The crypto thread

[Samson]

Well, to start with, you're just about the only person in the world, who knows the difference between privacy coins and the other option. I agree with Edward and Rob that primary allure is value speculation, not privacy. Privacy would be nice if people could have it, but it's far from being a deciding factor. Most people don't do drugs for crypto, illegal racing, shopping in dark webs, greasing officials, tax evasion - so, for most, the kind of privacy on offer is more of a beauty concept, not really a functional advantage. Secret agents and drug lords violently disagree, but hey.

There is a class of legal but private stuff that most people spend some money one. That pretty much cuts that sector of the economy off from those coins.

For me, idea of Ethereum is far more important - a building block for other crypto projects, malleable currency, the stuff from which other valuable stuff is made. A platform for digitalising value, eventually. This is something existing money can't do, so that's the future value I see.

There is a whole technical side that I do not understand. Smart contracts basically cannot exist on monero I think. Could they would on something like Zcash that is optionally private? I do not know.

But if it is it technically feasible someone will make it and that will have a killer feature etherium does not have, and ethidium will lose.

If you can give me some privacy, sure I'll take privacy, but it's far from being a deal breaker. If I wanted real privacy in commerce I'd stick with proverbial gold bars, and other solid and well researched options that has long been and will remain in existence.

This comes to the point. If you are using it for speculation the only way it is a sustainable instrument, rather than something relying on the bigger fool principle, it has to be good for something. Is not the tech that can feasibly replace bank accounts more likely to be that?

 

[Samson]

Texas cryptomining outfit earns more from idling rigs than digging Bitcoin

Bitcoin mining outfit Riot Platforms earned $31.7 million from Texas power authorities last month for curtailing operations – far more than the value of the Bitcoin it mined in the same period.

In a press release yesterday, Riot said it produced 333 Bitcoin at its mining operations in Rockdale, Texas, which would have been worth just shy of $9 million on August 31. All the cash earned from those energy credits, on the other hand, equates to around 1,136 Bitcoin, Riot CEO Jason Les said in the company's monthly update.

The Electric Reliability Council of Texas (ERCOT) operates a demand response program that allows big energy consumers, like Riot, to earn power credits for using less of it for operations and selling power back to the grid, as well as additional credit for being enrolled in its demand response programs.

 

[Kyriakos]

Texas cryptomining outfit earns more from idling rigs than digging Bitcoin

Bitcoin mining outfit Riot Platforms earned $31.7 million from Texas power authorities last month for curtailing operations – far more than the value of the Bitcoin it mined in the same period.

In a press release yesterday, Riot said it produced 333 Bitcoin at its mining operations in Rockdale, Texas, which would have been worth just shy of $9 million on August 31. All the cash earned from those energy credits, on the other hand, equates to around 1,136 Bitcoin, Riot CEO Jason Les said in the company's monthly update.

The Electric Reliability Council of Texas (ERCOT) operates a demand response program that allows big energy consumers, like Riot, to earn power credits for using less of it for operations and selling power back to the grid, as well as additional credit for being enrolled in its demand response programs.

Shouldn't this be a scam/loophole to be closed? Already mining is generally a scam (due to artificial demand for it, from how the system is set with inherent limitations next to fiat card transactions & of course the strictly speculative nature of the currency), but at least that is set to serve the purpose of enabling authentication of transactions in the blockchain, by using heavy-duty cards. Making a profit out of selling energy back to the energy provider, seems too easy and makes you literally too big to fail, no?

 

[Samson]

Shouldn't this be a scam/loophole to be closed? Already mining is generally a scam, but at least that is set to serve the purpose of enabling authentication of transactions in the blockchain, by using heavy-duty cards. Making a profit out of selling energy back to the energy provider, seems too easy and makes you literally too big to fail, no?

It seems totally broken. I am all for demand metered pricing for electricity, it should save so much levelling hardware. But how those numbers can make any sense is beyond me.

 

[Kyriakos]

Can you explain the alternative plan for transaction authentication? Iirc in some video I heard that Eth is examining such - which I suppose would make mining obsolete for that currency (?).

 

[Samson]

Can you explain the alternative plan for transaction authentication? Iirc in some video I heard that Eth is examining such - which I suppose would make mining obsolete for that currency (?).

You mean the switch to proof of stake (PoS) from proof of work (PoW) that happened last year? You get that PoW used a "hard sum" to randomly assign the right to mine the next block to a miner, and that caused loads of electricity use. The alternative PoS randomly assigns the right to mine the next block in a "lottery" based on people staking their etherium for the duration of the mining process.

