!

On Mon, Nov 25, 2013 at 6:12 PM, David Vorick wrote:

... Nobody cares how many petaflops the network is pulling, because the petaflops can't be put to use somewhere else... But if the mining was based on cloud storage, a dramatic drop in the price of the currency would result in a dramatic drop in the cost of storing data on the network.

i like the idea of "proof of _useful_ work" applied here to storage. if only mining had been applied to BOINC, GIMPS, or *@home efforts... surely there is prior art?

Joe, the only reason that the price of cloud storage would fall is if demand for cloud storage falls. The value of cloud storage over time should be fairly stable, perhaps not as stable as today's US dollar but certainly more stable than bitcoin is today. But in the case of tulips, bitcoins, etc., their stability was only derived from their speculative value. Bread will be reasonable stable, because people don't speculate in bread. Bread has a minimum price, because there is a limited supply and a clearly defined need. All commodities are not equal. Bitcoin is one of the worst I can imagine, but the tulips during tulipmania take the cake. I believe you can regulate cloud storage in a way that prevents fraudsters from manipulating it. The only assumption I need is that the majority of the network is honest. You can use hashing + random strings to confirm that a person still has the file they are hosting. You only need then to be sure that the person hosting the file and the person uploading the file are not in cahoots. You can achieve that by making a random mapping between people and hosts, and only picking the host after a person has announced how much file storage they wish to rent (and paid for the first month). This makes it too expensive to host files on your own machines, because you have a very low probability of getting the opportunity to store a file on your own machine. On Mon, Nov 25, 2013 at 9:43 PM, Andy Isaacson wrote:

On Mon, Nov 25, 2013 at 06:20:27PM -0800, coderman wrote:

...

On Mon, Nov 25, 2013 at 6:12 PM, David Vorick wrote:

...

... Nobody cares how many petaflops the network is pulling, because the petaflops can't be put to use somewhere else... But if the mining was based on cloud storage, a dramatic drop in the price of the currency would result in a dramatic drop in the cost of storing data on the network.

i like the idea of "proof of _useful_ work" applied here to storage. if only mining had been applied to BOINC, GIMPS, or *@home efforts...

The critical feature of the BTC PoW block chain is that the work is applied to a believed-computationally-hard problem that is a function of the block under consideration. This precludes the "work" being a function of any other property.

...

surely there is prior art?

How quickly we forget ... Bitcoin did 4 impossible things before breakfast, and now we're whining that it didn't do 5. :)

In 2008 nobody in the open research community would have proposed that a peer-to-peer (1) autoscaling (2) computational PoW (3) deflationary (4) space-conserving cryptocurrency was even theoretically possible. Then Nakamoto dropped working code and the paper.

Adding a "useful work" unit to the mining PoW has been considered; it's extremely hard to do and puts the "useful work" project (whatever it is) squarely in the line of fire for fraudsters and attacks.

-andy

Yes but it still doesn't compare to the price fluctuations of bitcoin. But you are right, everything has fluctuation in price. I merely wanted to show that some thing have a more volatile price than others. The US bond is a typical financial example of something that doesn't fluctuate dramatically in price. (And even that still fluctuates, but very gradually by comparison to stocks & commodities). So, yes, by tethering a currency to the value of cloud storage you are still limited by the fluctuations of the value of cloud storage itself. But at least now you have a concrete way to price your currency, and I think it's reasonable to assume that the value of cloud storage won't be decreasing any time soon. (Price per TB may decrease, but we don't tether the currency to the value of 1 TB, we tether the currency to the value of $1 worth of disk storage hardware). On Mon, Nov 25, 2013 at 10:15 PM, Joe Wang wrote:

Hi David,

I am not sure of your assumption on the cloud storage. What about the component cost goes into it? memory costs? I remember when I was a teen trading DRAMS the price isn't that stable for certain period of time. So even if demand for cloud storage fall, wouldn't cost of the cloud storage could be rising due to other events?

About perishable commodity. I don't know where you live. But I know cost of milk has gone up tremendously in certain parts of the world. In China, cost of salt has gone up 10 folds in a short few years. Price of corn and orange juice can always limit up or down if some crazy weather hit certain part of the country.

-Joe

------------------------------ *From:* David Vorick *To:* Andy Isaacson *Cc:* "cypherpunks@cpunks.org" *Sent:* Tuesday, November 26, 2013 10:52 AM *Subject:* Re: bitcoin as a global medium of exchange (was Re: Interesting take on Sanjuro's Assassination Market)

Joe, the only reason that the price of cloud storage would fall is if demand for cloud storage falls. The value of cloud storage over time should be fairly stable, perhaps not as stable as today's US dollar but certainly more stable than bitcoin is today.

But in the case of tulips, bitcoins, etc., their stability was only derived from their speculative value. Bread will be reasonable stable, because people don't speculate in bread. Bread has a minimum price, because there is a limited supply and a clearly defined need. All commodities are not equal. Bitcoin is one of the worst I can imagine, but the tulips during tulipmania take the cake.

I believe you can regulate cloud storage in a way that prevents fraudsters from manipulating it. The only assumption I need is that the majority of the network is honest. You can use hashing + random strings to confirm that a person still has the file they are hosting. You only need then to be sure that the person hosting the file and the person uploading the file are not in cahoots. You can achieve that by making a random mapping between people and hosts, and only picking the host after a person has announced how much file storage they wish to rent (and paid for the first month). This makes it too expensive to host files on your own machines, because you have a very low probability of getting the opportunity to store a file on your own machine.

On Mon, Nov 25, 2013 at 9:43 PM, Andy Isaacson wrote:

On Mon, Nov 25, 2013 at 06:20:27PM -0800, coderman wrote:

...

