bitcoin as a global medium of exchange (was Re: Interesting take on Sanjuro's Assassination Market)

David Vorick david.vorick at gmail.com
Mon Nov 25 17:43:11 PST 2013


Bitcoin has a lot of problems.

Andy, the problem isn't the denomination, the problem is that Satioshi has
5% of all the currency, and the Winklevoss twins have another 0.5%. If
bitcoin becomes worth 100 trillion dollars, they've got a solid 500 billion
for being nobody and doing nothing. That's a problem to me.

Another problem with bitcoin is that the blockchain won't scale. Another
problem is that nobody knows how to price transaction fees. And then
there's the selfish mining problem.

I think though that we'll see other cryptocurrencies that solve these
problems. Bitcoin is overinflated, and while the current alt coins aren't
offering much in the way of competition.

I'm working on one right now. It's not built but the idea is to use
proof-of-contribution instead of proof-of-work, where contribution is disk
storage contributed to a distributed network. The disk storage is used to
house the blockchain, but it can also be sold on a market for people to
use. Theoretically, this gives people a way to price the currency (using
the value of cloud storage vs. the price of storage on the network using
the network currency).

The tricky part is preventing cheating, but I think I have a decent
solution.

I don't however know a good way to distribute currency to the network, for
the problems I was explaining to Jim Bell. Storage is currently getting
cheaper at an exponential rate, and I have no idea how to predict the
volume of users over time, nor a good way to measure the volume of users as
immune to sybil attacks. How do you prevent the early adopters from
becoming stupid wealthy if the currency takes off?
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