The big advantage is that it uses hardly any electricity. The big disadvantage is that it gives control of the network to the holders of the coins. The effect of this is seen for example in the fact that is did not take long for >50% of nodes to start censoring wallets that have interacted with tornado cash. This shows that these chains can be controlled by governments.

 

[Kyriakos]

Hm, so why was the previous method, proof of work, more secure? Couldn't government mining projects get it on merit of their processing power? (in other words, I only know of the solving-a-complicated-problem aspect, not why it was assigned or if there was any inherent value to the system by doing such- ie if one is actually showing proof of anything other than having a powerful mining rig). Were those math problems in any way linked to the actual transactions? (eg some map)

 

[Samson]

Hm, so why was the previous method, proof of work, more secure? Couldn't government mining projects get it on merit of their processing power? (in other words, I only know of the solving-a-complicated-problem aspect, not why it was assigned or if there was any inherent value to the system by doing such- ie if one is actually showing proof of anything other than having a powerful mining rig).

Basically because it is easier to buy >50% of all coins, which have no intrinsic value, than it is to buy >50% of all computing hardware that lots of people need for other stuff.

Were those math problems in any way linked to the actual transactions? (eg some map)

I really do not know the details of the algorithm.

 

[Kyriakos]

Is there no way to change the blockchain element which limits the number of concurrent transactions to so small a number?
I heard ( ) that it was deliberately set in that way by the founder of cryptocurrency, but can't it even be altered?
(of course a question would be if altering it would bring any value to so speculative a set of currencies; mining already created a market on account of the built-in limitation).
(yes, as is obvious, I am only aware of bits and pieces, but wanted to ask)

 

[Samson]

I hope this just shows how bad twitter is at security rather than how bad Vitalik Buterin is

Vitalik Buterin's Twitter account hacked to promote crypto scam

The Twitter account belonging to Vitalik Buterin, inventor and effective leader of the Ethereum project, was hacked to promote a crypto scam. A tweet posted to his compromised account advertised a "commemorative NFT" to celebrate the impending release of "proto-danksharding", which is the actual name for an upcoming change to the Ethereum protocol.
However, the link was a scam, and anyone who connected their wallet risked having their wallet drained of its cryptocurrency and NFTs. Some blue-chip NFTs were stolen, including two CryptoPunks (a collection with a floor price of around 47 ETH, or $76,800). Altogether, stolen assets surpassed $650,000 in value within a few hours of the theft according to zachxbt, though this counts notoriously difficult-to-value NFTs.

The tweet was taken down within twenty minutes of being posted. All in all, posting a link to a wallet drainer was probably among the least effective things the attacker could do with the Twitter account of a person whose word can dramatically move markets.

It did seem to be something of a stark warning to some in the crypto world, however, who expressed sentiments along the lines of "if Vitalik can get hacked, anyone can."

 

[Kyriakos]

Maybe that was the (warning) point, as such relatively low-level use of hacking into twitter for crypto scams has happened before. Then again, even if they could have dumped/pumped something which would make them tens of millions, what's the likelihood of ever actually safely using the loot?

 

[Samson]

Maybe that was the (warning) point, as such relatively low-level use of hacking into twitter for crypto scams has happened before. Then again, even if they could have dumped/pumped something which would make them tens of millions, what's the likelihood of ever actually safely using the loot?

It is still quite possible to launder crypto. At the least you can always go through privacy coins

 

[Kyriakos]

I watched a case where the owner (had something like 3.5 billion dollars in crypto) was exposed through an automatic fault, which linked (one of) the safe wallet to a parent wallet.
I am not even aware if you can easily exchange those lesser known coins for dollars online (?)
The crime-ridden history of using crypto is rather interesting, but I suppose that's just a general fascination, similar to the allure of dark literature or non-fiction about sk.

 

[uppi]

Is there no way to change the blockchain element which limits the number of concurrent transactions to so small a number?

Yes and no. There is the block size which determines how many transactions fit into a single mining cycle. The block chain protocol can be easily altered to increase the limit. The hard part is to convince a majority of the miners to adopt the new version.

However, there is a fundamental problem, which cannot be easily solved: the very nature of the block chain demands that there is only a single block chain (for one currency), which needs to contain all the transactions. At the same time, anyone interacting with the chain needs a copy of it. So a large amount of users would require processing a gigantic amount of data. Compare that to a centralized system, where you need to record each transaction only once (plus a few backups of course).

 

[Kyriakos]

Yes and no. There is the block size which determines how many transactions fit into a single mining cycle. The block chain protocol can be easily altered to increase the limit. The hard part is to convince a majority of the miners to adopt the new version.