On Mon, Nov 25, 2013 at 6:12 PM, David Vorick wrote:

...

... Nobody cares how many petaflops the network is pulling, because the petaflops can't be put to use somewhere else... But if the mining was based on cloud storage, a dramatic drop in the price of the currency would result in a dramatic drop in the cost of storing data on the network.

i like the idea of "proof of _useful_ work" applied here to storage. if only mining had been applied to BOINC, GIMPS, or *@home efforts...

The critical feature of the BTC PoW block chain is that the work is applied to a believed-computationally-hard problem that is a function of the block under consideration. This precludes the "work" being a function of any other property.

...

surely there is prior art?

How quickly we forget ... Bitcoin did 4 impossible things before breakfast, and now we're whining that it didn't do 5. :)

In 2008 nobody in the open research community would have proposed that a peer-to-peer (1) autoscaling (2) computational PoW (3) deflationary (4) space-conserving cryptocurrency was even theoretically possible. Then Nakamoto dropped working code and the paper.

Adding a "useful work" unit to the mining PoW has been considered; it's extremely hard to do and puts the "useful work" project (whatever it is) squarely in the line of fire for fraudsters and attacks.

-andy

Sean Lynch wrote:

On Mon, Nov 25 2013, coderman wrote:

...

surely there is prior art?

I just remembered, there is in fact prior art, though it's state of the art, as in "nearly practical." They're called SNARKs: Succinct Non-interactive ARguments of Knowledge. You can take any computation and annotate it sufficiently that whoever runs the computation can generate a (constant size) proof that they did it correctly in (nearly) constant time. Andrew Miller posted about it on the Tahoe-LAFS mailing list. See http://eprint.iacr.org/2013/507.pdf for one implementation.

I'm not sure if you could use this for a Bitcoin-style problem, though, since I have no idea if the difficulty can be adjusted smoothly. It's interesting that we can now take ALL computations problems and turn them into the "easy to verify" variety, however.

Interesting to see this mentioned here. Mike Walfish and Andrew Blumberg have written a nice survey on the work in this area: http://eccc.hpi-web.de/report/2013/165 Justin Thaler provides another perspective: http://mybiasedcoin.blogspot.com/2013/09/guest-post-by-justin-thaler-mini-su... I can also add a little context to this conversation---I've actually done an independent re-implementation of the work of Ben-Sasson et al that Sean linked above. At a high level, my take is that this area has huge potential, but neither this work nor other projects in the area (summarized below) are really practical---yet. The overhead for the party constructing the proof is at least 3 orders of magnitude more than the cost of running the computation directly. The work of Ben-Sasson et al costs more like 6 orders of magnitude! (In principle, though, they are paying this price to achieve greater computational generality.) The work required of the party verifying the computation is also non-trivial: while *checking* the answer is quick, these systems (with one exception) require pre-processing work on the computation being verified, and the cost of this is several orders of magnitude larger than simply computing the result directly. (Note, however, that this cost can be amortized by outsourcing the same computation over many different inputs.) But there is some real hope here: the rate at which progress is being made is impressive (two years ago overhead was more like 20 orders of magnitude than three!), and there are contexts where the extra work is worth the cost. Perhaps one of these is a cryptocurrency that relies on proof of "useful" work. With regard to smooth difficulty adjustment: since the goal of most of these projects is to encode arbitrary computations, the problems of difficulty adjustment and proof of work become orthogonal. For those wanting a bit more detail: Broadly speaking, there are four research groups working on this stuff: - Ben-Sasson et al at Technion/Tel Aviv/MIT http://scipr-lab.org/ - Parno et al at Microsoft Research http://research.microsoft.com/apps/pubs/default.aspx?id=180286 - Thaler et al at Harvard http://people.seas.harvard.edu/~jthaler/PracticalVerifiedComputation.html - Walfish et al at UT Austin/NYU (full disclosure: I work with these guys) http://cs.utexas.edu/pepper/ The work of Thaler et al is somehat distinct from the other three because, while it is extremely efficient for certain computations, it is not general: the efficiency improvements it offers are limited to computations with a regular underlying structure. However, when this requirement is met, it has very low overhead compared to the other three systems, and it involves no costly pre-processing. The three other groups have built systems that compile from a subset of C to a form whose result can be encoded into a probabilistically checkable proof. The resulting PCP is huge, so in all three systems the result is not the proof itself. Rather, the proof is queried and the result used for verification. The method of querying is one distinguishing factor between these systems. Ben-Sasson et al and Parno et al share common ancestry in the work of Gennaro et al, also at Microsoft Research. http://research.microsoft.com/apps/pubs/default.aspx?id=180285 In both cases, the query/response take the form of a noninteractive argument. Basically, the queries are encrypted and bundled into the description of the computation ahead of time, after which the computation can be run by providing an input and requesting an answer. These systems also support public verifiability, allowing the answer to be checked by anyone holding the public verification key. The work of Ben-Sasson et al achieves more generality by encoding computations as the execution of a virtual microprocessor, then verifying correct execution of the processor. This system supports full C semantics and achieves an efficient abstraction for verified RAM (again, at a penalty of 3 *additional* orders of magnitude beyond the other systems). The UT/NYU group have also adapted a simplification of Gennaro et al, but their system really rests upon refinements of the efficient argument systems of Ishai et al. http://www.cs.ucla.edu/~rafail/PUBLIC/79.pdf In this case, verification involves two separate interactions, one that establishes a commitment to the proof and one that queries it. Though it requires interaction, the advantage of this approach is that it is cryptographically simpler. Concretely, the crypto is one of the most expensive parts of the system, so this simplification results in good performance relative to the other systems. The UT/NYU group have also developed verifiable storage abstractions, including the ability to verify computations (in zero knowledge) on hidden state for which you hold a cryptographic commitment. http://eprint.iacr.org/2013/356 -=rsw

