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Merged Bitcoin - Part 3

steenkh said:
How is this managed? Is each fragment getting its own blockchain, or does each Bitcoin contain the transactions of all fragments?
Can you buy the parts of a Bitcoin and gather them together again?
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Yes, it's just numbers. Transaction simply looks like this: 0.5 from this wallet and 0.5 from that wallet goes into this wallet, which now has 1. Pretty much the same as with any banking system.
 
Dr.Sid said:
Yes, it's just numbers. Transaction simply looks like this: 0.5 from this wallet and 0.5 from that wallet goes into this wallet, which now has 1. Pretty much the same as with any banking system.
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Some years ago I saw a TV documentary about Bitcoins, and I believe they claimed that every Bitcoin had its own blockchain that followed it everywhere, and this blockchain just grows and grows with each transaction. This could pose a problem in finding out which Bitcoin a given fraction belongs to.

But the way you describe it, seems to indicate that there is a common huge blockchain somewhere that contains transactions of all Bitcoins and fractions everywhere. Is that correct?
 
steenkh said:
Some years ago I saw a TV documentary about Bitcoins, and I believe they claimed that every Bitcoin had its own blockchain that followed it everywhere, and this blockchain just grows and grows with each transaction. This could pose a problem in finding out which Bitcoin a given fraction belongs to.

But the way you describe it, seems to indicate that there is a common huge blockchain somewhere that contains transactions of all Bitcoins and fractions everywhere. Is that correct?
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Yes. 1 journal for one currency.
 
steenkh said:
Some years ago I saw a TV documentary about Bitcoins, and I believe they claimed that every Bitcoin had its own blockchain that followed it everywhere, and this blockchain just grows and grows with each transaction. This could pose a problem in finding out which Bitcoin a given fraction belongs to.

But the way you describe it, seems to indicate that there is a common huge blockchain somewhere that contains transactions of all Bitcoins and fractions everywhere. Is that correct?
Click to expand...

it gets technical at this point and i’m not a programmer. but basically all the blocks compare their chains to one another, so it’s a common block chain by virtue of all blocks finding agreement with one another. it matters less about which bitcoin a particular piece came from but more so do the wallet contents check out and did this transaction happen. it also means you basically can’t roll anything back

it’s also very slow and cumbersome but hard to fake transactions. in that way, hacking it, it’s very secure. in other ways, like fraud or mistakes, it’s very insecure.
 
steenkh said:
Some years ago I saw a TV documentary about Bitcoins, and I believe they claimed that every Bitcoin had its own blockchain that followed it everywhere, and this blockchain just grows and grows with each transaction. This could pose a problem in finding out which Bitcoin a given fraction belongs to.

But the way you describe it, seems to indicate that there is a common huge blockchain somewhere that contains transactions of all Bitcoins and fractions everywhere. Is that correct?
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Each miner has their own copy of the blockchain. Part of validating a transaction is examining the blockchain to ensure that there are enough btc in a wallet to let it make the transfer.

It gets technical here but basically, when a new valid block is created, each miner adds it to their copy of the blockchain. In the event that two or more valid blocks are created, the rule is that the longest chain wins. It usually doesn't take long for a miner to find out if they are working on the wrong chain.
 
Gulliver Foyle said:
Ten years ago payments were made in bitcoins, now they're being made in thousanths or smaller fractions. And during one of the collapses in value payments went from hundreths of bitcoins to tenths.
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What are you talking about ? What do you mean by "payments" ? Are you trying to say bitcoin is much more valuable now than in the past ?
 
dirtywick said:
i think he’s describing that it’s deflationary
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Interesting point of view .. I'd say comparison to gold would be interesting: https://charts.bitbo.io/btc-gold/
Until 2018 the price against gold went up rapidly. But especially after 2022 it's not changing that much. So you indeed can argue that since 2022 it just follows price of gold, and thus increase in price against dollar might be cause by dollar losing value.
But that's still pretty good !
 
dirtywick said:
right but only a grifter would present buying art as an investment opportunity.
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So a big believer in NFT's I see. THat is where the real money is of course not these totally fungible bit coins. The uniqueness makes them intrinsically far more valuable than mere crypto.
 
Dr.Sid said:
Interesting point of view .. I'd say comparison to gold would be interesting: https://charts.bitbo.io/btc-gold/
Until 2018 the price against gold went up rapidly. But especially after 2022 it's not changing that much. So you indeed can argue that since 2022 it just follows price of gold, and thus increase in price against dollar might be cause by dollar losing value.
But that's still pretty good !
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gold is deflationary as well. which, like intrinsic value, being one or the other on its own isn’t a a bad thing. it’s a bad thing for your currency to be deflationary though.

anyway i’m not sure what would peg the price of gold to the price of bitcoin. until it’s described to me that’s just two similar looking graphs
 
What do you mean by deflationary ? Gold doesn't lose value, certainly not as much as dollar. It's not affected by deflation. Its price in dollars keep rising .. but that's because dollar value keeps dropping. That just means gold has stable value, which is good for currency, is it not ?
 
it has a fixed supply so as the supply of dollars are increased it requires more dollars to purchase as time goes on.

as an asset it’s fine, since you can buy it and it’ll presumably grow in value and you can sell it later at a higher cost. if you bought it at market value for its worth, anyway.

as a currency it’s pretty bad. if a gold coin can buy you one sandwich but next year it can buy two sandwiches, the sandwich guy just went from making one gold per sandwich to half a gold. so, not so great for economic growth to constantly be having to pay people less and less. fixed currencies don’t really make sense anyway, it doesn’t account for growth.

this is where an inflationary currency works better. as the economy grows, print more to reflect it.
 
dirtywick said:
it has a fixed supply so as the supply of dollars are increased it requires more dollars to purchase as time goes on.

as an asset it’s fine, since you can buy it and it’ll presumably grow in value and you can sell it later at a higher cost. if you bought it at market value for its worth, anyway.

as a currency it’s pretty bad. if a gold coin can buy you one sandwich but next year it can buy two sandwiches, the sandwich guy just went from making one gold per sandwich to half a gold. so, not so great for economic growth to constantly be having to pay people less and less. fixed currencies don’t really make sense anyway, it doesn’t account for growth.

this is where an inflationary currency works better. as the economy grows, print more to reflect it.
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OIC .. I was under impression gold increases price more or less at the same rate as inflation .. but it is actually more. That's certainly not good for currency.
 
I'm curious if anybody knows. Are gold hoards still increasing? How much is actually used for something physical compared to how much is mined?
 
i mean, it really depends on demand. if tomorrow we found out gold cures cancer the price would jump with demand. then we find out it’s a lie and it actually causes cancer and it drops like a stone as a ridiculous example.

edit

but with relatively fixed demand it should increase steadily which is what you typically see
 
Dr.Sid said:
What are you talking about ? What do you mean by "payments" ? Are you trying to say bitcoin is much more valuable now than in the past ?
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Bitcoin's apparent conversion to dollars is very volatile, the numbers of transactions are too low to give a definitive valuation, but because there's allegedly only ever going to be 21 million* of them it should be severley deflationary over time. However because the denominations can be chopped and changed, also on a whim, it's very hard to predict whether the deflationary effect will ever kick in.

*I say allgedly because whoever has master access to the baseline code can change this on a whim.
 
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