However, there is a fundamental problem, which cannot be easily solved: the very nature of the block chain demands that there is only a single block chain (for one currency), which needs to contain all the transactions. At the same time, anyone interacting with the chain needs a copy of it. So a large amount of users would require processing a gigantic amount of data. Compare that to a centralized system, where you need to record each transaction only once (plus a few backups of course).

Thanks
Is the math run through the mining rigs, actually itself the direct solution to the problem of establishing authenticity of the cryptocoin transfers? Or is it unrelated and for other reason set as a distinction/indirectly related?

 

[uppi]

Thanks
Is the math run through the mining rigs, actually itself the direct solution to the problem of establishing authenticity of the cryptocoin transfers? Or is it unrelated and for other reason set as a distinction/indirectly related?

Yes, it is directly related, but in PoW-type algorithms made artificially hard. If you had one authoritative system, calculating the algorithm only once would be sufficient. PoW adds artificial constraints, so that the algorithm needs to be run a ludicrous amount of times until someone stumbles upon a valid solution.

 

[Kyriakos]

Yes, it is directly related, but in PoW-type algorithms made artificially hard. If you had one authoritative system, calculating the algorithm only once would be sufficient. PoW adds artificial constraints, so that the algorithm needs to be run a ludicrous amount of times until someone stumbles upon a valid solution.

Is there no case of anyone tricking the system so as to mine not by having an impressive rig, but messing with the input/other?

 

[Samson]

This is from last year, but I missed it and it seems like a useful real world application of a blockchain. An ID scheme advocated for by the W3C and opposed by google, it has to have something going for it:

W3C overrules objections by Google, Mozilla to decentralized identifier spec

The World Wide Web Consortium (W3C) has rejected Google's and Mozilla's objections to the Decentralized Identifiers (DID) proposal, clearing the way for the DID specification to be published a W3C Recommendation next month [article date Fri 1 Jul 2022].

The DID specification describes a way to deploy a globally unique identifier without a centralized authority (eg, Apple for Sign in with Apple) as a verifying entity.

"They are designed to enable individuals and organizations to generate their own identifiers using systems they trust," the specification explains. "These new identifiers enable entities to prove control over them by authenticating using cryptographic proofs such as digital signatures."

The goal for DIDs is to have: no central issuing agency; an identifier that persists independent of any specific organization; the ability to cryptographically prove control of an identifier; and the ability to fetch metadata about the identifier.

These identifiers can refer to people, organizations, documents, or other data.

DIDs conform to the URI schema: did:example:123456789abcdefghi. Here "did" represents the scheme, "example" represents the DID method, and "123456789abcdefghi" represents the DID method-specific identifier.

"DID methods are the mechanism by which a particular type of DID and its associated DID document are created, resolved, updated, and deactivated," the documentation explains.

This would be expressed in a DID document, which is just a JSON Object that contains other key-value data describing things like how to verify the DID controller (the entity able to change the DID document, typically through control of cryptographic keys) in order to have a trusted, pseudonymous interaction.

A DID method specification represents a novel URI scheme, like the http scheme [RFC7230] but each being different. For example, there's the trx DID method specification, the web DID method specification, and the meme DID method specification.

These get documented somewhere, such as GitHub, and recorded in a verifiable data registry, which in case you haven't guessed by now is likely to be a blockchain – a distributed, decentralized public ledger.

 

[Kaitzilla]

SBF guilty on all 7 counts!

Sam Bankman-Fried Found Guilty in Crypto Trial

A verdict from twelve jurors found SBF guilty of defrauding FTX customers out of $10 billion with his crypto empire.

gizmodo.com

A verdict from twelve jurors found SBF guilty of defrauding FTX customers out of $10 billion with his crypto empire.

He faces up to 115 years in prison, but who knows what he will get in sentencing in 5 months.

 

[RobAnybody]

Checking this again today - Bitcoin: $25,898; Etherium: $1,635, so both down quite a bit since February [EDIT: above numbers were from May] (-5% for Bitcoin, -10% for Etherium). But oddly, still not gone *poof*. I still have no idea what any of this means. Still just holding, because, well... "why not?" seems as good a reason as any (I only really have a few Etherium, plus some minor not-even-relevant stuff like Shiba).

No point meant really, just trying to update this price tracking every ~3 months or so.

I hadn't been checking for quite a while, but decided to check: Bitcoin: $36,409; Etherium: $1953

As always, I have no idea what's going on. But, Beanie Coins are up quite a bit this year?