I think its important that new alt coins being introduced.  Not that it confuses the market.  But to keep innovation going.  Creating specialized coins with different characteristics would only help the entire market move forward.  Its like the car industry in its infancy.  How many car companies were out there at the time when people were trading in their horse carriages with 4 wheels + a motor?    -Joe ________________________________ From: Al Billings To: "cypherpunks@cpunks.org" Sent: Tuesday, November 26, 2013 10:25 AM Subject: Re: bitcoin as a global medium of exchange (was Re: Interesting take on Sanjuro's Assassination Market) I suggest reading http://www.reddit.com/r/bitcoin instead of reinventing the wheel here. All of this has been discussed, ad nauseum, there and a few other forums. We don’t live in a perfect world and people will always attempt to game the system to make themselves rich. The problem other alt currencies have is why would anyone adopt them when bitcoin is already there and clearly (somewhat) successful? Why mine litecoin, for example, when if I mine bitcoin (or even buy them), I make money for sure (for now at least)? ________________________________ From: David Vorick David Vorick Reply: David Vorick david.vorick@gmail.com Date: November 25, 2013 at 6:19:10 PM To: coderman coderman@gmail.com Subject: Re: bitcoin as a global medium of exchange (was Re: Interesting take on Sanjuro's Assassination Market) As I was telling Jayvan, the idea would be that early adopters use the currency for its inherent uses to them, as opposed to its speculative potential. Right now, bitcoin is almost exclusively speculative. It's worth a lot of money because the value has been increasing consistently. That's tulipmania. In a perfect world you would have some way to protect a currency against speculation. The volatility in bitcoin makes it less useful as a currency, therefore the speculation is damaging bitcoin. I don't have a solution, and I'm not suggesting one, I'm merely suggesting that a solution might exist that would be a substantial improvement. If bitcoin was based on something that had inherent value, say cloud storage, then a spike in value would be followed by a spike in the amount of storage being contributed to the network (bitcoin currently does this, a spike in price is followed by a spike in mining). The key here though is that the network would be protect from dramatic dips in value. When bitcoin drops in price, all of the abundant mining does nothing to save bitcoin, because the bitcoin mining doesn't actually add any value to the network. Nobody cares how many petaflops the network is pulling, because the petaflops can't be put to use somewhere else. But if the mining was based on cloud storage, a dramatic drop in the price of the currency would result in a dramatic drop in the cost of storing data on the network. That's something that actually has use, and so people would let the price fall unreasonably low (instead they would find a way to make use of the cheap storage). This would allow the currency to ride arbitrary spikes in price while being protected against arbitrary drops in price. Jim, the amount of mining being done on the bitcoin network has no impact on the price. The price might have an impact on the volume of mining, but because the mining is specific to the bitcoin network (double sha2 hashing or something like that) it can't be sold or used for other applications. Bitcoin mining is only good for bitcoin mining, which means the demand for the mining is exclusively based on value of the bitcoins being mined every day.

I've found the problematic passage in Satoshi's paper.  From Section 4, 'Proof of Work':          "To compensate for increasing hardware speed and varying interest in running nodes over time,the proof-of-work difficulty is determined by a moving average targeting an average number of blocks per hour. If they're generated too fast, the difficulty increases." So I ask, "What is 'too fast'?"  What it means is that the algorithm tries to limit the rate of creation of bitcoins to a relatively constant value.  At the time most people first read that paper, this might not have appeared like it was going to foment a problem.  But, it should have been obvious to Satoshi that the adoption of a new digital currency isn't a linear process:  Particularly in the early stages I would have anticipated that 'demand' for BTC would be some approximation of the square of the elapsed time, rather than the elapsed time.   One user would likely 'create' other users at a relatively constant rate, meaning that the integral of xdx is (x**2).   (disregarding the 1/2 factor...).    To limit the creation of bitcoins to a linear value amounts to throttling its potential, and that means a pressure for the value to go up, way up.  That's great for the early adopters, whose early work is made far more valuable than it otherwise would have been.  Doubtless Satoshi understood this.  Doubtless Satoshi also understood how important it was for him to get together  as much computing power as he could afford, at the beginning, because CPU power at that point was quite sufficient to mine bitcoin.         Jim Bell ________________________________ From: David Vorick To: coderman Cc: "cypherpunks@cpunks.org" Sent: Monday, November 25, 2013 6:12 PM Subject: Re: bitcoin as a global medium of exchange (was Re: Interesting take on Sanjuro's Assassination Market) As I was telling Jayvan, the idea would be that early adopters use the currency for its inherent uses to them, as opposed to its speculative potential. Right now, bitcoin is almost exclusively speculative. It's worth a lot of money because the value has been increasing consistently. That's tulipmania. In a perfect world you would have some way to protect a currency against speculation. The volatility in bitcoin makes it less useful as a currency, therefore the speculation is damaging bitcoin. I don't have a solution, and I'm not suggesting one, I'm merely suggesting that a solution might exist that would be a substantial improvement. If bitcoin was based on something that had inherent value, say cloud storage, then a spike in value would be followed by a spike in the amount of storage being contributed to the network (bitcoin currently does this, a spike in price is followed by a spike in mining). The key here though is that the network would be protect from dramatic dips in value. When bitcoin drops in price, all of the abundant mining does nothing to save bitcoin, because the bitcoin mining doesn't actually add any value to the network. Nobody cares how many petaflops the network is pulling, because the petaflops can't be put to use somewhere else. But if the mining was based on cloud storage, a dramatic drop in the price of the currency would result in a dramatic drop in the cost of storing data on the network. That's something that actually has use, and so people would let the price fall unreasonably low (instead they would find a way to make use of the cheap storage). This would allow the currency to ride arbitrary spikes in price while being protected against arbitrary drops in price. Jim, the amount of mining being done on the bitcoin network has no impact on the price. The price might have an impact on the volume of mining, but because the mining is specific to the bitcoin network (double sha2 hashing or something like that) it can't be sold or used for other applications. Bitcoin mining is only good for bitcoin mining, which means the demand for the mining is exclusively based on value of the bitcoins being mined every day. On Mon, Nov 25, 2013 at 8:54 PM, coderman wrote: On Mon, Nov 25, 2013 at 5:43 PM, David Vorick wrote:

...

