Richard Murphy says:
May 4 2016 at 3:54 pm
But how do you know they verify them?And why – this is an open ledger, or so I am told. So why is verification needed?
Because the mining is the verification?
Err:
So you confirm the credit is not recorded
OK then – tell me who owns it in that case
Because I promise you it exists – and don’t give me the BS about mining – that’s an economic charade in my view. No one needs to ‘mine’ to make this system work: it’s just a silly game and not remotely related to any economic fundamental. Someone gains from this process outside the system denying the capital it needs to be sustainable – who is it?
And then we get this gorgeousness:
Richard Murphy says:
May 3 2016 at 7:21 pm
Fiat money is backed by capital
It is? Umm, so, what’s that word “fiat” doing in there? And this is lovely:
Richard Murphy says:
May 3 2016 at 5:31 pm
I am sorry, but you are just wrongThe double entry for gold creation is:
What? We’re creating gold now?
And then this as the most gorgeous misunderstanding of the entire point:
James g says:
May 3 2016 at 9:58 pm
I think your argument is: money must be credit. Bitcoin is not credit. Therefore bitcoin can’t work as money.The solution is that money doesn’t have to be credit. It can be a commodity. Problem solved. Payments then become as simple as transferring ownership of the commodity. This is how money worked throughout history.
Richard Murphy says:
May 4 2016 at 5:11 am
Tally sticks are sn unlikely feature of a modern economy
But that’s pretty much what the ledger is, tally sticks. And the argument is about whether they might be a useful addition to the modern economy.
Yup, as I suspected. He is, as usual, too thick, ignorant and hidebound to have anything meaningful to say on the subject of a cryptocurrency. In this as in so much else his opinion is utterly worthless.
Tobias Hills novel the Cryptographer about a future crypto currency and the importance of trust and secrecy is an interesting read, one of the main characters is a tax inspector if my recollection is correct so you would have thought Richie had read it.
Having in the past worked on designing inventory control systems for a mining and ore processing outfit and reviewing valuation methodologies (with regard to both IFRS and GAAP) I can’t bring myself to read what he thinks the double entry is for gold.
I think Adam Smith had an idea about the double entry for gold (and silver) which began with labour. The only thing is, who’s going to be brave enough to suggest to Ritchie that he look to Adam Smith for inspiration?
(I’d never thought of Bitcoin as tally sticks before. But I can’t think of a much better illustration)
It appears that murphaloon hasn’t bother to figure out how bitcoin mining actually works. I looked into it several years ago* and IIRC the mining process works by finding factors of very large primes. In many ways it is just like mining for gold. Instead of sifting through a big pile of dirt for small flecks of gold computers sift through a big pile of numbers for small flecks that work for the system.
Since he fails to understand the basic concept of mining the block chain is surely beyond him.
*At the time most of the alluvial gold type bitcoins had been found. There simply wasn’t enough profit when only using a couple desktops to make it worth the time or higher electricity bills.
You’d think that Murphy would be all over Dunning-Krugerrands. His brand of wilful ignorance would serve him well in ignoring the problems with them.
LY, mining is essentially the calculation of a large number of cryptographically-secure hashes, in the case of Bitcoin SHA-256. That’s why everyone uses ASICs for mining, as general-purpose CPUs just aren’t fast enough.
Not that I find Ricky Gervais all that funny but I did like his quote;
“The funniest thing about stupid people is they don’t realise how stupid they are but that’s also the most irritating thing about them”
Always think of that when I read the Murphaloon’s latest offering…..
As with the Californian gold rush, the real money to be made in bitcoin mining is selling the virtual spades (or dedicated ASIC processors or pre-built tin in this case). No money left in bitcoin mining for the little guy now.
Liberal Yank: the mining process can’t be finding the factors of a very large prime. If it’s a prime its only factors are 1 and itself. I think you meant prime factors of a very large number?
A veritable tresure trove of stupidity – Check these out from the comments:
How not to do the Socratic method….
‘Why pay 1%?
What s this for?
It’s clearly a rent. Who gets it?
And why?
But what is the urpose (sic) for it?
Secrecy?
So we have a new tax and crime haven?’
The power of strong argument:
‘I do not believe you’
Appeal de haut en bas
‘But in that case the insecurity I refer to is real
I think my questions are clear’
Starting to blow a fuse:
‘I am sorry, but you are just wrong’
The power of historical Knowledge
‘And gold proved to be a dire basis for a currency’
And the comfort of friendly voices – hinting at maybe something more…..
‘Izzy
Much to reflect on there
We should bash those ideas around
Mail me
Best, and thanks
Richard’
The entire thread is hilarious – he can’t even begin to understand bitcoin and cryptocurrencies – he flails around like a blind hedgehog and resorts to his trusted tools of bluster, abuse, false appeal to authority – and of course hundreds of people already better informed than him are subject to permanent bans so to take that big a pounding when your biggest nemesese are prevented from taking part in the debate is some achievement – has made my morning!
The inextricable connection between the block chain, verification, and mining is, admittedly, complicated. But I’ve managed to explain it in a few minutes to people who know nothing about crypto currency.
It says a lot about Richie that he cannot even be bothered to spend half an hour reading up on something before he spouts off about it as an ‘expert’.
He’s like a stagecoach driver sneering that a car could never work because there is no room to fit a horse inside it.
He genuinely has no idea about how ill informed he is.
I wonder how many students of his have twigged that he is the least intelligent and knowledgeable person in the lecture room? You would have thought he would adore the concept of the blockchain and the verification procedures. If the bitcoin concept survives, it could well be those features that are found to be most useful.
I see now that my initial comment was very poorly crafted. Most of that is my fault for not bothering to relearn information I discarded a years(IDK if it was 2 or 5 at this point) ago.
Mary Snell,
That is what I meant.
I would hope that most readers believe I understand bitcoins far better than Murphaloon despite the fact that I didn’t get paid to post an article about it.
Yeah but bitcoin mining has got nowt to do with factoring, as I mentioned. Just because bitcoins are ‘crypto’, doesn’t mean blockchain operations have anything to do with public-key ciphers (which is where factoring large integers is a thing).
The blockchain means that every transaction has a verifiable record behind it. You would think that Murph would adore that kind of verifiability, but he is simply too stupid. He does not realise that it enables secure and traceable transactions between people, without neo liberal notions, such as trust, being involved.
The best bit about bitcoin mining is that it is all about finding the nonce. And it has nothing to do with primes. Just hash codes as BICR said.