... How do you prevent the early adopters from becoming stupid

...

wealthy if the currency takes off?

high risk, high reward.

why should early adoption with high risk not pay more than late adoption with significantly less risk?

i agree that the externals affecting BTC exchange rate are volatile and annoying, but this hardly seems like bitcoin's fault.  do you fight tulpenmanie with currency controls?  good luck!

2013/11/26 Jim Bell

At this point, how much real 'risk' would there be in a new digital currency? Far less than BTC.

I think this is a very interesting question. You're still left with the same problems though. Unless you can make the coin's real-life value constant in some way. Best I can come up with is increasing mining payout with the difficulty. That'll link the value of a coin to the cost of mining, directly. Meaning you can turn electricity into coin, but not the other way around. I suppose you'll need demurrage because else the coin will inflate beyond making mining cost neutral, and the mining rates will decline accordingly. Actually.. Why isn't this how Bitcoin worked in the first place? Maybe it just complicates things too much.

2013/11/27 Mike Gogulski

The concern with the current price rise and deflationary aspect seems a bit short-sighted to me.

The mining reward is algorithmically destined to fall to less than 1 Bitcoin per block somewhere around 2032

Yeah. That really doesn't matter left or rightwise.

On Mon, Nov 25 2013, Jim Bell wrote:

The use of CPU 'effort' as 'earning' bitcoins (or other electronic currency) was a good idea. Problem is, there's plenty of electricity being wasted in the process. It seems to me that it should be possible to develop some sort of use for this dedicated CPU effort. What's a major use of CPU power? One is weather forecasting, another is simulations of various kinds. These use huge amounts of computer-time, and if they are made to be sufficiently divisible people could earn digital-coin by doing things that are actually valuable in and of themselves. Jim Bell

I am less concerned about this waste than most people seem to be. People don't complain about the wasted effort of all the runners or politicians who didn't win the race, and that's basically what it is. But if we do want to replace Bitcoin's mining function, we need to come up with something that can be verified in a distributed fashion, is not likely to suddenly be made trivial by a major breakthrough, and whose difficulty can be easily adjusted according to some difficulty algorithm. Primecoin is the best candidate I've seen so far, though admittedly I haven't been looking that closely at altcoins, because like I said I don't consider the electricity "wasted" on the mining race to be a big deal. A closer analogy might be trading algorithms. -- Sean Richard Lynch http://www.literati.org/~seanl/

On Tue, Nov 26, 2013 at 04:53:09PM +1000, James A. Donald wrote:

I am, however worried that bitcoin can be dominated by a small group. As the total transaction volume increases, the number of people that are full and equal participants in recording and facilitating transactions must diminish.

There are scaling issues in Bitcoin which can be addressed in a successor that is not a mere copycat with no added value. Some of the issues might be even fixed as time passes, and there's sufficient incentive.

On Mon, Nov 25 2013, Javier Liendo wrote:

isn't the real problem with bitcoin becoming a global currency an issue of how to best manage the potential exponential growth in size of the blockchain? 

i know this is cypherpunks but please explain like i'm five...

Hopefully Moore's Law will save us, but I actually expect that, should Bitcoin continue to grow, most payments will be made through payment services of some kind, with the actual transactions only used to deposit money in your account with the payment service. This is analogous to how gold was used once banking became popular. Should these payment services become full-fledged banks, they could help with the deflation problem as well by engaging in fractional reserve banking, the same way banks did with gold. Many people have a negative impression of fractional reserve banking, but in fact most of the instability experienced in the US was actually caused by restrictions on branching and requirements that banks invest in the debt of states that kept defaulting. Bank failures were much rarer in countries without these requirements. For example, Canada had *zero* bank failures during the Great Depression and only created a central bank for the purpose of facilitating international payments, so that Canadian banks and businesses didn't need accounts in London. -- Sean Richard Lynch http://www.literati.org/~seanl/

On Mon, Nov 25, 2013 at 05:50:27PM -0800, Sean Lynch wrote:

Hopefully Moore's Law will save us, but I actually expect that, should

Moore's law has unfortunately recently ran into financial scaling limits, which are slowing doubling times (estimate from 18 months to three years at the moment) with physical scaling limits close to follow (somewhen shortly below 5 nm). Of course current ASICs are far removed from cutting edge. Another issue is blockchain storage (NOR flash is also pretty finished, HDD area density has stalled recently, but might resume scaling, at least for a while) and availability of network bandwidth. You can buy 10 Gbit/s close to the backbone, but it's beyond affordability for most people.

Bitcoin continue to grow, most payments will be made through payment services of some kind, with the actual transactions only used to deposit money in your account with the payment service. This is analogous to how gold was used once banking became popular.

Well, I don't see how I've "validated [your] statement".  You said the ONLY reason bitcoin is deflationary "because the number of people who use it is growing faster than the number of coins in circulation".   I'd say, to the contrary, that the limitation on the circulation of BTC is 'baked into the cake' of bitcoin itself:  It is algorithmically determined by the 'policy' built into the design of bitcoin.  That limitation on bitcoin was set long ago, long before most people understood what bitcoin was (secretly) intended to do.  And, since the 'cost' of mining yet another bitcoin is automatically adjusted, to greatly increase over the lifetime of the mining of bitcoin, 'blame' for the deflation should be assigned to the person who designed the algorithms. I think at this point 'we' (the public; or at least the experts on bitcoin) understand that in principle, it would be possible to 'design' a new digital currency, call it "Bitcoin 2.0", which is specifically designed to not appreciate (nor depreciate) dramatically.  Part of the advantage they will have is that it won't be necessary to compensate for ease-of-mining represented by the transition through the CPU/GPU/FPGA/ASIC eras:  Everybody will 'start' with a level playing field, ASIC's.  The number of 'Bitcoin 2.0's could be set to approximately 20 trillion, if it is limited at all, and there will be no dramatic increases in the 'difficulty' of mining them, over the lifetime of the mining.  Because the difficulty will not appreciably increase, their value will also not appreciably increase.  It would certainly not increase so much so as to dissuade people from spending them.          Jim Bell  ________________________________ From: David Vorick To: Jim Bell Cc: "cypherpunks@cpunks.org" ; "iam@kjro.se" Sent: Monday, November 25, 2013 4:04 PM Subject: Re: Interesting take on Sanjuro's Assassination Market You've validated my statement. Your problem is if bitcoin becomes a world economy. That means bitcoins usage grows by something like 2 orders of magnitude. Except that bitcoins are already halfway mined, which means that the circulation will not keep up. That is what drives the price up. If you want a currency that will scale with it's global usage (IE when the market cap hits $21 trillion, there are 21 trillion in circulation), you need some mechanism that knows how to equate 1 bitcoin to 1 dollar, that way more bitcoins can be printed as the market cap goes up. On Mon, Nov 25, 2013 at 6:17 PM, Jim Bell wrote: I don't agree with your statement, "Bitcoin is only deflationary because the number of people who use it is growing faster than the number of coins in circulation.".   To the contrary, my understanding is that a number of factors have combined with the net result that Bitcoin is hyper-deflationary.  One major factor has been the shift of bitcoin 'mining' from computer CPUs, to video graphics processors (GPU's), to FPGA (Field Programmable Gate Arrays), and ultimately ASICs (literally, "application-specific integrated circuits"; what used to be called 'custom' IC's decades ago.)  While I don't have a specific number, I would not be surprised to hear that an ASIC miner is 1000x faster than even the fastest x86 CPU.  If that were the only factor, it would appear that new bitcoins should be 1000x more available than in, say, 2009.  However, I also understand that the 'difficulty' of mining bitcoin has been algorithmically increased regularly, in order to make it more difficult to compute to find individual bitcoins.   This is programmed into the entire bitcoin system.  In fact, it is to the point where the limiting factor to the cost of 'mining' bitcoin is the electricity cost of running the machines, not the cost of the machines themselves.  The bitcoin system 'programs' the appreciation of bitcoin by gradually increasing the difficulty of that mining operation.  This translates into an increase in the market value of bitcoin.

In fact, this is essential to the (theoretical) outcome of bitcoin.  I think of it this way:  The system is programmed to only allow the generation of 21 million bitcoins.  If bitcoin is ultimately to be used to run the entire world economy (why not?) there should be at least one million times more.  (Say, 21 TRILLION; 21,000,000,000,000 bitcoins, if we think of the ultimate value of a bitcoin as being roughly equal to the current value of the US dollar, the Euro, the British Pound, etc.)  But since they are limited to 21 million, by algorithm, the value of a 2013 bitcoin will have to be increased by a factor of 1000  to stretch to the task of funding a world's market.  And that means that the 2 million BTC currently in the wallet most likely owned by Satoshi will presumably increase in value to $2 trillion  (USD).  "Nice work if you can get it". Is this a problem?  Who, instead, would claim that it ISN'T a problem!  Bitcoin has many great features, its possibility (through Zerocoin) of being anonymous one of the most intriguing,  but there is nothing about a digital currency that requires that it deflates at the rate historically associated with bitcoin.  I view this deflation as being arbitrary and capricious, and wildly too large.  Like I've said, I don't begrudge Satoshi $1 billion (USD), but I DO begrudge him $2 trillion.  If Satoshi's bitcoin rescues us from all governments (enabling 'AM'), perhaps he should be entitled to $10 billion (USD), but not $2 trillion (USC).          Jim Bell

________________________________

From: David Vorick To: Jim Bell Cc: Kelly John Rose ; "cypherpunks@cpunks.org" Sent: Monday, November 25, 2013 2:20 PM

Subject: Re: Interesting take on Sanjuro's Assassination Market

How do you think something like that could be managed?

Bitcoin is only deflationary because the number of people who use it is growing faster than the number of coins in circulation. But how can you measure the number of people who are using it, and how can you measure how much they are using it? (IE are they speculating, are they actually using it to hide money from their government, are they buying needs like food+water?).

Any cryptocurrency hoping to 'appreciate by at most 5%' has to have some reliable metric for measuring it's value in the real world. Otherwise coin generation algorithms are just a shot in the dark, hoping to mimic the expected growth of the coin or having some authority that can provide input about it's real dollar value. And anything that tries to get insider metrics will need some defence against liars and sybil attacks.

On Mon, Nov 25, 2013 at 5:07 PM, Jim Bell wrote:

...

________________________________ From: Kelly John Rose To: cypherpunks@cpunks.org Sent: Monday, November 25, 2013 8:00 AM Subject: Re: Interesting take on Sanjuro's Assassination Market

On 11/25/2013 4:26 AM, Lodewijk andré de la porte wrote:

...

...

Why suddenly all this attention for yet another assassination market? Because it's more "hit them and earn the bounty", like at a fair, style?  

...

I wonder what would happen if multiple people claimed the same date for the death of a celebrity.

I haven't read enough of the 'AM' system to know what that system would do, but it seems to me that a logical outcome would be to split the reward based on the size of the contribution included with each prediction.  For instance, if Person A correctly predicted with 1 BTC, and Person B correctly predicted with 9 BTC, Person 1 should get 10% of the reward, while Person B should get 90%.

Incidentally, one problem I see with Sanjuro's 'AM' (Assassination Market) system (at least, so far) is the setting of a minimum bet at 1.0 BTC, which is about

$800 when I checked a few seconds ago.  In writing my AP essay, I anticipated that very small bets (say, 10 cents US) would be allowed.  Except in unusual situations, few people would want to donate $800 (USD) to see somebody dead; Far more would be willing to donate $1 (USD) for that.

...

  I don't know if the current minimum bid in 'AM' has something to do with the granularity of 1.0 BTC, but the existence of digits to the right of the decimal point in the prediction totalizations suggests that this is not the case.   If the problem is that the prediction totalization is currently being done manually, rather than automatically, that is a limitation that I think must be fixed in order for 'AM' to operate well.  And with a minimum bet of 1.0 BTC, it might be portrayed as if 'AM' is a tool of the wealthy, rather than that of the average person.

To the extent that this is a problem now, it will be worse as Bitcoin continues to deflate (increase in value) as it was no doubt intended to do.  What happens when 1 BTC = $10,000?   I consider that one of the few disadvantages or problems with Bitcoin is its hyper-deflationary nature:  How can a currency function as a currency, if it is 'scheduled' (by algorithm) to appreciate in value far faster than any commodity?  Another related problem is that Bitcoin is effectively programmed to excessively reward early-adopters.  While I feel that the inventor of Bitcoin should be richly rewarded for doing the work necessary to give us such a beneficial addition to society, the limit of my generosity is about $1 billion (USD).  Ultimately, I think that a replacement for Bitcoin ("Bitcoin 2.0"?) is necessary, one that won't appreciate in value more than, say, 5% per year.          Jim Bell

Disclaimer:  I am not associated with Sanjuro's 'Assassination Market' in any way.

2013/11/26 Sean Lynch

On Mon, Nov 25 2013, Jim Bell wrote:

Please don't confuse an assassination market with Bitcoin. Both can exist without each other. One does not require the other and none is a direct result of the other. They are extremely complementary. Regarding general disagreement with Bitcoin: there's really no point resisting mathematics. And at this point the deflation of Bitcoin is about as tied to a mathematical certainty as reality ever gets. It's a market thingy. Early adopters get *huge* advantages. Knowledge presses the price harder than risk. Anyway. Having multiple Bitcoins isn't much going to solve your problems. No other currency will be without it's own flavor of problems. As a rule of thumb: if the math is sound but it seems illogical, check yourself. If you can't check the math, don't trust it. Having multiple cryptocurrencies would be nice. But Ripple for example sucks in comparison. Again, this thread is not about bitcoin and cryptocurrencies. Regarding assassination markets I don't think this particular one isn't too special. I also think any form of assassination should be communally prevented. Of course anonymity, which always exists in some form, makes it impossible. I'm not sure making it as in-your-face as Tor+Bitcoin is doing it right now is better or worse. Sure is fair when knowledge isn't the deciding factor. Bottom line: whatever, I hope it doesn't take off. I like safety and wish it weren't a marketable good. I'm still not sure how far this extends into healthcare, but I hope development in the area makes the choice easier (just take care of them is my preferred answer). Best regards, Lewis

Not to mention all the horrific typos. The pain grammar school teachers suffer as a result of anonymous, uninhibited and over caffeinated anarchists is one of the silent tragedies of our times. On Thu, Nov 28, 2013 at 3:17 AM, David Vorick wrote:

I hadn't though about it this way until now, but having the ability to achieve full anonymity on the internet enables things like this, and assassination markets might not be the first or most viscous thing enabled by anonymity.

I can imagine that if assassination markets were to take off, you'd see some large bounties (in excess of $100k) on every major politician in the world. Pretty much any figure of high popularity would probably have some sort of assassination bounty on their head, because the more popular you are, the more haters you have.

What other sorts of unacceptable things could you do given fully anonymous money coupled with a fully anonymous internet identity? I can think of:

website takedowns funding murder, rape, arson, etc. bombing certain buildings funding smear campaigns (say, tear the clothes off a popular celebrity or something) bounties for drugs, child porn, etc. kidnappings doxing

You could basically attempt to crowd fund any illegal activity.

-- "On two occasions I have been asked, 'Pray, Mr. Babbage, if you put into the machine wrong figures, will the right answers come out?' I am not able rightly to apprehend the kind of confusion of ideas that could provoke such a question." -Charles Babbage, 19th century English mathematician, philosopher, inventor and mechanical engineer who originated the concept of a programmable computer.

2013/11/28 Patrick Chkoreff

You could also crowd fund an investigation of the abhorrent activities listed above, finding the people who do such things and stopping them with gentle persuasion.

That's good, because decent people outnumber sociopaths by a very large margin.

Solving crime is also very much more expensive than causing it. And the advantage to solving another person's problem is smaller than solving your own.

2013/11/29 Patrick Chkoreff

Lodewijk andré de la porte wrote, On 11/28/2013 09:37 AM:

...

Solving crime is also very much more expensive than causing it.

That doesn't matter. All that matters is that the benefit of solving the crime exceeds the cost of solving it.

I think we disagree here. Game theory doesn't support this standpoint. I am sure having no crime would be better for humanity than the other way around. But to commit a crime can be extremely profitable, emotionally or financially. And for me to protect others is not profitable for me directly. It's like taxes, it's good for society if everyone just pays their taxes (provided the taxes are fair). But do I want to pay taxes? I don't know anyone that looks forward to paying his taxes.

Forget retribution. The primary benefit of an investigation is the insight which enables you to prevent future crimes. That can be enormously valuable in terms of life and property.

Then why didn't you spend 10% of your wealth/income last year on investigating crime prevention? I appreciate that you feel this discussion is helping, and it's helping me get my thoughts clearer, but I truly think a community cannot be expected to behave in a way good for the community but bad for the individual.

...

And the advantage to solving another person's problem is smaller than solving your own.

The advantage is the same when your problems are the same, which is often the case.

I don't quite see this argument. A murderer and a police officer have opposing motives. A person in the street will back away from both to prevent getting hurt, even if he might help either achieve his/her goal.

(sidenote: what if a future "electronic monetary system" that relied on community taxation would have a voting option, such that 50% of taxes go towards a general system of operation, and the other 50%, say based on income, can be steered into categories of funding (e.g. crime prevention). such that localities or demographics could focus their tax contribution towards the issues of most relevance. <snip>

Pacifists have long yearned to pay no war taxes and might perhaps speak up now, if they are present here. --dan

forgot to mention: this fractional taxation that could be individually routed to issues then could be a way of funding basic science or studies or research outside of existing political frameworks and providing oversight or for 'increasing support' for agencies such as the GAO in the US, via what programs are given more prominence within policy (for instance if issues of EMFs and cancer and telephony were put into policy via directed tax funding). also: the income-based structure of whatever this 'routable tax percentage' may be called, would need to address vast income inequality, such that each citizen has a certain proportion though some citizens should not have a million-times more vote if wealthy and taxed. perhaps more of their taxes would go to the general system fund allocated to basic government operation, or some other way to keep the vote distributed by unique individual views versus dominated by those with most all the money, circulating and non-circulating. (which brings up the issue of paper currency as ultimate surveillance/monitoring system, if taking into account traffic analysis of money from points A to B to C ... to N. while credit and debit is more transparent about this, it is difficult to imagine a more useful model for flow of money through a chain than tracking paper currency in exchange and using this for all it is worth statistically, pre-internet, though computer-dependent to parse all the data.)

2013/11/29 Patrick Chkoreff

Lodewijk andré de la porte wrote, On 11/29/2013 10:38 AM:

...

That doesn't matter. All that matters is that the benefit of solving the crime exceeds the cost of solving it.

...

I think we disagree here. Game theory doesn't support this standpoint.

Chuck game theory. I'm not talking about an intricate prisoner's dilemma with layers of feedback here, just a simple matter of benefit versus cost.

This deserves further explanation. I do think game theory is extremely present in all of our society. We'd be more happy to have other pay tax and not us, than to also pay taxes ourselves.

...

... it's good for society if everyone just pays their taxes ...

I disagree, but it's irrelevant anyway. I'm not talking about big chewy abstractions like "society", just individual interest.

Arguing against "taxes" in the broad sense of the word (contribution to society as a whole, government is less often the right word) is very challenging indeed if you ask me. Some things only work when everyone pitches in. Reducing climate destruction will not be possible without universally agreed upon rules or very aggressive resistance by ... pretty much all buying power. The latter hasn't happened ever, not without a governing organ explicitly "boycotting" something. We're entering a very murky discussion here which I think shouldn't be required. Let's say "do something for the good of all of *cared-for-group-name* that will cost the individual more than the individual will profit from it". Becoming vegetarian is an example. It doesn't work if just that one person does it, but it does cost that person something.

...

Forget retribution. The primary benefit of an investigation is the insight which enables you to prevent future crimes. That can be enormously valuable in terms of life and property.

Then why didn't you spend 10% of your wealth/income last year on investigating crime prevention?

Because the benefit to me did not exceed that particular cost. I did however spend some amount of money and time on computer and physical security. Some of the benefits of my efforts are shared by others.

You're right in that 10% is pretty darn high. Only Israel gets to that number. About 5% of gov' taxes goes to defense though. With developed countries' tax pressure at ~35% (US only ~25%) that makes 0.35 * 0.05 = 0.0175 or about 2% of your money. Only a fifth of what I asked you for. Then you say you did *additional* things to secure yourself. Let's say 2% is about right for a personal defense budget. Knowing that committing a murder is cheaper than preventing one, by a factor I'm not aware of, and that murder can sometimes have an economic advantage you will find that murder will exist. (see also estimated victims and cost of prevention of terrorism. Now see the costs of hitmen (find a cheap one).) Having a public market for hitmen will make it cheaper. Having a crowdfunding posibility will enable a new *class* of people, those with lesser profit from it, to still contribute to a kill. This model doesn't show failures and thus misguides hitmen into thinking it is easy money, distorting the market in the unpreferred direction. Observe how "no retribution" significantly reduces the estimated cost of a murdering someone. I simply think you wouldn't get the type of civilization where you could focus on development of the race as a whole. A way to live more than just for your own little life, but for that of your family and "comrades". If you don't do that you choose the most painful way to die; to live.

...

I truly think a community cannot be expected to behave in a way good for the community but bad for the individual.

Thank goodness. I can't imagine what such a horror could even mean in the first place.

For real, right? Frikkin' goody two shoeses. Can't understand their insanity.

...

The advantage is the same when your problems are the same, which is often the case.

I don't quite see this argument. A murderer and a police officer have opposing motives. A person in the street will back away from both to prevent getting hurt, even if he might help either achieve his/her goal.

It is generally wise for that person to back away, though in specific instances people do find it mutually advantageous to look out for each other. As a small example, people in my neighborhood have alerted each other to the presence of suspicious characters.

People in your neighborhood have a (perhaps unspoken) currency of reputation. Their warning to others would be reciprocated. That idea makes them do it. You don't have to consider this rational or good for the individual, evolution made sure that it increases the size of the population. This is not personally advantageous, it's popularly advantageous. Evolution made you a less rational being to cause your existence. Very philosophical standpoint. "Humans aren't rational, therefore they can exist". Anyway. There might very well be examples of true mutually beneficial cases. For example if a wallet's finder may keep a percentage of the wallet's contents. The finder has this dilemma: Max( wallet.content * captureRiskFactor, wallet.content * rewardFactor + emotionalBonus) If the wallet's finder is found out (the owner found him) he will lose the reward. The risk factor is 0 to 1. 10% chance of getting caught makes content * 0.1. This is the expected profit. Everyone on this list really should know about expected returns and all. Only when the rewardFactor is bigger than his riskfactor will he give the wallet back. You'll find that even this is not actually mutually beneficial, lets the wallet has different values for both people. This is generally true, maybe a family picture, ID's that have to be rerequested at a cost, etc. While the cash is all that's good to the finder. The emotional bonus is the thing that causes people to be vegetarian and is also the typical reason people obey the law. It's part of the unlikely risk-adverseness common in people nowadays. I guess safely living worse is better than maybe living better in terms of survival. Anyway again. Given such proper gametheory you'll find it hard to find situations where one would be interested in protecting another unrelated human being. At some point crime will stabilize at a certain level. That level is where people are so generally scared of a crime against them, yet not scared of retribution for their protests against crime, that they'll put efforts (in financial or other form) into reducing the level of criminality. You'll find their first move is closing assassination markets to increase the effective cost and risk of finding a murderer to do one's bidding. It's by far the cheapest way to reduce murder.

It amazes me that some glibly assert that people will voluntarily fund the assassination of a politician, but would not voluntarily fund the investigation of a string of crimes which cost money and lives. -- especially given that "crowdfunding" is all the rage these days. The view strikes me as excessively dismal and eeyorish.

Once there's a string of crimes you'd rather barricade your home than collectively hire a detective. Maybe you'll have a guard on your street. But you wouldn't donate to a crime lab doing experimental research. That's just too little directly visible return. Ad-hoc patchwork solutions. (Paying safety money for example) An assassination pool however has very direct and clear payoffs if it ever happens. Easy to put money towards out of a simple grudge. Excuses for the subpar use of language. My End Of Day has been reached. Could you try to summarize the arguments we've been throwing at each other? I'd like to reach some sort of satisfying answer. I think you estimate the cost of protection to be comparable to the cost of attacks. I think protection is far more expensive and although likely a more popular expense (let's say people are generally good, witchhunts and discrimination would suggest otherwise but w/e) also more frequently a smaller expense, as the profit derived from it is very hard to determine and the profit would hardly alter by a personal contribution. Therewith creating a game theory scenario (a simple one!) where general safety will dwindle as to alter our society significantly and make crime an auctioned commodity. Subverting any way of life not strictly egoistical. (What was the last time you donated to your police station?) As you see my summary turned into another piece of argument. Excuses excuses. Eeyorish is a nice word btw. And after a string of crimes is a tad late. And who'd notice it's a string of crimes?

That's good, because decent people outnumber sociopaths by a very large margin.

But sociopaths tend to have a higher spending power, both because sociopaths are less inhibited in the pursuit of profit at others' expense, and because the acquisition of wealth and power is now well established as a cause of acquired sociopathy. So, sure. Plenty of nice people without the money to outbid awful people. Pretty much what we have today; an oligarchy of wealthy murderers without significant barrier. It's OK! The Market will fix this! On Thu, 28 Nov 2013 08:16:37 -0700 Patrick Chkoreff wrote:

David Vorick wrote, On 11/28/2013 01:17 AM:

...

website takedowns funding murder, rape, arson, etc. bombing certain buildings funding smear campaigns (say, tear the clothes off a popular celebrity or something) bounties for drugs, child porn, etc. kidnappings doxing

You could basically attempt to crowd fund any illegal activity.

You could also crowd fund an investigation of the abhorrent activities listed above, finding the people who do such things and stopping them with gentle persuasion.

That's good, because decent people outnumber sociopaths by a very large margin.

-- Patrick

On Thu, Nov 28 2013, David Vorick wrote:

I hadn't though about it this way until now, but having the ability to achieve full anonymity on the internet enables things like this, and assassination markets might not be the first or most viscous thing enabled by anonymity.

I can imagine that if assassination markets were to take off, you'd see some large bounties (in excess of $100k) on every major politician in the world. Pretty much any figure of high popularity would probably have some sort of assassination bounty on their head, because the more popular you are, the more haters you have.

What other sorts of unacceptable things could you do given fully anonymous money coupled with a fully anonymous internet identity? I can think of:

website takedowns funding murder, rape, arson, etc. bombing certain buildings funding smear campaigns (say, tear the clothes off a popular celebrity or something) bounties for drugs, child porn, etc. kidnappings doxing

You could basically attempt to crowd fund any illegal activity.

This doesn't particularly concern me, because a) you have to get enough people (or people with enough money) who are willing to fund murder to actually fund it, and b) someone has to actually do the act. Making a liquid market for murder means you can overcome the risk only for high profile targets with a lot of enemies. That means primarily politicians, asshole celebrities, CEOs of widely hated companies, etc. And on the other side, you can also crowdsource defense, as has already been happening with the various legal defense funds. I fear the interventions governments are likely to engage in far more than I fear the new markets. -- Sean Richard Lynch http://www.literati.org/~seanl/